Senators and Representatives. I have also informed myself of the general state of mind of the American press and upon the platforms of each of the political parties. I have come to the conclusion that as far as the general public is concerned, both it and the Government are clearly favorable to the Nicaragua Canal and its control by the American Government. You will thus see that the problem is quite different to that which you have been facing. It is no longer a bankrupt company which is our competitor, it is the Nation itself. Now to turn the Nation from this design becomes the new and weighty problem. I feel that it will be necessary to take active steps in order to stop the Government in its inclination to settle the canal question itself. I know that it is your desire to build the Panama Canal under the auspices or protection of this Government, in some form or other, but what I have told you will show you the difficulty, to wit, that it is clear that our Government wishes to be the virtual owner of the canal. Permit me therefore, respectfully, to suggest that you seriously consider whether the time for us to address our Government in the interest of the Panama Canal has arrived, and if so the basis and form of a proposal on this subject.

This advice was reiterated on February 9, 10, and 13 in letters and telegrams, and brought Monsieur Hutin, director general of the New Panama Canal Co., to New York, where he remained during the latter part of February and the beginning of March. For more than three weeks Mr. Cromwell had daily conferences with him.

On March 4, 1897, the inauguration of Mr. McKinley as President took place, and he immediately called a special session of Congress for the 15th of that month.

In his brief, Mr. Cromwell says:

The Nicaragua bills were at once reintroduced. The new Secretary of State was ex-Senator Sherman, who, only a few days previously had been chairman of the Committee on Foreign Relations in the Senate, in charge of the Nicaragua bills, and he was an avowed and powerful supporter of that route. He entered into negotiations with the Central American States, represented by Senor Rodriguez, their minister, with a view to a treaty under which the Nicaragua Canal would be built by the United States itself directly, instead of being built under the concessions of the Maritime Co. He sent official communications to the Senate to this effect and appeared in person before the Senate committee in support of his plan. All these developments (démarches) not only demanded but received the utmost vigilance and diligence on our part; they also necessitated the almost constant presence in Washington of a member of our law firm.

Then Mr. Cromwell goes on to tell how he conceived the idea of making Colombia serve the ends of the Panama Canal Co., and how his clients approved of his plan He says:

Confronted by the unexpected developments (circumstances) of the special session and the active negotiations between the United States and Nicaragua entered upon by Secretary Sherman, we conceived the plan of inducing Colombia herself to intervene and enforce (faire valoir) according to the terms of the treaty of 1846-48 between New Granada (now Colombia) and the United States, and to protect the rights of the Panama Canal Co. as the owner of the concession which had been granted by Colombia on the basis of that treaty. The plan (idea) thus conceived by us was presented to the company, which approved of it at once; and, in consequence, we immediately spoke of it to the representative of Colombia in the United States (Mr. Rentigo, chargé d'affaires at Washington), and a series of interviews ensued, in the course of which we made a full exposition of the new position of the canal company, discussed the treaty of 1848, and furnished arguments in support of these views.

Mr. Cromwell's plan was mapped out in a letter dated March 20, addressed to the New Panama Canal Co., in which he said:

The moment to act has arrived. The Colombian Government and the Panama Co. ought to officially bring to the knowledge of the Government of the United States the existence of the Panama concession, the considerable amount of work accomplished under the concession, the present business like

(serieuses) intentions of the parties, and to remind it of the clauses of the treaty of 1848 between the United States and Colombia. In face of such a presentation it will be far more difficult, if not impossible, for our Government to take action with Nicaragua; and in my opinion it is the only means to prevent its so doing. Certainly this is essential to the canal company, for if this Government adopts Nicaragua it will kill our project; but it is equally important to Colombia, which does not wish to see its rival (Nicaragua) obtain the richest prize a South American nation could ever win. Colombia, as well as the Panama Canal Co., must wake up, must come to a keen realization of her danger, and must show herself equal to the opportunity that offers. She ought, immediately and by cable, to notify her minister to present a note covering the grounds we indicate, and to cooperate with us earnestly and at once. Do not let the Government trust to the mails, which are slow. This matter calls for action by cable as rapidly as possible. To gain time, I am myself going to cable you to this effect.

As we have already seen, the plan thus conceived by Mr. Cromwell to make Colombian diplomacy the catspaw of the New Panama Canal Co. was heartily approved of by his clients, and in consequence he immediately turned his attention to Senor Renfigo, the Colombian chargé d'affaires in Washington. What Mr. Cromwell did had best be told in his own words:

We prepared and presented to the representative of Colombia an official protest, and, after discussion, it was accepted by him and presented to the Government of the United States. The effect of this step (mesure) made itself felt, and the attention of the United States was attracted to the Panama Canal through important diplomatic channels. This arrested the attention of the Government and introduced the Panama Canal, advantageously and with effect, as a factor whose consideration imposed itself in the solution of the pending problems; until then it had been completely neglected.

Mr. Cromwell's correspondence with the company shows how fully he was aware of the necessity of defeating all Nicaragua legislation. Writing on April 6 to his clients he said:

Your duty has colossal importance, and we must lay our plans with Napoleonic strategy to prevent any other transisthmian project from taking shape *. It is clear that, unless all the other transisthmian projects are thwarted, the hopes of your security holders will be entirely disappointed, and it is equally clear that if this Government makes an agreement with the Nicaragua Government, or even with the present Nicaragua company, our canal project will be henceforth almost hopeless.

Mr. Hutin, who had gone to Panama at the end of March, returned from the Isthmus on April 20. Mr. Cromwell had daily conferences with him, and he spent a great part of the next 30 days in Washington with Mr. Cromwell and Mr. Curtis; then he left for Paris.

Mr. Lemarquis, trustee for the bondholders of the old company, also visited the United States in May of this year, collaborated with Mr. Cromwell daily in the study of the political situation of the parliamentary developments of the public sentiment in favor of Nicaragua and the desire of the United States to itself own a canal, and of the methods Mr. Cromwell was employing and the plans he was advising. In Mr. Cromwell's words:

Mr. Lemarquis's observations and studies permitted him to arrive at wise conclusions, both for his own guidance and that of other interested parties on his return to Paris.

On June 4, 1897, Congress passed the sundry civil appropriation act containing the appropriation to continue surveys in Nicaragua. The act also empowered the President to appoint a commission to report on the Nicaragua route. Under this act President McKinley appointed the Nicaragua Canal Commission, commonly referred as

the first Walker Commission. Its members were Rear Admiral John G. Walker, Col. Peter C. Hains, and Prof. Lewis M. Haupt.

Congress met again in December, 1897, and at the very opening of Congress Representative Barham introduced a new bill for the building of the Nicaragua Canal. During this session various new measures were introduced, all with a view to the construction of the Nicaragua Canal under the auspices of the United States. These bills emanated, one from Senator Hansbrough, January 5, 1898; another from Mr. Davidson, January 11, 1898; Senator Morgan, May 5, 1898; Senator Stewart, May 25, 1898; and yet another from Senator Morgan June 20, 1898. The Walker-Hains-Haupt Nicaragua Canal Commission sailed for Nicaragua in December. Mr. Cromwell again wrote to the Panama Canal Co, under date December 24:

More than ever I am convinced that we ought to make an energetic demonstration before the return of the commission.

On January 26, 1898, Mr. Cromwell again wrote to the company: Everywhere one finds proof of a growing confidence in, and desire for the construction of a Nicaragua Canal, and I can not help thinking that we have lost and are losing ground every day in regard to our project, and I find myself obliged to insist that the Panama project be called to the attention of our Government before it is too late to stop the drift in favor of the Nicaragua project, and too late to break pledges given or to win against the private and selfish advantage offered by the other plans.

The grave international complications which arose between the United States and Spain over the disturbances in Cuba, followed by the Spanish-American War, absorbed almost the entire attention of Congress during the session of December, 1897-8. Mr. Cromwell's brief continues:

The celebrated voyage of the American battleship Oregon down the Pacific coast, round the Horn, and up the Atlantic coast to Cuba was followed with intense interest not only by the people of the United States, but by the whole civilized world, and this battleship was hurrying to join Admiral Sampson's fleet, which it reached only just in time to take part in the battle of Santiago. The nation understood the danger to which the necessity of such a voyage would have exposed the country in case of war with a more powerful naval power. The enormous advantage of being able-by means of an interoceanic canal-to avoid going round the South American Continent impressed everybody, and a general clamor for the Nicaragua as a measure of public safety Another result of this state of public opinion was to put an end to all ideas of a canal owned by a private company, as Mr. Cromwell had long since predicted. It was to be built, owned, and operated by the United States; it was to be fortified and garrisoned by the United States. It was no longer to be merely a tool of commerce, but, first and foremost, a part of the uational defenses, and, as such, not neutral but American. No passage of this kind could be opened to an enemy, it could exist only if held by the United States.

arose.

* * *

The irritation against France, created in the United States by the open sympathy of the people and press of France with the cause of Spain, led Mr. Cromwell, in April, 1898, to advise a temporary postponement of a public presentation of Panama's case; but he energetically urged upon the company to make this presentation before the Congress which was to meet in the following December.

In May, 1898, a resolution was passed by the Senate inviting the Maritime Co. to make a proposal for the transfer of its capital stock to the United States, carrying with it the ownership of its concessions and the payment of its debt. In response to this resolution, the Maritime Co. made a proposal to the United States in which it offered

to effect the necessary transfers on the payment of $5,500,000. It was on these lines that the Morgan bill of June 20, 1898, was presented to Congress.

In June, 1898, the Panama Co. asked Mr. Cromwell to go to Paris to discuss the plans he had urged upon the company. Mr. Cromwell went and was absent from the United States for about six weeks, conferring with the representatives of the canal company in Paris. The result was the complete and unreserved adoption of the plan he had advised, and he was intrusted with its execution. Mr. Cromwell at once returned to the United States and began active work. He organized a press bureau

for the preparation and publication of technical and popular articles in the various magazines and periodicals of the country, dealing with every phase of the Panama and Nicaragua problems, and to this end employed experienced writers and engineers. The work of the bureau, which lasted for a year or two, extended all over the United States.

Mr. Cromwell hired Gen. Abbot and Mr. Corthell, a distinguished engineer, to assist in the work of this press bureau.

Messrs. Lemarquis and Lampre came to New York in September, and had daily conferences with Mr. Cromwell for several weeks, and accompanied him to Washington.

As the reassembling of Congress drew near (the first session after the Spanish War) a unanimous feeling in favor of the immediate selection of the Nicaragua Canal as a national undertaking made itself manifest throughout the United States. The President of Costa Rica made a special trip to Washington, and in the name of Costa Rica, as well as of Nicaragua, gave President McKinley official. assurances that these Governments would adopt all legislation necessary to facilitate the building of the Nicaragua Canal. In his brief. Mr. Cromwell says:

Keenly alive to the gravity of the situation we insistently urged upon the company to make an official presentation of the case of Panama to President McKinley in the form of a memorial before the reassembling of Congress. We prepared the first draft of the memorial which was to be presented to the Government of the United States in the name of the company, containing a synopsis of the formation of La Compagnie Nouvelle du Canal de Panama, its concessions, the extent of the construction work already accomplished, the organization of the international committee and its findings, the intentions of the company, etc.

Mr. Cromwell went to Washington and communicated to Secretary of State Hay in advance the plan for the official presentation of the case of the New Panama Canal Co., and arranged with the Secretary for an official audience with President McKinley. This was fixed for December 2, 1898, and Mr. Cromwell, with the director general and the chief engineer of the company, who had come from Paris specially for this purpose, officially presented to President McKinley the memorial of the company, accompanied by the report of the international committee, which had just been completed.

At this time the Panama Canal Co. was asking the Colombian Congress for an extension of its concessions, and two days after the presentation of the memorial and report of the technical committee to President McKinley an official statement was given out by the Department of State to the effect that the Colombian Congress in Bogota had refused to grant an extension of its concessions to La Compagnie Nouvelle du Canal de Panama, which naturally meant

that the Panama Co. no longer cut any figure in this matter. Mr. Cromwell sent an official communication to the United States Government in which the accuracy of this report from Bogota was denied, and the Colombian minister, at Mr. Cromwell's request, did the same and sent a copy of his note to the press. The same day (Dec. 4) the president of the Maritime Co. sent to the press a note attacking the Panama Canal, and alluding to the interview of its representatives with President McKinley and Secretary Hay on the 2d instant as an insult to the American people.

The following day (Dec. 5) Congress reassembled and President McKinley sent in his message, in which he recommended the building of the Nicaragua Canal under American control.

Two days later Senator Morgan made a violent speech in the Senate, announcing his determination to force the passage of the Nicaragua Canal bill, and attacking the representatives of the Panama Canal as in league with the transcontinental railroads to prevent the American people obtaining an American canal through Nicaragua. Nobody in America thought the session of Congress could pass without the enactment of law for the building of the Nicaragua Canal. Nothing seemed able to resist the influences combined in its favor. Mr. Cromwell, however, proved himself equal to the task. The Nicaragua plan entailed not a neutral canal, but a canal to be built, owned, and controlled by the United States alone, and to be fortified so as to assure to them its exclusive mastership. Mr. Cromwell in his brief says:

We called the attention of Members of Congress and of the administration to the fact that this was contrary to the Clayton-Bulwer treaty with England, and put forward the objection that difficulties with that power would be precipitated if the Nicaragua project were adopted before a modification of this treaty. This objection was made in the Senate and surprised several Senators whose zeal for Nicaragua was not great enough to blind them to other considerations. It was strengthened by a formal protest against the bill presented a few days later by the British Ambassador, Lord Pauncefote, to the Secretary of State and based upon the same grounds. December 23, 1898, the Walker-Hains-Haupt Commission made its preliminary report in favor of the Nicaragua Canal, estimating the cost of its construction at $135,000,000. settled for the public the practical side of the question, which the report of the Ludlow Commission had left somewhat in doubt. It was assured that the Nicaragua Canal could be built, and at a known cost. Henceforth only one question remained, that of the authorization of Congress.

**

This

Mr. Cromwell's next move was to prepare a complete and descriptive pamphlet, explaining in detail the position of the new Panama Canal Co., the progress of the work, the amount of construction. already accomplished, the entirely new management of the reorganized company, the concessions and titles, a summary of the report of the technical committee, the plan of the canal itself, accompanied by photographs illustrating the condition of the work, etc.; one of these photographs showed the

sea end of La Boca Pier. This is the pier which connects with the Panama Canal, now open from the ocean.

Speaking of the pamphlet, Mr. Cromwell in his brief says:

We spent several weeks writing this pamphlet, entitled "The New Panama Canal Co." (dated Dec. 26, 1898), of which we circulated a large number of copies. We sent one to each Member of Congress, to all the higher officials of the Federal Government, to the governors and other high officials of all the States, to all the leading newspapers of the East (the number of which 29008-No. 2-12

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