CHAPTER V

Upon every principle which governs the relations to each other, either of nations or of individuals, the United States is completely estopped from denying that the treaty is in full force and vigor. If changed conditions now make stipulations, which were once deemed advantageous, either inapplicable or injurious, the true remedy is not in ingenious attempts to deny the existence of the treaty or to explain away its provisions, but in a direct and straightforward application to Great Britain for a reconsideration of the whole matter.[181]

It was precisely in this spirit that Secretary Hay undertook in 1899 to negotiate a new treaty with England. The original draft of the Hay-Pauncefotetreaty, signed February 5, 1900, provided for a neutralized canal and drafted for its control rules substantially in accord with the Constantinople convention of 1888, providing for the regulation of the Suez canal. The most important provision of the new treaty was that authorizing the United States to construct and to assume the management of an isthmian canal, either directly or through a company. The United States Senate, however, amended the treaty in three important particulars: (1) by declaring that the Clayton-Bulwer treaty was thereby superseded; (2) by providing that the restrictions in the regulations governing the use of the canal should not apply to measures which the United States might adopt for its own defense and for the maintenance of public order along the canal; and (3) by cutting out entirely the article providing for the adherence of other powers. The British government refused to accept these amendments, and a year elapsed before an agreement was finally reached.[182]The revised treaty which was ratified by the Senate December 16, 1901, was a compromise between the original draft and the Senate amendments. The new treaty abrogated in express terms the Clayton-Bulwer convention, and provided that the United States might construct a canal under its direct auspices, to be under its exclusive management. The principle of neutralization was nominally retained, but under the sole guarantee of the United States, with power to police the canal, and the clause of the first draft forbidding fortifications was omitted.[183]

This convention removed the principal diplomatic obstacles which stood in the way of constructing a canal through the isthmus. For several years the United States had been investigating the cost of constructing a canal through Nicaragua, that route being the one which had always been considered most feasible by the great majority of American engineers. Two commissions, one in 1895 and another in 1897, had reported favorably on the practicability of that route. A third commission, headed by Admiral John G. Walker, was appointed under act of March 3, 1899, which authorized an expenditure of $1,000,000 for the purpose of making a thorough investigation of all available routes. While the Walker commission was carrying on investigations in Nicaragua, at Panama, and along the Atrato river, the various financial interests concerned in the choice of routes were actively at work in Washington, each trying to influence Congress in favor of its particular project. The New Panama Canal Company had secured, at the time of the reorganization, an extension of its concession to October, 1904, and subsequently another concession to October, 1910, but the validity of the latter arrangement was in doubt. The company could not raise the necessary funds to continue the work at Panama and was therefore threatened with the forfeiture of its franchise and property. It concluded, therefore, that its only hope lay in transferring its concession and property to the American government. With this end in view, an active lobby was maintained at Washington for the purpose of influencing public opinion in favor of the Panama route.

But the Panama Company had a powerful rivalin the Maritime Canal Company, which held a charter from Congress and had secured a concession from Nicaragua. This company had started work at Greytown in 1890, but having been forced from lack of funds to stop work in 1893, was now urging Congress to make its enterprise a national one. It found a ready champion in Senator Morgan of Alabama, who had for years taken a lively interest in the canal question and who had strong convictions as to the superiority of the Nicaragua route. In 1900 Nicaragua declared the concession of the Maritime Canal Company null and void, and granted a new concession to a group of New York capitalists known as the Grace-Eyre-Cragin Syndicate. The Maritime Canal Company, however, refused to abandon its claims, and a contest between the two concerns was carried to the lobbies of Congress. The opposition of the transcontinental railroads to a canal at either point brought into play another set of powerful interests, usually arrayed against the plan which appeared for the time being most likely to succeed.[184]

On November 16, 1901, the Walker commission after a thorough investigation of the Nicaragua and Panama routes made its report. It estimated the cost of construction of the Nicaragua canal at $189,864,062, and the cost of completing the Panama canal at $144,233,358. To this latter sum had to be added the cost of acquiring the rights and property of the French company, which had stated to the commission that it estimated its interests at $109,141,500, making the total cost of the Panama canal $253,374,858. The commission expressed the opinion that the interests ofthe French company were not worth over $40,000,000. In conclusion the report stated:

After considering all the facts developed by the investigations made by the commission and the actual situation as it now stands, and having in view the terms offered by the New Panama Company, this commission is of the opinion that the most practicable and feasible route for an isthmian canal, to be under the control, management, and ownership of the United States, is that known as the Nicaragua route.[185]

A bill was promptly introduced into the House of Representatives by Mr. Hepburn providing for the construction of the canal through Nicaragua, and on January 9, 1902, this bill passed the House by the almost unanimous vote of 308 to 2. The report of the commission had meanwhile created great consternation among the stockholders of the New Panama Canal Company, and on January 4, 1902, a definite offer to sell out to the United States at $40,000,000 was made to the commission by cable. On January 18, the commission filed a supplementary report which recommended the adoption of the Panama route instead of that through Nicaragua.

When the Hepburn bill came up for discussion in the Senate, the situation had thus been radically changed, and a long debate ensued as to the relative merits of the two routes. Senator Morgan continued to fight for Nicaragua as the traditional American route, declaring that the Panama Company could not give a valid transfer of its property and interests. But this objection was cleverly met by Senator Spooner, who offered an amendment, which wasvirtually a substitute, authorizing the President to acquire the rights and property of the French company at a cost not exceeding $40,000,000; to acquire from the Republic of Colombia, upon such terms as he might deem reasonable, perpetual control of a strip of land, not less than six miles in width, extending from the Caribbean Sea to the Pacific Ocean, with jurisdiction over said strip; and to proceed as soon as these rights were acquired, to construct a canal. But should the President be unable to obtain a satisfactory title to the property of the French company and the control of the necessary strip of land from the Republic of Colombia "within a reasonable time and upon reasonable terms," then he was instructed to secure control of the necessary strip through Nicaragua and to proceed to construct a canal there. The bill as amended passed the Senate June 19, 1902, by a vote of 67 to 6. The House at first refused to concur in the Spooner amendment, but after a conference it finally gave way and the measure was adopted by a vote of 260 to 8. The act was signed by President Roosevelt June 28.[186]

Attorney-General Knox was sent to Paris to make a thorough investigation of the affairs of the Panama Company. He reported that it could give a clear title. The next step was to secure a right of way through Colombia. After considerable delay Secretary Hay and Mr. Herran, the Colombian chargé d'affaires, signed, January 22, 1903, a canal convention, by the terms of which the United States agreed to pay Colombia $10,000,000 in cash and an annuity of $250,000 for the lease of a strip of land six miles wide acrossthe isthmus. Objection was raised to this treaty because it failed to secure for the United States full governmental control over the canal zone, but it was considered the best that could be gotten and it was ratified by the United States Senate March 17, 1903.

The Colombian Senate, however, did not regard the treaty with favor. They felt that Panama was their greatest national asset, and they knew perfectly well that in spite of threats to the contrary President Roosevelt was determined not to adopt the alternative of the Spooner amendment and go to Nicaragua. After discussing the treaty for nearly two months, they finally rejected it August 12 by the unanimous vote of all the senators present.[187]They probably thought that they could get better terms from the United States and particularly that they might reserve a fuller measure of sovereignty over the isthmus. President Roosevelt declared that the action of the Colombian Senate was due to an "anti-social spirit" and to the cupidity of the government leaders, who merely wished to wait until they could confiscate the $40,000,000 worth of property belonging to the French company and then sell out to the United States. This view is not borne out by the dispatches of Mr. Beaupré, the American minister, who repeatedly warned Secretary Hay that there was a "tremendous tide of public opinion against the canal treaty," which even the Colombian government could not ignore. The charge of bad faith against Colombia does not come in good grace from a country whose constitution also requires the ratification of treaties by the Senate.

As soon as the Hay-Herran convention was rejectedby the Colombian Senate, the advocates of the Nicaragua route began to take courage and to demand that as the "reasonable time" allowed in the Spooner act for the President to acquire the right of way through Panama had expired, it was now his duty to adopt the Nicaragua route. The directors of the French company were again in a state of consternation. If they could not sell to the United States they would have to sacrifice their property entirely, or sell to some other purchaser at a lower figure. It was rumored that Germany was willing to buy their interests. The directors of the company were so completely demoralized that William Nelson Cromwell, their American attorney, hastened to Paris to dissuade them from taking any rash step. The rejection of the Hay-Herran treaty was a great disappointment to the inhabitants of the isthmus, who considered this action a sacrifice of their interests, and some of the foremost citizens conferred with the American agent of the Panama Railroad Company as to the advisability of organizing a revolution. Before taking any step in this direction, it was considered advisable to send one of their number to the United States, and Dr. Amador was selected for this mission. He had conferences with William Nelson Cromwell and with Secretary Hay. The latter merely outlined what he considered the rights and duties of the United States under the treaty of 1846, but refused of course to commit the government to a definite support of the revolutionary project. Amador was somewhat discouraged at the result of his conference with Hay, but his hopes were revived by the sudden arrival of Philippe Bunau-Varilla, the former chief engineerof the French company, who entered with enthusiasm into the revolutionary scheme.[188]

The Colombian Congress adjourned October 30 without any reconsideration of the treaty, and President Roosevelt at once ordered theBoston,Dixie,Atlanta, andNashvilleto proceed within easy reach of the isthmus. Their commanders received orders to keep the transit open and to "prevent the landing of any armed force with hostile intent, either government or insurgent, at any point within fifty miles of Panama." TheNashvillearrived off Colon November 2. It can hardly be denied that these measures created a situation very favorable to revolution.[189]

The revolutionists had been greatly disappointed at Dr. Amador's failure to get a definite promise of support from the American government, but their spirits revived when they learned of the presence of American war vessels. Still they were slow in taking advantage of their opportunities and the government at Washington was growing impatient. At 3.40P. M.November 3 the following dispatch was sent to the American consuls at Panama and Colon: "Uprising on isthmus reported. Keep Department promptly and fully informed. Loomis, Acting." At 8.15 a reply was received from the consul at Panama: "No uprising yet. Reported will be in the night. Situation is critical." At 9P. M.a second dispatch was received from the same source: "Uprising occurred to-night, 6; no bloodshed. Army and navy officials taken prisoners. Government will be organized to-night."[190]

Before theNashvillereceived the order to prevent the landing of armed forces, 450 Colombian troops arrived at Colon. The principal officers were provided with a special train to take them across the isthmus to Panama. When they arrived they were seized by the revolutionary leaders and locked up for safe-keeping, while the railroad officials saw to it that there were no trains for their troops to use. The next day Commander Hubbard landed fifty marines from theNashvilleat Colon, and a day later the officer in charge of the Colombian forces was persuaded by a generous bribe to reëmbark his troops and leave. Events continued to follow one another with startling rapidity. On the 6th thede factogovernment was recognized and a week later Bunau-Varilla was received by President Roosevelt as envoy extraordinary and minister plenipotentiary of the Republic of Panama. Such hasty recognition of a new government was of course without precedent in the annals of American diplomacy, and it naturally confirmed the rumor that the whole affair had been prearranged. On October 10 President Roosevelt had written a personal letter to Dr. Albert Shaw, editor of theReview of Reviews, who was a strong advocate of the Panama route, in which he said:

Privately, I freely say to you that I should be delighted if Panama were an independent state, or if it made itself so at this moment; but for me to say so publicly would amount to an instigation of a revolt, and therefore I cannot say it.[191]

This letter throws an interesting light on an article in theReview of Reviewsfor November of the sameyear in which Dr. Shaw discussed the question, "What if Panama should Revolt?" and outlined with remarkable prophetic insight the future course of events.

In his annual message of December 7, 1903, the President discussed the Panama revolution and undertook to justify his course under the treaty of 1846. This message failed to allay public criticism, and on January 4, 1904, he sent a special message to Congress in defense of his action. He held that Colombia was not entitled "to bar the transit of the world's traffic across the isthmus," and that the intervention of the United States was justified, (1) by our treaty rights, (2) by our international interests, and (3) by the interests of "collective civilization." The "legal" argument in this message, if we may dignify it by that name, is reported to have been prepared by Root and Knox, both at that time members of the Cabinet. Several years later, after Mr. Roosevelt had retired from the presidency, he expressed the real truth in a public speech when he said:

If I had followed traditional conservative methods I should have submitted a dignified state paper of probably two hundred pages to the Congress and the debate would be going on yet, but I took the Canal zone and let Congress debate, and while the debate goes on the canal does also.

The reason why the President did not wish the matter to go before Congress again was that he had decided upon the Panama route, and he knew that when Congress convened in December, the situation remaining unchanged, action would be taken to compel him to adopt the alternative of the Spooneramendment and go to the Nicaragua route. His object in the hasty recognition of the Panama revolution was therefore to make the Panama route an accomplished fact before Congress should meet. This was the attitude definitely assumed in the message of January 4, 1904, in the course of which he said:

The only question now before us is that of the ratification of the treaty. For it is to be remembered that a failure to ratify the treaty will not undo what has been done, will not restore Panama to Colombia, and will not alter our obligation to keep the transit open across the Isthmus, and to prevent any outside power from menacing this transit.

The treaty referred to was the convention with Panama which had been signed November 18, 1903, and which was ratified by the Senate February 23, 1904, by a vote of 66 to 14. By the terms of this agreement the United States guaranteed the independence of the Panama Republic, and agreed to pay the Panama Republic a sum of $10,000,000 upon the exchange of ratifications and an annual rental of $250,000 a year beginning nine years thereafter. Panama on her part granted to the United States in perpetuity a zone of land ten miles wide for the construction of a canal, the United States receiving as full power and authority over this strip and the waters adjacent as if it were the sovereign of the said territory.[192]The construction of the canal was at once undertaken and the work was carried through successfully by General Goethals and a corps of army engineers. It was opened to commerce August 15, 1914, though it was not completed at that time and traffic was subsequently interrupted by landslides.

Colombia naturally felt aggrieved at the course pursued by President Roosevelt and refused to recognize the Republic of Panama. She objected to his interpretation of the convention of 1846. In this convention the United States pledged itself to keep the isthmian transit open and guaranteed Colombia's sovereignty over the same. This treaty established an obligation to Colombia alone, and it is difficult to accept the President's view that it established an obligation to the world at large against Colombia. Colombia demanded that the whole question be submitted to arbitration. As the United States had always held the ground that disputes arising out of the interpretation of treaties should be settled by arbitration, it was inconsistent for the United States to refuse to arbitrate. But President Roosevelt did refuse. The Panama episode created strained relations with Colombia and made a very bad impression throughout Latin America. The United States has since been eyed with suspicion by its weaker Southern neighbors. The Taft and Wilson administrations both tried to appease Colombia by a money payment, but this subject will be discussed in a subsequent chapter.

[140]Report of International American Conference, Vol. IV (Hist. App.), p. 143.

[141]Snow: "Treaties and Topics in American Diplomacy," p. 328.

[142]Our treaties with Mexico and Honduras, although covering the case of canal constructions, were of no practical importance, as the routes through these countries were not feasible.

[143]Correspondence in relation to the Proposed Interoceanic Canal, the Clayton-Bulwer Treaty, and the Monroe Doctrine. Government Printing Office, 1885, p. 5. Referred to hereafter as "Collected Correspondence."

[144]Ibid., pp. 23-27.

[145]Ibid., pp. 27 and 40.

[146]Seward to Adams, July 11, 1862.

[147]"Collected Correspondence," pp. 7 and 8.

[148]Mr. Scruggs to Mr. Bayard, April 16, 1885, For. Rel., also "Messages and Papers of the Presidents," Vol. VIII, p. 326.

[149]"Collected Correspondence," p. 94.

[150]Ibid., p. 14.

[151]"Collected Correspondence," pp. 11 and 12.

[152]"Collected Correspondence," p. 99.

[153]Mr. Buchanan to Hon. John A. McClernand, April 2, 1850, "American Hist. Rev.," Oct., 1899.

[154]"Wharton's Digest," Sec. 295.

[155]"Collected Correspondence," p. 102.

[156]Ibid., p. 234, also Wharton's Digest, Vol. II, p. 190.

[157]"Collected Correspondence," p. 248.

[158]"Collected Correspondence," p. 286.

[159]Ibid., p. 262-263.

[160]Ibid., p. 276.

[161]"Collected Correspondence," p. 280.

[162]Ibid., pp. 294-302.

[163]"Messages and Papers of the Presidents," Vol. V, p. 639.

[164]"Collected Correspondence," p. 303.

[165]"Collected Correspondence," p. 132.

[166]Ibid., pp. 310-12.

[167]"Messages and Papers of the Presidents," Vol. VII, p. 585.

[168]"Collected Correspondence," p. 313.

[169]"Messages and Papers of the Presidents," Vol. VIII, p. 11.

[170]"Collected Correspondence," pp. 322-326.

[171]Ibid., p. 326.

[172]"Collected Correspondence," pp. 327-332.

[173]"Collected Correspondence," pp. 340-352.

[174]"Collected Correspondence," pp. 160-161.

[175]"Collected Correspondence," pp. 353-359.

[176]Ibid., p. 364.

[177]"Messages and Papers of the Presidents," Vol. VIII, p. 327.

[178]See Mr. Bayard to Mr. Phelps, Nov. 23, 1888. For. Rel., 1888, Pt. I, pp. 759-768.

[179]For. Rel., 1889, p. 468.

[180]See Foreign Relations, 1894, App. 1. "Affairs at Bluefields," pp. 234-363.

[181]Senate Doc. No. 160, Fifty-sixth Cong., First Sess.

[182]Moore, "Digest of Int. Law," Vol. III, p. 211.

[183]Foreign Relations, 1901, p. 245.

[184]Johnson, "Four Centuries of the Panama Canal," Chap. VIII.

[185]Report of the Isthmian Canal Commission (Sen. Doc. No. 54, Fifty-seventh Cong., First Sess.).

[186]U. S. Statutes at Large, Vol. XXXII, Pt. I, p. 481.

[187]Senate Doc. No. 51, Fifty-eighth Cong., Second Sess., p. 56.

[188]Johnson, "Four Centuries of the Panama Canal," pp. 162-171.

[189]Senate Doc. No. 53, Fifty-eighth Cong., Second Sess.

[190]House Doc. No. 8, Fifty-eighth Cong., First Sess.

[191]Literary Digest, October 29, 1904.

[192]Foreign Relations, 1904, p. 543.

The attempt of Louis Napoleon to establish a European monarchy in Mexico under the tutelage of France was the most serious menace that republican institutions in the new world have had to face since the schemes of the Holy Alliance were checked by Monroe and Canning. The thwarting of that attempt may be accounted one of the greatest triumphs of American diplomacy. The internal disorders common to South and Central American republics have always been a fruitful source of embarrassment to the United States, on account of the liability to European intervention to which these governments continually subject themselves in such periods by their open and flagrant disregard of international obligations. Of no country is this statement truer than of Mexico, where the well-nigh interminable strife of parties gave rise between the years 1821 and 1857 to thirty-six different governments. In 1857 a favorable change occurred in the affairs of the republic. A constituent congress, elected by the people of the different states, framed and adopted a republican constitution which promised better things for the future. Under the provisions of this constitution an election was held in July (1857) and General Comonfort chosen president almost without opposition. His term of office was to begin December 1, 1857, and to continue four years. Withinone brief month, however, President Comonfort was driven from the capital, and ultimately from the country, by an uprising headed by General Zuloaga. As soon as Comonfort abandoned the presidency, General Benito Juarez, the president of the Supreme Court of Justice, became according to the constitution, the presidentde jureof the republic for the remainder of the unexpired term, that is, until December 1, 1861. General Zuloaga had, however, assumed the name of president, with indefinite powers, and the entire diplomatic corps, including the minister of the United States, had recognized his government. But Zuloaga was speedily expelled, and the supreme power seized by General Miramon, the head of the church party, whom the diplomatic corps likewise recognized. Meanwhile Juarez, the constitutional president, had proceeded to Vera Cruz, where he put his administration into successful operation.

For several months, Mr. John Forsyth, the American minister, continued at the city of Mexico in the discharge of his duties. In June, 1858, however, he suspended his diplomatic connection with the Miramon government. Our relations, which had been bad under former governments, were now rendered almost intolerable under that of Miramon by outrages towards American citizens and personal indignities to Mr. Forsyth himself. His action was approved by President Buchanan, and he was directed to return to the United States. All diplomatic intercourse was thus terminated with the government of Miramon, but as yet none was established with the Juarez government. The ultimate success of the latter became, however, so probable that the following year the President senta confidential agent to Mexico to inquire into and report upon the actual condition of the belligerents, and in consequence of his report, Mr. Robert M. McLane was dispatched to Mexico, March 8, 1859, "with discretionary authority to recognize the government of President Juarez, if on his arrival in Mexico he should find it entitled to such recognition according to the established practice of the United States." On the 7th of April, Mr. McLane presented his credentials to President Juarez, having no hesitation, he said, "in pronouncing the government of Juarez to be the only existing government of the republic." He was cordially received by the authorities at Vera Cruz, and during all the vicissitudes of the next eight years the United States government continued to extend its sympathy and moral support to the government of Juarez as the only one entitled to the allegiance of the people of Mexico.

Juarez thus came forward, in the rôle of reformer, as the champion of constitutionalism and the supremacy of the state against the overreaching power, influence, and wealth of the church party. He was a full-blooded Indian, without the slightest admixture of Spanish blood. In December, 1860, he finally succeeded in overthrowing the party of Miramon and driving the latter into exile. Immediately, on reoccupying the city of Mexico, the Constitutionalists proceeded to execute with severity the decree issued at Vera Cruz nationalizing or sequestrating the property of the church.

The most difficult question which the new government had to face was that of international obligations recklessly contracted by the various revolutionaryleaders who had successively been recognized as constituting the government of Mexico. In consequence of debts contracted and outrages and enormities perpetrated, for the most part during the régime of Miramon and the church party, the governments of England, France, and Spain determined to intervene in Mexico.

The grievances of the British government were based on the following facts: non-settlement of claims of British bondholders; the murder of the British vice-consul at Tasco; the breaking into the British legation and the carrying off £152,000 in bonds belonging to British subjects, besides numerous other outrages committed on the persons and property of individuals.[193]

The claims of the British bondholders referred to had been recognized by the Pakenham convention of October 15, 1842, and formed into a consolidated fund of $250,000, which was to be paid off, principal and interest, by a percentage on import duties at the custom-houses of Vera Cruz and Tampico. This convention was not carried out by the Mexican government, and on December 4, 1851, Mr. Doyle signed on behalf of Great Britain a new convention, in which not only the claims under the Pakenham convention, but others, recognized by both governments, were likewise formed into a consolidated fund, on which the Mexican government bound itself to pay five per cent. as a sinking fund and three per cent. as interest until the debt should be paid off. This five and three per cent. were to be met by a percentage of customs receipts.In 1857 the sinking fund was to be raised to six per cent. and the interest to four per cent.

Two days after the signing of this Doyle convention the Spanish minister in Mexico also signed a convention on behalf of some Philippine missionaries, known as the "Padre Moran" convention, on almost the same basis as the British. The consolidated fund in this case was $983,000, the sinking fund five per cent., and the interest three per cent.

The interest was paid on both funds in almost the whole amount, but the sinking fund was not kept up. Succeeding agreements were made in 1858, in 1859, and in 1860, by which the custom-house assignments to satisfy both conventions (British and Spanish) were raised from twelve per cent. in 1851, to twenty-nine per cent. in 1860.[194]

It will thus be seen that the British and Spanish claims were perfectly legitimate. The French claims, however, were of a somewhat different character. During Miramon's administration arrangements were made through the agency of Jecker, a Swiss banker, by which $750,000 were to be raised through an issue of $15,000,000 of bonds. These bonds fell into the hands of Jecker's French creditors and were pressed by the French government, which thus demanded the repayment of twenty times the original sum advanced. A claim was made also for $12,000,000 for torts on French subjects.[195]

When the Liberal party came into power again in 1860, they were unable to meet the situation and showed a disposition to question the obligatory forceof engagements entered into by their various revolutionary predecessors. The British government had undertaken to provide against this contingency upon the occasion of extending recognition to the Juarez administration. Under date of March 30, 1861, Lord John Russell wrote to Sir Charles Wyke, recently appointed minister to Mexico, as follows:

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