IT IS only too evident that in the not distant future the United States will undertake the construction of an isthmian canal via the Nicaragua route. An examination of the international commitments which involve this project is therefore not untimely.
In building a second canal, the best interests of the United States seek a waterway which shall be a strictly national utility.
Apparently the path in this direction is unobstructed.
As to suzerainty, the willingness of Nicaragua to have the United States build the canal on its own terms is evident. The problems of approach defenses have quietly solved themselves. The physical task presents no great engineering obstacles. Nor will appropriations be lacking when the proposition is properly presented to the country. There remains only to take up our existing option with Nicaragua and enter into an appropriate bilateral treaty respecting the rights of each nation in the premises, in order to initiate an all-American canal joining the Atlantic and the Pacific.
Such an arrangement, however, would make possible the exemption from tolls of ships of American registry.
Notwithstanding the fact that the Nicaragua route will be used almost exclusively by intercoastal traffic, the possibilities of isthmian tolls exemption for the shipping of any one nation are so far-reaching as to involve certain opposition from abroad.
With interoceanic transit available minus the payment of the present charge of $1.20 per net ton, the United States merchant marine must receive a tremendous impetus. This virtual subsidy would, in fact, place American shipping in a commanding position as a carrier of world trade. Inevitably British maritime interests stand to suffer under such a handicap. It is therefore logical to anticipate a concentration of all the strength of the British Foreign Office in diplomatic resistance to an unneutralized Nicaragua canal.
The legal arguments to support this resistance, while they may lack the strength of those advanced during the Panama tolls controversy, are still not without some historical precedent. For Great Britain has a stake in Central America, a heritage from the past which doubtless will be utilized in connection with any diplomatic discussions of the Nicaragua canal.
The extent to which this will influence the policy of the United States, however, must depend largely on the vigor of the Washington presentments.
In order to apprehend the nature of British influence in isthmian canal affairs, it is necessary to consider conditions precedent to the much criticized Clayton-Bulwer treaty of 1850.
At that time the canal project had already been actively discussed for a quarter of a century. These discussions were brought to an issue, however, in 1849. The vast territorial acquisitions which followed the war with Mexico gave to the United States a Pacific coast line accessible only by overland trails and via the long passage around Cape Horn. The need for a short water route had become accordingly urgent.
But, although Clay as Secretary of State had announced in 1835 that an isthmian canal should be available to all nations on equal terms, which policy was later underscored by Congress, the immediate project was clouded by the threat of British dominance of the proposed waterway.
British interest in the Caribbean began in the days when the Spanish Main was an area of importance in world affairs. Great Britain early assumed control of numerous islands in the West Indies, and had repeated clashes with Spain over claims on the Central American mainland.
Latterly in the eighteenth century British subjects engaged in lumbering operations along the stretch of coast inhabited by the Mosquito Indians from Cape Gracias a Dios south to Costa Rica. These operations led subsequently to the establishment of a British protectorate over the Mosquito country, administered from Jamaica. Despite the opposition of both Nicaragua and the United States, Great Britain extended this control southward until she dominated the mouth of the San Juan River, at the same time attempting to occupy a strategical location on the Pacific coast of Nicaragua.
Such an example of European opportunism in the Western Hemisphere would be impossible under later-day conditions. Yet, as a fait accompli it was a factor to be reckoned with in contemporary discussions of the Nicaragua canal; and it presented a grave problem to the Washington government, which was extremely anxious that the canal be built as an aid to both internal and external development.
To offset this territorial foothold, the United States had negotiated “favored nation” treaties with Nicaragua and Honduras providing suitable diplomatic background for the construction of a canal. But ratification of these treaties was withheld until an assurance of the amiable intentions of Great Britain could be had.
The idea of constructing the canal as a governmental enterprise was not at the time entertained.
Yet it was apparent that the Central American nation whose territory any canal must penetrate had neither the wealth to build the canal nor the political stability to maintain it. Under these circumstances it seemed necessary that a group of capitalists negotiate a concession for building the canal and that the arrangement be sponsored by one or more of the great powers.
The capital necessary for this project was not, at the time, to be had in the United States. London was the world’s financial center, to which all eyes instinctively turned when projects of such magnitude were being considered. Great Britain held the purse strings and Great Britain occupied a commanding position with respect to the most feasible route for the canal. All the United States had to contribute to the situation was an urgent need for isthmian transit, certain incipient local advantages, and a Monroe Doctrine which it lacked the power to enforce.
It is therefore evident that any agreement with Great Britain which assured the effective internationality of the then proposed canal was not inimical to the interests of the United States in 1850.
This is what the Clayton-Bulwer treaty was designed to accomplish.
When the isthmian canal discussions between Mr. Clayton and Lord Palmerston had reached the stage of negotiations, Sir Henry Bulwer was then recalled from Madrid and dispatched to Washington to represent the British interests. That astute diplomat was more than a match for his less experienced conferee and had little difficulty in utilizing a temporary situation, unfavorable to the United States, as the basis for a permanent convention between the two powers.
In return for the proviso that England surrender her claims in Central America— that neither party should occupy, fortify, nor exercise dominion over any Central American state—the United States subscribed in perpetuity to certain principles with respect to isthmian transit. Most important among these was the agreement that neither should obtain nor maintain any exclusive control over interoceanic communications, whether rail or water. Fortifications also were proscribed, the two powers mutually guaranteeing the neutrality of the projected waterway.
In effect the United States surrendered, in this treaty, all future rights to exclusive jurisdiction over any Central American canal, in order to prevent Great Britain’s extension of physical control over the then apparently most practicable route. This occurred twenty-five years after the famous pronouncement of President Monroe.
Nevertheless the Clayton-Bulwer treaty possessed timely merit. It secured the Monroe principle, which we were then unable to enforce by the pressure of power. It promised that our shipping would not receive adverse treatment. But it was defective in that it apparently contemplated the permanence of the international status quo and failed to provide for such modifications as the future might demand, an error which must be attributed to the lack of vision of the short administration of Zachary Taylor.
This treaty met with immediate objection in the Senate, and was only accepted after explanations by Mr. Clayton which amounted, according to the later expressed opinions of some senators, to a misrepresentation of the intentions of the contracting parties. Subsequently and for the succeeding fifty years it was recurrently denounced in both Houses of Congress. But it remained a bona fide diplomatic bargain by which Great Britain traded tangible holdings in Central America for an acceptance of the principle of neutralized isthmian transit.
Soon after the ratification of the Clayton-Bulwer treaty preliminary plans were drawn for a lock canal across Nicaragua. While the necessary diplomatic and engineering details were being arranged, however, a group of United States citizens, headed by Cornelius Vanderbilt, organized a transportation service by steamer up the San Juan River and across Lake Nicaragua, thence by coach line to the Bay of Fonseca. This venture immediately proved successful and flourished until political difficulties together with competition from the Panama route forced its discontinuance.
In 1846 the Washington government had ratified an agreement with New Granada (later Colombia) extending certain rights for transit across the then state of Panama. Under this treaty the Panama Railroad was built, and was opened in 1855 under a pledge of neutrality guaranteed by the United States. The superior service offered by this route was in part responsible for the discontinuance of the land-and-water route across Nicaragua, and in fact served temporarily to postpone the construction of an all-water route across the isthmus.
The Nicaragua canal project therefore became dormant.
When De Lesseps succeeded with the construction of the Suez Canal some fifteen years later, however, world interest focused on the Central American isthmus as nature’s remaining challenge to man. The genius of France accepted the challenge and under the leadership of De Lesseps undertook to repeat in America the accomplishment at Suez.
De Lesseps weighed the relative possibilities of Nicaragua and Panama, and finding the reaction of Colombia more favorable to his project, chose the latter route, although at the time admitting Nicaragua to be the most practical path for a lock canal.
With the arrival of De Lesseps in America, the diplomatic battle for the control of the canal route was resumed.
An optimistic report of the French engineers at Panama was submitted on February 14, 1880. During the same month the U. S. Navy took possession of a coaling station at near-by Boca del Toro.
On March 8 President Hayes, spurred by extensive news reports of the progress being made by the French syndicate, submitted a special message to Congress, in which he said:
The policy of this country is a canal under American control. The United States cannot consent to the surrender of this control to any European power or to any combination of European powers. If existing treaties between the United States and other nations .... stand in the way of this policy .... suitable steps should be taken by just and liberal negotiations to promote and establish the American policy on this subject.
President Garfield, in his inaugural address shortly after, indicated his approval of this policy, and soon instructed his Secretary of State, Mr. Blaine, to initiate conversations with London, in order that the objectionable obligations of the Clayton-Bulwer treaty might “by just and liberal negotiations’’ be eliminated.
There is to be noted a fundamental difference between the canal policy of President Taylor and that of President Garfield. Earlier we did not aspire to dominate the canal, but undertook merely to prevent any other power from interfering with our free and equable use of any canal which might be built. Yet thirty years later we calmly announce our intention to control the canal, even though we had already solemnly surrendered our right to do so.
In the interim had transpired an era vital to the history of the United States.
The Monroe Doctrine, which should have been invoked to halt British pretensions in Central America early in the century, was vitiated by domestic politics during the two decades which preceded the Civil War. The issue of slavery cast a malignant shadow on Pan-American relations, and no aggressive foreign policy was possible until all questions as to stability of the Union had been definitely answered.
But after the reconstruction period it was appropriate that the United States should look abroad with confidence and should undertake to mitigate the errors of a less sophisticated age.
So it became the task of Mr. Blaine to undo the work of his predecessor, Mr. Clayton.
Athough Mr. Blaine undertook this work with energy and with no inconsiderable ability, his overtures encountered abroad an air of urbane complacency. When the British Foreign Secretary, Lord Granville, finally deigned to consider this question, the extent of his committal was that Great Britain found no objection to the existing agreement on isthmian transit.
Against this attitude the diplomacy of Mr. Blaine was unable to prevail. Public opinion at home ranged from mild regret to violent resentment over the spirit of Downing Street. But interest in the issue again waned with the collapse of French efforts at Panama.
The organization of M. de Lesseps, the Interoceanic Canal Company, ran afoul of French politics in 1888, and two years later it became evident that private enterprise was unable to cope with the tremendous task of building an isthmian canal.
So world affairs drifted leisurely toward the events of 1898.
After the Spanish-American War the demand for a waterway between the American continents again became insistent. This time it was not alone economic need that sought speedy water communications with the west. The famous voyage of the Oregon around Cape Horn illustrated most forcibly the military necessity for the long-broached canal. This military need was emphasized by the acquisition of Hawaii and the extension of national influence into the western Pacific. So President McKinley resumed the attempt to translate the dream of centuries into a tangible reality.
Thus it fell to John Hay, as Secretary of State, to present anew to Great Britain the desire of the United States for a nationally controlled canal.
The suave Mr. Hay knew his ground well, having returned from the Court of St. James to accept the portfolio of the State Department. And, above and beyond personalities on both sides of the Atlantic, there was abroad in a nation fresh from a victorious war, an unmistakable insistence that Great Britain surrender her isthmian pretensions to the more urgent needs of the United States.
Under these circumstances Lord Lansdowne receded gracefully from the position which had been maintained by his predecessor, so that representatives of the two governments were enabled to incorporate into the first Hay-Pauncefote treaty a modernization of the earlier Clayton-Bulwer treaty.
The basis of the new agreement was the theory of neutralization as expounded in the Convention of Constantinople of 1888, wherein rules were laid down for the international usage of the Suez Canal.
The modern Suez Canal was begun as a purely private enterprise of French conception, and at the outset did not have the serious consideration of a majority of the powers. Little of the necessary funds were raised outside of France. The British government was skeptical of the undertaking, and held itself entirely aloof until success was demonstrated. Then a remarkable volte face took place.
In 1875 Lord Beaconsfield (Disraeli) learned that shares comprising the Khedive’s holdings in the canal were about to be sold. With startling promptness the entire block was purchased in the name of the British Empire, so that in a single stroke Great Britain became the largest individual shareholder in a successful private enterprise, the initiation of which she had actually opposed.
It was not the incidental profits which the Suez Canal offered, however, that interested the British government. By obtaining a substantial interest in the waterway Great Britain was able, if not to dominate its affairs, at least to insure its operation along lines not inimical to imperial interests.
So when the international convention was convened to formulate principles under which the Suez Canal should operate, Great Britain entered the conference as the largest single owner as well as the largest collective user of the waterway. Under these circumstances it is natural that the resulting treaty emphasized neutrality and nondiscrimination in the matter of traffic charges.
It is not irrelevant to note, however, that while the Suez Canal was also declared open to the use of vessels of all nations in war as well as in peace, the oceanic approaches to the canal were actually controlled by Great Britain. From the Atlantic, Gibraltar had long been an outpost of the British Empire. From the Arabian Sea, Perim was annexed and fortified before the Suez waterway had been completed. It was therefore the economic more than the military neutralization of Suez that inspired the Convention of Constantinople.
This treaty, which for a decade had furnished the diplomatic setting for the canal between Europe and Africa, was looked to as establishing precedents which should likewise apply in the Western Hemisphere.
The first attempt of Hay and Pauncefote to write an American canal treaty along these lines, however, was unsuccessful.
Their treaty encountered opposition in the Senate, which body proposed two important revisions: that the abrogation of the Clayton-Bulwer treaty be specifically adverted to in the new convention, and that the clause which prohibited fortification of the canal be nullified.
Mr. Hay decried the refusal of the Senate to accept his treaty as written, apparently so satisfied with the efforts which had achieved at least partial reversal of a British foreign policy of a half century that he feared to jeopardize his success in further pourparlers. But he set to work without delay, and was able within a short time to bring about an entirely satisfactory rapproachement of conflicting interests which must stand out as one of the notable achievements of American diplomacy.
The textual differences between the two Hay-Pauncefote treaties are so slight that a careful reading of the diplomatic conversations leading up to the second treaty is necessary to silhouette the historical significance of these revisions.
In deleting the reference to fortifications, which had been carried forward from the Clayton-Bulwer treaty, the right of the United States to arm the canal as a matter of national defense was tacitly conceded. Thus while the application of the essential features of the Convention of Constantinople were preserved, a control geographically analogous to that exercised by Great Britain at Gibraltar and Perim in the case of Suez was insured to the United States.
The second treaty is also somewhat more specific than the first. While originally the Nicaragua route alone was under consideration, the revised treaty mentions, in the singular, a canal “by whatever route may be considered expedient.” This phrase has the significance of tying the treaty particularly to the undertaking then in hand, and, as events shortly developed, to the Panama instead of to the Nicaragua route.
Most important, however, was the insertion of the article:
The high contracting parties agree that the present treaty shall supersede the aforementioned convention of the 19th April 1850.
Thus, while the “general principle” of neutralization as defined in the Clayton-Bulwer treaty was carried forward to the second Hay-Pauncefote treaty, its application was limited by the context of the latter to the present canal. The Marquis of Lansdowne, British Foreign Minister, was wholly cognizant of this inference, and attempted to have the treaty so worded as to apply also to subsequent waterways. But his suggestion was gracefully waived by the Washington government on the plea that the construction of more than one canal was highly improbable and that the fettering of the contracting parties any further than to the immediate project was subject to the same objections as was a continuation of the Clayton-Bulwer treaty.
The second Hay-Pauncefote treaty was ratified in December, 1901, and forthwith established the international guaranties under which the existing canal was built.
It is to be noted that in the course of the negotiations leading to this end, Great Britain surrendered one by one important advantages, despite the diplomatic leverage afforded by the Clayton-Bulwer pact which Downing Street insisted to the end to be a valid and binding contract. “So far as Her Majesty’s Government were concerned,” states Lansdowne, “there was no desire to procure a modification of that convention.” Yet in the end the convention was modified, and that very much in favor of the United States.
On the other hand Great Britain was relieved by the new treaty of all responsibility for maintaining the neutrality of the waterway. Likewise the entire financial burden of construction was assumed by the United States, with assurance that traffic charges would be shared on “a fair and equitable” basis. The net result of the bargain was
to secure for Great Britain the principle of neutralization, which was so definitely written into the pact as to withstand very serious assaults during the Panama tolls controversy.
Now comes the time, unforeseen thirty years ago, when a second canal is needed.
The question to be decided is therefore whether the United States, having fulfilled its duty to civilization in providing an isthmian waterway “free and open to the vessels of commerce and war of all nations on terms of entire equality,” and having observed the spirit of an agreement entered into in a relatively remote era, may now proceed to build another canal dedicated entirely to its own purposes and without entangling alliances beyond the working agreement with the local government.
The British answer to this question may be that Lord Lansdowne, in consenting to the abrogation of the Clayton-Bulwer treaty by the Hay-Pauncefote treaty, did so with the understanding that the principle of neutralization as originally propounded was being perpetuated by the preamble to the latter document.
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And the Washington response may properly be that the phrase “without impairing the general principle of neutralization” had reference only to the project then in hand— the present Panama route; and that President McKinley definitely declined to further commit the United States in the matter of canal policy.
This problem will call for the highest degree of statesmanship, since it touches a matter vital to future maritime leadership.