Clemenceau, the Man and His Time

by H. M. Hyndman

Early in the year 1879 M. de Lesseps, following the course adopted by him in the case of the isthmus of Suez, called a Congress of the nations to consider the entire project of a Panama Canal. There was nothing new in the matter. The line of the canal had been surveyed by a capable French engineer nearly forty years before. The Congress estimated the actual cost of the construction of the canal at about £25,000,000, or a little more than the highest sum thought sufficient by the English engineer of the Panama Railroad. But the mere figures are of little importance. That they were quite insufficient, as the business was managed, has since been abundantly proved. But at first there is no reason to believe that de Lesseps was other than quite straightforward. He had bought the concession for the canal from Mr. Buonaparte Wyse, who had acquired it from the United States of Colombia, through whose territory the canal as surveyed ran. That this concession itself had previously been found very difficult to finance in any shape was a matter of common knowledge; that also the canal, when constructed, might prove far less valuable in every way than was calculated for world commerce was the opinion of many skilled engineers. But then the same things had been said about Suez. So the French public rushed in to subscribe the money required for the French Company immediately formed by M. de Lesseps to exploit the concession.

The great name of de Lesseps covered the whole risk and rendered criticism quite useless. But the management of the excavation was wildly incapable and inconceivably extravagant. It was very soon discovered that the original estimates were absurdly at variance with the cost of the real work to be done. The entire enterprise, as undertaken in 1884, was entered upon possibly in good faith, but in a wholly irresponsible and ignorant manner. In spite of warnings as to the certainty of encountering exceptional obstacles, no steps were taken to provide against contingencies, to inform the shareholders as to the position, or to revise the plans in accordance with the facts. The canal was inspected by M. Rousseau at the end of 1885. This engineer gave a most unfavourable report in regard to the excavations and constructions already carried out at vast expense, and the enormous additional sum needed to give any chance of completing the works. Instead of honestly facing this most unpromising situation and disclosing to the shareholders the real state of the case, or declaring that at least three times the amount would be required to bring the project to a satisfactory conclusion, and calling for this huge sum at once, the directors resorted to all the worst tactics of the unscrupulous promoter. This part of the matter went into the hands of M. Jacques Reinach and M. Cornelius Herz, names and persons afterwards covered with obloquy in connection with the whole affair. They set to work systematically, and were restrained by no inconvenient scruples. Strong political influence in both Chambers was needed in order to obtain the passing of the Panama Lottery Bill. Strong political influence was bought, though the Bill itself was not carried. From 1885-86 onwards this wholesale bribery was continued on an enormous scale.

The company was as careless of men’s lives as it was of shareholders’ money. Labourers from all parts of the world had been gathered together in what was then a deadly climate, without proper sanitation or reasonable medical attendance. Some time prior to the financial troubles it was known that such anarchy and horror prevailed on the Isthmus that intervention by the French Government, or even by an international commission, was called for. Nothing but the great reputation of de Lesseps could possibly have upheld such a state of things, or have obtained more and still more money to perpetuate the chaos. Even when the truth as to the frightful mortality of the men employed and the incredible waste, due to incompetence and corruption, must have been known to the President of the Company (M. de Lesseps himself) and his fellow-directors, when, likewise, they must have been convinced that the company was drifting into a hopeless position, they still appealed to their countrymen for more and more and more money to throw into the bottomless quagmire at Panama, and sink of French savings in Paris, to which the whole company had been reduced.

By the year 1888 no less than 1,400,000,000 francs had been expended in one way or another, while not one-third of the necessary work had been done. Of that £55,000,000 nominal amount not a few millions sterling found their way into the pockets of deputies, senators, and even Academicians, to say nothing of commissions and brokerages of more or less legitimate character.

Politicians in France are no worse than politicians in other countries. But the proportion of well-to-do men among them is less than elsewhere. There was consequently a margin of them always on the look-out for an opportunity of adding to their income, and this margin was much larger in the National Assembly before payment of members than it is to-day. For such men the Panama finance was a glorious opportunity. Nobody could suspect de Lesseps of being consciously a party to a fraud. To make a French venture like the Panama a great success, in spite of all difficulties, was a patriotic service. To receive good pay for doing good work was a happy combination of circumstances none the less gratifying that, the work being honestly done, remuneration followed or preceded in hard cash. The extent to which this form of corruption was carried and the high level in the political world to which streams from the Panama Pactolus were forced up is only partially known even now. But so wide was the flow and so deep the stream that, when the outcry against the Company began in earnest, statesmen whose personal honour had never been challenged were afflicted with such alarm, on the facts being laid before them, that they did their very utmost to suppress full investigation.

This, however, was not easy to accomplish. For there were no fewer than 800,000 French investors in the Panama Company. All of these were voters and all had friends. It became a question, therefore, whether it was more dangerous to the Republic and its statesmen—for personal as well as political considerations came in—to compel full publicity, or to hush the whole thing up as far as possible. Meanwhile, the public, and important journals not suspected of Panamism, took the whole thing down from the Cabinet and the Bureaux into the street.

For the opponents of the Republic it was a fine opening. That enormous sums out of the £55,000,000 subscribed had been paid away to senators, deputies and Academicians, for services rendered, was certain. Who had got the money, and under what conditions? Imputations of the most sinister character were made all round. Paris rang with accusations of fraud. That more than a hundred deputies were concerned in Panama corruption is a matter of common knowledge. One who was in a position to know all the facts declared that more than a hundred who were mixed up in other nefarious transactions used Panama to divert attention from their own malfeasances. However that may be, public opinion, excited by the clamour and denunciations of eight hundred thousand shareholders and electors, clove to Panama. It became an instrument of political warfare as well as of personal delation. The obvious determination of Presidents Carnot and Loubet to prevent a clear statement from being issued and the Directors prosecuted only rendered the sufferers more determined to get at the facts and wreak vengeance on somebody.

There were two views as to Count de Lesseps—to give him his title, which had its value in the Affair—and his conduct in the Panama Canal Company. There were those who held that de Lesseps, beginning as an enthusiast, and believing himself perhaps to be inspired in everything he undertook, no sooner found that his carelessness, in disregarding real natural difficulties and in organising the excavations on the spot, must result in failure, unless he could obtain unlimited resources, and doubtful of ultimate success even then, began at once to display the worst side of his character. The successful adventurer became, by degrees, the desperate gambler with the savings of his countrymen. Instead of regarding himself as the trustee of the people who, on the strength of his reputation and character, had risked their money, he deliberately shut his eyes to the real facts. He resorted to all the tricks of an unscrupulous charlatan, misrepresented the truth in every respect and had no thought for any other consideration than to get in more funds. For this purpose he paraded the country, making the utmost use of his personal and social advantages, and losing no opportunity for unworthy advertisement. All this time he knew perfectly well that his enterprise was doomed. Consequently, there was little to choose between de Lesseps and Reinach, Herz and the rest of them, except that he was perhaps the greatest criminal of all. Such was the view of the promoter-in-chief taken by lawyers and men of business who looked upon the whole matter as a venture standing by itself, to be judged by the ordinary rules of financial probity.

On the other side a capable and influential minority regarded de Lesseps as an enthusiast, a man of high character and noble conceptions, quite devoid of the power of strict analysis of any matter presented to him, and destitute of common sense. His financial methods and commercial obliquities were due to his overweening confidence in his own judgment and faith in his good fortune to pull him through against all probabilities. The one great success he had achieved rendered him a man not to be argued with or considered on the plane of ordinary mortals. He saw the object he was aiming at, felt convinced he would accomplish it, regarded all who differed from him as ignorant or malignant, and went straight ahead to get money, not for his own purposes but in order to carry out the second magnificent scheme to which he had committed himself. Corruption and malversation by others were no concern of his.