Random Thoughts

In 1902, the U.S. purchased the rights and assets to the Panama Canal project from a French development company for about $40M in gold. The initial asking price was $100M. In 1903, the U.S. paid Panama, a newly created state plucked away from Columbia with Uncle Sam's help (fascinating story on its own), $10M + $250K in annuities. In nominal terms, that is greater than the combined sum of all the previous land purchases combined:
- Louisiana in 1803 for $15M
- Florida in 1819 for $5M
- Alaska in 1867 for $7.2M
- Philippines in 1898 for $20M

The key figure in negotiations with the French, who happened to convince Theodore Roosevelt to select the Panamian project vs. the Nicaraguan alternative, was J.P. Morgan. If one would ask Gemini for the reasons behind his involvement, a list of generic answers would appear. Financial interests, political influence, strategic importance, and patriotism. Although these were generally correct for almost anything J.P. was professionally involved with throughout his career, AI fell short in identifying the reason.

Teddy, who assumed the presidency in 1901 after McKinley's assassination, turned out to be quite a different politician than business elites were counting on. He aggressively pursued anti-trust policies. To that end, he opposed the merger which created the Northern Securities Company, a railroad trust formed in 1901. The Sherman Antitrust Act of 1890 was applied. This was a direct blow to the House of Morgan. Especially humiliating was that it came from an unelected official.

Morgan desired to restore his reputation and favorable regulatory regime first and foremost, which forced him to make inroads with T.R. When J.P. learned about Teddy's drive for a canal and the treasury's inability to finance such purchase he lobbied for a meeting and ultimately was successful as strategic planner, negotiator and financier.

#AmericanImperialism #history
November 2024

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145 viewsedited  Nov 19, 2024 at 17:54

In 1902, the U.S. purchased the rights and assets to the Panama Canal project from a French development company for about $40M in gold. The initial asking price was $100M. In 1903, the U.S. paid Panama, a newly created state plucked away from Columbia with Uncle Sam's help (fascinating story on its own), $10M + $250K in annuities. In nominal terms, that is greater than the combined sum of all the previous land purchases combined:
- Louisiana in 1803 for $15M
- Florida in 1819 for $5M
- Alaska in 1867 for $7.2M
- Philippines in 1898 for $20M

The key figure in negotiations with the French, who happened to convince Theodore Roosevelt to select the Panamian project vs. the Nicaraguan alternative, was J.P. Morgan. If one would ask Gemini for the reasons behind his involvement, a list of generic answers would appear. Financial interests, political influence, strategic importance, and patriotism. Although these were generally correct for almost anything J.P. was professionally involved with throughout his career, AI fell short in identifying the reason.

Teddy, who assumed the presidency in 1901 after McKinley's assassination, turned out to be quite a different politician than business elites were counting on. He aggressively pursued anti-trust policies. To that end, he opposed the merger which created the Northern Securities Company, a railroad trust formed in 1901. The Sherman Antitrust Act of 1890 was applied. This was a direct blow to the House of Morgan. Especially humiliating was that it came from an unelected official.

Morgan desired to restore his reputation and favorable regulatory regime first and foremost, which forced him to make inroads with T.R. When J.P. learned about Teddy's drive for a canal and the treasury's inability to finance such purchase he lobbied for a meeting and ultimately was successful as strategic planner, negotiator and financier.

#AmericanImperialism #history
November 2024

BY Random Thoughts