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the United States, and Elihu Root, former Secretary of War and now Secretary of State. It was they who aided Mr. Cromwell in consummating the Panama revolution, arranged the terms of the purchase of the Panama Canal, made the agreement to pay $40,000,000 for the canal properties and an additional $10,000,000 for a manufac tured Panama republic, every penny of both of which suns was paid by check on the United States Treasury to J. P. Morgan & Co.-not to the French Government, as Mr. Roosevelt says, but to J. P. Morgan & Co.

The natural query of the Indianapolis News as to "who got the money" was based on The World's historical summary of Mr. Cromwell's connection with the Panama Canal. The inquiry was originally The World's, and The World accepts Mr. Roosevelt's challenge. If Congress can have all the documents in the case, as Mr. Roosevelt says, let Congress make a complete investigation of the Panama Canal affair, and in particular of William Nelson Cromwell's relations with the French company, with Panama and with the Government of the United States. Let Congress officially answer this question: "Who got the money?"

The old French company organized by Ferdinand de Lesseps in 1879 failed in 1889, years before Mr. Cromwell's relations with President Roosevelt began. As Mr. Cromwell testified before the Senate Committee on Feb. 26, 1906, "we never had any connection with the socalled de Lesseps company. Neither did the United States Government conduct negotiations with the old French Panama Canal Company."


What Mr. Cromwell did represent was the new Panama Canal Company, the American Panama Canal Company and the $5,000,000 syndicate which he formed to

finance the new companies. After Mr. Cromwell had testified "I do not recall any contract," Senator Morgan produced a contract reading (Panama Canal Hearing, Vol. II, page 1146):

Mr. William Nelson Cromwell is exclusively empowered, under the formal agreement with the Board of Directors of the Compagnie Nouvelle du Canal de Panama (New Panama Canal Company of France) to effect with an American syndicate the Americanization of the Panama Canal Company on the following basis.

The basis on which Mr. Cromwell was "exclusively empowered" in this contract was that an American Panama Canal Company with a capitalization of $60,000,000 preferred and $45,000,000 common should be organized to take over the Panama Canal concessions and all other property belonging to the new French Panama Canal Company, which had bought the same from the old de Lesseps company. This company was incorporated in New Jersey with 'dummy directors. There was also incorporated in New Jersey with dummy directors the Interoceanic Canal Company.

Senator Morgan unearthed a copy of the $5,000,000 syndicate agreement, which provided that the subscribers should contract with William Nelson Cromwell to pay $5,000,000 in cash and to take their several allotments in the enterprise.

Five million dollars was more than ample to buy the majority of the old Panama stock. As The World said on Oct. 25:

Mr. Cromwell applied to the canal situation the methods of American high finance by which a syndicate takes over the property of a bankrupt concern, then creates a holding company and a recapitalization, keeping the majority control in a syndicate trusteeship.

Following that, to quote from Mr. Cromwell's testimony, "in May, 1904, I, representing the new Panama Canal, and Judges Day and Russell, representing Attorney-General Knox, consummated" the transfer and sale to the United States.

Mr. Roosevelt says, "the Government paid, this $40,000,000 direct to the French Government."

Mr. Cromwell testified that the United States paid the money to J. P. Morgan & Co.

Mr. Roosevelt says, "the French Government 'distributed the sum."

Mr. Cromwell testifies as to how he 'distributed it.

Mr. Roosevelt talks of "getting the receipt of the liquidator appointed by the French Government to re

ceive the same."

Mr. Cromwell testified: "Of the $40,000,000 thus paid by the United States Government $25,000,000 was paid to the liquidator of the old Panama Canal Company under and in pursuance of an agreement entered into between the liquidator and the new company. . . . Of the balance of $15,000,000 paid to the new Panama Canal Company $12,000,000 have already been distributed among its stockholders, and the remainder is now being held awaiting final distribution and payment.'

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What follows is further eloquent testimony taken by the Senate committee:

Senator Taliaferro: There is $3,000,000?
Mr. Cromwell: Three million. Yes, sir.
Senator Taliaferro: Who holds the money?

Mr. Cromwell: The new Panama Canal Company in its treasury.

And yet Mr. Roosevelt says that "the United States Government has not the slightest knowledge" as to the 'distribution of the $40,000,000 and that "this was the business of the French Government."

As to Mr. Roosevelt's statement that "there was no syndicate," he could have read the "syndicate subscription agreement" on page 1150, Vol. II, of the testimony before the Committee on Interoceanic Canals-if he had cared for the truth.


That the United States Government was not dealing with "the French Government," or "the liquidator appointed by the French Government," or with Colombia, or with Panama, or with any one else except William Nelson Cromwell and his associates, is made still more plain by the 'description of Señor J. Gabriel Duque as to the Panama revolution and as to the manner in which Mr. Cromwell got $10,000,000 additional from the United States Treasury. Señor Duque said:

Mr. Cromwell made the revolution. He offered to make me President of the new republic and to see me through if I would raise a small force of men and declare a secession from Colombia. He made promises that we should have the help of his Government. It was accompanied by a liberal use of money. We bought this general and that one, paying $3,000 to $4,000 per general. The Colombian officers were all paid off and the Colombian general who was sent to stop the revolution was also bought off.

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Then Mr. Cromwell, having been elected by the Panama Republic as general counsel, and he and J. Pierpont Morgan having been appointed a "fiscal commission," negotiated with President Roosevelt, by which the United States paid $10,000,000 more to the "fiscal commission" for Mr. Cromwell's Panama Republic. Of this money three-quarters is still under the control of "the fiscal commission."

Why did the United States pay $40,000,000 for a bankrupt property whose control could undoubtedly have

been bought in the open market for less than $4,000,000? Who were the new Panama Canal Company?

Who bought up the obligations of the old Panama Canal Company for a few cents on the dollar?

Among whom was divided the $15,000,000 paid to the new Panama Canal Company?

Whether Douglas Robinson, who is Mr. Roosevelt's brother-in-law, or any of Mr. Taft's brothers associated himself with Mr. Cromwell in Panama exploitation or shared in these profits is incidental to the main issue of letting in the light.

Whether they did or did not, whether all the profits went into William Nelson Cromwell's hands or whatever became of them, the fact that Theodore Roosevelt as President of the United States issues a public statement about such an important matter full of flagrant untruths, reeking with misstatements, challenging line by line the testimony of his associate Cromwell and the official record, makes it imperative that full publicity come at once through the authority and by the action of Congress.


[December 16, 1908]

MR. ROOSEVELT is mistaken. He cannot muzzle The World.

While no amount of billingsgate on his part can alter our determination to treat him with judicial impartiality and scrupulous fairness, we repeat that we have already said that the Congress of the United States should make a thorough investigation of the whole Panama transaction, that the full truth may be known to the American people.

It is a most extraordinary circumstance that Mr.

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