The Panama Canal

362,000,000f., and that 350,000,000f. were still on hand January 1, 1885, and accepting his supposition, that the canal can be finished December 31, 1888, the following is the financial outlook :-Present contracts not yet completed will require 203,000,000f., or £8,120,000. To carry out contracts for parts not yet contracted for will require 255,000,000f., or £10,200,000, which, together with 100,000,000f., the estimated cost of the barrage, will amount to 558,000,000f., or £22,320,000. The canal company must carry a load of 25,749,740f. interest. The report assumes that on July 1, 1886, the company having paid all interest to date on the original stock and the loan of September 1884, and having paid 170,000,000f. for works, will have exhausted their resources and will have to negotiate another loan. Supposing that its credit remains unchanged, and it raises a loan in 1886 of 807,000,000f., its bonded debt would be 1,601,495,901f., or $320,000,000, or £64,060,000. If the canal is not completed in 1888, at least 12,000,000f. will be needed to pay interest on loans. The amount spent to date of the last report of the company was 370,000,000f., or $74,000,000.

Lieutenant McLean concludes that, considering the difficulties that are met, the large amount of money spent in preparations, materials, &c., has been well spent. He thinks, however, that ample preparations have been made, and sees no reason why, with plenty of money, the work should not proceed rapidly. He does not think it possible that the canal can be finished in 1888. Even if completed in 1888, its cost must be at least $320,000,000, and it is his opinion that it would be $350,000,000. It was hoped that in May 1885 the two dredges working on the Colon and Gatun sections would meet, and that the portion of the canal excavated would

be opened, having only half depth of water. It was generally believed that that part of the canal would be opened with ceremony by M. de Lesseps in person, and that the demonstration, together with the confidence inspired by M. de Lesseps, would so help the Canal Company's credit that a new loan, large enough to carry the work to completion, could be negotiated.

CHAPTER XIII.

THE FINANCES OF THE COMPANY.

Very scanty information.—In fifteen months £8,800,000 spent, and only 1,103,000 metres excavated, out of 125,000,000.-£22,275,000 already raised to this day, and yet M. de Lesseps still adhering to the fiction of £24,000,000.-£57,125,000 in cash must still be raised to finish the work, presuming that the Chagres offers no difficulties, and that there are no contingencies unexpected by M. de Lesseps.-The future business of the company will start with a deficit of £3,300,000 per annum.

WE have sketched out the various efforts made to solve the problem of interoceanic communication, and we have shown that the present Panama Canal Company is not an enterprise that was brought into existence by any careful and serious consideration of the elements which make up that problem, but it was rather the jobbery of a few men who were bent upon making use of the honoured name of M. de Lesseps, who allowed himself to be ensnared into the trap laid by them.

We have shown that the Panama Canal, begotten of unworthy purposes, was bound from the beginning to prove a great failure, because not only was it badly designed in itself, but its projectors also overlooked the great difficulties presented to the engineering art. Indeed, this rude project was conceived on a misapprehension of its own financial bearings, and in defiance of the most rudimentary principles which should control even an undertaking of much smaller proportions.

We have endeavoured to show how persistent M. de Lesseps has been in misleading his capitalists, not only as to the engineering difficulties, but also as to the financial difficulties; how he makes light of the unsolved problems of the Chagres, and how he is still saying that the canal will cost £24,000,000, and will be ready in 1888. That the canal cannot be ready in 1888 we have shown from the work that is still to be done; and that the canal cannot cost only £24,000,000 we have also proved from the official data furnished by the company itself. We will now show how much money has been raised and how it has been spent; and having in view the work still to be accomplished, we will demonstrate that the Panama Canal, if it is ever to be finished, must cost so much as to prove a ruinous investment to the unlucky believer in the luck of M. de Lesseps.

In studying the finances of the Panama Canal Company, we are from the start confronted by the great difficulty that the data furnished us are very meagre indeed. In France the balance-sheets are only presented for study and discussion one year after the closing of the fiscal year that is balanced. At present, for instance, the last balance-sheet to be had refers to the year from July 1882 to June 1883. Only at the general meeting of the company to be held in July 1885 we will have the inventaire for 1883-84.

The least possible is said in such balances, and this fact, taken in connection with the late date at which they are published, renders the task of the student most difficult.

However, without claiming to be as precise as we should like to be in such case, we will do our best to

collate all the elements that we may have, in order to get at a clear view of the finances of the Panama Canal Company.

The company was formed in 1881. In June 1884 we were furnished by M. de Lesseps with the financial condition of the undertaking up to June 1883. We do not pretend to transcribe literally M. de Lesseps' very meagre statement, but taking his own figures as our basis, we will collate them with well-known facts, and show in our own way, and as clearly as possible, what the condition of the Panama Canal Company was in June 1883.

In that month the financial position of the concern was as follows: