Evening star. [volume] (Washington, D.C.) 1854-1972, 1908-12-15
PANAMA CANAL DEAL WAS CLEAN,
ASSERTS PRESIDENT IN MESSAGE.
Continued from First Page-)

December =. 1903: January 4, 1904, and
December Il. 1906. in which | set fortn
at length the history Of various phases or
the whole transaction.
| recall your attention TO the report
and opinion of the Attorney Genera
rendered TO mo. dated October 20, l9oZ,
with the accompanying documents and
exhibits, | call your attention 10 the
CORES pondenCc of the officers and agents
of tho Panama Canal Company with the
President and other officers of the United
States printed in Senate document NO.
81 December 10. 1909: also to the copy
of the official proceedings of the New
Panama Canal Company at Paris on the
;oth of December. 1903. together with
report of the council of administration
of that company, printed in Senate docu-
ment No. 133. January IS, 1904; and TO
The copy of the general conveyance by
The New Panama Canal Company TO the
United States, also copies OF certain
kilograms from the president Of the
company making an offer of sale and
Attorney General knoxs cablegram In
response printed in Senate document No.
2s5, March %, 1905.
Testimony Before Congress.
I call your attention Furthermore to
the exhaustive testimony recorded IN
public document tSen. doc. No. 4ol 59c
Cong I'd sessl. which contains the
searching investigation into the whole
transaction made by the Congress for
ITS information and fully considered by
the Congress before 1T took action.
In the act approved June %. 1917. TO
proyide for the construction of a canal
connecting the waters of the Atlantic and
Pacific oceans the Congress provided as
follows:
THAT the President of the United
States Is hereby authorized to acquire,
for and on behalf of the United States. at
cost not exceeding forty millions OF dol
lars. the rights, privileges. franchlses'
concessions grants of land, right OF way,
unfinished work. plants and other prop
crty, real. personal and mixed, of every
name and nature. owned by the New
Panama Canal Company of France, on
the ISthmus of Panama, and all ats maps,
pIans drawings. records on the 1sthmus
of Panama and in Paris, including all the
capital stock, not less, however. than
sixty-eight thousand eight hundred and
sixty-three shares of the Panama RAIL
road Company. owned by or held for the
u4e of said canal company. provided
satisfactory title to all OF said property
can be obtained -.
1t thereupon became the duty OF the
President, in execution Of this statute, to
purchase the property specified from the
New Panama Canal Company of France.
provided he could obtain satisfactory
title. The Department of Justice was
instructed to examine the title. and after
such an examination Attorney General
Knox reported that q satisfactory title
could be obtained.
Payment of the purchase price was
thereupon made to the New Panama
Canal Company, in accordance with the
act of the Congress. and, the property
was conveyed by that company to the
United States. 1t was no conc I'm OF the
President, or of any officer of the execu-
tive department.. to inquire to what
the New Panama Canal Company did
with the money which it received.
AS a matter of fact, the New Panama
Canal Company did distribute the money
between its shareholders and the share
holders of the preceding Panama Canal
Company in accordance with the decree
of "A French court. and the records OF the
French court show who were the share
holders who received the money, but that
is no concern OF ours.
call your attention to the accompany
ing statement to the attempt to form
an American company IN 1899 for the
purpose of taking over the property of the
French company. This attempt proved
It's effort to put through this plan. its
complete failure and abandonment being
known to every one.
What Is Set Forth.
The important points set forth in the
e1companying papers, and in the papers
10 which l have referred you, are as fol-
lows:
The investigation Of the history, phys
ical condition and existing value Of the
enterprise by the Congress, resulting in
the enactment of the law OF 1902 author1z-
ing the President to acquire the property
for the sum of S40O00.0O0 upon securing
a satisfactory title and thereupon to I'M
dertake the work Of construction; the
failure OF the A2nericanization of the en-
terprise in 1899: the transmission by me
TO the Congress from time to time of full
Information and advice as to the rela-
tions of this government to transit across
the iSthnlus and under the treaties, as to
the negotiations and final acquisition of
the title. and later as to the progress and
condition of the work Of construction;
the previous authorization Of the sale to
the United States by the stockholders of
the new company and their subsequent
ratification the examination and approval
of the title by Mr.. Knox: the arrange
ments for payment through ]. p. Nor
gan & Co. as the fiscal agents Of this
government. and the payment accordingly
At the Bank of France upon proper Of
fetal receipts to the liquidators acting
under the decree of the French court, the
French governmental body having iurfs-
dlction I'm the matter, and. finally, the
subsequent superintendent and distribu-
ton of the fund to the creditors and
stockholders OF the two companies under
that decree.
The Panama canal transaction was
actually carried through not by either
the then Secretary Of State Mr. John
Hay, or the then Secretary of War, Mr..
Elihu Root, both Of whom however. were
but by the then Attorney General Mr. p
& Knox. at present senator from Penn
sSivania- | directed Or approved every
action and am responsible for all that
VAS oSne In carrying out the will of the
ongress: and the provisions OF the law
enacted by Congress after exhaustive ex-
animation and discussion, were scrun11-
!cnsiy complied with by the executive
Nhie the transaction was pending ]
saw Mir. Cromwell but two or three times
mad my Communications with him were
limited to the exchange of purely formal
sourtes.es. Secretary Hay occasionally
saw him. In the same manner: l doutt
whether Mr.. Root held any conversation
With him. The Attorney General saw him
frequently as he was counsel for the Pan
anna company: their communications
were official. representing the two
sides.
lnciose copies of my correspondence
with Mr. William Dudley Foulke. who
nrSt brought these scandalous stories to
my attention. and with Senator Knox
and MIR Cromwell. 10 whom I wrote in
response to the request of gentleman
VINO wished to know about the stock
holders IN the Panama Canal Company
Title Held by New Company.
The title TO the Panama canal proner-
Ties was vested in the New Panama Canal
Company of France which was the legal
owner thereof. and the old or so-called De
Lesseps Company had large equity
therein. TIE title was not in Nov, Yar