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Panama In France: Incompetence And Corruption

The equipment used by the French was the best available at the time, most of it was left to rot in the jungles of Panama.

On 25 September 1513, Spaniard Vasco Nunez de Balboa became the first European to see the Pacific Ocean from the Americas. He had crossed what became known as the Isthmus of Panama - the narrow strip of land dividing the Caribbean from the Pacific. By luck, Balboa had crossed Central America at the narrowest part. Although the west coast of the Americas generally runs north to south, the isthmus runs east to west. So Balboa saw the new ocean to the south and, to this day, the southern part of the Pacific is sometimes still referred to as the South Seas.

Within a few years, the Spanish had explored most of Central America and knew that the isthmus was the narrowest point. One of the earliest European arrivals to the area was Francisco Pizarro, who heard rumors of a gold-rich civilization to the south: The Incas of Peru. With a tiny army, he set out from the isthmus to conquer the Incas.

As early as the 1530s, Holy Roman emperor Charles V toyed with the idea of building a canal, but this was abandoned by his successor Philip II, who figured that if God had wanted a canal there, He would have built one. But the Spanish did build a road from the Caribbean to the Pacific, the Camino Real - the Royal Road - which was used by the Spanish to transport the Incan gold and silver across the isthmus, where it was loaded into the Spanish treasure galleons.

Panama was not a pleasant place. The jungle was thick, the hills were difficult, the low-lying areas were swamps and the heat was terrible. There were deadly snakes of many varieties. In fact, the mountain pass that was eventually cut down to build the canal was called Culebra - Spanish for snake. Many places in the world shared these unpleasant characteristics, but Panama had two other nasty things: Disease and rain.

First, Panama's Caribbean coast was called the Fever Coast due to the prevalence of so much disease, particularly malaria and yellow fever. Malaria was an accepted fact of life in the tropics at this time and virtually everybody got it. Malaria is a chronic relapsing infection; after getting over the original bout of sickness, it could return years later. It was (and is) a serious disease but most people survive it, especially with the use of quinine and today, synthetic drugs. Malaria comes in many varieties; one of the most virulent was named for the largest river on the isthmus - Chagres Fever.

Yellow fever is far worse than malaria. The chances of survival were less than 50 percent. The only good news - if you can call it that - is that if you survived, you were immune for life. Then, there was the rain. The rainfall in Panama varies by area and very much by season. Some areas get 170 inches a year - that's 14ft of rain. In 1910, 2.5 inches of rain fell in just five minutes!

For centuries, Panama was a sleepy province of New Granada - what is today called Columbia. This changed when gold was discovered in California in 1849. There were three ways for people in the eastern states to get to California: Overland, by ships sailing all the way around South America via Cape Horn, or to take a ship to Central America, cross overland and then pick up another ship to San Francisco. This last route was 8,000 miles shorter than the journey around the Horn.

At least 27,000 of the 49ers took the isthmus route across Panama, hiring canoes to paddle them up the Chagres River, then mules across Culebra Pass - a pass through the Continental Divide - to Panama City, where they took another ship to California.

This traffic encouraged the building of a railroad, from Colon on the Caribbean side, across Culebra, to the city of Panama. Building the railroad began in early 1850; it took five years to build just 50 miles, however, 300 bridges were needed. These 50 miles cost $7.5 million, the most expensive railroad built up to that time. The original estimate had been $1 million. Even worse, about 6,000 men died during the construction, mostly from disease. The difficulties experienced in building the railroad should have been a warning to the earliest canal builders.

The railroad was incredibly successful - it had been given a monopoly by the Columbian government and the operators took full advantage of it: The fare was $25 one-way, first class, $10 second class plus bags at five cents per pound. To put this into perspective, a decent wage in the US at this time was 50 cents a day!

The year 1869 marked two major advances in world transportation: The opening of the Suez Canal, joining the Mediterranean to the Red Sea and the completion of the Union Pacific railroad across the US. The moving force behind the Suez Canal was the charismatic Frenchman, Ferdinand de Lesseps. He was born in 1805 and became a diplomat. By all accounts he was charming and likeable, but above all, he was extraordinarily persuasive. He could talk for hours without notes; he claimed that this was because he only told the truth and he did not have to remember that.

Until he was 50, de Lesseps' career was not particularly exciting. He had served France well but without any great distinction. But things changed in 1854, Sa'id Pasha, an old friend, became Viceroy of Egypt. De Lesseps had become fascinated by the idea of a canal through Suez when he had served in Egypt and he hurried out there. Sa'id wanted to undertake some great project to make his mark on history. The two men got together to organize the building of a canal.

De Lesseps wasn't an engineer or a financier: He wasn't even a manager and he'd never run a company. But he was a diplomat and had an uncanny ability to talk people into doing things. He succeeded in putting together a company and ran it. The Suez Canal was opened in 1869.

De Lesseps became a hero to the French. The people who had invested in the canal - the whole enterprise cost $100 million - made a lot of money. The Suez Canal became a great source of pride for the French. De Lesseps first became known as the Great Engineer and was soon nicknamed Le Grand Francais – the Great Frenchman.

De Lesseps basked in his glory after completing the Suez Canal, but he was restless. In 1876, he convened a conference of several countries and renowned engineers in Paris to consider building a canal at Panama. The differences between Suez and Panama were minimized. The land through which the Suez Canal was built was virtually at sea level; nowhere was the land over 50 foot high, and there was an enormous cheap labor force available nearby. On the other hand, Panama was known as a death trap with mountains and disease.

As a result of the conference, a company was formed with a plan to build the canal at sea level across the Panama Isthmus. In 1880, one of de Lesseps' daughters symbolically dug the first spadeful after which de Lesseps returned to Paris to run things from there. Raising money for the venture was tough. Only 30 million francs - at the time $6 million US - of the needed 400 million francs was initially raised. The French press was hostile and the Americans and the British did not take kindly to the French muscling in on what they regarded as their territory: The Americans because the majority of the traffic would become theirs, the British because they controlled most of the world's shipping.

By the standards of today, the French press was notoriously unethical during the 1800s. Newspapers expected to be paid to run favorable stories - in fact, you were expected to pay the writers, the editors and the publishers. Technically, this wasn't illegal. At first, de Lesseps had failed to buy the backing of the press but once he realized how important they were, the company started to hand over huge sums. The press became enthusiastic and the money started to roll in.

The first two years of the work were taken up clearing a wide path through the jungle and over the Culebra Pass - which was 275 feet high - and doing survey work. It was 1882 before the proper work started. Hundreds of engineers, almost all of them French, arrived; labor was imported, mostly from Jamaica, as the local Panamanians showed little interest.

The engineers quickly realized how formidable the task would be, especially building the canal at sea level. They tried to talk de Lesseps out of the original plan but after the meeting, it was the engineers who came away convinced it would work. When the digging started at the top of Culebra, to the engineers' pleasant surprise, it was easier going than they had expected. This turned out to be anything but a blessing.

On the face of it, things had started well. There was no shortage of money and the French engi neers and managers lived extremely well: Champagne flowed and the best equipment was sent over from Europe. But the work was a mess. Several companies - many of them American - had been contracted to carry out the work but there was little coordination. The main problem was not the digging itself, but getting rid of the spoil. Each company was responsible for finding its own disposal site. Usually this simply meant dumping the waste in the jungle, sometimes where another company would have to dig it all out again!

There was also a high level of corruption. There was a lot of money available and this attracted some very unsavory characters. The machinery was mostly powered by coal and this had to be shipped in. Coalers would dock at Colon, unload a small portion of the cargo but get a signature stating that all of it was unloaded; the coaler then returned to sea for a few days and then docked again, repeating the process a number of times, gradually unloading the whole cargo but being paid for it several times over.

De Lesseps was not directly responsible for the corruption; by all accounts, he was honest. He was paid only $15,000 a year - a great salary for 1880, but modest considering the scale of the operation. De Lesseps was a charismatic person, but he was not an engineer, manager or planner. There seems to have been nothing in the way of a master plan for the canal - just to keep digging until the canal was finished. Innumerable problems were foreseen, but the attitude, led by de Lesseps, was that the progress of technology and science was so rapid, that something would turn up; new technology would supply the answer. This had actually served de Lesseps well during the work at Suez where technology seemed to appear "just in time".

Corruption, poor management and lack of direction were overshadowed by other problems. First, the digging at Culebra was easy, however, as they dug down, the land began to slip back into the cut. The angle of repose is the slope of the land needed for stability. To achieve this, the cut was made shallower and shallower to overcome this slippage, but that, of course, meant that vastly more earth needed to be removed.

The second problem was disease. Mosquitoes infested the area and, although it was not known at the time, these were responsible for spreading malaria and yellow fever. Within days of the work starting, the first workers became ill. Almost everyone got malaria, but at least there was a fair chance of survival.

But yellow fever was something else. The survival rate was under 50 percent. The death toll was appalling. Colleagues might say goodnight to each other, apparently healthy and one or more may be dead by the start of work the next day. It is to the credit of the French engineers that, although they quickly learned of the short odds of survival, yet they continued to volunteer - they did this for the glory of France and de Lesseps. About three-quarters of the French who came out to work on the canal, died there.

As the work progressed, so did the death toll, reaching 400 a week in 1885. No proper record was kept of the West Indian deaths. The most common estimates of the death toll - from all causes - during the French years are in the 22,000 range. And this was from a work force that only reached 20,000 at its peak. However, there was an enormous turnover of workers, few would last for six months - they would die or leave, but there were always people prepared to take their place.

After five years of work, the mounting problems facing the project were being recognized, even by de Lesseps. There was simply too much dirt to move - as they dug deeper, the worse the landslides became. No one knew what to do about the Chagres River which could rise 30 feet in a day during the rainy season and which flowed beside the proposed canal route.

In 1885, the engineers persuaded de Lesseps that a sea-level canal was impossible and the plan was changed to incorporate locks, but even this was going to be temporary. It is far easier to dredge out the bottom of a waterway than dig down. The engineers would dredge out the bottom and, when a route was complete, they would lower the water level and so on until they reached sea level. In 1887, the contract to make the locks was given to Gustave Eiffel, the engineer who was, at the time, also building the Eiffel Tower.

The company did its best to disguise the problems; the death rate was kept quiet and the gross overspending was covered up. But, gradually, word was getting out. De Lesseps, who made claims that the work was half finished, when maybe five percent had been completed, was losing his touch. The money was running out and investors were getting nervous. By 1887, the problems were widely known. To raise more money, the company tried to get the French government to hold a lottery. To get the necessary legislation passed, they bribed politicians. Eventually, the government passed the law to allow the lottery, but by this time, the scale of the problems had become widely known: Few people bought tickets.

The whole project collapsed in 1889 when the company was forced into bankruptcy. The effect was massive. The French government held an inquiry but much of it was covered up. It was found that some 2,500 newspapers and magazines had been paid off. The payoffs were so enormous that a number of publications were started specifically to get the handouts. One hundred and fifty deputies had accepted bribes, but only one, who pled guilty, went to prison. De Lesseps was a broken man.

A new company was formed out of the shell of the old one, but they were reduced to maintaining the best of the equipment. The whole enterprise was dead. It was the biggest bankruptcy in history and the French government was forced to resign. Hundreds of thousands of people had lost everything. For years, the word Panama in France was a term for incompetence and corruption.

The magnetism of de Lesseps resulted in engineers agreeing to his unworkable ideas. The enthusiasm for the project resulted in brave men willing to face death from disease rather than trying to solve the problem. But mostly, the French tried to build the canal before its time. It is tempting to think that if the Americans, British or Germans had tackled it, they'd have done it properly but that is doubtful. De Lesseps was right to have faith in the future of technology and science - this is what finally made the project work - he was just 20 years too early.

Halvor Moorshead. The Panama Canal: The First Attempt. History Magazine. April / May 2007.

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