The Great Events by Famous Historians

The United States, not unmindful of the advantages of an isthmian canal, had from time to time made investigations and surveys of the various routes. With a view to government ownership and control, Congress directed an investigation of the Nicaraguan Canal, for which a concession had been granted to a private company. The resulting report brought about such a discussion of the advantages of the Panama route to the Nicaraguan route that by an act of Congress, approved March 3, 1889, a commission was appointed to "make full and complete investigation of the Isthmus of Panama, with a view to the construction of a canal." The commission reported on November 16, 1901, in favor of Panama, and recommended the lock type of canal.

By act of Congress, approved June 28, 1902, the President of the United States was authorized to acquire, at a cost not exceeding $40,000,000, the property rights of the New Panama Canal Company on the Isthmus of Panama, and also to secure from the Republic of Colombia perpetual control of a strip of land not less than 6 miles wide, extending from the Caribbean Sea to the Pacific Ocean, and "the right … to excavate, construct, and to perpetually maintain, operate, and protect thereon a canal of such depth and capacity as will afford convenient passage of ships of the greatest tonnage and draft now in use."

Pursuant to the legislation, negotiations were entered into with Colombia and with the New Panama Canal Company, with the end that a treaty was made with the Republic of Panama granting to the United States control of a 10-mile strip, constituting the Canal Zone, with the right to construct, maintain, and operate a canal. This treaty was ratified by the Republic of Panama on December 2, 1903, and by the United States on February 23, 1904.

The formal transfer of the property of the New Panama Canal Company on the Isthmus was made on May 4, 1904, after which the United States began the organization of a force for the construction of the lock type of canal, in the mean time continuing the excavation by utilizing the French material and equipment and such labor as was procurable on the Isthmus.

President Roosevelt, in a message to Congress, dated February 19, 1906, stated: "The law now on our statute-books seems to contemplate a lock canal. In my judgment a lock canal, as herein recommended, is advisable. If the Congress directs that a sea-level canal be constructed its direction will, of course, be carried out; otherwise the Canal will be built on substantially the plan for a lock canal outlined in the accompanying papers, such changes being made, of course, as may be found actually necessary, including possibly the change recommended by the Secretary of War as to the site of the dam on the Pacific side."

On June 29, 1906, Congress provided that a lock type of canal be constructed across the Isthmus of Panama, of the general type proposed by the minority of the Board of Consulting Engineers, and work has continued along these lines. The Board of Consulting Engineers estimated the cost of the lock type of canal at $139,705,200 and of the sea-level canal at $247,021,000, excluding the cost of sanitation, civil government, the purchase price, and interest on the investment. These sums were for construction purposes only.

I ventured a guess that the construction of the lock type of canal would approach $300,000,000, and without stopping to consider that the same causes which led to an increase in cost over the original estimates for the lock canal must affect equally the sea-level type, the advocates of the latter argued that the excess of the new estimates was an additional reason why the lock type should be abandoned in favor of the sea-level canal.

The estimated cost by the present commission for completing the adopted project, excluding the items let out by the Board of Consulting Engineers, is placed at $297,766,000. If to this be added the estimated cost of sanitation and civil government until the completion of the work, and the $50,000,000 purchase price, the total cost to the United States of the lock type of canal will amount to $375,201,000. In the preparation of these estimates there are no unknown factors.

The estimated cost of the sea-level canal for construction alone sums up to $477,601,000, and if to this be added the cost of sanitation and civil government up to the time of the completion of the canal, which will be at least six years later than the lock canal, and the purchase price, the total cost to the United States will aggregate $563,000,000. In this case, however, parts of the estimate are more or less conjectural—such as the cost of diverting the Chagres to permit the building of the Gamboa dam and the cost of constructing the dam itself.

Much criticism has resulted because of the excess of the present estimates over those originally proposed, arising largely from a failure to analyze the two estimates or to appreciate fully the actual conditions.