States for explorations and determining the practicability of the work, they should not enter into negotiations with any other country for similar privileges," referring, as I understand, to Nicaragua. This is, in my judgment, included in the good faith of the treaty, and I see no objection to it as a supplemental article. Dr. Rojas, of the committee, reports in favor of the treaty, but has, unfortunately, made a very long report, and suggests numerous amendments, most of which, so far as I yet understand them, are inadmissible. Dr. Carlos Martin is totally opposed to the project, and so reports. I merely heard these read in the Senate yesterday, and have not yet been able to obtain copies. Martin's opposition is known to be on personal grounds. He was named as one of the plenipotentiaries, but declined, unless the whole matter should be confided to him alone. I have made a very careful canvass of the Senate. It consists of twenty-seven members. Of these I feel pretty sure of fifteen, and have the promise of eighteen. A majority is sufficient to appprove. If these were all men of position and principle I should feel quite assured, but they are not. At present we wait for Salgar, the President elect, who will be in this city on the 15th instant, and be inaugurated on the 1st of April. I am assured that he favors the treaty, and if he will lend his influence I shall feel quite certain of prompt and favorable action. He was declared President elect on the 1st of this month without any disturbance or opposition, and I think that peace and good order may be considered secure for the next two years. There have been sent in to the government three propositions by private parties to engage in the construction of the canal. Two of these are English, one French, but they have not the indorsement of their respective governments, and I consider them of no special importance. It is the fashion of this country to publish all official matters, and treaties occupy the same position as other documents. The canal treaty was published here on the 27th January, 1870. S. A. HURLBUT. Mr. S. A. Hurlbut to Mr. Fish. LEGATION OF THE UNITED STATES, Bogota, March 12, 1870. (Received April 28.) SIR: I have an opportunity of forwarding this by private hands to New York, and take the occasion to send, for the consideration of the Department, and, if thought advisable, of the Senate, the inclosed memorandum and tables showing certain special advantages to the United States in the modes of levying tolls, &c., as provided in the treaty. Colombia's proportion of gross receipts for first twenty years is less than 7 per cent., and need not exceed 5 per cent. on the remaining eighty years. S. A. HURLBUT. MEMORANDUM. BOGOTA, March 12, 1870. By the treaty the United States, or its assignee, may levy duties on tonnage, merchandise, passengers. I propose to show that these may be, and should be, so appointed as to give in practice a solid and substantial advantage to American commerce. The productions of the United States likely to move through the canal are of considerable bulk and relatively small value. The productions of Europe likely to move through the canal are of relatively small bulk and great value. (See Table 1 attached to this report.) The low rate of tonnage and an increased rate ad valorem on merchandise will create a strong discrimination in favor of American vessels and American products. The tonnage and values of merchandise in 1857, which would have passed through the canal, are stated in Admiral Davis's report, and are attached to this memorandum as Table No. 1. It appears from this table that in 1857 the United States, with a tonnage superior to that of England by 828,190 tons, shows cargo value inferior by the sum of $38,890,147. France, with about one-eleventh of tonnage of the United States, shows value of cargo over one-half. The great development of exportation of cereals and other bulky products from California has undoubtedly increased this disproportion. Thus a low rate of tonnage duty and a comparatively high rate on values will be favorable to the United States and unfavorable to European states. The effect of the Suez Canal upon European commerce, and the extent to which it may divert business from the Panama Canal, it is as yet impossible to estimate. But undertaking to guess from present appearances, and endeavoring to be within probable limits, I assume this state of things in 1882, by which time the Panama Canal should be open for business: I estimate that the general commerce of the world tributary to this canal in 1857 will have increased by 1882 50 per cent., and that the Suez Canal will have attracted one-half of all the then commerce represented in Table No. 1 other than that of the United States. I, therefore, reconstruct Table No. 1 for 1857 on the above basis, and produce Table No. 2 for 1882, and thus obtain the probable tonnage and values for the opening of the Panama Canal. For convenience of figures and as a full estimate, we will suppose that the canal shall have then cost $100,000,000. We will further assume that it ought upon that capital to realize a gross revenue of $15,000,000. To obtain this revenue from tonnage duties alone, the duty must be $1 814 per ton. On that basis the proportions paid by each nation are shown in Table No. 3. To receive the same amount of revenue ($15,000,000) from ad valorem duties on merchandise alone, the proportions payable by each nation will appear in Table No. 4. The difference to the United States arising from the adoption of the one system or the other exclusively appears from comparison of Tables No. 3 and No. 4, as follows: The United States pay on tonnage duties alone Ad valorem alone. Difference... $11, 254, 000 7,240,000 4,014 000 As to the other countries the case is reversed; England paying $1,905,000, and France $1,638,000-more on the basis of valus than on that of tonnage. Now by the treaty it is not incumbent on the United States to impose both of those classes of duty. They have power to do so or not. Colombia is to receive a certain fixed tonnage rate, but not to exceed in any case one-tenth of the sum levied for the use of the canal. If the canal imposes no tonnage rate, will Colombia receive anything? This, of course, is an extreme and highly improbable event, nor, in fact, would such action be in good faith; but the power of graduating the tonnage imposts and ad valorem duties, so as to keep the Colombian share in reasonable bounds and co as to protect American commerce, was carefully considered by me and inserted as the only way in my power to restrain within due limit the avarice of this people and to do justice to the United States. I have constructed and attached Table No. 5, calculated on $1.50 tonnage and 3 per cent. ad valorem, and also on $2 tonnage and 24 per cent. ad valorem, assuming of course the tonnage and value as in Table No. 2. The share of Colombia,,at 10 cents per ton and 5 per cent. on income, of course will be deducted from above gross amounts. This is only for the first ten years. At the end of twenty years, tonnage duties being held during that time at from $1.50 to $2 per ton, Colombia receiving during the time 10 cents, 15 cents, and 20 cents per ton, her percentage of general receipts will fall to 3 per cent. As a final table, I have constructed and attach No. 6, in which is shown the results of twenty years' business of the canal upon the data set forth in the preceding tables, on the basis of $2 per ton and 2 per cent. on merchandise values, adding probable amounts from passengers at $10 per head, and from incidentals (as stated in second schedule of Table No. 5 for one year), and deducting the proportions due to Colombia, under the treaty, and 25 per cent. for expenses of administration and repairs, &c. The net balance in favor of the canal, as the clear earnings of these 20 years, amounts to $218,308,093, on an assumed capital of $100,000,000. For the next 80 years of the privilege, the percentage of Colombia on the general receipts falls to 3 per cent., and the tounage duty may be held at $2 or lowered, which latter, ia my judgment, would be advisable. In these estimates I have not taken into account the probable increase of business stimulated by the competition of the canal; it can scarcely be stated lower than 10 per cent. per annum. I have placed the expenses of managing and maintaining the canal at 25 per cent. of gross receipts, which is very high, as the work, if properly constructed, must be of unusual solidity and will require few repairs. Neither have I considered at all the grant of lands. My principal object has been to show that we have the power to adopt the scale of duties, so as to work to the advantage of American interests and restrain the proportion of Colombia within due bounds. I wish the work could be done by the nation and for the nation; but as it is proba-ble that the privilege will be transferred, to a corporation, it appears to me that strong powers of inspection and direction ought to be reserved to the United States.. If a loan of the credit of the country or guarantee of interest is given, provision should be made for its repayment or for acquisition of stock in the company with a voice in the direction. It is too large a matter and pregnant with too many interests of national importance to be yielded exclusively into the hands of a private. corporation. S. A. HURLBUT. TABLE 1.-Tonnage and value of cargo shipping which would have passed through the canal if opened in 1857 (Davis's report). To obtain a revenue of $15,000,000 by tonnage duty alone (duty $4.81 per ton), charges would be to the nations respectively on tonnage from Table 2: To obtain the same revenue ($15,000,000) by duties on cargoes (ad valorem), 'would give to each nation : TABLE 5.-Statement of revenue ($15,000,000) on mixed basis, tonnage, and ad valorem. TABLE 6.-Probable earnings of the canal for twenty years on basis of $2 per ton, and 2 per cent. on values, &c., as in Table 5. Annual revenue, $15,870,777, amounts in twenty years to... Five per cent. on income from values for twenty years.. Two dollars on passengers for twenty years. Expenses, &c., 25 per cent... Percentage of Colombia on gross receipts, .0633, or six and three-tenths per cent. Mr. Fish to Mr. S. A. Hurlbut. No. 15.] DEPARTMENT OF STATE, Washington, March 19, 1870. SIR: Your dispatch No. 7, of the 5th of January last, relative to the negotiation of a new treaty with Colombia relative to the Darien Canal, has been received. No definitive opinion upon the subject can be formed here until the treaty itself shall have reached here. The abstract which you give of the points which you say have been assented to by the negotiators on the part of Colombia has been compared with the last treaty, which was not approved by the Colombian Congress. While many of the articles in the proposed convention appear to be almost identical with those in the one referred to, the new articles seem to be improvements likely to be mutually advantageous. At one time the Department believed that you were probably correct in anticipating hostility from the Panama Railway Company to any treaty upon the subject. Recently, however, informal assurances have been received from Mr. Hoadly, the president of the company, that no feelings or purposes are entertained by them in opposition to the canal. There may be cause to anticipate hostility from foreigners, who would prefer themselves to undertake and to have exclusive control over the enterprise. You will no doubt be vigilant, and we trust successful, in overcoming any opposition from such quarters. HAMILTON FISH. Mr. Fish to Mr. S. A. Hurlbut. DEPARTMENT OF STATE, Washington, March 19, 1870. SIR: Not long since I received a visit from an English gentleman, named Lanauze, who said he was a representative of capitalists in his own country who were able and willing at once to provide the funds necessary for the construction of the Darien Canal. He seemed to wish that we should so shape our proceedings as to enable his friend or associate only to embark in that enterprise, and thereby virtually to obtain paramount control over it. I replied that we preferred that the canal should be constructed by our citizens, who could easily provide the means if the practicability of the work should be shown by the survey. I added that the stock of the company which would be formed for the purpose would probably be in the open market and might be bought by any person. The gentleman seemed so disappointed at the result of his interview that he may try in some way to thwart your convention at Bogota, whither, as I understaud, he was about to proceed. HAMILTON FISH. No. 19.] Mr. S. A. Hurlbut to Mr. Fish. LEGATION OF THE UNITED STATES, SIR: Before and immediately after his inauguration I was assured by General Salgar that the weight of his administration would be given in favor of the canal treaty as signed. Three days since I was invited by the secretary of foreign relations, Señor Tapata, to a conference at his office. Then, for the first time, I learned that the administration would not support article 11 of the treaty, inasmuch as they considered that, by conceding to the United States the privileges therein given, Colombia would make herself party belligerent in any war in which the United States should become involved. He therefore informed me that the administration would insist upon a radical change in that article, returning to the principle of neutrality. He also asked my opinion as to the effect of such change upon the prospects of approval of the treaty in the United States. I answered that I had no doubt but that the political and military advantages secured by that article would be exceedingly popular in the United States, and were the only national inducements to its acceptance; that deprived of these features it became solely a question of dollars and cents, in fact a commercial speculation; that the grant of these privileges was my principal inducement for accepting the high rates of compensation given to Colombia. Señor Tapata expressed himself very little interested in the money receipts and very much in the political complications which might result from retension of article 11. I requested him to wait for the coming of the mail due here on the 13th, but so far it has not arrived. I must therefore act in this matter upon my own responsibility. This change in policy is due, without doubt, to the action of Mr. Bunch, her Britannic Majesty's chargé. He has been exceedingly active for two weeks past, and used some rather strange means to deepen the hold he has on this people. For example, on Good Friday the British flag was displayed at half-mast, and Mr. Bunch attended early mass at the cathedral, carrying a lighted candle in some procession which made part of the service. These concessions on the part of the virtual head of the English Church in Bogota, added to his long acquaintance and thorough knowledge of the prominent politicians, and the immense hold which England, as her great creditor, has upon this country, combine to make his influence very powerful. To this I attribute the change. I therefore expect that article 11 will be modified, and my effort is to control the modification. I have therefore offered to modify said article, or rather to approve such modification, in accordance with the principles of the Clayton-Bulwer treaty, a copy of which modification I attach, marked Exhibit A. Our friends in the Senate say they will pass the article thus modified whether the administration approve it or not. I hope it may be done. If, however, this should fail, there remains to me only one course. It becomes my duty to avail myself of this anxiety on the part of the Colombian Government to secure all the monetary advantages possible. In that event I shall therefore submit to the government that, in the event of the adoption of neutrality, they should amend article 14, and release to the United States all their claims to the moiety of damages to the Panama Railroad Company referred to in article 15, and also surrender all participation and share in profits of the canal provided for in articles 12 and 13, accepting as sole compensation for Colombia 15 to 20 cents tonnage duty in lieu of everything else. It is absolutely certain that article 11, as it stands, cannot pass if the administration oppose it, and it is certain, I think, that they will oppose it or modify it. I have informed the secretary that I protest against any alteration of article 11; but if it should be altered in conformity substantially to the views expressed in Exhibit A, that I shall recommend concurrence in said modification. I am exceedingly annoyed by the failure of the mail at this precise juncture, when I had reason to expect your opinion and that of the President upon the treaty. I know nothing of the impression made at home by the provisions of the treaty, having not even seen a newspaper comment upon the subject, and must therefore act upon my own notions of probable advantage, which are to yield nothing further as in Exhibit A, and in case I find the government bent upon destroying the special national privileges conceded in article 11, then to guide them, if I can, to the very lowest rates of participation in profits, so that if the treaty fails in its national point of view it may be a success as in an affair of finance. S. A. HURLBUT, Minister Resident United States America. EXHIBIT A. At the end of the second paragraph of the 11th article, after the clause "but said canal shall be closed against the flag of all nations which may be at war with either the |