Panama Canal, Panama

Panama Canal History: How an Isthmus Became Center of the Western Hemisphere

Guest Contributor|June 8, 2017|Blog Post

Panama City’s Biomuseo is a perfect starting point for learning about Panama Canal history.

This informative, Frank Gehry-designed biodiversity museum places the Central American isthmus of Panama at the center of…well, everything. It leaves no doubt that this narrow land bridge uniting the Americas has played a unique, perhaps outsized role in the natural, social, economic, and political development of both the Western Hemisphere and the world.

The human contribution to this narrow divider between the Atlantic and Pacific oceans is no less consequential. The 48 miles of the Panama Canal—one of the 20th century's greatest engineering accomplishments, which celebrated its 100th anniversary in 2014—are perhaps some of the longest in history. After all, the canal connects 144 maritime trade routes, reaching 1,700 ports in 160 countries.

Here’s a brief overview of Panama Canal history, and a look at how it became the most important logistics and transportation center in all of the Americas.

Prominent Features of the Panama Canal

Today’s canal consists of a system of locks (i.e. water elevators) that raise and lower ships between sea level and Gatun Lake. The man-made reservoir, located 85 feet above sea level, allows for passage through the 7.9-mile Culebra Cut. This is the narrowest part of the canal’s course, excavated with gargantuan effort from the hard rock of the continental divide.

There are three lock systems in the Panama Canal. The two coastal ones—the Gatun Locks on the Atlantic side and the Miraflores Locks on the Pacific side—are fascinating tourist sites. Then there’s the Pedro Miguel Locks in the middle. These three systems control the size and flow of the 13,000 - 14,000 ships that use the canal every year, each of which takes 8 - 15 hours to traverse from end to end.

The Panama Canal Authority charges each ship a toll for canal access. The fee is based on cargo volume and ship size, with the largest vessels paying about $450,000. The fee includes the service of a specially trained canal pilot, who guides each vessel through the waterway. Some $1.8 billion in tolls are collected every year.                                                                                                                                

The Origins of the Panama Canal

The idea of a canal traversing the slim neck of the Americas dates back to the early 16th century. Newly arrived Spaniards sought better means of transporting their plunders from Peru, Ecuador, and Asia back home. An initial survey of the isthmus led to plans for a canal in 1529, but wars and other distractions closer to home took precedence.

Interest in a shortcut that could cut 7,800 miles from a sea journey between New York and San Francisco (not to mention eliminating the risky navigation of the Drake Passage and Cape Horn) resumed in earnest in the 19th century. Spain, France, Britain, and the United States all commissioned studies and identified two practicable options—one across Panama and another across Nicaragua.

Nothing ever went beyond planning stages until 1878. Then, a French company, La Société Internationale du Canal Interocéanique, secured permission to dig a navigable trench across Panama.

Early Panama Canal History

The French canal project was led from 1880 to 1893 by Ferdinand de Lesseps, who had famously developed the Suez Canal and sought to replicate his success in Panama. His idea was to carve out a sea-level channel (without locks).

Multiple insurmountable obstacles—including malaria and yellow fever epidemics (which killed more than 20,000 workers), major engineering setbacks, poor administration, and financial troubles—ultimately pushed the company into bankruptcy. In 1893, after the squandering of approximately $240 million in funding, fraud, mismanagement, and corruption charges ensnared many of the major players. These included architect Gustav Eiffel, of French tower fame, who was hired late in the process to create locks.

When a second French effort under a new administration failed to gain traction, all French canal assets in Panama were sold to the United States for $40 million in 1902. The US had already created an Isthmian Canal Commission that, while initially determined to pursue a new route through Nicaragua, instead decided to pick up where the French left off.

Despite the French failure, detailed surveys and studies had been completed. Machinery, including usable railroad equipment and vehicles, were left behind. And tens of millions of cubic yards of rock and earth had been removed, especially from the Culebra Cut into the highest mountains through which the canal would pass.

Successful Completion of the Canal

At the turn of the 20th century, President Theodore Roosevelt was convinced of the strategic value of a completed Panama Canal. When a treaty between the US and Colombia was rejected by Colombia (of which Panama was then part), the US government supported a revolution that led to Panama’s independence on November 3, 1903.

The Panamanian government then negotiated a new treaty with the US that ensured Panama’s freedoms in exchange for US construction of the Panama Canal and perpetual control of a Canal Zone five miles wide on either side of the waterway. Panama was to receive compensation of $10 million, plus a $250,000 annuity beginning in 1913.

Starting in 1904, US-led work on the canal lasted for 10 years. The first three years of construction focused largely on surveys, the decision to pursue a high-level lock canal, improvement and expansion of the construction facilities, and disease control.

By then, medical experts had a better understanding of how mosquitoes carried epidemic diseases. They were able to significantly reduce the number of canal worker deaths, although approximately 5,600 laborers succumbed to illness or accidents. Interestingly, when Roosevelt made an inspection visit in November of 1906, it was the first-ever trip outside the US by a sitting president.

At a cost of around $350 million, the canal was completed and officially opened on August 15, 1914. It was the most expensive construction project in US history to that point. The process ultimately involved the displacement of more than 240 million cubic yards of earth, or the equivalent of about 70 Great Pyramids of Giza!

Independence and Expansion

Over the next 60 years, the US made significant improvements to the canal; but despite the US increasing Panama’s annuity, the canal did little to support the local economy. In 1964, when the Panamanian flag was forbidden from flying next to a US flag in the Canal Zone, Panamanians rioted. That's when the US and Panama finally attempted to work through their territorial issues.

This resulted in a landmark treaty signed by US President Jimmy Carter and General Omar Torrijos of Panama on September 7, 1977. The treaty returned 60% of the Canal Zone to Panama in 1979, with the canal itself and remaining territory to fall fully under Panamanian control starting on December 31, 1999. The canal was officially declared a neutral international waterway, with the US and Panama jointly defending it against any threat.

In 2006, after several years of successful canal operations under the Panamanians, then-President Martín Torrijos proposed the largest infrastructure project for the canal since its original construction. A national referendum approved the $5.25-billion Panama Canal Expansion Program, which began on September 3, 2007. Now in operation since June 26, 2016, the new canal has doubled the capacity of the old one by adding a wider, deeper lane of locks capable of admitting more and larger ships.

The Future of the Panama Canal

Importantly, the environmental and social (i.e. employment) impacts of the Panama Canal expansion have been key considerations. There are, of course, loud voices both pro and con. But at least there have been lively discussions about whether and how the mitigation measures required by environmental impact studies are accomplishing all that was promised through water-saving engineering, reforestation, wildlife intervention, and archaeological and paleontological rescue.

There are debates about whether the CO2 savings of big boats now passing through the canal rather than making long journeys are truly a palliative against climate change. Similar debates continue about whether job training programs and new employment opportunities are laying the base for medium-term and long-range pledges of economic development.

What’s not up for debate, however, is the critical role Panama Canal history has played, both in Panama and all across the world. Churn the waters of the Panamanian isthmus today and the ripple effect is likely to be felt just as strongly as the Biomuseo claims it always has.

Ethan Gelber is a freelance writer and editor. He founded The Travel Word and is editorial director of the Family Travel Association. He recently spent time in Panama as part of a year-long, around-the-world journey he is taking with his wife and two young sons.

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