The herald., 1893-02-12
ABOUT THE NICARAGUA CANAL.
The Question of the Govern
ment's Action.
Some of the Features of the Bill
Now Before the Senate.
1t Is Proposed to Give the Control of
the Canal to the Federal Governs
ment-Some Estimates of the
Probable Business.

pared by the press committee appointed
blythe recent national convention in
New Orleans, which unanimously de-
manded the prompt construction and
government control OF the Nicaragua
canal; this committee has for chairman
]. M. Eddy of Eureka, CAL, and ]. W,
Faulks of Cedar Rapids, Ia, is secre.
tary:
1t is conceded on all sides that the
Nicaragua canal is commercial neces-
eity to the people of the United States,
and that its construction and operation
| will do more to enhance the CONNER
cial Importance and increase the collec-
| tive wealth of the states of the union
than any measure now thought of. The
newspapers of the United States, to
| whose effort more than to that of any
other agency is due the widespread dis
cussions OF, and interest in, the project,
are agreed on these propositions. If
the canal ia not constructed by public or
private energy in the United States, it
will be done with the help of private or
pnblic capital in other financial markets
of the world. 1t does not need an ap-
peal to American patriotism to make
manifest the desirability OF it's construc-
ton by the people of the United States.
Upon the question whether the United
| States government should have any di-
rect relation to its construction, there
is not entire unanimity. When, how
ever, all the facts are known, objection
to such participation is, we think, un-
founded. These facts show that before
the New Orleans convention the senti-
ment favorable to some sort of govern
ment Intervention had taken but i'm !.
perfect form, and that this convention,
composed of representative men from
the various states, formulated the sug-
gestion which has since been expressed
in the amended bill recently reported to
the senate by the committee on foreign
relations. The terms of this new
measure envelop the governments re-
lation with such protection and safe
guards that whatever objection existed
to its participation in the project nave
now been fully met.
The new bill strips the present owners
of the canal of all but less than one
eighth of the ownership, and gives over
the control to the federal government.
The men to whose efforts was due the
inception of the undertaking are thus
rendered powerless and well-nigh voice.
less. In return for guarantee only of
500, 0,000,0 900 or less of bonds, the United
States takes $50, 500, 900, or S0L per cent,
of the canal company's stock, fully paid,
and the government appoints 10 of the
Is directors. These 10 directors are to
be non-partisan. As consequence this
arrangement gives the government four
fiths OF the canal company's entire as
sets. Unlike the guarantee of the Pacific
railroad bonds, in which the government
neglected to provide for its own appoint
ment of majority of the directors, 1t aJ
all times yuuJrUfr tiIu os.~l Sriziiv IT 1s
not, for state reasons, the legal owner.
1t is in effect, if not theoretically, there
fore, the owner of the canal, since the
latter's destinies are within its entire
keeping. If the interest which
it guarantees is not paid, it will
be the fault of ite directors, and hence
its own neglect, since being the majority
of two-thirds of the canal company,
their duty is to vote the company's
money to meet the interest, and for
such other purposes as may be neces-
sary. The delicate matter of a violation
of the Olayton-Bulwer treaty, the Mica
ragua treaty and the terms OF the
Nicaragua and Costa Rice concessions,
are by this virtual control, without
ownership in legal form, avoided. The
government cannot own the canal, in a
legal sense. The treaties between this
country and Nicaragua and Costa Rica,
and the concessions made by those re-
publ1cs, require among other things that
the concessions be the property of cor
poration. In this corporation Nicaragua
and Costa Rica must be represented on
the directory by one director each. Any
foreign government may hold majority
of the stock of the corporation or be
otherwise represented, but the conces-
sion cannot pass from the corporation to
foreign government. This seems to us
to dispose of several points which we see
raised in our exchanges.
It is not properly understood that the
citizens of the United States, and es-
pecially those of the south and west,
| whose proximity makes them specially
| interested, and not the canal company,
are pressing the matter of government
control. The latter occupies, 30 far as
we are able to Judge, an independent po-
sition. 1t has at no time directly or in
directly asked government aid. 1t is
doubtful indeed whetherlthe terms of the
amended bill are of any advantage to it,
| since if it were inclined to do 30 it could
doubtless find in the money markets oi
Europe capital ready and willing to in
vest in an undertaking which is eurer OF
substantial returns than was the Sue2
canal at its inception. The people OF
the United States, however, would re.
gard as little less than q crime any
movement looking to denial to this
country of the opportunity to conatrucl
and take the tremendous advantages oi
an enterprise whose geographical posi-.
ton seems to entitle the United States
to its requirement as of natural right
We think the first promptings of patri
otism should restrain recourse to foreign
money centers, until it is at least found
impossible to awake the people of this
country to realization of the full i'm
portance of securing to itself high
way of such commercial and strategic
momext.
The condition of government aid being
the virtual ownership of the canal, it il
therefore not subsidy. 1t is not prob
able that one dollar will ever be spen
on the project by the United States
The chance of loss by the government il
reduced to most unlikely possibility
To cause government any financial los
the enterprise mpst fail. No one ap
preciating the full significance of tn
unanimous and imperative demant
throughout the world for the canal Cal
seriously believe it will fail to pay whel
completed. Any accomplishment of en-
gineering science within a not exceeHiv