The Construction of Panama Canal - Research Paper Example

? History of the Panama Canal and the Long-Range Consequences of American Acquisition and Ownership of the Canal on Panama of the course Instructor’s Name March 27, 2011 1. Introduction The construction of Panama Canal proved to be one of the costliest undertakings of the early twentieth century. For the first time in human history the Atlantic and the Pacific were united via a common waterway that offered relatively easy access from the one great ocean to another. The consequences for American influence in the Western Hemisphere were also rather significant: the new nation-state of Panama that emerged due to the very project of the Canal was utterly dependent on its great Northern neighbor, and the maintenance of this subservience was to become one of great pre-occupations of American policy makers in the region for years to come. This paper purports to analyze the history of the Panama Canal and implications of its construction and ownership by the USA. The author believes that the construction of the Panama Canal was driven mainly by the greater geopolitical considerations of the Roosevelt Administration. The further analysis will aim at expounding and broadening exactly this point. 2. General Body a. Early History Even though the existence of narrow isthmus between the Atlantic and the Pacific had been known since 1513, when the expedition of Vasco Nunez de Balboa saw the Pacific for the first time1, no serious attempts to dig a permanent waterway through the isthmus were made by the Spanish authorities. Nevertheless, the use of the Panama Isthmus for the transportation of the loads of gold by land from the Spanish colonies of South America to the Atlantic coast foreshadowed the future role of the place as an important transportation hub2. i) The Scottish Attempt The unlikely competitors to the Spanish predominance in the region were actually the first to conceive the possibility of using the Isthmus of Panama for the purposes of interoceanic trade. The desperation of the Scottish traders at their country’s inability to compete efficiently with the greater maritime powers led them to contemplate the prospects of establishing trade colony near the Isthmus in order to engage in lucrative transit trade with the countries of Far East, shipping their goods from one ocean to another3. Unfortunately, this so-called ‘Darien scheme’, which consisted of brief attempt at establishing a settlement a two additional failed expeditions in 1698-1699 was doomed to failure from the very outset: not only were the merchants that provided initial capital for this venture unable to sustain long-term expenses4, but also the harsh natural conditions of the place led to the virtual epidemic among the settlers, and in the end this colonial adventure turned out to be a manifest failure. For the next century, there were no comparable ambitious projects for exploiting the narrow Isthmus of Panama in interoceanic trade. The first scientifically grounded proposal for the construction of the Canal that was to unite two oceans was expounded by famous scientist and traveler Alexander Humboldt5. From his travels in Central America, he came to believe that it was possible to start the construction of permanent waterway in nine locations, including Panama, though he evidently thought that the territory of Nicaragua was more suitable for such an endeavor6. Humboldt’s judgment on the feasibility of interoceanic canal project marked the beginning of ‘Panama fever’ that was to reach its peak in the second half of the nineteenth century. ii) The Panama Railway The first involvement of the USA in the affairs of Panama and its attempts to secure the territory there for its commercial purposes dates back to this period as well. While it was Thomas Jefferson who first among American statesmen envisaged the possibility of inter-Isthmus canal as early as 17887, the USA was for the first time involved in the canal project in 1826, when the government of Grand Colombia asked both the USA and Great Britain to participate in its construction8. Still, at that time the USA was unable to finance such a project on their own, and then-Secretary of State Henry Clay actually supported the idea of multilateral construction project, fearing the British dominance9. In the end, the canal building was not to commence in the 1820s, as the political complications prevented any coordinated effort in the region. The situation changed dramatically after the Mexican War and the rising popularity of ‘Manifest Destiny’ idea. The revival of the Monroe Doctrine by Polk Administration in 1845 marked the drastic change in previous American policy in Western Hemisphere, showing its willingness to aggressively pursue its economic and political interests in the region10. The increased assertiveness of the American policy makers with regard to Latin American issues was also extended to the problem of interoceanic canal in Central America. In the last months of 1845 the USA entered into direct negotiations with the New Grenadan government, which ended in the agreement to be known as Mallarino-Bidlack Treaty, from the names of chief negotiators, the U.S. charge Benjamin Bidlack and the New Grenadan foreign minister Manuel Mallarino11. The treaty stipulated that the USA get the right of transit via the Isthmus in return for the guarantee of its neutrality12. The conclusion of the treaty was abetted by the fear, which was felt by the senior members of the New Grenadan government, of aggressive British policy in the region. Ultimately, it facilitated the promotion of American influence in Panama and Central America in general. Capitalizing upon Mallarino-Bidlack Treaty, several American steamship companies in 1847 entered into contract with the American government with a view to establishing maritime traffic between the cities of the U.S. Pacific Coast and Panama13. The Californian Golden Rush, which raged just at that time, made the transit of passengers from the Atlantic to the Pacific Ocean incredibly lucrative, and Cornelius Vanderbilt, in particular, made immense profits from the transportation of passengers across the Isthmus14. Nonetheless, there were still problems with the state of infrastructure in the region that inhibited the effective exploitation of the route; old camino real (‘the king’s road’) built in the seventeenth century was inadequate for the new requirements of transportation industry. This led the American companies involved to contemplate the possibility of investing in more efficient traffic infrastructure. The project of the Panama Railway was born out of these considerations. William Aspinwall, an engineer who participated in building mail steamships for transportation across the Pacific, was a principal figure behind this plan. Having established the Panama Railway Company, he launched the project of trans-Isthmus railroad which ended in January 1855 with the completion of the first inter-continental railway in Western Hemisphere15. The Panama Railway was a first expression of American economic influence in Panama. Despite the high costs of building the railway (it was estimated that $7 to $9 million were spent on its construction16), the returns from its operation were rather high: in 1855 to 1861 the Railroad Company, despite competition from Vanderbilt’s Accessory Transit Company, which shipped the passengers through Nicaragua got more than $7 million in profits17. The success of the Panama Railway attracted the attention of the American and international business circles and facilitated the further plans for establishing additional transport routes across the Isthmus. b) The French Project As Parker observes, the French government was interested in the prospects of transoceanic canal in Central America as far back as 173518. It was 1835, however, when the first serious French attempts to secure the territory for such a project could be dated19. In 1838 a group of French investors led by Charles de Thierry managed to obtain a land grant from the government of the Republic of New Granada (modern-day Colombia) for the purposes of building railroads, roads or canals20. However, the investors were unable to undertake any significant project of that kind, and the first French attempt to establish a through-passage via the Isthmus of Panama was without serious consequences. In 1843 French mining engineer Napoleon Garella visited the Isthmus and recommended the location of future town of Colon as an ideal place for the beginning of the construction of interoceanic canal21. Nonetheless, it was only with the involvement of Ferdinand Lesseps that the French projects of inter-Isthmus canal were to undergo practical implementation. i) Conception Ferdinand de Lesseps, the creator of the project of the Suez Canal, was the principal instigator of the Panama ambition of French banking capital. At the International Geographical Congress of 1875, which was held in Paris, he unveiled the plan for interoceanic canal through the Isthmus of Panama for the first time. Using the reports of the French travelers who claimed to have discovered a low pass suitable for the construction of the future canal at sea level in the vicinity of the Isthmus, between the Tuyra and Atrato rivers22, de Lesseps chose this variant over Nicaragua for the construction of the canal. As it turned out later, this information was actually erroneous. ii) French Canal Company Due to the efforts of French businessmen Reinach and Turr, on March 20, 1878 the government of Colombia entered into an agreement with the newly organized French company, Societe Civile Internationale pour le Percement du Canal Inter-oceanique de Darien, granting it a concession for a canal in a zone of the Isthmus of Panama, the condition being attached that the canal should be built within 12 years23. The works on the canal actually commenced in 1879, after the respective decision by the International Geographic Congress, which entrusted de Lesseps with overseeing the project. The total cost of the Panama project was originally equal to 1,070 million francs, but after de Lesseps officially established Universal Company for an Interoceanic Canal in Panama, it rose to 10 million, with the concession being bought from the Colombian government24. The attempt at mobilizing 400 million francs of venture capital in August 1879 failed but in December 1880 much more successful campaign brought 600 million francs, with the individual shares sold at 500 francs each25. De Lesseps narrowed the deadline for the Canal completion from 12 to 8 years; that is, it was to be finished in 1888. The mood on financial markets was favorable to the project. iii) French Achievement The engineers of the Company severely underestimated the challenges that the construction of the Canal entailed. While the findings of experts commissioned by de Lesseps initially pointed to the necessity of extracting 75 million cubic meters, at the beginning of 1888 the workers commissioned by the Company already excavated about 55 million cubic meters, and the net cubage to extract was estimated at nearly 120 million26. The ineptitude of many technicians and administrative workers who were sent from Europe, being ignorant of local conditions, as well as high mortality rates among local and imported workforce exacerbated the situation. The epidemic of yellow fever was especially damaging. In the end, despite the heroic efforts by French engineers and contracted West Indian workers, Universal Company for an Interoceanic Canal in Panama suffered a bankruptcy in December 1888. c) Nicaragua In the second half of the nineteenth century the activities of the USA in the sphere of construction of interoceanic canal across Central America were mostly concentrated on Nicaragua. In June 1849 a particularly advantageous treaty was signed between the government of Nicaragua and the U.S. representative, Elijah Hise. Even though this treaty was not recognized by the USA, it gave the Americans a total jurisdiction over the canal zone, the rights to pass warships through and to ban the passage of enemy vessels27. The Hise Treaty was a prototype of the following agreements concluded between the USA and the Central American countries on this subject. Nevertheless, the pressure from the British forced the USA to agree to the Clayton-Bulwer convention, which proscribed the exercise of complete control of any of the states involved over the Nicaragua canal28. This led to hostility on the part of the supporters of the American expansion, and in 1859 the attempts of the U.S. government to force through more unilaterally worded canal treaty fell through, as Nicaragua distrusted the USA. Nevertheless, in 1866 the USA made a second attempt at launching canal project in Nicaragua, as that country was much more open to American influence than larger and more independent Colombia, which controlled the Isthmus of Panama. After the treaty of 1867, which established the principle of neutrality of the future canal, the Grant Administration organized additional expedition to Nicaragua in 1869. Its leader, Vice Admiral Daniel Ammen, tried to convince the International Geographic Congress in 1871 of the feasibility of the Nicaraguan variant but his proposal did not get the majority of the votes needed29. In the end, in 1874 the de Lesseps disastrous project won the backing of the Congress, and the Nicaraguan variant was eventually abandoned, although it was still seriously considered as late as 189930. d) United States Enters Canal Project The almost bankrupt New Company of the Panama Canal, established after the failure of de Lesseps project, continued on those parts of the project which were developed in the times of de Lesseps. However, the absence of liquidity forced them to look for new sources of capital, and in 1898 the representatives of the New Company arrived in Washington, D.C., offering the U.S. government to effectively take over the company, and the project of Panama Canal with it. The reaction of the USA was initially reluctant. As late as March 1899 the governmental commission still hesitated whether Panama or Nicaragua was to become a choice for interoceanic canal31. Eventually, with the strong backing by President Theodore Roosevelt, the Panama variant was chosen. The reasons for the decision to take on Panama seemed to be manifold. On the one hand, the government of Theodore Roosevelt needed the strategic pass between the Pacific and the Atlantic Oceans in order to increase American naval power. On the other hand, as the experience of Panama Railway Company showed, the Panama route had important advantages over the Nicaraguan one, including the shorter length of the canal to be dug. In addition, unlike in the case of Nicaragua, there existed no treaty binding the USA to ensure the neutrality of the future canal, and the possibility to establish garrison and fortifications on the both ends of the Canal seemed lucrative to Roosevelt and his inner circle32. In the end, the Panama route won. However, there still existed the need to deal with possible Colombian objections to the proposed settlement. Even though the Colombians bowed to the pressure and agreed to accept the U.S.-drafted proposals of the Canal Commission in May 1901, which granted the U.S. the right to deploy military police and to appoint heads of local police service, its government was still reluctant to surrender effective sovereignty over the future canal. The Colombian government objected to the provisions of the draft treaty that deprived Colombia of its share on $40 million package of the New Company’s share34; this infuriated the Roosevelt Administration, which felt that its ambitious plans for naval domination were in danger of being wrecked by the intransigent South American nation. Even though Roosevelt contemplated the possibility of permanent occupation of the territory of Panama and holding it by force34, eventually he settled on the use of alternate instrument of the U.S. foreign policy. The instigation of the secessionist revolt in Panama led to the emergence of independent Panamanian government, which was much more pliable to the U.S. proposals. 3. Conclusion Despite the building of the Panama Canal itself drawing on until 1914, the USA obtained what they wanted. If the involvement of the U.S. government into Panama affair in the late 1890s may seem surprising in the late of its previous emphasis on Nicaragua, it should be noted, though, that in the late of both previously existing economic ties between the USA and Panama and the ambitious plans of the Roosevelt Administration as regarded the projection of the U.S. naval power, the choice of Panama for the location of American-run interoceanic canal was rather logical, and the implementation of this plan had the great importance for the further history of Panama in the 20th century. Notes 1. Loizillon, 1. 2. Ibid. 3. Prebble, 14. 4. Ibid., 90. 5. Parker, 32. 6. Major, 10. 7. Parker, 32. 8. Ibid., 35. 9. Connel-Smith, 44. 10. Ibid., 71-72. 11. Connif, 32. 12. Parker, 37. 13. Major, 13. 14. Loizillon, 3. 15. Parker, 52. 16. Ibid., 53. 17. Ibid. 18. Ibid., 30. 19. Loizillon, 1. 20. Ibid. 21. Parker, 36. 22. Ibid., 69. 23. Loizillon, 18. 24. Ibid., 20. 25. Parker, 101. 26. Loizillon, 26. 27. Major, 14. 28. Ibid. 29. Loizillon, 8. 30. Ameringer, 352. 31. Ibid. 32. Marolda, 5. 33. Major, 30. 34. Hill, 67. Bibliography Ameringer, Charles. “The Panama Lobby of Philippe Bunau-Varilla and William Nelson Cromwell”. American Historical Review 68, no. 2 (1963): 346-363. Connel-Smith, Gordon. The United States and Latin America: An Historical Analysis of Inter-American Relations. Portsmouth, NH: Heinemann Educational, 1974. Connif, Michael. Panama and the United States: the Forced Alliance. Athens, GE: University of Georgia Press, 2001. Hill, Howard. Roosevelt and the Caribbean. 1927. La Vergne, TN: Lightning Source, 2008. Loizillon, Gabriel. The Bunau-Varilla Brothers and the Panama Canal. Lulu.com, 2008. Major, John. Prize Possession: The United States Government and the Panama Canal, 1903-1979. Cambridge: Cambridge University Press, 2003. Marolda, Edward. Theodore Roosevelt, the U.S. Navy, and the Spanish-American War. New York: Palgrave Macmillan, 2001. Parker, Matthew. Panama Fever: The Battle to Build the Canal. London: Century Hutchinson, 2007. Prebbel, John. Darien: The Scottish Dream of Empire. Edinburgh: Birlinn, 2000. Read More