Mr. Chairman, there are three reasons why I think we should have a second canal at Nicaragua, and I should like to outline them briefly to the committee.

In the first place, as you know, under the old Clayton-Bulwer Treaty of 1852, I think, and the Hay-Pauncefote treaty, made during Mr. Theodore Roosevelt's administration, England claimed and asserted an indirect interest in that canal, because of their ownership of certain islands, and she had to be consulted about it. I think there is no doubt that she would be consulted today in respect to any change in the Panama Canal.

The CHAIRMAN. Is it not a fact that the only thing England ever claimed about the Panama Canal was that they were entitled to equal treatment with the United States? Personally, I have felt that contention was sound in many ways. Nevertheless, Congress did to a certain extent recognize it. The same situation would apply to Nicaragua as well as Panama.

Senator MCKELLAR. I don't agree with you about that. When Theodore Roosevelt was constructing the Panama Canal, I recall very distinctly that Great Britain interfered and claimed rights under the Clayton-Bulwer Treaty of 1852, and while Mr. Roosevelt got a modification of those claimed rights, Great Britain insisted that our first policy of not providing for equal tolls to the United States with all other nations was improper, and she demanded and obtained from our Government equal treatment for all nations using the canal. Of course, she still retains an interest in it, and we have a treaty on that subject.

The CHAIRMAN. On that point, did not the contention of the British Government with regard to our obligations under the Hay-Pauncefote Treaty go to the extent of any or all isthmian canals?

Senator MCKELLAR. NO.

The CHAIRMAN. That was the statement made by the Solicitor of the State Department before this committee at the last session of Congress. Senator MCKELLAR. It has been some time since I examined the treaty, but I am quite sure from recollection that Great Britain's sole claim of interest was as to the Panama Canal, and that the ClaytonBulwer Treaty and the Hay-Pauncefote Treaty pertained to the Panama Canal alone. In my judgment, if a new canal were built at Nicaragua, it would be an absolutely all-American canal. I mean by "all-American canal" this: I do not mean that the United States alone would have control of the Canal, because, while we have bought and paid for a strip over which the canal is to be built through Nicaragua, Nicaragua has rights that must and will be respected. In addition to that, as the canal will be almost the same as crossing Costa Rica, we will have to deal with Costa Rica about the matter. We are on the friendliest terms in the world with both Nicaragua and Costa Rica, and I am quite sure there will be no difference of opinion as to those two countries. If Honduras, which is, I believe, the nearest state to the canal, claims rights, or any other Central American country claims. rights, we may have to deal with them about that, and it would give us a good deal of pleasure to deal with them, and I am sure there would be no trouble about giving them their rights.

At this point I desire to insert in this record a portion of the speech of Mr. Somoza, the President of Nicaragua, who was here

recently and addressed the Senate last week. During his address he specifically referred to the building of the Nicaragua Canal. I desire to insert in the record such excerpts from that speech as refer to the building of the canal, and his cooperation and the cooperation of his Government in connection with it.

The CHAIRMAN. That may be done, without objection.

(The matter referred to is here printed in full, as follows:)

Because of her geographic position, and the fortunate configuration of her territory, Nicaragua, in spite of her size, will be called upon to be a complementary factor, indispensable to any plan or combination of forces for the security and defense of this continent. Her territory offers a convenient route for the construction of an interoceanic canal.

The Nicaraguan people consider this fact as their most valuable source of potential prosperity. We earnestly desire that this gift of nature may not be left hidden indefinitely in our native forests, when, by the act of man, it could bring incalculable benefits to ourselves, to you, to the Americans as a whole, and to the commerce of the world. [Applause.]

By a treaty which we are willing to carry through in terms which conform to the interests of both parties, on permanent bases of equity and justice, the United States has long been associated with Nicaragua in the possible realization of this mighty undertaking. We have thus joined our international destiny to yours, confident that this association will always be maintained in an atmosphere of reciprocal amity, of mutual benefits, and of a real comprehension of the needs and character of both Nations. Those who are now engaged, as I am, wholeheartedly in the consolidation of this association of our destinies, firmly believe that when history records its judgment on future events, posterity will not betray our present hopes and convictions. [Prolonged applause.]

Senator HAYDEN. Senator, I want to inquire with respect to the right to be obtained from Nicaragua or Costa Rica, or any other neighboring country, in the construction of the proposed new canal. Would not the proposition be similar to what is contained in the treaty with Panama? I understand, with respect to the Panama treaty, that we have obtained a perpetual lease for a strip of land on each side of the Canal, but that the ultimate sovereignty over the land was never ceded by Panama.

Senator MCKELLAR. That is true.

Senator HAYDEN. There is quite a material difference between that and the acquisition of the territory to become a part of the United States.

The CHAIRMAN. The Panam Canal Zone is a part of the territory of the United States.

Senator HAYDEN. My understanding of the Panama Canal Zone is that we have a lease, an easement, a right-of-way, but that the ultimat sovereignty is still in Panama.

Senator MCKELLAR. That is not my understanding of it.

Senator HAYDEN. For all practical purposes, we control the Canal Zone as completely as though it were a part of the territory of the United States.

The CHAIRMAN. We have a perpetual lease.

Senator HAYDEN. It may be a legal fiction, but my understanding is that Panama never surrendered complete title to the land.

Senator MCKELLAR. That is my understanding. We pay Panama $250,000 a year rent for that leasehold. As I understand it, the Nicaraguan Government agrees to cede to the United States the necessary land, marked out, over which this canal would go, and that would become United States territory. There would be no yearly

rental. No such rental is specified. We have bought the zone over which the canal is to go for $3,000,000.

However, to be absolutely sure, I want at this point to insert in the record the treaty with the Government of Nicaragua, and the HayPauncefote Treaty.

The CHAIRMAN. Without objection, that may be done.

(The Nicaraguan Treaty and the Hay-Pauncefote Treaty, respectively, are here printed in full, as follows:)

NICARAGUA

1867 TREATY OF FRIENDSHIP, COMMERCE, AND NAVIGATION

(Concluded June 31, 1867, ratification advised by the Senate January 20, 1868; ratified by the President February 7, 1868; ratifications exchanged June 20, 1868; proclaimed August 13, 1868)

The United States of America and the Republic of Nicaragua, desiring to maintain and to improve the good understanding and the friendly relations which now happily exist between them, to promote the commerce of their citizens, and to make some mutual arrangement with respect to a communication between the Atlantic and Pacific Oceans by the River San Juan and either or both the lakes of Nicaragua and Managua, or by any other route through the Territories of Nicaragua, have agreed, for this purpose, to conclude a treaty of friendship, commerce, and navigation, and have accordingly named as their respective Plenipotentiaries, that is to say:

The President of the United States, Andrew B. Dickinson, Minister Resident and Extraordinary to Nicaragua; and His Excellency the President of the Re public of Nicaragua, Senor Licenciado Don Tomas Ayon, Minister of Foreign Relations:

Who, after communicating to each other their full powers, found in due and proper form, have agreed upon the following articles:

Article I. There shall be perpetual amity between the United States and their citizens on the one part and the Government of the Republic of Nicaragua and its citizens of the other.

ART. II. There shall be between all the territories of the United States and the territories of the Republic of Nicaragua a reciprocal freedom of commerce. The subjects and citizens of the two countries, respectively, shall have full liberty freely and securely to come with their ships and cargoes to all places, ports, and rivers in the territories aforesaid, to which other foreigners are or may be permitted to come, to enter into the same, and to remain and reside in any part thereof, respectively; also to hire and occupy houses and warehouses

for the purposes of their commerce; and generally the merchants and traders of each Ñation, respectively, shall enjoy the most complete protection and security for their commerce, subject always to the laws and statutes of the two countries, respectively. In like manner the respective ships of war and post-office packets of the two countries shall have liberty freely and securely to come to all harbors, rivers, and places to which other foreign ships of war and packets are or may be permitted to come, to enter the same, to anchor, and to remain there and refit, subject always to the laws and statutes of the two countries, respectively.

By the right of entering places, ports, and rivers, mentioned in this article, the privilege of carrying on the coasting trade is not understood; in which trade national vessels only of the country where the trade is carried on are permitted to engage.

ART. III. It being the intention of the two high contracting parties to bind themselves by the two preceding articles to treat each other on the footing of the most-favored nations, it is hereby agreed between them that any favor, privilege, or immunity whatever, in matters of commerce and navigation, which either contracting party has actually granted, or may grant hereafter, to the subjects or citizens of any other State, shall be extended to the subjects or citizens of the other contracting party; gratuitously, if the concession in favor of that other nation shall have been gratuitous, or in return for a compensation, as nearly as possible of a proportionate value and effect, to be adjusted by mutual agreement, if the concession shall have been conditional.

ART. IV. No higher or other duties shall be imposed on the importation into the territories of the United States of any article being the growth, produce, or manufacture of the Republic of Nicaragua, and no higher or other duties shall be imposed on the importation into the territories of the Republic of Nicaragua of any article being the growth, produce, or manufacture of the United States, than are or shall be payable upon the like articles being the growth, produce, or manufacture of any other foreign country; nor shall any other or higher duties or charges be imposed in the territories of either of the high contracting parties on the exportation of any articles to the territories of the other than such as are or may be payable on the exportation of the like articles to any other foreign country; nor shall any prohibition be imposed upon the importation or exportation of any articles the growth, produce, or manufacture of the territories of the United States or the Republic of Nicaragua to or from the said territories of the United States, or to or from the Republic of Nicaragua, which shall not equally extend to all other nations.

ARTICLE V. No higher or other duties or payments on account of tonnage, of light or harbor does, or pilotage, of salvage in case of either damage or shipwreck, or on account of any local charges, shall be imposed in any of the ports of Nicaragua on vessels of the United States than those payable by Nicaraguan vessels, nor in any of the ports of the United States on Nicaraguan vessels than shall be payable in the same ports on vessels of the United States.

ART. VI. The same duties shall be paid on the importation into the territories of the Republic of Nicaragua of any articles being the growth, produce, or manufacture of the territories of the United States, whether such importation shall be made in Nicaraguan vessels or in the vessels of the United States; and the same duties shall be paid on the importation into the territories of the United States of any article being the growth, produce, or manufacture of the Republic of Nicaragua, whether such importation shall be made in Nicaraguan vessels or United States vessels. The same duties shall be paid, and the same bounties and drawbacks allowed, on the exportation to the Republic of Nicaragua, of any article, being the growth, produce, or manufacture of the territories of the United States, whether such exportation shall be made in Nicaraguan or United States vessels; and the same duties shall be paid, and the same bounties and drawbacks allowed, on the exportation of any articles, being the growth, produce, or manufacture of the Republic of Nicaragua to the territories of the United States, whether such exportation shall be made in the vessels of the United States or of Nicaragua.

ART. VII. All merchants, commanders of ships, and others, citizens of the United States, shall have full liberty in all the territories of the Republic of Nicaragua to manage their own affairs themselves, as permitted by the laws, or to commit them to the management of whomsoever they please, as broker, factor, agent, or interpreter; nor shall they be obliged to employ any other persons in those capacities than those employed by Nicaragua, nor to pay them

any other salary of remuneration than such is paid in like cases by Nicaraguan citizens; and absolute freedom shall be allowed in all cases to the buyer and seller to bargain and fix the price of any goods, wares, or merchandise imported into or exported from the Republic of Nicaragua as they shall see good, observing the laws and established customs of the country.

The same privileges shall be enjoyed in the territories of the United States by the citizens of the Republic of Nicaragua under the same conditions.

The citizens of the high contracting parties shall reciprocally receive and enjoy full and perfect protection for their persons and property, and shall have free and open access to the courts of justice in said countries, respectively, for the prosecution and defense of their just rights; and they shall be at liberty to employ, in all cases, advocates, attorneys, or agents, of whatsoever description, whom they may think proper; and they shall enjoy, in this respect, the same rights and privileges therein as native citizens.

ART. VIII. In whatever relates to the police of the ports, the lading and unlading of ships, the safety of merchandise, goods, and effects, the succession to personal estates, by will or otherwise, and the disposal of personal property of every sort and denomination by sale, donation, exchange, testament, or any other manner whatsoever, as also the administration of justice, the citizens of the two high contracting parties shall reciprocally enjoy the same privileges, liberties, and rights as native citizens; and they shall not be charged in any of these respects with any higher imposts or duties than those which are or may be paid by native citizens, submitting, of course, to the local laws and regulations of each country, respectively.

The foregoing provisions shall be applicable to real estate situated within the States of the American Union, or within the Republic of Nicaragua, in which foreigners shall be entitled to hold or inhert real estate. But in case real estate situated within the territories of one of the contracting parties should fall to a citizen of the other party, who, on account of his being an alien, could not be permitted to hold such property in the State in which it may be situated, there shall be accorded to the said heir, or other successor, such time as the laws of the State will permit to sell such property. He shall be at liberty, at all times, to withdraw and export the proceeds thereof without difficulty, and without paying to the Government any other charges than those which would be paid by an inhabitant of the country in which the real estate may be situated.

If any citizen of the two high contracting parties shall die without a will or testament in any of the territories of the other, the Minister or Consul, or other Diplomatic Agent of the nation to which the deceased belong (or the representative of such Minister or Consul, or other Diplomatic Agent, in case of absence), shall have the right so far as the laws of the country will permit, for the benefit of the lawful heirs and creditors of the deceased, giving proper notice of such nomination to the authorities of the country.

ART. IX. The citizens of the United States residing in Nicaragua, or the citizens of Nicaragua residing in the United States, may intermarry with the natives of the country; hold and possess, by purchase, marriage, or descent, any estate, real or personal, without thereby changing their national character, subject to the laws which now exist or may be enacted in this respect.

2. The citizens of the United States, residents of the Republic of Nicaragua, and the citizens of Nicaragua, residents in the United States, shall be exempted from all forced or compulsory military service whatsoever, by land or sea; from all contributions of war, military exactions, forced loans in time of war; but they shall be obliged in the same manner as the citizens of each nation, to pay lawful taxes, municipal, and other modes of imposts, and ordinary charges, loans, and contributions, in time of peace (as the citizens of the country are liable), in just proportion to the property owned.

3. Nor shall the property of either, of any kind, be taken for any public object without full and just compensation to be paid in advance; and

4. The citizens of the two high contracting parties shall have the unlimited right to go to any part of the territories of the other, and in all cases enjoy the same security as the natives of the country where they reside, with the condition that they duly observe the laws and ordinances.

ART. X. It shall be free for each of the two high contracting parties to appoint Consuls for the protection of trade, to reside in any of the territories of the other party. But before any Consul shall act as such, he shall, in the usual form, be approved and admitted by the Government to which he is sent; and either of the high contracting parties may except from the residence of Consuls such particular places as they judge fit to be excepted.