THE history of Panama is for the most part identified with that of Colombia, of which republic it was until recently a province. It is necessary to know something of certain movements and tendencies of the last half century in order to gain a just understanding of the position and prospects of the new republic.
All the principles of advanced democratic government were included in the program of the party which ruled Colombia from 1863 to 1883, and the leaders earnestly tried to put those principles into practical effect. They dreamed of an Utopia, but practically their efforts only aggravated the anarchical tendencies bequeathed by the Spaniards and Bolivar. Colombian liberals still insist that a persistent enforcement of the constitution and principles of 1863 would ultimately transform the character of the peoplethat religious bigotry and priestly influence would gradually disappear ; that the progressive enlightenment of the masses would make military despotism and revolutions impossible; and that in process of time the relations of the states to the federal government would reach a satisfactory and workable basis. But so far as the experiment went, no progress was made toward unifying the nation and pacifying the adverse elements. Discontent, disorders, civil wars increased in violence as the years went by. Though one-fifth of the federal revenues were spent on the public school system, and one-tenth of the children were nominal attendants, the clergy were permitted to have no share in their control, and retaliated by excommunicating the parents. The devoutly pious Creole mothers and wives, threatened with the closing of the confessionals and the denial of absolution, threw their incalculable influence against the atheistic government. The destruction of the convents and the confiscation of the vast ecclesiastical estates violently changed the owner-ship of two-thirds of the land in the confederation, but this imposition of new landlords on the industrious, oppressed, half-enslaved tenantry did not much modify real agricultural conditions. No extensive subdivision of estates resulted, and the Creole aristocracy continued to pay more attention to political intrigue than to improving their property.
Not less disappointing in its practical working was the independence of the states. Not only did the local bosses constantly abuse autonomy for their own selfish purposes, but the presidents of Bogotá often ignored the constitutional rights of the states, and selected for coercion precisely those states which were farthest from the capital and most needed wide autonomous powers. Though Panama’s position was isolated, its population cosmopolitan, its commercial interests and social structure peculiar, and though in colonial times its dependence on Bogotá had been only nominal, the liberal presidents usually ruled it like a conquered province. Members of the Andean oligarchy poured in to fatten on its revenues; the autonomy guaranteed by the constitution proved illusory, and discontent led to repeated efforts to achieve absolute independence.
Rival ambitions among its own leaders furnished, however, the immediate cause of the downfall of the liberal party. A close oligarchy grew up and that inevitable corollary, a powerful faction of dissident liberals, while the clericals remained formidable and irreconcilable even after their bloody overthrow in 1876. Rafael Nunez, a brilliant writer, a resolute and ambitious party chief, and a leader in the confiscation of church property, had been defeated in his candidacy for the presidency in 1875. The younger and dissatisfied liberals rallied behind him in his war against the oligarchy, and in 1880 the old-fashioned liberals could not prevent his election to the presidency. He vigorously strengthened the prerogatives of the federal executive and built up his personal following, but although the issue of paper money and the discontinuance of interest on the foreign debta debt which only ten years before had been scaled down to $10,000,000, one-sixth its original amount, on a solemn promise that at least this much would be faith-fully paidplaced large funds at his disposal, the old-line liberals were strong enough to prevent his reelection in 1882. Their victory was illusory and temporary; Nunez controlled both houses of Congress and was able to block President Zaldua at every turn. Eighty years old and in feeble health, the latter died after a year of fruitless struggle.
After a short ad interim administration in which Nunez’s influence predominated, he was reelected to the presidency and installed in 1884. By this time his centralizing tendencies were manifest, and the measures he adopted unmistakably pointed to the substitution of a unified republic for the old loose confederation. Many of his liberal supporters fell away and he was driven into an alliance with the conservatives. Appointments of members of that party to important positions were followed by the great revolt of 1885. The insurrectionists delivered their main attack on the Caribbean coast, whither the importation of arms was easy. Much of the department of Magdalena fell into their hands, and they besieged Cartagena in force. But when one of their expeditions invaded the Isthmus, burning Colon, and interrupting traffic on the Panama Railway, the president appealed to the United States, as previous presidents had done in similar cases, to carry out the guaranty of free transit’ contained in the treaty of 1846. At the same time the government troops attacked and defeated the isolated insurrectionists at Colon, and shortly afterwards the latter’s main army suffered a bloody repulse in an assault on Cartagena. This broke the back of the movement against Nunez.
The insurrection had been undertaken for the purpose of defending the 1863 Constitution, and its defeat meant the destruction of departmental independence. As the logical and natural result of his victory, the president proclaimed the abolishment of the constitution and summoned a convention to adopt a new one. Thenceforward, until his death ten years later, Rafael Nunez and his political ideas were supreme in Colombia, and Panama was held in most rigid subjection. The old United States of Colombia was replaced by a Republic of Colombia, one and indivisible; the departments became mere administrative divisions whose governors were appointed from Bogotá; the presidential term was increased to six years ; the radical liberal projects were abandoned; the clergy regained many of their privileges; and the historical conservatives continued the dominant party.
Panama suffered far more than the mountain districts. Practically she was allowed no voice in either her own or general affairs ; the very delegates who nominally represented her in the Constitutional Convention of 1885 were residents of Bogotá appointed by Nunez ; military rule became a permanent thing on the Isthmus; all officials were strangers sent from the Andean plateau ; and the million dollars of taxes wrung each year from the people of Panama were spent on maintaining the soldiers who kept them in subjection. In January, 1895, the harassed province broke out in a rebellion which was suppressed by an overwhelming force of Colombian troops in April.
Meanwhile in Colombia proper, the opposition to the ruling clique grew stronger and stronger. Persecution united the liberals, and they began organizing for revolt all over the republic. The conservatives themselves divided into two parties, one of which opposed the administration. Nunez did not live to finish the second-term to which he had been elected in 1892, but his successor managed to suppress the premature revolt of 1895, and in 1898 Sanclemente was elected, the opposition refraining from going to the polls. The new president soon found his position very difficult, and, unlike Nunez, was unable to dominate his own party and hold the opposition in check. The French Canal Company, whose concession, granted in 1878, would expire in 1904, offered a million dollars for a renewal, desiring to recoup, by a sale to the United States, a part of the two hundred million sunk by De Lesseps. Sanclemente’s government wished to accept, but the opposition and even the conservative congress insisted on the forfeiture of the French rights. The administration rapidly lost prestige, the discontented elements saw their opportunity, and the long brewing storm now broke on the hapless country. The liberals hurriedly completed their preparations, and in the fall of 1899 a civil war beganthe most terrible and destructive that has ever devastated the republic. Before it ended in 1902, more than two hundred battles and armed encounters had been fought, and thirty thousand Colombians slain. The detailed history of the campaigns has not yet been written, but it is apparent that the insurrectionists at first gained many successes. The president declared martial law, suspending the functions of congress, and the extension desired by the French Canal Company was granted by executive decree. But the pecuniary relief thus obtained did not materially help the floundering administration. Sanclemente became a mere figurehead for his more resolute ministers, and in July, 1900, the vigorous vice-president, Marroquin, seized power by a coup d’etat, throwing Sanclemente into a prison, where he remained until his death. Thereafter the war against the rebels was prosecuted with more energy, and the tide turned with the defeat of an army of Venezuelans, eight thousand strong, which had invaded the eastern provinces, to co-operate with the insurrectionists.
However, the liberals were still strong in the west and north. On the Isthmus four insurrections had broken out from October, 1899, to September, 1901, and though each had been promptly’ suppressed, in 1902 the liberals were able to make a last great effort to establish themselves in Panama. They had considerable forces near the mouth of the Magdalena, and gunboats on the Pacific. The secure possession of the Isthmus would have enabled them to reinforce this Magdalena army, cut off Marroquin’s troops at Agua Dulce, near Panama. But this was their last success. Marroquin poured reinforcements into Colon, and though the American admiral at first refused to allow them to be transported over the railroad to Panama, permission was granted when it became evident that there would be no fighting near the line. News came of the defeat of the liberal army near the Magdalena, and General Herrera, the victor at Agua Dulce, found himself isolated. In desperation he sent an expedition in October, which surprised and captured Colon, but French and American marines were promptly landed to prevent fighting in that city. The expedition had no alternative but to surrender, and a few days later General Herrera with the main body capitulated on the Pacific side.
The three years of war left Colombia in frightful demoralization. The victorious government was little better .off than the defeated liberals. Commerce and industry had been prostrated; revenues had dwindled to nothing; the paper currency was worth less than one per cent. The exhaustion of its adversaries, not in its own strength, enabled Marroquin’s government to continue in power. In such a situation the administration welcomed the opportunity which now offered of renewing the building of the Isthmian canal. The United States government determined to undertake this great work itself, and finally decided in favor of Panama as against the Nicaragua route. Forty million dollars was agreed upon as a just price for the work already done by the French company, and nothing remained but to obtain Colombia’s consent to the transfer. The civil war helped to delay the negotiation of a satisfactory treaty, but, as soon as it was over, the Marroquin administration lost little time in coming to an agreement with the United States. Colombia was to receive a bonus of ten mil-lion dollars for consenting to the transfer and° enlarging the terms of the original concession; her sovereign rights were reserved and guaranteed, although she agreed to police and sanitary control of the canal strip by the United States.
When the treaty was submitted to the Colombian Senate for ratification, opposition developed which the administration was not strong enough to overcome. Among the politicians at Bogotá, the opinion was almost universal that the executive should have demanded more. The Colombian people have ever regarded the political control of the Isthmus as their most valuable national heritage, and cherished extravagant hopes that some day they would be vastly enriched by the sale or rental of this strategic bit of ground for its natural use as the greatest artery of the world’s commerce. Many now insisted, as they had done in 1898, on enforcing a forfeiture of the French rights, or at least on receiving a proportion of the $40,000,000 to be paid for them. It was also said that Americans could well afford a larger bonus, and the opponents of the treaty made the further point that the agreement was unconstitutional and contained insufficient guaranties of Colombian sovereignty. Against this storm the feeble administration probably could do little and certainly did nothing. The Senate was allowed to adjourn without ratifying the treaty, and an attempt was made to negotiate a new one providing for a larger bonus and more stringent guaranties of Colombian sovereignty.
The United States, however, absolutely refused to consider any other terms than those already agreed upon, and the civilized world saw the completion of an enterprise promising incalculable benefits to mankind indefinitely postponed by the opposition of the Andean provinces whom the accidents of war and international politics had given an arbitrary control over a region with which they had no natural connection. The situation was particularly hard for the people of the Isthmus, whose confident hopes were now disappointed of at last receiving, by the prosperity which would follow the building of the canal, some compensation for the oppression and losses they had suffered during the eighty years of misrule by the Bogotá oligarchies. Hardly had the treaty been rejected when plotting for a declaration of independence began. The resident population was unanimous, and good grounds existed for believing that even the Colombian garrison would offer no resistance unless reinforcements should come from Bogotá. In case of an armed conflict with Colombia, the people of Panama could count on the sympathy of all America and Europe. The stockholders of the French Company had a direct pecuniary interest in their success. If once they could establish independence and a de facto government, Colombia could not deliver an effective attack without violating the neutrality and security of transit guaranteed to the Isthmus by the United States. Everything pointed to the success of a well-conducted movement.
Though the preparations for the revolt could not be concealed, the Bogotá government took no effective measures to forestall it. Warned that trouble was impending, the United States sent ships to prevent fighting that might interfere with transit. The new republic was proclaimed at Panama on the 3d of November, 1903. The Colombian authorities made no resistance ; the garrison surrendered without firing a shot; and the entire population acquiesced in the appointment of a provisional government, pending the calling of a convention and the adoption of a constitution. A small force of Colombians had been landed at ;Colon, but the revolution at Panama found it still on the Atlantic side. On November 4th the American naval commander refused to give these troops permission to use the railroad for warlike purposes. Because the vital portion of the new republic is virtually neutral under the treaty of 1846, the provisional government having established itself in peaceable possession, was safe from external attack. The useless Colombian troops at Colon either joined the people of Panama or retired. The inhabitants of Colon and the outlying districts immediately sent in their adherence, and the peace of the whole Isthmian region remained unbroken. On the 13th of November the United States recognized the new republic, being followed by France on the eighteenth, and then by all other nations as soon as diplomatic formalities could be complied with. Dr. Manuel Amador Guerrero was elected first president of the Republic of Panama, being inaugurated on February 19, 1904. A treaty with the United States for the building of the canal was framed on substantially the same lines as the one which had been negotiated with Colombia. By the end of February it had been ratified and proclaimed, and the United States at once made the preparations for the beginning of the work.
That Panama has a great future before her is evident, and in his most entertaining manner the noted traveler, Mr. Frank G. Carpenter, tells us something of the probable future, having gained his information from an interview with the president of the Republic, Dr. Pablo Arosemena, who has been in office since the death (March 1, 1910) of President Obaldia. Mr. Carpenter, in a recent news letter, tells the story of the interview as follows :
I met President Arosemena in the Isthmian white house, or, as it is known here, the government palace. This is a big, white, two-story building of Spanish architecture. It surrounds a patio filled with palm trees, in the center of which is a pond where huge turtles roll over and over and splash about in the water.
I found soldiers on guard as I entered the palace with the American minister, Mr. H. Percival Dodge, and we saw more soldiers at the wide stone stairway to the second floor. At the top of the stairway we waited until our cards were sent in, and a moment later were ushered into the long narrow parlor which forms the audience room of the mansion. This parlor is furnished strangely for this land of the tropics. The floor is covered with a warm velvet carpet, the windows are veiled in hot-looking curtains, and the gold-plated furniture is upholstered and hot. At each end of the room is a great mirror in a frame of gold and over the windows hang lambrequins from gold frames.
We waited but a few minutes, when the president entered. He is a lean, dark-faced, black-eyed man of medium height, and he weighs, I should judge, about 150 pounds light. He is seventy-four years old, but is still in his prime. When the minister introduced me,I was surprised to hear the president address me in English. He speaks that tongue fluently, and it was in English that our conversation was held. The first part of it related to the political situation, and I asked as to whether there was any danger of a revolution in case the administration candidate should be defeated.
“There will be no revolution here,” said President Arosemena, “and the day of revolution is fast passing away as far as the whole of Latin America is concerned. As for us Panamanians, we have given up such foolishness, and we expect to have no revolutions for all time to come. I think the same will be the case at no distant date throughout South America. It is already so with Peru and Chile. We have now no revolutions in Argentina and Brazil, and it will soon be so in Colombia and Venezuela.”
“How about Central America?” I asked.
“That eventually will be the case with Central America, although I can not say when. The people of some of those countries have had so many revolutions that they may be said to have acquired the revolution habit, and it will be some time before a condition of permanent peace can be established there. Nevertheless, Central America is improving, although the several republics composing it are not so free as ours. The Panamanians have more liberty of speech. For instance, my enemies call me a tyrant and I make no reply. If one should denounce certain of the presidents of the republic north of us, he might hear from his denunciation in no favorable way.”
The conversation here turned to the Panamanian republic and its prospects, and President Arosemena said:
“I am enthusiastic over the future of Panama. It is the baby of the nations, the youngest of all the republics. It is still in its swaddling clothes, and is just beginning to grow. Look at what we are doing! Take the city of Panama. It had only 12,000 people nine years ago, and it has now 35,000. It will have 50,000 as soon as the canal is completed. Colon, at the other side of the Isthmus, had 5,000 population when you made your deal with the French. It has 17,000 now, and we have other towns which have greatly increased.”
“But will not this population drop when we stop our work on the canal?” I asked.
“I think not,” replied the president. “Col. Goethals says the United States may have to keep soldiers here to the number of 10,000, and also that it will take 2,000 additional employees to run the canal. These people will spend a great deal. Then we shall have the tourist travel. That will steadily increase. It will give us a stream of travelers passing through and dropping dollars into Panama and Colon. Why, take your own people! All of you Americans will certainly want to come to see the canal. There are ninety millions of you, and even at as low as a dollar apiece, that would give us $90,000,000 to start with. If you should spend $10 apiece, the amount would soon reach a billion.”
“But can you accommodate the crowd?”
“Yes. We shall have big hotels for the tourists,” said Dr. Arosemena, “and the tourist travel will bring in a great deal. Paris gets a thousand million francs every year out of tourists, and Switzerland feeds fat upon them. There is no reason why we should not do likewise.”
“Do you not think that the Americans will have cities of their own here?”
“Very likely so. There will probably be a great business city at Balboa, but that will be in the swamps, and while it will contain the warehouses and great stores, it will hardly be fit for the hotels and the residences. Panama will be the Brooklyn, the residence quarter, and we shall have street-cars which will go back and forth in five minutes. The people of Balboa will do their business there and come to Panama for the night.”
“But has Panama nothing else but hotels to offer to the world?”
“She has a great deal more,” said the president. “The Panama Republic is one of the richest countries in the tropics, and by modern sanitation the most of it can be made one of the most healthy. It is now open to settlement, and we will do what we can to encourage the establishment of small farms and farmers. We are offering land in tracts of fifty hectares, or about 247 acres, at a little over 20 cents an acre, and 200 hectares at a still less price per acre. As the amount of land goes up, the price goes down, and we are doing everything we can to encourage development. We have been building roads in many of the provinces, and we now have in the neighbor-hood of 500 miles of roads and over sixty-one bridges.”
“But tell me something about your lands, Mr. President,” said I. “What can you raise on them?”
“We can raise all sorts of tropical fruits. We have good lands for coffee and cacao. Coffee plantations are being set out in some places, and cacao land is in demand in the country about Bocas del Toro. There are immense banana estates there. The United Fruit Company owns thousands of acres, and it ships millions of bunches of bananas a year. The most of that fruit goes to the United States. We have also good soil for rubber, and rubber plantations are being set out by Americans and others. Some of the ex-employees of the canal have rubber estates which are already in bearing.
“We have also large areas of fine grazing land,” continued President Arosemena. “The climate is such that the cattle can feed out-of-doors all the year round, and we have three varieties of rich grasses to fatten them. Take the province of Chiriqui in the northern part of the republic. There is a region there known as the Divila country, which has many square miles of plains covered with grass which is dotted here and there with groves.
“The country is well watered, but there are no swamps, although it rains almost daily for about eight months of the year. Still the rains are short and for the most of the time the weather is clear. That land is splendid for cattle, and it has more stock than all the rest of the republic. It has al-ready a number of large ranches, and there is room for many more. I doubt whether we have more than fifty or a hundred thousand head of stock in Panama now, whereas I have seen it estimated that our lands would sustain 5,000,000 head. When the canal is completed, there will be a great demand for meat, from the ships passing through, and it ought to be supplied by the Isthmus. It. seems to me there should be a great deal of money in cattle raising. As it is now, lean cattle may be purchased at from $15 to $20 a head. After they have been grazed for six months they will bring $30 and upward.”
“What opportunities have you outside of farming?”
There is a great deal of money to be made in real estate,” said the president. “With the completion of the canal there is sure to be a demand for farm lands and plantations of various kinds. There is a steady rise in real estate values also both at Panama and Colon. I have property here which is worth ten times what I paid for it a few years ago, and I have put up a building at Colon which cost me only $7,000 and which has been netting me $700 per month in rents. That property is now paying for the building every year. I know of buildings here in Panama which are doing as well. Rents are exceedingly high, and we have a number of men who have grown rich out of their real estate deals. We have several millionaires and some of them have incomes of over $50,000 a year. The Panamanian minister at Washington receives something like $5,000 per month from his real estate investments, and I venture that M. Espinoza of this city does equally well.
“And then there is a great deal of money in banking,” continued the president. “You can loan here all the money you have on good security, at eight or nine per cent. The old rate of interest used to be twenty-four per cent, but we have cut that down by establishing our national bank, which makes loans on real estate at seven per cent, and on jewelry and other collateral at nine per cent. That bank has a million and a half capital, and its net profits last year were $90,000.”
“What is Panama doing to open up the interior of the country ?”
“Not as much as we could wish,” replied the president. “We have some roads and we expect to build mote. We have had plans for railroads, but the time is not yet ripe to build them. All that will come, and in the end we shall be a thickly populated land.”
“How about your mines ?”
“We have some gold mines working right here in the central part of the Isthmus, and there are others at Darien. We know that we have copper and other minerals, but the country has not been thoroughly prospected.”
“How about your pearl fisheries?”
“They have produced a great deal in the past, but we have not been taking care of them and they do not yield what they did. I have been interested in pearls myself, and my father sold one pearl for $4,500. It weighed twenty-three carats, and was of a beautiful shape and fine color. That pearl would bring $10,000 today. I think if we should let the pearl fisheries lie still for a while and keep a closed season for fishing that we might make that a profitable industry.”
“How about the hidden gold of Panama? It is said that you have islands near your coasts where the treasures of the Incas are buried and also that there is gold under old Panama.”
“That is the stuff that dreams are made of,” replied the president. “Many have hunted for those treasures, and have never found them. We have now made a road to old Panama, and it is probable that something may be discovered there.”
“Tell me something about your trade with the United States.”
“We are buying more of you than of any other nation, and the trade steadily increases. It might pay your merchants to establish a great warehouse here for the display of American goods. There will be a continuous stream of merchants passing through the canal, and that house could take orders for both North and South America. As it is now, our foreign commerce amounts to $11,000,000 per year, and of that about $5,750,000 goes to the United States. Next to you, our chief consumer is Great Britain, and after that come Germany, France, and Italy. As to our exports, the most of them go to the United States. Indeed, you buy nearly all that we sell.”
“Are you doing much in education?”
“We are preparing the way. We have established some schools, and have a large number of students abroad to be prepared for teachers. We have some girls studying for that purpose in Belgium, and we have also scholarships in Chile, which I arranged for during my trip there last year. We have also built a national educational institute here at a cost of about $800,000.”
“How about the health of the Isthmus? Do you think that the sanitation methods which we are using here at Panama could be extended to the whole country?”
“Not as an entirety,” said the president. “It would be too expensive. Nevertheless, you have done a great deal for the cities of Panama and Colon. Indeed, the sanitary commission is the most absolute ruler we have. Every one has to obey it, and the men who come in on the ships, no matter whether they be presidents of other countries, American ministers, or our own officials, are kept in quarantine for three days if they come from any port that is even suspected of fever or contagious disease. We did not like the sanitation methods at first, and many of the people objected to having their houses inspected. That has all passed away now and we are congratulating ourselves on our new streets with good water and freedom from disease.”
“What are to be the future relations of Panama and the United States?”
“I hope they will always remain two sister republics.”
“Is there any chance that Panama will be annexed to the United States?”
“I do not see any possibility of that at present,” said Dr. Arosemena. “We are glad to have you as our great and good friend, and we want to work along with you as far as we can. I believe that our people would prefer to be independent.”
At this point I rose to go, but the president asked me to wait a moment and have some refreshments. A moment later a servant brought in a tray of champagne, and we drank to the health of our respective countries as we said goodbye.