000,000000,000 francs, while the amount set down under the heading, "clearing the surface of wood and stumps, installing machinery, and excavation," amounts to but 115,000,000 francs. This is less than a third of the whole. Mr. Bigelow observes that this "last item only, and that partially, represents work on the canal." He assumes that this 115,000,000 francs represents the cost of about one fifth of the excavation. Now, it has been customary for the critics of the undertaking to argue thus: If one fifth of the excavation costs 308,000,000 francs, it is easy to see that the whole will cost about 1,800,000,000 francs, a sum greatly in excess of the estimate of the Paris Congress. This estimate was 1,070,000,000 francs.[1] But the above method of computation is obviously erroneous. Mr. Bigelow, referring to it, says: "It would be very misleading to infer the cost of the work remaining to be done from the apparent cost of what has been done. Fully two thirds of the expenses already incurred are in the form of plant." He points out in like manner that it would be "scarcely more fallacious" to infer that because one fifth of the excavation had been made for 115,000,000 francs, the money required to complete it would be only four times that amount. The work which remains is much more difficult than what has already been done. As the trench descends to lower and lower levels, it becomes more expensive to get rid of the material excavated.
Another criticism of a somewhat vague and yet serious character is brought against the undertaking. It is said that lavish expenditures, a reckless disregard of prudence and economy, have characterized the work. Upon this point also Mr. Bigelow's testimony is not without weight. He says: "No doubt some of the money has been injudiciously expended, but what great work, whether of a private or public character, has escaped this reproach? Taking the waste through these channels at the largest presumable figures, the inconsiderate expenses of the average individual all over the world would probably represent a larger percentage of his aggregate expenditure."[2]
- ↑ It is not to be inferred that even so large a sum as 1,800,000,000 would preclude all chance of reasonable profits. A statement upon this point was made at the Geographical Congress of Hamburg, held in April, 1885. One session was devoted to a lecture upon the Panama Canal, given by a Dutch engineer, Van Nehus. He said: "According to the learned report of the. French economist, Levasseur, the probable annual tonnage of the canal would be 7,250,000, and this at the rate of fifteen francs per ton, after deducting 3,000,000 francs for maintenance, would afford an income of 105,750,000 francs. This would give a satisfactory interest, even for a stock capital of 2,000,000,000 francs."
- ↑ "The Popular Science Monthly" for April, 1880, in an editorial discussion of the canal question, makes the following observation. The editor, referring to the fact that the foreign holders of American securities have been not unfrequently, by skillful manipulators defrauded of their just dues, says that De Lesseps "defies the world to show that a centime of the funds contributed to the Suez Canal was misappropriated or stolen."
Of the contrast which, according to the opinion of some, exists between the financial management of Suez and that of Panama no sufficient evidence seems to exist.
