delesseps.jpg (21555 bytes) De Lesseps — His Great Scheme

Two powerful influences worked to interest the people of France in the idea of cutting through the Isthmus.  One was the successful completion of the Suez Canal, and the other was the personal popularity and magnetism of its promoter, Count Ferdinand de Lesseps.  The Suez Canal was begun in 1859, and completed without encountering any serious obstacles, ten years later.  This achievement gave De Lesseps a reputation as a canal builder, and made it easy for him a years afterward to step in the new field of canal operations and the confidence of the French nation.  He was not an engineering expert of the present day definition, but he had a vast intellect at his command, and an unusual facility for organization.   That he was over-sanguine cannot be doubted, and that this fault led to his making serious mistakes none deny.  On the other hand he was in earnest in his enthusiasm for the success of the project, and fundamentally honest in his purpose.  This cannot be said of all those he had under him.  As one of his countrymen once remarked, "Of all the men high in authority engaged with De Lesseps on the enterprise, he was about the only one whose chief endeavor was not to feather his nest."  Can it be wondered that a fabric built upon a foundation so faulty should be doomed to failure?   At the inception of canal operations and for several years afterwards De Lesseps was practically idolized both in France and on the Isthmus.  His advent at Panama was heralded as a greater event than that of a conquering general returning home.


Agitation in France in favor of constructing the Isthmian waterway was begun in 1875, and resulted in the formation of a company under the direction of General Turr for the purpose of entering upon negotiations with Colombia to obtain the necessary concession.  In May, 1876, Lucien N.B. Wyse, a lieutenant of engineers in the French army, and a brother-in-law of General Turr was delegated to visit the Isthmus, conclude negotiations and map out a feasible route.  The right of way was secured, with the proviso that nothing in the contract should be construed to interfere in any way with the grants given the Panama Railroad under a concession to an association of American capitalists entered into in 1849.  The concession with "a string tied to it" like this was not entirely satisfactory to the company Wyse represented, which was organized for promotion purposes only, so an enlargement of privileges was sought, and on March 20th, 1878, a new contract was entered into with the Colombian Government which gave the association of promoters the right to cross the territory occupied by the Panama Railroad Company, providing an amicable agreement could be arrived at with the latter corporation.  Under the terms of this agreement the promoters were given the exclusive right to construct and operate a maritime canal across the territory of Colombia, between the Atlantic and Pacific Oceans, for a period of 99 years from the day it was wholly, or in part opened to public service, or when they should commence to collect tolls on transit and navigation.

It was agreed that the general route of the canal should be determined by an international commission of individuals and competent engineers, and upon settling on a route, the promoters were to b e allowed two years to form a joint stock company, which company was required to finish the canal and put it into service in twelve years.  All public lands necessary for the route of the canal, and stations, wharves, moorings and warehouses incident to its construction were ceded gratis.   This provision also contained the grant of a zone of land about 1,400 feet wide the entire length of the waterway.

It was further stipulated that the canal should remain neutral for all time to the end that in case of war merchant vessels and individuals might enjoy its use and advantages unmolested.  For these rights and privileges the Government of Colombia was to be entitled to a share in the gross income of the canal from all sources on an increasing scale of from five to eight percent, dating from the seventy-sixth year after its opening, to the termination of the concession, four-fifths of which was to go to the Republic of Colombia, and one-fifth to the State of Panama, the company controlling the enterprise to guarantee however, that the Government's share should not be less than $250,000 each year.

The right to transfer these privileges to other capitalists or companies was conceded, but an absolute prohibition was made against cession or mortgaging to any foreign government.

The international commission of individuals and engineers, known as the International Scientific Congress met in Paris on May 15, 1879.  There were present 135 delegates, most of whom were French.  Nearly all European countries were represented however, the contingent from the United States numbering eleven.   The conference was presided over by Count De Lesseps, and continued in session for two weeks.  The net result was the reaching of a decision that a sea-level canal should be constructed from Limon Bay to the Bay of Panama.

This important point settled, the canal concession was transferred to La Compagnie Universelle du Canal Interoceanique de Panama, commonly known as the Panama Canal Company, an organization chartered under the laws of France.  De Lesseps was given control and one of his first steps taken was to purchase a controlling interest in the Panama Railroad Company which involved the changing hands of about $18,000,000.

Arrival of De Lesseps.

The 30th day of December, 1879, will be forever memorable in the history of the Isthmus, says the Star & Herald in its issue of January 1, 1880.  At 3 o'clock in the afternoon of that day the French steamer Lafayette with Count Ferdinand de Lesseps was signaled at Colon, and soon afterwards entered the harbor.  The steamer came immediately alongside the wharf where the reception committee appointed by the Government, the delegation from the State Assembly, and a large number of invited citizens were collected to welcome the illustrious engineer and the other members of his party.

A little past 4 p.m., the landing stage was put on board and all repaired to the spacious saloon of the Lafayette where a formal address of welcome was made by J.A. Cespedes, Chairman of the reception committee, which was responded to in a brief but hearty manner by M. de Lesseps.  Then followed short and appropriate addresses by Messrs. Andreve and Prestan of the State Assembly, Mr. Pike, consul for Denmark, and Mr. S.W.D. Jackson on behalf of the English-speaking residents of the Isthmus.  To all of these the distinguished guest replied with great urbanity and cordiality, and in all his utterances conveyed the unmistakable impression of his earnestness in regard to the projected canal.  An hour or more was spent in convivialities appropriate to the occasion, after which the crowd dispersed.  During the reception the fine band from Panama played several soul-stirring airs.  In the evening many houses in town were illuminated, and there was a fine display of fireworks at the ice house, the usual headquarters for such festivities.  Later, J. de Lesseps came on shore and took a walk in the beautiful moonlight, attended by a few friends and surrounded by an enthusiastic crowd of people.

On the morning of the 31st, M. de Lesseps and the distinguished engineers of his party made an examination of the harbor front, and inquired into the direction and force of the northers.  By the aid of a carefully prepared chart he marked the location of the necessary breakwater, as well as the probable entrance to the great Isthmian Canal.  In all and on every point M. de Lesseps declared his great satisfaction at the apparent practicability of the great undertaking, and more than once became enthusiastic in speaking of the prospect.  "There are," he said, "only two great difficulties to be overcome, the Chagres River, and the deep cutting at the summit.  The first can be surmounted by turning the headwaters of the river into another channel, and the second will disappear before the wells which will be sunk and charged with explosives of sufficient force to remove vast quantities at each discharge.  The existence of the railroad will greatly facilitate the work on the canal, and unless closer examination, for which the present visit has been made, should prove unfavorable, a result that is in nowise anticipated, there is no doubt but the work will be begun in earnest and without material delay."

The utmost good order was maintained, and the most profound respect was shown to M. de Lesseps by all classes, while the enthusiasm knew no bounds.  The flags of all nations were displayed, with the notable exception of that of the United States, and the reception may be said to  have been a decided success.

On the 31st, at 11 a.m., the party left Colon for Panama.   The train was met at Barbacoas bridge by the President of the State, and the party was safely transferred to another train by which it arrived in this city at 5:30 p.m.   A fine lunch was provided on the train, with wines, which gave entire satisfaction.

In Panama considerable preparation had been made to do fitting honor to the great impresario.  At the station an open tent was placed in which the representative of the State, Mr. Manuel J. Diez, accompanied by Lieutenant Colonel Montufar, General Gonzalez, the secretaries of the Government, and other prominent military and civil officials extended him a hearty greeting in the name of the sovereign State of Panama.  The party was conveyed in carriages to the Grand Hotel, the battalions of the 3d, and 11th Colombian Guard forming a guard of honor the entire distance.  The houses in the Calle Real (the former name of Central Avenue), and other leading streets were profusely decorated with flags in which the French and Colombian colors predominated.

Flag staffs had been erected at convenient intervals along the line displaying the flags of the two Republics.  Each staff bore a shield with the name of one or the other of the promoters and engineers of the different explorations and projects for the canalization of the Isthmus.  They were of every country and every walk of life; the bold discoverer, the hardy buccaneer, naval officers of various nations, and civil engineers following the peaceful routine of ordinary duty.  There were the names of Balboa-1513; Dampier-1549; Patterson-1698; Donozo-1761; Ariza-1783; M. Wagner-date not shown; Lloyd-1829; N. Garella du Courtines-1843; Totten-1849; Trautwine and Hughes-1853; Harrison-1867; Lull and Selfridge-1870; and the Wyse-Reclus-Sosa-Verbrugghe-Bixio-Lacharme-Musso and Brooks expeditions of 1877-8.   These names were principally displayed in the Plaza, a notable group to whom the world is largely indebted.  Among the several arches was one at Plaza Santa Ana reading "Colombia salutes Ferdinand de Lesseps," and on one other, "Panama congratulates her illustrious guest, Ferdinand de Lesseps."  A banquet terminated the day's doings, which passed off pleasantly.

Among the De Lesseps party was his wife and three of his children.  "M. De Lesseps is now 77 years of age," says a current newspaper article and his second wife was but 21 when he married her.   They have seven children.  The Madame is of creole origin, her beauty being the type of that class, enhanced by a pair of magnificent black eyes.  Her form is the admiration of the dressmakers of the French capital, and a tight-fitting dress sets off her figure to perfection.  There is a great tenderness on the part of the distinguished engineer toward his little ones.  They are permitted to do pretty much as they choose either in the saloon, or out of it.  It was this sort of paternal manhood that prompted De Lesseps to escort the Empress Eugenie and her ill-fated son from the mob that threatened the Tuileries close on to twenty years ago."

Others in the Count's party were Lieutenant Wyse, J. Dirke, Engineer-in-Chief of the canals of Holland, M. Boutan, mining engineer of France, M. Dautaz and M. Albert, engineers of Holland waterworks and canals, Messrs. Verbrugghe, Couvreux, Blanchet and Fontan, civil engineers, and Messrs. Bionne, C. Wiener, Gally and Dauprat, secretaries.

The Canal Inaugurated.

M. De Lesseps has kept his promise, and the 1st of January, 1880 has witnessed the formal inauguration of the work of completing the perfecting the surveys for the Panama Canal, says the Star & Herald in its issue of January 3, 1880.  The exhaustive documents furnished to the Paris Congress were amply sufficient to prove the superiority of the Panama route over all others.

On the lst inst., a large party of ladies and gentlemen went on the steamer Taboguilla to the mouth of the Rio Grande about three miles west of Panama.  Here it was intended to land and witness the turning of the first sod, a task which was assigned to Miss Fernanda de Lesseps, which was to mark the beginning of the work that was to end in the union of the Atlantic and the Pacific Oceans.  On account of the lateness of the hour at which the steamer left the wharf, it was impossible to carry out the program in its entirety without delaying the return to the city.  With the entrance of the Taboguilla into the mouth of the river (the first occasion in which a steamer had ever been seen in that place), it was considered as a beginning of the surveys (mark the failure at the start), and the remainder of the program was then proceeded with.

An address was made by M. de Lesseps in which he announced the fulfillment of his promise to begin practical work on the great canal enterprise on January 1, 1880.  He further remarked that his labors had now begun under the authority of the United States of Colombia, with the benediction of Monsignor, the Bishop of Panama, and with the assistance of the members of the Technical Commission charged with the definite studies for the Universal Interoceanic Maritime Canal.

He expressed his entire confidence in the enterprise and its success, to which, he said, he consecrated the closing years of his life, and had no hesitation in counting upon the assistance of the financial world form means to open another highway to the commerce of the world.  His Grace, the Bishop then formally bestowed his benediction upon the enterprise, and the blessing of the Universal Church upon the labors of science for the benefit of commerce.  Other addresses were delivered after which the steamer proceeded to the islands and then returned to the wharf, landing its distinguished passengers who were unanimous in their delight over the trip.

Grand Banquet to De Lesseps.

The public demonstrations in honor of De Lesseps' arrival came to a close on Sunday, January 4, 1880 with an elaborate banquet tendered him by Dr. Antonio Ferro, the representative of the Colombian Government.  One hundred and forty invitations were issued, and among those present were notable men from the United States and every part of Europe.  M. de Lesseps proposed a toast to "The Press", stating, "That it was the representative of public opinion, and the greatest force of the epoch.   With its assistance the greatest commercial interoceanic highway of the world would be made on Colombian territory, under the protection of the Colombian Government and the great powers of the world."

Later he again took the floor and announced that the International Commission had been completely organized, and that it would be divided into five sections.  Lieutenant Wyse afterwards proposed a toast to the health of the humble laborers, "Without distinction of race of nationality who, in the future may be the useful and modest instruments to carry to completion the greatest work of the age."

First Blast at Culebra.

A numerous party accompanied M. de Lesseps on the morning train of Saturday, January 10, 1880, to witness the discharge of the first blast on the Cerro Culebra.  M. de Lesseps was accompanied by a number of engineers of the surveying party; Dr. Ferro, Colombian Delegate; His Grace, Bishop Paul; Don Damaso Cerver, President of Panama; M. Le Brun, the French Consul, and various residents of the city.  With him also was his seven-year old daughter, Miss Fernanda de Lesseps who was to apply the electric spark which was to discharge the first blast in the mighty operation of canal construction.

The mine had been carefully laid in an exceedingly hard and compact formation of basalt, at a few feet below the summit, and charged with thirty kilograms of powerful explosive.  The operation was performed with complete success, an immense mass of solid rock being hurled from its original foundation.

The party returned to Panama on the 11 a.m. train exceedingly pleased and enthusiastic over the first practical experiment in canal building on the Isthmus.

American Press on De Lesseps.

"The arrival of De Lesseps and his party at Colon," said the New York Herald of January 9, 1880, gives assurance that this able engineer is quite in earnest of his desire to add to his great fame as the constructor of the Suez Canal, the grater fame of opening a navigable way between the two principal oceans.  He wishes to satisfy himself as to the practicability of his proposed route by personal inspection.   It is not likely that any of the obstacles will escape the observation of so trained and competent a judge.  If he concludes that none of them are insurmountable, the world will naturally put faith in his opinion.  He has with him H. Dirke, the famous Dutch engineer whose practical achievement in canal making ranks next to the Suez.   If the two most celebrated engineers of the age concur in the belief that a ship canal at Panama is practicable at the sea level, capitalists will be likely to have confidence enough to furnish the means for the undertaking.  If the belief of De Lesseps in the feasibility of this route should not be shaken, his energy and alertness will have given him a decided advantage in advance of the advocates of the Nicaragua route."

Organization of Finances.

The first canal company was capitalized at $60,000,000 divided into shares of $100 each, and $20,000,000 worth of stock was disposed of without effort.  De Lesseps went to the United States immediately after his first visit to the Isthmus, and made a tour of all the principal cities in the interest of the undertaking.  He was given an ovation everywhere and succeeded in arousing a great deal of enthusiasm.  He then made a similar tour of Europe.  At a banquet in Antwerp, a composition was improvised for the occasion reading—

De Lesseps da sa main forte
A Suez ouvrit la porte
De 'Occident vers l'Orient:
Par sa force et son courage
Il va creer le passage
De l'Orient vers l'Occident.

The immediate result of his missionary work was the prompt taking of the remaining stock offering of $40,000,000 with as much again bid for.   The preliminary budge of expenses, including the cost of the concession footed up to nearly $9,000,000 and was paid out of the earlier subscriptions.  One of the most important items of this budget was the profit-taking on preliminary expenses by the organizers of the company.  Under the articles of incorporation, the organizers were entitled to certain cash payments, and fifteen percent of the net profits.  The latter arrangement consisted in the setting aside for the benefit of the organizers of some 1,300 blocks, or "Founders parts", amounting to 5,000 francs each, and constituted a speculation pure and simple.  These blocks later sold all the way from 80,000 to 300,000 francs, the profits thereon accruing to the original holders.

Cost of the Canal.

The Scientific Congress estimated the cost of the canal at $214,000,000, while the Technical Commission, on which were two American members, G.M. Totten and W.W. Wright, after personally going over the route, formulated a report on February 14, 1880, estimating the total cubic meterage to be excavated at 75,000,000 and the cost of doing it $168,600,000.  On February 20, of the same year, De Lesseps in a letter on the subject lowered the estimate to $131,600,000 on the ground that he believed certain figures named by the Commission were too high.  He cut down the items of the diversion of the Chagres, and the Chagres dam by $19,000,000, in which judgment he erred as shown by later developments.

Speaking before a meeting of the Society of American Engineers at New York on March 1, 1880, De Lesseps stated that vessels would be able to go from ocean to ocean after the expenditure of $120,000,000.  Referring to the type of canal at the same meeting he said:—

"If the committee had decided for a lock canal, I should have put on my hat and gone home.  Locks are very good for small vessels, but they would not do for large ships.  There is a ship now on the stocks 520 feet in length, and it would take a very long time to take a ship through a canal of this length with a single lock, and with a system of double locks, it would be much more expensive than any deep cutting on the route."

It is interesting to note in this connection that the ship, De Lesseps spoke of is something of a pigmy compared with the floating places Lusitania and Mauretania of the present day, whose length exceeds the 1880 vessel by more than 200 feet.

The Era of Activity.

During the first three years the company devoted its energies principally to the work of preparation and getting material to the isthmus, although by the end of February, 1883, 500,962 cubic meters of earth had been excavated, and a working force of about 3,000 men established.  At the very beginning the laborers struck for higher wages.  They went to work for 90 cents silver per day, but made a demand for $1.20 per day, claiming that the cost of living had increased, and that the day laborer in Panama was getting $1.00 per day [Wages of laborers in 1883 were figured in Colombian piastres, worth 84 cents gold each.  Therefore the laborer was actually getting 84 cents gold for the day's hire.].  The demand was granted, and later the rate of wage rose to $1.50 silver per day.  The purchase of material was not confined to France, but came from every industrial nation.  In 1882 three dredges were purchased of a Philadelphia firm for $400,000.

In February, 1883, M. Dingler assumed control of the works as director General.  From this on an impetus was given to operations, and the work proceeded along more systematic lines.  Closely following him came Ch. Aime de Lesseps, son of the elder De Lesseps who later became interested as a silent partner in nearly all the large canal contracts, and derived considerable profit thereby.  the original plan under which the work was let to contractors failed to meet the company's expectations.  The contracts were too small and the work did not go on quick enough.   Later on the work was let out in large contracts, most of the smaller contractors prior to this time becoming sub-contractors under the new system.

The route of the canal began at Folks River, Cristobal-Colon, followed approximately the valley of the Chagres to Bas Obispo, then crossed the Cordilleras through Culebra Mountain, and descended through the valley of the Rio Grande to its mouth, the line ending two miles out in Panama Bay.  The water depth of the canal was to be 30 feet, and the bottom width about 72 feet.  The problem of crossing the Chagres was to be solved by the construction of a great dam at or near Gamboa, from which the surplus water would escape in another direction by means of diversion channels.

With the inception of canal operations, an era of vast expenditure began.  Contracts were placed without due regard to economy, and by 1885 it was apparent that all the estimates made both as to cost and length of time in building would be exceeded.  About this time too the investors became alarmed at the ruinous manner in which the vast establishment was being run.  The press also took it up and soon a strong undercurrent of adverse public opinion became manifest.  De Lesseps essayed to stem the tide of opposition sentiment and in 1885 applied to the French Government for permission to establish a lottery branch by which he hoped through the issuance of bonds, to provide funds for carrying on the work.  The Chamber of Deputies voted the desired permission, but the proposition was later held up pending a report on actual conditions.  To this end the French Government dispatched Armand Rosseau, an eminent engineer to the Isthmus to go over the situation in detail.

Rosseau's report was discouraging.  He declared that a sea level canal could not be carried through to completion with the means in sight, and recommended the changing of the plans from a sea level canal to a canal with locks as an immediate expedient.  Others connected with the enterprise coincided with this view, and De Lesseps in the end reluctantly gave his consent to the change.  This plan made no change in the line of the canal, but the surface of the canal at its summit was to be forty-nine meters, or about 160 feet above sea level.

The new line of action decided upon, the lottery bonds were issued, the limit being put at $160,000,000.  Each bond represented a value of $80, but were put on the market at $72.00.  They were to bear 4 percent interest, and be redeemed by amortization.  The investing public, although the bait was attractive, refused to do more than nibble, and a second attempt likewise proved abortive.

All the Good Things of Life.

Economy was an unknown factor in the administration of affairs of the first company, and extreme generosity characterized its treatment of its white employees who in the main were from France.  The average pay of a clerk was $125 per month, and of a chief of division from $200 to $300 per month.  Two years' service entitled the employee to 5 months' leave of absence, and travelling expenses both ways.  Quarters were furnished free as well as everything necessary to fit them up, furniture, bedding, lamps, kitchen utensils, etc.  All the head offices were in Panama, and the officials all resided there.  The section of the city surrounding San Francisco Park was the headquarters of the French colony in those days.  There was no system of accounting in vogue, and employees were permitted to draw household articles upon requisition about whenever they liked.  In a multitude of cases this laxity was taken advantage of and quite a business in the buying and selling of company's furniture, etc., was secretly carried on.  After pay days money flowed like wine, and it was not an uncommon occurrence to see the street around Cathedral Park filled with seats for the accommodation of officials and employees bent upon having a good time.  In the offices a day's work consisted of seven hours, from 7 a.m. to 11 a.m. and from 2 p.m. to 5 p.m.

Convalescents at the Taboga Sanitarium were cheered back to health with truffles, mushrooms, spinach, wines and all the delicacies of the French markets.  In four years the items of pillows, bolsters, and other bed linen purchased from one Paris firm aggregated $30,000, and this was only one of several firms furnishing this class of material.  The purchases of stationery in six months from one firm alone amounted to $15,000 per month.  In 1904, the writer saw more than a ton of pen points that had become rusted and useless, thrown away.  Verily the material contracts were a good thing for the dealers, but what of the poor peasant who invested his savings in canal shares on a rising market?

"Dingler's Folly" (Folie Dingler).

Standing on a handsome terrace on the western slope of Ancon Hill is a building that readily commands attention from passersby via either the old or new La Boca roads.  It was the prospective home of M. Dingler, one of the foremost Director Generals of the French company, but he never occupied it.  Work on the mansion was started shortly after he came to the isthmus in February 1883, and the cost including the grounds is estimated to have been nearly $50,000.  For many years it has been known among the French people of Panama, as "Folie Dingler," or "Dingler's Folly."  At the time the American Government took possession the place had fallen greatly into decay, but needed repairs were made, and for the past three years it has been used by the Department of Sanitation as a quarantine detention station.

The experience of M. Dingler on the Isthmus is, perhaps, the most pathetic in canal history.  Stories of the fatal effect the climate of the Isthmus was said to have on foreigners reached France, but Dingler scoffed at these reports.  "I am going to show them," he is reported to have said, "that only drunkards and the dissipated take the yellow fever and die there."   He brought with him his wife, son and a daughter.  His son who was made Chief of Posts, shortly contracted yellow fever and died.  Dingler subsequently returned to France on leave of absence and upon the reappearance of himself and family on the Isthmus, his daughter fell victim to Yellow Jack.  On the return from a second vacation his wife also sickened and died from the same fatal disease.  Dingler afterwards went back to France a broken-hearted man.  Later he became insane and died in a mad house.

The Collapse and its Results.

The closing days of 1888 marked the end of the De Lesseps regime.  In December of that year the company went into liquidation, and on February 4, 1889, a receiver of its affairs was appointed by the Civil Tribune of the Seine, with authority to transfer all, or any portion of its assets, to a new corporation.  On the Isthmus the work was not definitely suspended until March 15, 1889, although but little work had been accomplished for three months to this event.

The suspension of operations threw a small army of laborers out of a job, and an immense amount of suffering resulted.  Nine-tenths of the men employed on the canal works were from the West Indian islands.  Living only upon what they earned day by day the stoppage of work brought them at once to the verge of destitution.  The Jamaican Government however took cognizance of their condition and through their Minister Resident appointed thirteen agencies at different points on the the line to carry on the work of repatriation.  These agencies had up to May 7th, 1889 sent back over 6,000 while 4,000 more went back on their own account.  Of the balance of the 20,000 laborers at work on the canal when the crash came, some remained on the isthmus and the rest migrated to the other West India islands.  The work of repatriation cost the Jamaican Government $5.00 per head, or a total of about $30,000.   The Chilean Government seeing an opportunity at this time to secure immigrants granted 40,000 free passages from Panama to Valparaiso to all classes except colored people and Chinese, and for several months every mail steamer south took away from 400 to 600.

The report of the receiver showed that the total expenditures made by the canal company on the Isthmus amounted to $156,654,687, and the total expenditures in Paris, $78,140,330, a grand total of $234,795,017.  Of the items of disbursements at Panama, salaries and expenses of management footed up $16,540,883; rents and maintenance of leased property, $3,301,070; material and supplies, $29,722,856; buildings, $15,397,282; construction and engineering expenses, $89,434,225; land purchases, $950,655; and medical and religious attendance, $1,836,768.

"Coming Events Cast Shadows Before."

"It is time that we of the southern nations" says El Porvenir of Cartagena in an article published in April, 1889, commenting on the canal collapse, "should rely on no other assistance for the spread of our industries and to restrain the tendencies of European governments, save that which can be given by our brothers of the North who are interested with us in seeing that only American interests should prevail through the length and breadth of the land. ....... Let us undeceive ourselves.  If the nations of South America yet require a tutor to free them from deceit and to promote their well-being, that tutor should not be and cannot be other than the Government of the United States, which is directly interested in seeing that the map of America should register no other nationalities.  It is our opinion that the Panama Canal will be opened owing to the necessity felt by the commercial world for that cheap and commodious route, but in truth we must say that no other country save that of North America can carry to a happy conclusion that great work, since only that country possesses the requisites which are necessary to finish it, and which are:  An abundance of money, fitting machinery which cannot be found in other countries, and habits of work united to reasonable economy in expenditures."

The Star & Herald in an editorial in its issue of May 17th, 1889, under the caption of "Future of Panama," takes a philosophic view of the situation and urges the Isthmian people to bestir themselves and develop the rich possibilities that lie between the two oceans.

The Second, Or New Company.

The history of the new company does not record any startling achievement in the amount of work accomplished, in fact, the rater desultory manner in which the work was carried on lends color to the belief that it was organized primarily at least, to protect the assets of the old company, and to make a sale when the opportune moment arrived.  Compared with the amount of money expended however, it made a much better showing than the old company.  With a working capital of less than $13,000,000 it excavated some 10,000,000 cubic meters of material, as compared with about 50,000,000 cubic meters excavated by the old company at a cost of upwards of $250,000,000.  In this connection consideration must be given the fact that with the new company plant and material was ready at hand, so that the expense on this account was comparatively small.   It was also the expectation that at the end of three or four years' work the investing public would have their confidence in the undertaking restored, and provide more funds for the purpose, but this expectation did not materialize.

In 1890, the services of Lieut. Wyse were again brought into play and on December 10th of that year he secured a new agreement with Colombia granting a ten year extension for the completion of the work.  The delay in organizing the new company made it impracticable to comply with the above time limit, and negotiations with Colombia were reopened.  On April 4, 1893, another extension was granted which provided for the resumption of work on a permanent basis by October 31, 1894, and the completion of the canal within ten years from that date.  Toward the close of the nineties it was manifest that the concession would expire before the work could be finished, so in April, 1900 a third extension was arranged which stipulated that the canal should be completed by October 31, 1910.  In passing it is just to observe that the Colombian Government exercised a remarkable degree of patience in this connection.

A Stupendous Undertaking.

The organization of the new company was a stupendous undertaking in the face of the fact that the mere mention of "Panama" to a French investor was like flaunting a red rag in front of a bull.  Visions of graft and extravagance floated ever before his mind.  However, in October, 1894, the "New Panama Canal company" was finally launched upon the troublesome waters of canal endeavor, with a capital stock of 65,000,000 francs ($13,000,000), divided into shares of 100 francs each.  Under the agreement 50,000 shares fully paid up were at once set aside for the Colombian Government.   The receiver of the old company became a party to the new organization and transferred all the property and assets of the old company, real and personal, whether in France or Panama, including the grants from the Colombian Government; also the rights of every nature in the Panama Railroad, which had been obtained through arrangements entered into between the company and the holders of railroad stock.  The receiver also subscribed in his official capacity for about one-fourth of the stock of the new company.

Under the terms of the transfer the new company had a title to the whole property, but the rights of those interested in the old company were not entirely extinguished.   The latter were under no further obligations to contribute toward the   auxiliary works, but its successful completion and operation would be of advantage to them to some extent, inasmuch as under the terms of the sale sixty percent of the surplus income after payment of expenses, charges and stipulated dividends was to be appropriated by the receiver for distribution among them.  While there might be little or nothing left for the proposed distribution, the existence of this right in favor of the shareholders in the old company made concurrence obligatory in case of a sale of the property.

Should the construction have gone by default on October 31, 1910, the concession would have lapsed, but through its railroad contract the company would have exclusive control of the territory through which the the line extended until 1966, but being absolutely prohibited the while from selling to any foreign government, it was manifest that even if the privileges of the company could have been purchased, the conditions would not have permitted of any other government exercising its rights of ownership in connection with the construction of the canal.

The receiver according to the terms of transfer was clothed with authority to appoint a commission of engineers to rectify previous surveys, inspect progress made and to supervise expenditures, and one of the first steps taken was to organize the Comite Technique, consisting of seven French engineers.  This committee made in all three different reports.  The first proposed a lock canal at an impracticable height; the second provided for a lock canal, the bottom of which should be 20.75 meters, or about 68 feet above sea level.  The locks according to this plan would be five in number, one each at Bohio and Bas Obispo on the Atlantic side of the divide, and one each at Paraiso and Miraflores, with a tidal lock near Miraflores on the Pacific side.  The third plan comprehended a canal the bottom of which would be about 32 feet above sea level, and with but three locks, one at Bohio, another at or near Pedro Miguel, and the third at Miraflores.

Net Results.

The committee's plan for regulating the Chagres River, and to obtain therefrom the requisite amount of water to operate the canal at all times, consisted in the construction of a dam at Bohio of 250,000,000 cubic meter capacity, and of another dam farther up the river at Alhajuela, capable of storing 150,000,000 cubic meters of water.  With the lake at Bohio, and the reservoir at Alhajuela, it was estimated that there would be no difficulty as to a sufficient water supply at any period of the year.  The old company engineers proposed the site at Gamboa for a dam after it took up the lock canal proposition, but the Comite Technique considered this site as entirely unsuitable.   The Gatun site of the present day never entered into the calculations of the French engineers.

The Comite Technique left as a heritage a vast amount of valuable papers bearing upon surveys and chartings which have been used to good purpose by the Isthmian Canal Commission.  Apart from these, the results of the efforts of the new company were small.  The actual construction work was confined principally to excavating in Culebra cut, and work at the Pacific entrance to the canal.  Not to exceed 3,000 men were on the company's pay roles at any one time, as compared with the maximum number of 25,000 in the best days of the old company.

The amount of excavation done by the two French companies during the active period of their existence is shown by the following table:

Highest elevation at Culebra before work began  ... 312 ft.
Highest elevation at Bas Obispo before work began ... 233 ft.
Greatest depth of excavation by the French at Culebra ... 161 ft.
Greatest depth of excavation by the French at Bas Obispo ... 148 ft.
Total excavation by the French including diversion channel ... 70,000,000 Cubic Yards

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The above news coupled with the determined resistance offered by the government forces, and a shortage of ammunition discouraged the revolutionists, and at the termination of the three days' fighting, a truce was arranged.  this resulted in the revolutionists accepting the offer of General Alban, the military and civil chief of Panama, to surrender with honor and be placed on parole.

The trenches and outskirts of the city presented a terrible sight after the battle.   the streets and fields were strewn with the unburied dead, among them being some of the best of Panama's young men who had espoused the cause of both sides.

From this date until the cessation of hostilities, the city of Panama, being used as the head military post of the Colombian government on the Isthmus for troops and supplies, was kept in comparative peace and quiet, although the ensuing two years witnessed continual fighting in other parts of the country.  At one time the revolutionists were in possession of every important point and post, with the exception of the city of Panama.  The United States Government at the request of the authorities at Bogota finally landed a force of marines to keep the transit open.  Fighting was thereupon stopped along the line of the railroad, and to insure further the preservation of order, from three to four warships rode an anchor in the harbor.

From: The Canal Zone Pilot
The Star & Herald Company, 1908

October 9, 2000