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The Nicaragua Canal.
I beg leave to invite attention to the following state¬
ments :
1. There has never been any investigation made by
a committee of Congress, nor by the executive branch
of the Government, in pursuance of any order of Con¬
gress, for the purpose of ascertaining the amount of
tonnage which would annually pass through the pro¬
posed Nicaragua Canal.
2. A report on the general subject of an American
isthmian canal in its commercial aspects was made by
myself as Chief of the Bureau of Statistics in the year
1880, but it was made at the earnest request of the
American Society of Civil Engineers and not by order
of Congress. That report constitutes a volume of 136
pages, and covers the economic, nautical and commer¬
cial aspects of the question. It indicates clearly that
the canal is not justified by commercial considerations,
and subsequent investigations prove that it could not
secure 500,000 tons of shipping annually.
3. The statement of the proponents of the Nicaragua
Canal that it can secure from six to eight million tons
of shipping annually is absurd to the last degree. This
statement rests upon no better foundation than the
original representations of the Panama Canal Com¬
pany, and it was a part of the scheme of promotion
which ultimately caused the originators of the Panama
Canal project to be consigned to French prisons. In
the year 1890 the Nicaragua Canal Company earnestly
T C T? H
l\| k v
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requested the New York Chamber of Commerce to en¬
dorse their project upon the basis of an elaborate state¬
ment as to the tonnage which could be secured for their
route. This statement having been referred to me for
examination I found it to be the merest statistical juggle.
I have a copy of that statement and should be glad to
submit it to an official investigation. In making up
their prospectus the Nicaragua Canal Company appears
to have divided the cost of their project by two and to
have multiplied the tonnage likely to pass through it
by twenty.
4. The calm belt on either side of Nicaragua forbids
that sailing vessels shall ever be employed on the
Nicaragua Canal route.
5. The attempt to compare the proposed Nicaragua
Canal with the Suez Canal is absurd upon its face.
The Suez Canal is a sea-level canal, whereas the Nica¬
ragua Canal involves 220 feet of lockage. The Suez
Canal subserves commercial interests very much larger
than would be subserved by the Nicaragua Canal.
Besides the Suez Canal has no railroad competitor,
whereas the Nicaragua Canal would have, by the time
of its completion, thirteen railroad competitors between
Chili and British America.
6. The passenger traffic, and the carriage of bullion,
express goods and freights of the higher classes can
never be diverted from the trans-continental railroads
to any canal across the Isthmus of Panama, or across
Central America. Already 98 per cent of the exported
products of California are shipped east by rail.
7. None of the commerce of Europe with Asia and
Australasia, can be diverted to the Nicaragua Canal.
The considerations of distance and coaling facilities
prevent that.
8. The amount of tonnage engaged in the trade of
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ports on the eastern side of North America with Asia
and Australia, which can be diverted to the Nicaragua
Canal is less than 100,000 tons.
9. Under present economic conditions governing
transportation and the evident trend of such conditions,
it is much more highly probable that the wheat and
lumber of the Pacific Coast will be transported across
the continent by rail than that it will be diverted to the
Nicaragua Canal in steam vessels.
10. A fair investigation of the supposed political and
military aspects of the Nicaragua Canal scheme will
prove that it is of very small importance from those
points of view.
I earnestly recommend that before any money is ap¬
propriated in aid of the undertaking, its commercial
and economic merits shall be fully investigated and re¬
ported upon by the executive branch of the Govern¬
ment. It would be a serious error for Congress to
accept as final the unsupported and unexplained state¬
ments of the advocates of the Nicaragua Canal in
regard to the commercial merits of their scheme.
Ordinarily a proposition to appropriate money out of
the Treasury of the United States, or to extend the
credit of the United States to any commercial enter¬
prise, in advance of a thorough investigation of the
economic and commercial merits of such enterprise
would be properly regarded as unbusinesslike and con¬
trary to established methods of prudent legislation. I
can conceive of no more flagrant violation of that rule
than an extension of the public credit to the proposed
Nicaragua Canal.
In making these positive statements in regard to the
Nicaragua Canal scheme it appears to be incumbent
upon me to indicate just what sort of an investigation
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should be instituted in order to apply the proper tests
to the statements of fact made by the Nicaragua
Canal Company and by myself, officially and unofficially.
I have therefore prepared with considerable care the
form of resolution of inquiry appended hereunto. Hav¬
ing personally, as Government officer and as private
citizen, gone over this whole field of inquiry, I know
that the proposed investigation is entirely practicable.
This will more clearly appear from a succinct statement
covering all the points raised in the resolution, which
statement is now in course of preparation, and will ap¬
pear in print about two weeks hence.
Joseph Nimmo, Jr.
Washington, D. C., February 12, 1896.
RESOLUTION.
Resolved, That the President be requested to furnish to the House of
Representatives (or Senate) the information indicated by the following
inquiries :
1. If the Nicaragua Canal were now completed, what amount of ton¬
nage would probably pass through it upon the basis of shorter distance
as compared with the distances by competing water routes?
2. What deduction should be made from the amount of tonnage,
ascertained in reply to the foregoing inquiry, on account of the calm belt
on either side of Central America, on account of the competition of
transcontinental railroads in North America, Central America and South
America, and on account of other adverse conditions?
3. Will it be practicable to operate sailing vessels by the Nicaragua
Canal route? In replying to this question it is desired that in so far as
may be practicable the meteorological record as to prevailing winds shall
be presented, and also that the record of sailing and steam tonnage
actually employed on the east coast and on the west' coast of Nicaragua
and at Panama and Colon shall be presented, together with the opinion
upon the subject entertained by American merchants engaged in the com¬
merce of Central America.
4. Is it at all probable that guano, nitrate of soda or other gross pro¬
ducts of the wesiern coast of South America can be diverted from the
Cape Horn route to the Nicaragua Canal route?
5. Which is the more probable under present conditions—that the
5
exports of wheat from California to Europe will be shipped by steamer
through the Nicaragua Canal if it shall be constructed, or that such
exports will be transported by rail to Galveston or New Orleans and
thence to Europe in steamers or sailing vessels ? It is requested that in
replying to this question the opinion of experts in regard to the subject
of transportation shall be secured if that can be done without extra ex¬
pense to the Government.
6. At the present time where is the dividing point on the western
coast of South America for shipments via Panama and via Cape Horn
or the Straits of Magellan ?
7. Under present conditions is it probable that tea or silk imported
from China and Japan at Atlantic and Gulf ports of the United States
could be diverted to the Nicaragua Canal route ?
8. Upon the basis of distance, would any of the commerce of the
countries of Europe with Asia and Australasia be diverted from the Suez
Canal route to the Nicaragua Canal route?
9. What amount of sailing and of steam tonnage, entered and cleared,
was engaged in the commerce of the Atlantic and Gulf ports of the
United States with Asia and Australasia duriDg the fiscal year ended
June 30, 1895, and what proportion of this tonnage could be diverted
from the Suez Canal route or from the routes via Cape of Good Hope and
Cape Horn to the Nicaragua Canal route? In replying to this inquiry,
it is requested that the facilities for coaling by the Suez Canal route and
by the Nicaragua Canal route shall be described.
10. Upon the basis of the tonnage which would be likely to pass through
the Nicaragua Canal, as ascertained under the first and second inquiries
of this resolution, and upon the basis of four per cent upon the cost of
the Canal, and making the same allowance for cost of maintenance, op¬
eration and administration which now prevails on the Suez Canal, what
would be, approximately, the average charge per ton for tolls on the
Nicaragua Canal ?
11. Under present conditions could lumber be shipped from Oregon and
Washington to points east of thujlocky Mountains at less a"tual cost of
transportation by steamer via the Nicaragua Canal route or direct by rail,
slating this separately, for shipments to points west of a line drawn from
Buffalo to Pittsburg, thence to Parkersburg, thence to Chattanooga,
thence to Memphis and thence due southwest to the Rio Grande River,
and for shipments to points east of such line? It is requested that in re¬
plying to this inquiry the opinion of experts in regard to the subject of
transportation shall be obtained, if that can be done without extra ex¬
pense to the Government.
12. What proportion of the products of California are now shipped to
points in the United States east of the Rocky Mountains by rail by the
Panama route and by the Cape Horn or Straits of Magellan route?
13. To what extent has the commerce of California with the Eastern
6
portions of the United States been diverted from the Panama route and
the Cape Horn or Straits of Magellan route during the last thirty years?
14. Under the economic and commercial conditions now <2,overnin<r the
o o
course of commerce on the land and on the sea. is it at all probable that
traffic would be diverted from the transcontinental railroads of North
America to the Nicaragua Canal if that canal were constructed?
15. What proportion of the trade of California, Oregon and Washing¬
ton with Ihe countries of Europe is carried on in sailing vessels and what
proportion in steam vessels ?
16. Which is the more probable, under present conditions, that sailing
vessels employed in the trade of the States of Cali f ornia, Oregon and Wasli-
ington with the countries of Europe will give place to steam vessels pass¬
ing through the Nicaragua Canal, or that sailing vessels thus employed
will give place to shipments across the continent by rail to and from ports
on the Atlantic and Gulf Coasts and thence to Europe in sailing or steam
vessels?
17. To what extent is it probable that commerce now carried on over
the Panama Railroad could be diverted to the Nicaragua Canal ? The
opinion of experts in regard to this subject is requested.
18. Under present conditions what amount of tonnage, besides that di¬
verted from the Panama Railroad, can be secured by the Nicaragua Canal,
stating the amount which can thus be secured from each particular
branch of commerce?
19. What is the estimated cost of constructing the proposed Interconti¬
nental Railroad from the southern boundary of Mexico to Buenos Ay res
in Argentina ?
20. Which project would be likely to secure the largest commercial and
political advantages for the United States and for the countries south of
the United States on this continent—the proposed Nicaragua Canal or
the proposed Intercontinental Railway ?
21. Which do the people and governments of Central America and
South America regard as of the greater importance touching their com¬
mercial and political relationships with the United States—the construc¬
tion of the proposed Nicaragua Canal or the construction of the proposed
Intercontinental Railway?
22. What will be the probable effect of the completion of transconti¬
nental railroads in Mexico, Central America and South America upon the
possible traffic of the proposed Nicaragua Canal ?
28. Do the people or do the governments of Nicaragua and Costa Rica
regard the proposed Nicaragua Canal as of any particular importance
touching their political relationships to the United States?
24. Which do the people and governments of Guatemala, Nicaragua
and Costa Rica regard as of greater importance, touching their own com¬
mercial interests—the construction of the Nicaragua Canal or the com-
7
pletion of the railroads now in course of construction in those countries )
which railroads would sharply compete with the Nicaragua Canal ?
25. If the Government of the United States should seek to secure a naval
station and base of military supplies upon the territory of any country in
Central America or South America, with the consent of the government
of such country, would either terminus of the Nicaragua Canal be selected
for such purpose in preference to some other location ?
26. Does the assumed military importance of the proposed Nicaragua
Canal justify the cost of its construction?
It is requested that the several officers of the Government to whom the
President may refer the foregoing inquiries shall be directed to present
fully and in detail the data employed by them in the preparation of their
several answers, mentioning in all cases the sources of such data, and
stating clearly the processes by which their several conclusions are
reached.
This statement lias been prepared in reply to
inquiries from all parts of the country touching
my views in regard to the Nicaragua Canal
project. A carefully prepared article covering
all the points raised in the proposed resolution
of inquiry may be found in THE FOIiUM for
March, 189(5.
JOSEPH NIMMO, Jr.
w
Washington, D. C.,
February 27, 189(5.