The United States built the Panama Canal, a channel 50 miles in length, to cut through the Central American nation of Panama and link the Atlantic and Pacific Oceans. The construction of the canal reinforced the rise of U. S. naval power and economic dominance in the Western Hemisphere, fulfilling a long-held dream to create a route that allowed ships to move freely between the two oceans.
The Clayton-Bulwer Treaty of 1850 had already provided for the joint construction of any Central American canal by Britain and the United States. By the turn of the century, the United States wanted sole control over the canal zone. After its victory over Spain, President William McKinley came to an agreement with Britain in February 1900. The Hay-Pauncefote Treaty allowed the United States to build a canal on its own but did not permit its fortification.
The hero of the Spanish-American War of 1898, Theodore Roosevelt, opposed the treaty, because it forbade the United States from fortifying the canal. He led a campaign that defeated the Hay-Pauncefote Treaty in the Senate. On November 18, 1901, Hay and Pauncefote signed a treaty that Roosevelt, who had become president of the United States after William McKinley’s assassination, found acceptable.
At the same time, a two-year investigation under the Walker Isthmian Canal Commission found that Nicaragua would be a more suitable route for the canal. The report found that purchasing the rights for a route through Panama would be too expensive. A French-chartered firm, the New Panama Canal Company, which held the canal rights, estimated its assets on the Panamanian isthmus at $109 million. Following the recommendations of the Walker Commission, the U. S. House of Representatives passed the Hepburn Bill on January 8, 1902, authorizing a canal through Nicaragua.
Lawyers representing the New Panama Canal Company waged an intense lobbying effort in Washington, D. C. The Walker Commission estimated the value of the New Panama Canal Company at $40 million. In addition, the
The Panama Canal under construction (Library of Congress)
Walker Commission, noting that the company was willing to sell the rights to the canal at the lower price, reversed itself on January 18, 1902, to favor the canal route through Panama. Five months later, Congress passed the Spooner Act, which authorized the route in Panama. On January 22, 1903, Secretary Hay and Colombian charge d’affaires, Tomas Herran, signed a treaty that provided Columbia with an initial payment of $10 million and $250,000 annually. In return, the United States gained control over the canal zone for 100 years, an option renewable in the future only by the United States.
Although Colombia wanted the United States to construct the canal, a costly civil war created an urgent need for funds. The Colombian government tried to exact $10 million from the New Panama Canal Company as a payment for transferring its assets to the U. S. government. In addition, the Bogota government attempted to get a higher initial payment of $15 million from the United States. President Roosevelt refused to make the higher payments. In addition, the Colombian senate balked at the American encroachment on Colombia’s sovereignty over Panama. The Colombian senate unanimously rejected the treaty on August 12, 1903.
When Colombia’s rejection of the treaty seemed imminent, Roosevelt considered either taking Panama by force or providing any revolutionary regime in Panama with immediate recognition and support. With an uprising appearing likely, Roosevelt chose the second option. On October 16, 1903, Secretary Hay informed Philippe Bunau-Varilla, a Frenchman who had fought for a Panamanian canal and agitated for Panamanian independence from Colombia, that the United States was sending warships to the isthmus.
Bunau-Varilla notified the revolutionaries when the American ships would be arriving. On November 2, the USS Nashville reached Colon. Acting Secretary of State Francis B. Loomis had ordered the commanding officer of the Nashville to “make every effort to prevent [Colombian] Government troops at Colon from proceeding to Panama.” However, the transmission to the Nashville had been delayed, and the commander of the Nashville did not interfere with the landing of Colombian troops. The revolutionaries, forced to fend for themselves, successfully took control of Panama and formed a provisional government.
On November 18, 1903, less than two weeks after the U. S. administration recognized the new government of Panama, the two countries signed the Hay-Bunau-Varilla Treaty, which permitted the United States government to construct, fortify, and run a canal connecting the Atlantic and Pacific Oceans. Upon the urging of Roosevelt, the Congress quickly ratified the Hay-Bunau-Varilla Treaty. Construction of the canal began in 1904.
In 1911, former president Roosevelt was widely reported as saying, “I took the Canal Zone and let Congress debate; and while the debate goes on the Canal does also.” After a decade of construction, the Panama Canal opened to traffic on August 15, 1914. In 1922, the United States paid $25 million to Colombia for the canal zone. Vital to the strategic and economic interests of the United States in the Western Hemisphere, the Panama Canal Zone allowed for the free movement of shipping between the Atlantic and Pacific Oceans. The U. S. presence at the Panama Canal was symbolic of the rise of American economic and military power in the region.
See also Big Stick diplomacy; foreign policy.
Further reading: J. Michael Hogan, The Panama Canal in American Politics: Domestic Advocacy and the Evolution of Policy (Carbondale: Southern Illinois University Press, 1986); Walter LaFeber, The Panama Canal: The Crisis in Historical Perspective (New York: Oxford University Press, 1978).
—Glen Bessemer
World History
