as regards subventions Again, the

trans-continental railways has to be reckoned with, so far legislative facilities or for the Nicaragua canal. United States Government, in the event of the canal being constructed, would have to provide for a great increase in their navy both on the Pacific coast and in the Gulf of Mexico. There remains also the constant probability that the French Government may take up the rival Panama scheme, which would render perilous the financial success of the Nicaragua canal; and last, but not least, there is the burning question of the control of the Nicaragua canal, and the claim of the British Government to exercise a joint supervision under the Clayton-Bulwer Treaty of 1850. All these considerations do not tend to induce the private investor to hazard his capital.

The prospects of one or other canal being constructed by the Governments of France or the United States are decidedly more favourable than those of construction by private enterprise. In both cases the initial difficulty of obtaining the necessary capital of £20,000,000 would be practically ab

sent.

Either Government would only have to ask for the sum to get it. Again, the probability of profit would not weigh so much with a Government which, assuming an absolute loss of the capital in either case, would hardly feel the burden; and in any event it would be able to wait many years for a remunerative return.

As regards the Panama Canal, it is quite conceivable that it might in a few years become a popular undertaking on the part of a French Administration to resume the last work of De Lesseps when time has somewhat effaced the bitterness of the initial failure. Such an undertaking would not only constitute a monument to the memory of the great French constructor, but

would conciliate national pride by making France continue to be the pioneer in important engineering enterprises. France, having cut through the Suez isthmus, seems marked by fate to sever the only other isthmus of equal geographical importance. It would manifestly also be to the advantage of French commerce to secure the return to France of the revenue of the canal; and the political advantage of controlling the canal, if French sole control were permitted, would be obvious. Lastly, it is not at all inconceivable that the rivalry of the United States, manifested by pushing on the Nicaragua design, may arouse a corresponding feeling in French commercial and official quarters and in France generally.

It is plain, however, that the question is in the main one of French home-politics, and the somewhat temporary character of French Ministries does not augur well for any far-seeing or steady policy in foreign affairs. La revanche and colonial extension seem to be the only two lines of foreign policy pursued by the Third Republic, and of the two the first only has been unswervingly followed; the policy of colonial extension having been more than once checked, as by the Tonkin failure, and by the waste of French energy manifest in the French opposition to the British government of Egypt. And any

political advantage to be hoped for from controlling the Panama canal would be rendered problematical by the prospect of the intervention of the Great Powers at Panama as at Suez.

The likelihood of the Nicaragua canal being constructed by the United States Government appears to be not inconsiderable. It is true that the Bill of the Canal Company was rejected in March last by Congress, but a sum of twenty-five thousand

people

dollars was voted for an inquiry into the best method and the cost of construction. The military and naval authorities in the United States appear to be in favour of the project, and it is noticeable that the President has appointed as chairman of the Commission of Inquiry the late Military Attaché at the United States Embassy in London. The idea finds favour with the American people generally, whose desire for doing the greatest things in the world is here strengthened by that modification and extension of the Monroe doctrine popularised by Secretary Blaine,"America for the Americans." The advantages in time of war of having the canal in American hands are set forth in glowing language by the Canal Company.

To this possibility the geographical location and natural features of the Nicaragua canal are most advantageous, and Lake Nicaragua, the summit level of the canal, a mighty body of fresh water a hundred miles in length, by forty-five in width, deepening to fifty feet, swept continually by the trade winds, with a delightful and healthy climate, gives to the route a political and international importance unique and significant. The nation that controls this canal under terms of amity with Nicaragua will here find rest and refreshment for its fleets, and a point d'appui from which either ocean may readily be reached in case of need.

To this sheltered stronghold its squadrons, after service done on either ocean, at the bidding of a telegraphic sign from the home Government, may return to refit and rest in absolute security until some renewed need of action calls again for their services. There cannot be imagined a more potent means of avoiding difficulty than such efficient preparation in advance to quiet promptly any disturbances which may arise.

Placed thus advantageously, one fleet would readily do the work of two, and with a naval depot thus conveniently located, the Pacific Coast and our Alaskan possessions, as well as our commerce on both oceans, would be as well guarded as our Atlantic Coast.

On the other hand, it is to be remembered that the opposition of

the United States Railways may be counted on as implacable; that the creation of a huge fleet is an absolute necessity to the construction of the canal by Government; and that the altered political importance of Cuba and the West Indian Islands generally which would result from the construction of the canal would supply a new cause for anxiety to the United States Government and a source of constant complications with European Powers. Again, any chance of the canal repaying the cost of construction would be modified if not destroyed by the French Government completing the Panama canal. Lastly, there is no certainty that if the United States Government were to construct the Nicaragua canal, it would be allowed. to retain the control. There is the British claim to joint control under the Clayton-Bulwer Treaty to be considered.

The binding force of the Treaty of Washington of 1850, usually called the Clayton-Bulwer Treaty from the names of its negotiators, has been consistently maintained, and has been acted upon at considerable loss by the British Government. The history of the treaty is briefly as follows.

On California being annexed to the United States in 1847, a company of American citizens obtained from the Nicaraguan Government a concession to construct a ship-canal from the Pacific by way of Lake Nicaragua. As the project of piercing the isthmus was obviously of as great moment to the British Dominions on the northern Pacific as to the State of California, the United States Government and the British Minister at Washington thought it desirable to provide beforehand for common action in regard to the various possible projects of constructing canals or railways across the isthmus, and for joint control of these undertakings when constructed.

Although the immediate occasion which seemed to call for the conclusion of the treaty was the canal then in contemplation through Lake Nicaragua, nevertheless the provisions were perfectly general, and intended to cover all means of communication over the isthmus to be constructed at any future time.

The preamble of the Convention of Washington of the 19th of April, 1850, recites the fact of "Her Britannic Majesty and the United States of America being desirous of consolidating the relations of amity which so happily subsist between them, by setting forth and fixing in a convention their views and intentions with reference to any means of communication by ship canal which may be constructed between the Atlantic and Pacific Oceans, by the way of the River San Juan de Nicaragua, and either or both of the Lakes Nicaragua or Managua to any port or place on the Pacific Ocean." The sixth article declares that, "The Contracting Parties likewise agree that each shall enter into treaty stipulations with such of the Central American States as they may deem advisable for the purpose of more effectually carrying out the great design of this Convention; namely, that of constructing and maintaining the said canal as a ship communication between the two oceans for the benefit of mankind, on equal terms to all, and of protecting the same." Both parties further agree not to occupy territory in Central America which might lead to the assumption by one or other party of a preponderating control over the canal when constructed. Finally the eighth article declares: "The Governments of Great Britain and the United States having not only desired, in entering into this Convention, to accomplish a particular object, but also to establish a general principle, they

British Government relied on the binding character of the treaty. From this position the British Government has never retired. The suggestion that the treaty lapsed on the non-completion of the original canal is sufficiently refuted by the fact that for years after that project was abandoned, the treaty was insisted on by the United States, so as to induce the British Government to surrender British territory in Central America. In compliance with the Clayton-Bulwer Treaty, the British. Government ceded Ruabon and Bay Islands to Honduras in 1859, and the Protectorate over the Mosquito Coast to Nicaragua in 1860. Furthermore, the eighth article expressly declares the desire of the contracting parties to establish a general principle applicable to all projects of connecting the Atlantic and Pacific Oceans. The suggestion that the treaty has been abrogated by change of circumstances is equally untenable. The same material interests of the Dominion of Canada exist, giving rise to international rights to control over the means of communication across the isthmus. These rights increase those necessarily residing in the British Government, in common with all European Maritime Powers, to a voice in the control of a great international waterway. Some minor contentions of Secretary Frelinghuysen hardly deserve notice. To pretend that the retention by the British of their possessions in Belize was a violation of the treaty approaches to the disingenuous. By letters of the same date as the ratification of the treaty the British and American negotiations expressly excluded that territory from the scope of the self-denying ordinance. And to say, as Secretary Blaine maintained, that the prevention of the United States from creating military stations to control the canal on land leaves the sole control to the British

Government is really to argue against the good sense of the American negotiators.

Another point should also be borne in mind. Nothing but the ClaytonBulwer Treaty prevents the British Government from extending its possessions in Central America. As Lord Malmesbury pointed out in 1858, if the Clayton-Bulwer Treaty is to be torn up, the British Government recovers its liberty of action. At the very least it might reasonably claim the retrocession of the Mosquito Protectorate from Nicaragua and of the Bay Islands from Honduras.

Of course, it is conceivable that, as not unfrequently occurs, the British Foreign Office may resign British treaty-rights, as has been done in Japan, without consulting opinion at home, and relying on the absorption of public attention in domestic politics. But even if this contingency should occur, it must not be forgotten that the same right to secure free passage for commerce which justified the Great Powers in neutralising the Suez Canal will exist in the case of any canal constructed across the American isthmus. If the control of the Nicaragua canal is not shared by the British and United States Governments, or if the control of the Panama canal is not shared by these Governments and France, it is tolerably certain that a general control of the Great Powers would take the place of the more limited supervision.

The best solution of the difficult question of inter-oceanic communication across the American isthmus will obviously be that which reconciles the interests of commerce (chiefly concerned with the shortening of routes) and those of international peace. It would be nothing short of a calamity if the completion of this great engineering enterprise should leave as an after consequence a permanent cause

of rivalry and possible war between the Great Powers of the world.

It seems certain that such a calamity cannot be averted unless by a frank acknowledgment on the part of the United States and of France on the one side, and on the part of the British Government, the greatest commercial Power, on the other, that in the American as in the African isthmus the whole civilised world is entitled to a voice in the control of the canal whenever and wherever it may be constructed. Once this is acknowledged, the way is perfectly clear. For, if the Great Powers are entitled to control the canal when finished, it is obvious justice that they should be expected to contribute, in proportion to their commercial interests, to its construction.

Now it so happens that the very combination of the Great Powers for the construction of the canal which would secure the continuance of peace, or at least the elimination of one powerful element of possible war, supplies the conditions most favourable for the selection of the route dictated by geographical considerations and therefore most useful for commerce. To a combination of the Great Powers the sum of forty or even seventy millions would be comparatively unimportant, being less than the sum which Western Europe spends every year on maintaining its armies and navies. Financial difficulties disappearing, the only point for consideration would be the selection of the route most convenient to trade, and, as a consequence, that dictated by geographical considerations.

Any one who looks at the map will see that the route which is plainly the shortest is that by Colon and Panama. The International Conference of Engineers, held in Paris in 1879 under the presidency of De Lesseps, came to that conclusion. A sea-level canal,

running from the Atlantic to the Pacific for about fifty miles, one-third of the length of the Nicaragua route, and without locks, would not only be the shortest but the most permanent improvement of inter-oceanic communication. It would be a work for all time, and might be described as a great correction of the hand of Nature in its fashioning of the globe.

To appreciate this matter it must be distinctly borne in mind that financial, and not engineering, difficulties are the greatest in the way of the completion of the original project of De Lesseps. The engineering difficulties, as has been already shown, are great, but are by no means insurmountable. To cut a sea-level channel through the mountain-chain at Panama is a task of difficulty involving much time and expense; but in the face of the resources which the Great Powers could command those difficulties would disappear. Within a reasonable period a sea-level canal, requiring less cost of maintenance relatively than the Suez Canal, would be in existence, and would remain for ever as one of the great monuments of the skill and enterprise of the twentieth century. For if a rock-cutting be difficult, it is also permanent.

The Commission of Liquidation appointed by the French Government did not confine themselves to studying the reconstruction of the Panama Company as a French commercial undertaking. As an alternative to the reconstruction of a Company of private persons, they went on to consider the probability of carrying out the original scheme of a canal at sea-level, under the guarantee of all the Great Powers. The Commission fully recognised the right of all the States of the civilised world, interested through their commerce, to a share in the control of this great undertaking. With the aid of the Great Powers