PANAMA TOLLS
In an introduction to "The Panama Canal Tolls Controversy," edited by Hugh
Gordon Miller and Joseph C. Freehoff, Mr. Oscar S. Straus wrote: "There is
no more honourable chapter in the highly creditable history of the
diplomacy of our country than the repeal of the Panama Tolls Act under the
present administration. Being a controversy affecting our international
relations, it is gratifying that, aside from the leadership of the
President, the repeal was effected not solely by the party in power, but
by the help of leaders in all three parties, rising above the plane of
partisan politics to the higher reaches of broad statesmanship, guided by
a scrupulous regard for our international character in accord with 'a
decent respect for the opinions of mankind,' as expressed in the
Declaration of Independence." President Wilson himself, after the
repealing act had been passed, remarked, "When everything else about this
Administration has been forgotten, its attitude on the Panama Tolls treaty
will be remembered as a long forward step in the process of making the
conduct between nations the same as that which obtains between honourable
individuals dealing with each other, scrupulously respecting their
contracts, no matter what the cost."
In making his recommendations to Congress he, almost with high disdain,
ignored legal technicalities and diplomatic quibbles and took high moral
ground. Said he, "The large thing to do is the only thing we can afford to
do, a voluntary withdrawal from a position everywhere quoted and
misunderstood. We ought to reverse our action without raising the question
whether we were right or wrong, and so once more deserve our reputation
for generosity and for the redemption of our every obligation without
quibble or hesitation."
An act passed in 1912 had exempted American coastwise shipping passing
through the Canal from the tolls assessed on other vessels, and the
British Government had protested against this on the ground that it
violated the Hay-Pauncefote treaty of 1901, which had stipulated that the
Canal should be open to the vessels of all nations "on terms of entire
equality." Other nations than England had an interest in this question,
and there was a suspicion that some of them were even more keenly if not
more heavily interested; but England took the initiative, and the struggle
to save the exemption was turned, in the United States, into a
demonstration by the Irish, Germans, and other anti-British elements.
Innate hostility to England and coastwise shipping interests formed the
backbone of the opposition to any repeal of this exemption, but the Taft
Administration had held that the exemption did not conflict with the
treaty (on the ground that the words "all nations" meant all nations
except the United States), and British opposition to the fortification of
the Canal, as well as the attitude of a section of the British press
during the Canadian elections of 1911, had created a distrust of British
motives which was heightened by the conviction of many that the Hay-
Pauncefote Treaty had been a bad bargain.
It was understood early in President Wilson's Administration that he
believed the exemption was in violation of the treaty, but not until
October did he make formal announcement that he intended to ask Congress
to repeal it. The question did not come into the foreground, however,
until March 5, 1914, when the President addressed this request to Congress
in ominous language, which to this day remains unexplained. "No
communication I addressed to Congress," he said, "has carried with it more
grave and far-reaching implications to the interests of the country."
After expressing his belief that the law as it stood violated the treaty
and should be repealed as a point of honour, he continued: "I ask this of
you in support of the foreign policy of the Administration. I shall not
know how to deal with other matters of even greater delicacy and nearer
consequence if you do not grant it to me in ungrudging measure."
The first word I received that the President contemplated addressing
Congress, asking for the repeal of Panama Tolls, came about in this way: I
was notified after dinner one evening that the President wished to confer
with me in his study. When I arrived at the White House Mrs. Wilson met me
and informed me of the plan which the President had in mind with reference
to this matter and of his decision to issue a statement that night which
would be carried in the newspapers the following morning, and of his
determination to address Congress, asking for a repeal of the Panama
Tolls. Mrs. Wilson showed considerable excitement over the President's
proposed step when she discussed the matter with me as I arrived at the
White House. She said she had argued with the President and had tried to
persuade him that if he intended to do so unusual a thing that now was the
inopportune moment for it for the reason that it would create a party
crisis and probably a split, the result of which we could not foresee.
When I went into the President's study, he read me the announcement he had
prepared for the papers. The full significance and the possible danger
which lay in the proposed move that the President was about to make struck
me at once. Frankly I put the whole political situation in the country
before him as it would be affected by his attitude in this matter, saying
to him that the stand he was about to take would irritate large blocks of
Irish, Germans, and other anti-British elements in the country, and that
we might expect that the leaders in our own party, the heads of the
various committees, like Fitzgerald of Appropriations, Underwood of the
Ways and Means, and Clark, the Speaker of the House, would be found in
solid opposition, and that, at a time when we needed every bit of strength
to put our party programme of domestic legislation into effect, it seemed
to me unwise to inject this matter, which could only be a disturbing
element, into our party's councils. In discussing the matter with me,
after I had presented the objections to it, which I did with great feeling
and probably some irritation, he said: "I knew the view you would take of
it, but, unfortunately, every argument you lay before me in opposition to
the programme I have outlined in this statement is purely a partisan one
and one whose value I cannot recognize at this time. I must not count the
effect of a move of this kind upon my own personal political fortunes. I
am the trustee of the people and I am bound to take cognizance of the fact
that by reason of our attitude on Panama Tolls our treaties are
discredited in every chancellery of Europe, where we are looked upon as a
nation that does not live up to its plighted word. We may have made a very
bad bargain with England on Panama Tolls, but it will be all the more
credit to us if we stand by an agreement even when it entails a sacrifice
on our part. The men who were parties to this treaty, like Joseph Choate,
all agree that we have been indulging in hair-splitting and that we have
done a great injustice to England. I ought not, therefore, to be afraid,
because of the antagonisms that will be created, to do my duty and risk my
political future if necessary in righting a great wrong. We cannot expect
to hold the friendship of the world, especially of England, France, and
Japan, if we are to treat agreements not as inviolable contracts, but as
mere matters of convenience, whose plain terms are to be ignored when
matters of expediency dictate. I know that the Irish, through the Hearst
newspapers, will cry out that I have surrendered to England, that I am
attempting to hand over to Europe a quasi-control over the Panama Canal.
As a matter of fact, we are in bad by reason of our attitude on Panama
Tolls with various leading nations of Europe, and some unforeseen
contingency may arise where it will be found that the reason for their
withdrawal of friendship for us was our petty attitude in this matter. I
realize, as you urge, that the leaders of our party will be found in
opposition, but I must forget this and try to work the matter out so that
at least I shall have cleared my skirts and have done what is possible for
me to do to right a great wrong."
When the President concluded his statement I put before him the possible
reaction against his administration and him personally which might be
reflected in the returns of the Congressional elections to be held that
year. He replied by saying: "I have calculated every element in the
situation and I have concluded where the path of duty lies. If we begin to
consider the effect upon our own political fortunes of every step we take
in these delicate matters of our foreign relations, America will be set
adrift and her word questioned in every court in Europe. It is important
that every agreement that America subscribes her name to shall be carried
out in the spirit of those who negotiated it."
On March 5, 1914, the President addressed Congress and asked for a repeal
of Panama Tolls and immediately the fierce fires of party opposition began
to burn. His party leaders expressed their opposition to the repeal in
open, honourable, and vigorous fashion and the fight was on. Now that the
leading Democrats in the Senate and House had left us, it was necessary
for us to reorganize our forces at once. This task devolved upon me and I
immediately got in touch with younger men of the House, like Mitchell
Palmer, Judge Covington, and that sturdy Republican from Minnesota, Fred
Stevens, and over night we had a militant organization in the trenches,
prepared to meet the onslaught of our enemies.
The President was adamant under the bitterest criticism. His attitude
brought down on him a shower of personal abuse and vituperation from Irish
organs and from a group of newspapers which presently were to appear as
the chief supporters of Germany. The arguments against the repeal were
unusually bitter, and even though Elihu Root, leading Republican senator,
in a brilliant and effective speech took his stand by the President and
against the recent Republican Administration, partisan criticism seized
upon the opening. Nevertheless, the tolls exemption was repealed in June
and the events of July and August, 1914, and especially after Von
Bethmann-Hollweg stood up in the German Reichstag and characterized the
treaty between Germany and Belgium as a mere scrap of paper, gave a
certain satisfaction to those who stood by the President for the sanctity
of treaties.
Sir Edward Grey, then Secretary of State for Foreign Affairs, commenting
upon the action in the House of Commons said: "It has not been done to
please us, or in the interest of good relations, but I believe from a much
greater motive--the feeling that a government which is to use its
influence among nations to make relations better must never, when the
occasion arises, flinch or quail from interpreting treaty rights in a
strictly fair spirit."