At the close of the Spanish-American War American interest in a canal at Panama was renewed and increased. In 1901 the first sub stantial step toward the realization of a canal under American control was taken in the nego tiation of the Hay-Pauncefote Treaty, which terminated the Clayton-Bulwer Treaty. In 1902 the second step was taken by an act author izing the purchase of the Panama franchise and unfinished work of the bankrupt French company. The third step—the completion of satisfactory arrangements with Colombia— proved more difficult and unfortunately resulted in strained relations with Colombia from 1903 to 1919. Colombia partly through German in fluence failed to ratify a convention of 22 Jan. 1903 by which the United States for A0,000,000 and an annuity of $250,000 (beginning 1913), obtained the right to construct the canal and to use and control the canal zone. Panama promptly declared independence from Colombia and was as promptly recognized by the United States which, on 18 Nov. 1903, negotiated with the new republic a treaty similar to that re jected by Colombia, recognizing American con trol over a canal zone 10 miles wide.
President Roosevelt, whose policy in Panama was generally approved, recognized that Co lombia, in spite of her bad faith and her show of resentment against the United States, had a right in equity to compensation. In 1909 Secretary Root negotiated with the Colombian Minister the Root-Cortez Treaty, which provided for recognizing the independence of Panama by Colombia and payment of $25,000,000 (in 10 annual installments) to Colombia by Panama. Colombia, refusing to ratify this treaty, proposed to refer the controversy to The Hague tribunal. The American govern ment, declining this proposal, later made an amicable offer to pay an indemnity of $10,000, 000, which Colombia refused to accept. Finally, through instructions of Secretary Bryan, the American government authorized the negotia tion of a treaty, signed at Bogota on 7 April 1914, which expressed the regret of the United States for incidents disturbing the friendship of the two countries, favored Colombia by pro visions for readjustment of the Panama bound ary and for certain commercial advantages and obligated the United States to pay to Co lombia an indemnity of $25,000,000. This treaty, ratified by the Colombian Senate, met strong opposition in the American Senate, which in definitely postponed action, especially objecting to any expression which might imply a con fession of improper policy in relation to the Panama revolution. Later, in July 1919, the
Senate resumed consideration of the treaty without the objectionable clause. Meantime, a marked increase of friendly interest between the United States and South American coun tries followed an extensive tour of Secretary Elihu Root through those countries in 1906 and later visits of other American statesmen and other influential Americans who contributed much to the elimination of misunderstandings and prejudices and the consequent modification of opinions. In 1910 the American govern ment used its good offices in joint action with Brazil and Argentina to settle a boundary dis pute between Peru and Ecuador in a mediation which resulted in the submission of the con troversy to The Hague. In 1912 its demand of 1909 upon Chile for settlement of the long-exist ing so-called Alsop claim of $1,000,000 (arising in 1879 from the Chilean seizure of Bolivian territory upon which a Chilean firm with Amer ican members had a lien) was arbitrated by King George V whose award allowed about one-third of the original claim and apparently satisfied both Chilean and American govern ments. In 1909 it secured by mediation the set tlement of. a boundary dispute between Panama and Costa Rica. Its influence also restored amicable relations between Argentina and Bo livia. In 1914 it negotiated with Panama a new treaty by which it secured certain advantages, including control of the waters of Colon and Ancon, and surrendered the Savannah which gave Panama city direct communication with other territory of the republic.
In April 1914 in the serious Mexican situa tion which had resulted in severance of diplo matic relations with the United States, the ambassadors of Argentina, Brazil and Chile tendered their mediation, and later together with the ministers of Bolivia, Guatemala and Uruguay were called into consultation by the American government to aid in finding a solu tion to an embarrassing and dangerous difficulty.
Relations steadily improved during the period of the World War in which American example inspired increasing confidence throughout Latin America. In.1919 renewed efforts were taken to restore satisfactory relations with Colombia.
474, 63d Congress, 2d session; United States Relations') (1870).