Meanwhile a concession for building a sea-level canal in Panama (granted 1878) was acquired by a French company under Ferdinand de Lesseps. Work began in 1881, but poor planning, disease among the workers, construction troubles, and inadequate financing drove the company into bankruptcy in 1889. Amid charges of corruption and mismanagement, French courts transferred (1894) the rights and assets to a new company. Although the alternate Nicaragua route was favored by the United States, an American representative of the French company, William Nelson Cromwell, began working vigorously to interest the United States in the Panama route, and Philippe Bunau-Varilla, a leading figure in the new company, devoted himself to the cause. When a U.S. commission recommended a canal through Nicaragua in 1901, Bunau-Varilla persuaded the French directors to reduce the price of the company's rights, gaining the support of Mark Hanna and later of the new President, Theodore Roosevelt. The commission reversed its recommendation, and Congress authorized purchase of the French company's rights and construction of the Panama Canal.
The Columbia Electronic Encyclopedia, 6th ed. Copyright © 2012, Columbia University Press. All rights reserved.