No. 139.
Mr. Dicliman to Mr. Evarts.

No. 118.]

Sir: In my No. 112 of July 19, 1879, I took occasion to bring to your notice my views on the subject of an inter-oceanic canal across the terri tory of this republic, releating particularly to the Wyse contract and the defective nature of that instrument.

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I now beg to reiterate and respectfully submit to your judgment, that not only ought this mode of undertaking the construction of an inter-oceanic canal be not encouraged, but it ought to be discouraged by all proper means. The unsatisfactory character of the conditions contained in that instrument for attaining the objects for which it was executed, and its speculative features, as well as my reasons for arriving at the unfavorable opinion formed in regard to the same, are fully set forth in the dispatch to which reference is made above. Nor would the instrument be made acceptable by any amendments or modifications which could be introduced. The insuperable objection mentioned in my No. 112, that it was a mere contract or understanding between the Colombian Government and a private company, would always remain.

In addition to the reasons set forth in my No. 112 to sustain this opinion, it is only necessary to refer to chapter 2, section 2, article 5, of the constitution of the United States of Colombia, which article treats of the guarantees of the rights of property, and provides that private property shall not be taken for public use without judicial condemnation and previous indemnification. A copy and translation of the constitution of Colombia were forwarded to the Department with my No. 70, of April 17, 1879.

The language of the first part of article 5 might be well enough if it were not for the second part of the same article, which provides that in time of war the indemnification need not be previous, and that the necessity for the expropriation may be declared by other than judicial authorities (which means any military officer, from a general down to the commander of a squad), and thereby involves the tenure of properly in an uncertainty of doubts rendered all the more aggravating by the fact that by article 91 of the same constitution civil war is recognized as one of the institutions of the country, and that unfortunately the normal state of this republic is one of civil war, or, in its absence, one of-arined peace.

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Of course It does not need any argument to demonstrate that any contract entered into between the Colombian Government and a private company, is subject to all the limitations and provisions of the Colombian constitution; and while the same may also be said to be true in the case of a treaty, there is this great difference, that in the case of a treaty, and particularly one with a government which has the power to make itself respected, no difficulties as to rights of property guaranteed by the treaty nead be apprehended.

In treating of this subject, I have so far confined myself, both in this dispatch as well as in my No. 112, in setting forth the reasons which in my opinion make the present contract for the construction of a canal unacceptable to the United States, and to the commerce of the world. I shall now make a further demand upon your attention, in presenting some views as to the policy which, in my judgment, would be productive of the most satisfactory results in determining upon the legal and political conditions under which this great enterprise is to be executed and used.

I beg to premise in this connection, that perhaps the time has come when this dream of generations, the construction of a water-way between the Atlantic and Pacific Oceans, is to be realized, and that it may possibly, if not probably, be constructed within the territory of this republic, for the sentiment of the world appears to be in favor of a tide-level canal, without locks, even at an increased original cost for construction.

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As I have already exjjlained, the political condition of this republic is not of such a nature as to attract the investment of many millions of dollars in such an enterprise.* * * Even the existence of the government, and the union of these States, is anything but assured; and the ever-present danger of the secession of the State of Panama makes it exceedingly improbable that anybody can be found to invest his money in an undertaking which, without the support and guarantee of the United States, might probably be made a bone of contention between the different political factions of this country. Nor is it to be supposed that any European government would give its moral or material support to an enterprise of such magnitude on this continent without first coming to an understanding with the Government of the United States.

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I would also respectfully suggest that the question of the neutrality of the canal, and a zone covering its approaches, might probably be made the subject of an understanding between the great maritime powers.

While it is with great hesitancy and diffidence that, on the point of the neutrality of the canal, I would submit a modification of the views entertained by so eminent a statesman as the late Hon. William H. Seward, as expressed in his No. 58, of September 27, 1868 (explanation of Article IX), I should not deem it consistent with propriety to advance my views unless requested to do so by the Department.

The question of the neutrality of the canal is the only one about which a possible difference might exist between the United States and the other great maritime powers. After this shall have been satisfactorily adjusted, it would be easy to come to an understanding on the subject of additional surveys for a route for a canal, the manner in which a route is to be finally determined upon, and the support and guarantees which the different governments would be willing to give to the enterprise.

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If an understanding between the great maritime powers can be arrived at on this subject, it would also have the effect of eliminating from any future negotiations with Colombia in regard to the right of way, the jealousies which have marred previous efforts in that direction. (See No. 115, of February 22, 1879; 116, of March 1, 1869; 12, of March 16, 1870; and 19, of April 17, 1870, &c., from this legation.)

All the previous negotiations with the Colombian Government for the privilege to construct a canal have turned principally upon the amount of equivalent required for the right of way. Tile extravagant views entertained here of the value thereof, the idea of a participation in the income and management of the canal, and the absolute ownership of the entire work by Colombia in ninety-nine years after its completion are features which appear in all treaties and contracts which have been made so far, and which ought not to be entertained in any new negotiations. The rights of Colombia should be paid for by a fixed sum of money, excluding the idea of any future or contingent interest and if the amount of this sum of money cannot be determined by means of a direct agreement, it will, no doubt, be possible to devise some way whereby the same may be established by means of arbitration. In this connection it is well to bear in mind that on some of the proposed canal routes within Colombian territory the Indian title to the land has not yet been extinguished, and that the exercise of the sovereignty of the government of this republic is perhaps more nominal than real.

Precedents for an international understanding concerning improvements of channels of commerce or communication in which more than one nation is interested are not wanting. I beg to mention only the abolition of the Sound and the Scheldt dues, the Mont Cenis and St. Gothard tunnels, the improvement of the navigation of the Lower Danube, and the erection and management of the light-house at Cape Spartel.

It is more than probable that, after the construction of an interoceanic canal, the commerce from which the tolls will have to be collected will belong principally to the United States and Great Britain. Therefore the questions as to the cost and management of this enterprise are of great importance to the United States. The guarantee for its security against domestic and foreign dangers will ultimately have to be assumed as a heavy responsibility by the United States Government, and it is only right that, in determining the conditions under which this work is to be undertaken, the Government of the United States should be consulted,, and should have that control over its management and use which is demanded by the commercial and political interests of our country, the proximity of the canal to our ports, and its position on the American continent.

I am, &c.,