therefore, the executive committee on the transit question, appointed at the St. Louis meeting, issued its invitations at once for another canal convention to meet in New Orleans on the 30th of November. Every State and Territory was this time represented and 600 delegates were present on the occasion. In the course of the preliminary discussion, Governor Foster of Louisiana spoke for the Gulf section, Judge Jones of Arkansas set forth the farmers' interest in the project, and Governor Estee of California dilated upon the advantages that would accrue to the Pacific slope from the construction of the Nicaragua canal. Senator Morgan then made a long statement of the case from the governmental standpoint. After considering the project very carefully in its diplomatic, political, strategic, and commercial aspects, the Senator came definitely to the conclusion that the government was both justified and warranted in giving its support to the undertaking. Resolutions were, thereupon, unanimously adopted calling once more upon Congress to lend its aid in the construction of the canal, and to take such steps as would best accomplish the desired result at a minimum cost of time and money.'

These various petitions, memorials, and resolutions

1 "What the Chambers of Commerce, Boards of Trade and Exchanges of New York, Boston, etc., and Prominent Newspapers and Individuals have to say about the Nicaragua Canal." Pamphlet, New York, 1888. Proceedings of Chamber of Commerce of the State of New York, Dec. 15, 1891.

Proceedings of the Nicaragua Canal Conventions at St. Louis and New Orleans, June 2, and 3, 1892, November 30, 1892.

D. H. Montgomery, "Leading Facts of American History," § 390.

in favor of governmental participation in the canal project had their desired effect upon Congress. The § 167. The Senate Committee on Foreign Relations Guaranty again went over the whole question very Bill of 1892. carefully with the intention of pointing out some way by which American capital could construct the canal, and leave it under the exclusive control of the United States government, without coming into conflict with Great Britain. It was indeed a difficult course to navigate, but the committee had by no means lost confidence in its earlier chart and promised to steer clear of the difficulties.

On December 23, 1892, Senator Sherman accordingly presented an amended guaranty bill before the Senate in behalf of his committee and strongly recommended its passage. Like the former measure this bill provided for a governmental guaranty of the canal company's bonds to the extent of $100,000,000; and again gave the President power to name a majority on the company's board of directors. Instead of holding the shares in pledge as before, however, the government was now to receive in return for the security granted, and without further compensation, $80,500,000 of the capital stock of the company in full ownership. A similar bill was introduced into the House at the same time, and Congress thus had another opportunity of coming to some decision.

The course thus laid down in the chart was a point or two closer to the wind than before, for the government was now not only to guarantee the

bonds, but also to own a majority of the stock. It was a question, therefore, whether better progress could not be made by going about on the other tack, and making straight for governmental ownership and control. But Congress was assured by the committee that such a course would inevitably land the country on the shoals of another diplomatic controversy with England. Why not ease off then toward the open of free competition in the canal project? Because, the committee answered, there were foreign capitalists there, ready to embark on the undertaking and steer it entirely away from our control. It was the old question of Scylla and Charybdis, with the British government on the one hand and the British investor on the other, and again Congress did not dare make the run.

There were able speeches in both branches of Congress on this occasion as well, but, as before, the canal bills failed to reach a final vote.'

§ 168. Ef

forts to Raise Funds

by Private

The Maritime Canal Company was thus thrown back again on the markets of the world, with its financial prospects injured rather than aided by the government's interference. The Construction Company had been provisionally capitalized at $12,000,000, and Subscripone hundred and twenty thousand shares of $100 each had already been disposed of at fifty cents on the dollar. But the $6,000,000 thus acquired were now all but spent in providing for the

IU. S. Sen. Report, 1142, 51st Cong., 2d Sess.

tion.

surveys and the plant, and in the inauguration of the canal.

Funds were therefore necessary to continue the work, and some arrangements had now to be made for an issue of bonds. Bids were accordingly opened by the Construction Company for $5,000,000 gold bonds with interest at six per cent., guaranteed by the Maritime Canal Company's long-time bonds. The issue was not entirely successful, however, and a substitute plan was then evolved for selling bonds of a low denomination to the people direct.

But before this last scheme could be put into execution the panic of 1893 came on, and the Construction Company, without further funds at its dis posal, and with notes coming due, was obliged to suspend payments. Work on the canal came to a standstill in consequence, and, on August 30, 1893, the Construction Company went into the hands of a receiver.

The Maritime Canal Company, with neither gov. ernment guaranty nor private subscriptions to rely on, had thus to keep the Nicaragua project afloat during the storm. It weathered the gale successfully, nevertheless, and both public and private relief parties appear to be now on their way to its relief, but this belongs more properly to the pres ent situation, to be outlined in the following chapter.1

1 Bond Circular, Nicaragua Canal Construction Co., April 26, 1892. Bond Prospectus of same, June 25, 1893.

U. S. Sen. Ex. Doc., 5, 53d Cong., 2d Sess.

A

CHAPTER XXII.

THE PRESENT SITUATION.

S we come to examine the present situation of the interoceanic transit question, we lose our historical perspective. Viewed from so close a range, each special phase of the problem appears to make up the whole. We must take several different standpoints, therefore, and rest content with describing the particular aspects of the subject in turn as Situation. they appear to us from the several vantage-grounds chosen.

§ 169. The Political

The political features of the canal question will probably be the first to attract our attention, as recent events have lately brought them out in striking relief. More particularly is this the case with the de Lesseps project. It is the Panama canal scandal, accordingly, which should first be described.

The immediate results of the official liquidation of the Panama Canal Company's affairs have already been set down in the course of the Panama. narrative, and the effect of these figures upon the volatile French mind may well be imagined. As the parliamentary enquiry pro