Frank E. Doremus to Woodrow Wilson

Honorable Woodrow Wilson,
President of the United States.

My dear Mr. President: –

During our recent conversation, concerning the Panama Canal tolls controversy, I stated that the question whether the preference to our coastwise trade would contravene the Hay–Pauncefote Treaty was very carefully considered in the debates that preceded the passage of the Panama Canal Act. You suggested you would like to have me furnish you with excerpts from the Congressional Record, bearing upon this question, that you might peruse them at your leisure. Since then I have gone through the Congressional Record from the time the discussion of the bill began in the House, May 16, 1912, until its final passage in the Senate, August 9th, 1912, and am handing you copies of a few of the speeches reflecting both views of the Treaty. There were many more, but I presume these will sufficiently show the character and scope of the debate.

Permit me to say that the discussion of the Treaty was directly precipitated in the Senate by the receipt of the British note of July 8, 1912, which was brought to the attention of the Senate by Secretary Knox July 12, 1912. A copy of Secretary Knox’s communication ( Congressional Record, page 8990 ) is herewith enclosed. From that time until the passage of the bill, August 9, 1912, the Record shows that the Hay-Pauncefote Treaty was the chief topic of debate, and the view of the Senate with reference thereto is shown by the vote on the bill – yeas, 47; nays, 15. The record of this vote is enclosed

(Congressional Record, page 10590).

The Statement recently made in the Senate that the Panama Canal Act was passed without adequate consideration is unsupported by the Record. The question was carefully, earnestly and deliberately considered by men who realize the seriousness of violating a treaty obligation. In this connection your attention is respectfully invited to the enclosed copy of the speech of Mr. Mann, minority leader, (Congressional Record, page 2201). Enclosed you will also find a copy of the pamphlet issued by the State Department, containing copies of the diplomatic negotiations between the two governments. May I call your attention to the concluding paragraph of the first British note ( page 12 ), from which it clearly appears that Great Britain does not seriously doubt our right, under the treaty, to exempt the coastwise trade from the payment of tolls, but questions our ability to frame regulations which would prevent the exemption from resulting in a preference to United States shipping generally, and consequently in an infraction of the Treaty. This statement was, of course, induced by the fact that under our navigation laws, foreign vessels can not engage in our coastwise trade, and would not, therefore, be adversely affected by any treatment we might accord vessels engaged therein.

With this admission at the outset of the negotiations, it is indeed unfortunate that thus far we have been unable to dispose of the controversy by the positive assurance, upon our part, that the exemption would be confined exclusively to the coastwise trade, and thus prove non–discriminatory as to British shipping.

It can scarcely be doubted this would have been the outcome, had not Secretary Knox been embarrassed and the British hand strengthened by the unseemly haste with which certain of our citizens, both in and out of Congress, denounced the Act as a violation of the Treaty, and urged its immediate repeal or its submission to tThe Hague Tribunal, in contravention of our arbitration treaty with Great Britain, which authorizes arbitration only after diplomacy has failed.