Story of Modern France - Helene Guerber

The Panama Scandal

France, as we have learned, had a large share in the construction of the Suez Canal, not only because its engineer was De Lesseps, a Frenchman, but also because French capitalists supplied a large part of the necessary funds to carry out the work. From the outset, the Suez Canal had proved of great benefit to the world in general, and to England in particular, whose road to India it shortened by half. The Egyptian ruler, believing that this canal, by bringing so much traffic through his country, was going to make it rich, became extravagant, planning and beginning many other improvements, for which he recklessly borrowed money at ruinously high rates of interest. The result of all this was that Egypt ran yearly deeper into debt, until it finally came to the verge of bankruptcy, in spite of the fact that it sold its shares in the Suez Canal Company to England for a very large sum.

As Frenchmen and Englishmen had loaned money to Egypt, the French and English governments decided to prevent their people from losing the money they had thus invested. Each government therefore sent a representative to Egypt, to regulate the finances of the country, and the Egyptian ruler, unable to extricate himself otherwise from his difficulties, reluctantly accepted their help. Later, from 1879 to 1882, a board of English, French, and Egyptian ministers practically governed all Egypt. But, although conditions were gradually improving, the Egyptians suffered so sorely from their past mistakes that they rebelled in 1882, taking matters into their own hands once more and driving both French and English out of their country! Although it had been settled that an Anglo-French force should put down any rebellion, the English, compelled to do all the fighting, denied the French any further right to interfere with the government of Egypt. Since 1882, England has therefore exercised a sole protectorate over Egypt, and has been the real mistress of the Suez Canal.

Meantime, having made money in one canal speculation, the French were continually urging De Lesseps to undertake another, this time across the narrow central part of America. De Lesseps having chosen the Isthmus of Panama as the most suitable point, a canal was begun in 1881 between Colon and Panama, which are some forty five miles apart. But, owing to the deadly climate, this proved a far more costly undertaking than the Suez Canal, and as De Lesseps was too old and too feeble to carry on the work in person, it fell into the hands of swindlers. They induced many people to invest, but squandered the canal company's money, so that eight years later the work had to be stopped for lack of funds before it was half done. As the canal company's stock was almost worthless, the French government made an inquiry to protect the investors (1892).

At first De Lesseps was accused of fraud, and condemned to a fine and imprisonment; but it was soon proved that his mind was too far gone with old age for him to have had any responsibility in the swindle, for which some of the real culprits were duly imprisoned and fined. But the fact that many newspapers, a few deputies, and even senators accepted bribes to misrepresent things, made the "Panama Scandal" one of the sensational events of the brief presidency of Sadi Carnot (1892—1894). This fourth president, proved a man of thorough integrity, and enjoyed great popularity until his career was suddenly cut short at Lyons by the dagger of an Italian anarchist (1894). As martyr-president he rests in the Pantheon.