Evening star. [volume] (Washington, D.C.) 1854-1972, 1907-02-26
THE PANAMA CANAL
GOVERNMENT WILL DO THE
WORK ITSELF.

An official announcement will be made
this afternoon that no contract will be
let for the construction of the Panama
canal and that the government will do
the work itself.
At least. 1t is believed on pretty
good authority. that the statement will
contain this announcement. which will
be In the nature of a great surprise to
w. ]. Oliver and the contractors who
strengthen his bid for the construction
Of the big waterway.
The announcement will be in the form
of a letter. presumably to Secretary Taft.
in which the President will express his
views Of the contract side of the ques-
ton as well as the side of government
construction.
At the cabinet session today the Pres
ident talked the matter over with Sec
rotary Taft, and the typewriting of the
letter for the signature Of the President
was begun. 1t had not been finished when
the President went to his luncheon, shortly
before o'clock. When he returned in the
afternoon. after 2:3O clock. the letter was
laid before him for his signature.
Mr.. Oliver and his associates have long
been hopeful that they had succeeded in
convincing the President of their ability to
construct the canal under the former s
terms, and have seen no reason why the
contract should not go to them.
For some reason, however, the President
has been leaning toward government con-
/ OF ,isff for aof1
why there was a change of opinion on his
part Is not known. Rumors have stated
that Chief Engineer Stevens was violently
opposed to the digging of the canal going
out of his hands. and threatened to resign
IL this was done. This story was denied,
but it is known that Mr.. Stevens did report
to the President that he did not believe
the putting out of the work to contract
could be satisfactory from any point Of
view. AS the President has a high regard
for the opinion of Mr.. Stevens, 1t Is not
improbable that he finally accepted the
view of Mr.. Stevens.
Long and Careful Consideration.
For over six weeks the matter has re-
ceived the most careful consideration by
the President, Secretary Taft and the OFF,
Gals of the isthmian canal commission
When proposals were called for it had not
been fully determined to build the canal
by contract, the government expressly re-
serving 10 ltSelI the rlSnl REJECT any ana
all bids. Nevertheless, four bids were sub
mitted. William ]. Oliver Of Nashville, in
conjunction with Arson NJ. Bangs of New
York, was the lowest bidder, his tender
being 6.15 per cent upon the estimated cost
But Bangs was subsequently eliminated by
reason Of certain objections entertained by
the President. The other bidders were
George Peirce & Co., the North American
Dredging Company of California and the
observation-disclosures Company, New Jer-
sey corporation, whose chief offices are in
New York.
All the bidders were required to accom-
pany their proposals with a certified check
for &20O,OO0, while the stipulation was made
that. In the event the contract was award
ed, the successful bidder should give bond
in the sum of $2.O0O.OOO and show assets
OF S,OOO,OOO, In order to protect the gov
eminent from any loss. MI divers repu-
tation as a contractor was such that time
was given him in which to find one or
more associates whose professional ability
ana financial standing were such as to
meet all the requirements of the case. In
the ten days which were allowed him to
accomplish this task Mr.. Oliver got to-
gether number of the best known con-
tractors in the country, and Incorporated
the Panama Construction Company
White House Conferences.
But the President. fully cognizant of
the fact that the building of the canal was
the greatest of modern undertakings, and
that In turning over the work to private
contractors the government was taking a
step of far-reaching Importance, deter
mined to investigate on his own account
the incorporators of the Panama Construc-
tion Company as well as those who were
financing it, and hold frequent conferences
with them at the White House, at the
same time giving the other bidders
chance to be heard.
The proposals expressly reserved to the
government the control of sanitation and
engineering, and the right of rigid su-
pervision of the quarters and subsistence
department, SO directly connectd with the
health and well-being of canal employees