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Panama: The Canal, Noriega, and Some Brit

On the morning of November 19, 2009, my knowledge of Panama could be summed up with these words—canal, Noriega, and John Darwin, the Brit who faked his death and hid in Panama until he was caught. After 10 days in Panama and after plowing through David McCullough's The Path Between the Seas I found a country I loved and a history I had never known. Later, I'll share some of my experiences of my visit to Panama. Today I'll summarize the story of how the canal came into existence and why the US ended up building it.

I really didn't know much about the locks when I stepped onto the observation deck at Milaflores. The date on the locks is 1913. What that date doesn't reflect is that the building of the Panama canal started in 1870. For as long as sailors were sailing to the Americas (over 400 years), they dreamt of a canal. Who wouldn't. The Pacific and the Atlantic are so close at the isthmus. Without a canal, ships had to go around the bottom of South America and brave the waters of Cape Horn.

Back when Panama was part of Columbia, the French negotiated a treaty that gave them the right to carve a canal into Panama. The head of the canal company —Ferdinand de Lesseps — did not have any engineering background, but he was a terrific PR person. He convinced everyone to build a sea level canal in Panama. He had overseen the building of the Suez canal and concluded that because a sea level canal worked in the desert, it would work in the jungle.

Work went on for years despite the insurmountable engineering problems. There were almost 22,000 deaths from yellow fever, malaria, cholera, and other tropical diseases. The French were building the canal years before the mosquito had been implicated, and accepted, as the culprit who passed along tropical diseases so no one really knew how to prevent sickness. France lost many top engineers to yellow fever. The canal administrators found a way to profit from the deaths of some of the unknown workers with no families. They pickled the bodies and sold the cadavers to major medical institutions for study.

As part of his compelling publicity campaign, Ferdinand de Lesseps published a canal newsletter to update his shareholders. Its purpose was to keep them confident in the project. He used it to lie about the situation -- either by omission or misstating the facts. At first shareholders weren't aware of the magnitude of the deaths. It was easy to cover up the deaths of non-Caucasians because frankly, if you weren't white, your death was not entered in the books. But when top engineers left France and didn't return. Well, that was difficult to cover up. People started to get suspicious.

There were a lot of fancy dealings in France to finance the canal. Mr. de Lesseps was a precursor to Madoff. He convinced thousands of ordinary French citizens, many of them women, to invest in his canal company. Years later, when the canal company went bankrupt, all these people lost their life savings. Sounds familiar, doesn't it?

The French Panama canal ended in the biggest political and financial scandal of the 19th century. David McCullough sums it up nicely in his book "The Pathway Between the Seas."

Within four months after the scandal became public, "the French government fell, three former premiers had been named in the plot, along with two former ministers and two prominent senators; more than a hundred deputies or former deputies stood accused of taking payoffs; there had been one probable suicide; a panic on the Bourse (French stock exchange) and a much publicized duel."

Even Mr. Eiffel of the tower fame was involved in the scam!

The US wasn't idly sitting by. They, too, wanted to build a canal. But we were convinced that Nicaragua was the best place. When I looked at a map of Ncaragua, it seemed a no brainer that Panama is better. Panama has a few huge lakes. That means you simply have to put in a few locks, and cut out one or two sections and you have a canal. See the left side of the following image.

That's what I thought until I looked at the map from the1800's (right side of image). Lake Gatun and Madden Lake did not exist. They were created as part of the canal project. It turns out that you really do need a lake or two to control the water level of the canal. That's one of the reasons that Nicaragua looked so appealing to the US.

The US Congress was embroiled in one of their seemingly endless debates about where to build a canal when the French decided to sell their canal rights and equipment at a bargain price to recoup some of their losses. Some old southern senator had it stuck in his brain that the only place for a canal was Nicaragua. He wasn't an engineer but he was a formidable presence in the senate. He used his influence to hold up the process.

By this time all the US engineers decided Panama was a better choice. They could build on the work of the French, but make a canal with locks instead of a sea level one. Panama had a railway next to the canal site. Nicaragua didn't. The French already cleared a lot of the jungle, and therefore a lot of the disease was under control. The clearing made it easy to survey and measure distances. Nicaragua was still a jungle and was impossible to sight through. There were simply too many unknowns there.

The debate went on and on and on in Congress. One day, Nicaraguan volcanoes erupted and there were earthquakes. This became further evidence of the unsuitability of Nicaragua. But Nicaraguan officials sent a telegram to the US denying the eruptions and earthquakes. The southern senator claimed his foes made up the natural disasters. The truth was that they didn't. In fact ,one popular Nicaraguan postage stamp was engraved with a fuming volcano. One of the proponents of building a canal in Panama sent every senator one of those stamps. When the vote was taken, it was close, but Panama finally won out.

Negotiations between Columbia and the US began. It's a pretty involved story, so let me just say that two envoys to the US quit, one of them went insane, and the Columbian congress got caught up in debates and would not ratify the treaty as presented. Teddy Roosevelt was incensed. This is when he started to speak softly and carry a big stick.

Meanwhile, clandestine operations were going on in a few different circles. The short version is that Panama—remember it was part of Columbia back then—staged a revolt in 1903. The US Navy just happened to show up a day before the revolt. Panamanians got a hold of a lot of foreign money to bribe police and military to allow the coup to happen. As soon as Panama declared its independence, the US recognized Panama as a sovereign country.

The success of the coup was due in a large part to the quantity of bribe money provided by a Frenchman who was determined to see the canal finished. He insisted that in exchange he must be appointed the Panamanian envoy to the US. Sounds strange, but the Panamanians really had no choice if they didn't want the Columbian military to take them back.

The Frenchman wrote the treaty between the US and Panama, giving the US the right to build the canal and to rule, in perpetuity, the 10-mile swath of Panama surrounding the canal. He and a US official signed the treaty and got Congress to ratify it just 40 minutes before a Panamanian delegation arrived in Washington, D.C. They were enraged. They had not intended such a liberal treaty. At this point, there was nothing they could do if they wanted continued US protection. Shortly thereafter, the Frenchman resigned his post and returned to France.

The Torrijo-Carter treaties, signed in 1977, changed the perpetuity agreement. The US still has a permanent right to defend the canal from any action that could compromise its neutrality. But on January 1, 2000, the Panamanians became the owners and operators of the canal and got back the swath of land that the US previously controlled. On that day, 50,000 US citizens left the canal zone.

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