The anti-railroad movement reminded the public that the Interstate Commerce Law of 1887 was an imperfect statute. It had always done less than its framers had intended. Judicial interpretation had limited its scope. The commission did not have power to fix a rate or to compel in the railroads the uniformity of bookkeeping without which no scientific rates could be established. After Roosevelt had directed his speeches of 1903 and 1904 to the subject, Congress responded to the public interest thus aroused with a flood of projected railroad bills. One of these passed the House of Representatives in 1905, but was held up in the Senate while a new investigation of interstate commerce, the most exhaustive since the Cullom investigation of 1885, was undertaken. In 1906 the Hepburn Railway Bill was passed. In its chief provisions it gave the Interstate Commerce Commission power to fix rates and to prescribe uniform bookkeeping, and it forbade railways to issue free passes or to own the freight they carried. The long railroad debate was made notable by the speeches of a new Senator, Robert M. LaFollette, of Wisconsin, who had fought his way to the governorship on this issue and gone through a prolonged fight with the railroads of his own State. He insisted that public rate-making could not succeed without a preliminary physical valuation of the roads that would show the extent of their real capitalization. He talked, often, to empty chairs in the Senate, but he prophesied that the people had a new interest in their affairs, and that many of the seats, vacant because of the indifference of their owners, would soon be filled with Senators of a new type. In vacations he spoke to public audiences on the same subject, reading his "roll-call," and telling the people how their representatives voted for or against commercial privilege. With its enlarged powers the Interstate Commerce Commission made rapid headway against rebates and discrimination.

The popular revival was well advanced by 1905, but was becoming more sensational every month. Led on by an expectant public, the magazines manufactured exposures to supply the market, and hysteria often took the place of investigation. The real needs of reform were in danger of being lost in a flood of denunciation. In the spring of 1906 President Roosevelt spoke out to check the indiscriminate abuse. He drew his topic from Bunyan's "Man with the Muck-Rake," pointed out that blame and exposure had run its course, and demanded that enforcement of the law be taken up, and that efforts be turned from destruction to construction. He had done much himself to "arouse the slumbering conscience of the nation," and turned now to direct it toward a permanent advantage.

The trend of criticism injured the party under whose administration corporate abuse had grown up. The personal popularity of Roosevelt, and his associates, Root, Taft, Knox, and Hughes, saved the party from defeat. In 1906 the congressional campaign was fought on the basis of holding on to prosperity, enforcing the law against all violators, and strengthening the hands of government. Roosevelt wrote the substance of the platform, and his party gained control of its sixth consecutive Congress since 1896. The canvass over, Roosevelt departed from an old precedent, left the territory of the United States, and visited the Isthmus of Panama to inspect the work on the canal.

Six months after the signing of the Panama Treaty in 1903 the United States took possession of the Canal Zone and began to dig. It had to learn lessons of both management and tropical engineering. One by one its chief engineers deserted the enterprise. The choice between a sea-level and a lock canal divided the experts. The legislation by Congress was inadequate. In the spring of 1906 Roosevelt, with the approval of Taft, who had been recalled from the Philippines to be Secretary of War, determined to build a lock canal. The President tramped over the workings in November, 1906, and sent an illustrated message about them to Congress on his return. In 1907 Major George W. Goethals was detailed from the army to be benevolent despot and engineer of the Canal Zone. Inspired and encouraged by repeated visits from Taft, the work now made rapid progress toward completion. Sir Frederick Treves, the great English surgeon, visited the canal in 1908, and found there not only gigantic engineering works, but a triumph for the preventive medicine of Colonel William C. Gorgas, chief of the sanitary officers.

The attention of the world, directed toward the United States since 1898, was held by the canal and by a continuation of a vigorous and open diplomacy. In February, 1904, Russia and Japan, unable to agree upon the conduct of the former in Manchuria, had gone to war. Hostilities had continued until Russian prestige was shattered and Japanese finance was wavering. In June, 1905, the United States directed identical notes to the belligerents, offering a friendly mediation. The invitation was accepted, and during the summer of 1905 the envoys of Russia and Japan met in Portsmouth, New Hampshire, to conclude a treaty of peace. In 1906 the Nobel Committee awarded to Roosevelt the annual prize for services to peace.

Relations with all the world were friendly between 1905 and 1909. Great Britain contributed to the cordiality by sending to the United States as her ambassador the best-fitted of her subjects, James Bryce. Under his tactful management the next five years were a period of unprecedented friendship. The South American republics, always sensitive about the headship of the United States, were brought to kindlier feelings. There had been two congresses of all the Americas, one in 1889, at the instigation of Blaine, the next in Mexico in 1901. In 1906 the American republics convened at Rio de Janeiro in July. Secretary of State Elihu Root made a plea for friendship before this congress. From Rio he went to other capitals of South America, achieving notable triumphs in his public speeches.

The Pan-American Conference at Rio was an American preliminary to a larger meeting in which the United States played an important part in 1907. During 1904 Roosevelt had agreed to start a movement for a second conference at The Hague. He took up the negotiation during the Russo-Japanese War, deferred it at the instance of the Czar, and then stood aside to let the latter issue the formal invitation. The American delegation at the Second Hague Conference was led by Joseph H. Choate, leader of the American Bar and former ambassador to Great Britain. It forced the discussion throughout the session, tried in vain to produce an agreement to abolish the right of capture of enemy property on the high seas in time of war, and helped to strengthen the permanent court of arbitration. In January, 1906, the United States had sat in conference at Algeciras, over the affairs of Morocco. It had mediated in the Oriental war. It had strengthened its position at home. It was no longer true that the United States was entirely disinterested in the affairs of Europe, for it had become a world power.

A visible emblem of power was afforded to the world in 1907. Since the Treaty of Portsmouth there had been friction with Japan over the treatment of Japanese subjects on the Pacific Coast, and alarmists had drawn pictures of a possible war. Late in 1907 the President announced a practice voyage for the whole effective navy that would carry it around South America and into the Pacific. In December he reviewed the fleet, and saw it off from Hampton Roads. From the Pacific it was ordered round the world, visited Japan and China, and was received with keen interest everywhere. It came home early in 1909, having made a record for holding together without breakdown or accident.

While the fleet was going round the world and business was adjusting itself to the new constructive laws, an old problem was formally ended. The tribal sovereignty, which had made the Indians a problem, was terminated. The Dawes Act of 1887 had substituted severalty for tribal landholdings among the Indians. Out of the first cessions which followed the act Oklahoma Territory had been made in 1890. This had developed more rapidly than any previous Territory because of the railroads that crossed it in every direction. By 1900 it demanded statehood. In 1906 it was enabled, and during 1907 it was admitted, with the longest and most radical of state constitutions. Fear of the activities of corporate wealth and distrust of the agents of government were written into nearly every article.

In the spring of 1908 nearly all of the forty-six governors met with President Roosevelt in the White House and registered another problem upon which agitation and revelation had led to public reflection. The coal strikes of 1900 and 1902 had drawn attention to the possible relation of government to the coal supply of the people. The beginnings of reclamation in 1902 had revealed the fact that public reclamation was impeded by large private and corporate water rights. The natural resources of the country were seen to be following the course of all business and settling into the control of great corporations. The waste of coal and timber and water and land itself was unreasonable. The denudation of the hills led to terrible floods along the rivers. The future was being darkened by the organized selfishness of the present. A movement for conservation grew out of the conference of governors, but Congress for the present would not encourage it.