ago in the testimony, the freight coming into the Isthmus consigned to us during those four months moved about as it came in. Senator MORGAN. Suppose the Government should enact a law to prohibit persons who are suspected of infection of bubonic plague, of yellow fever, or any other of the extremely dangerous diseases, from going out of that Isthmus, from going abroad at all; suppose the Government puts the men under duress and in confinement or restraint on the Isthmus, and prevented them from going out-would not that have a very modifying effect upon the quarantine proceedings? Mr. SCHWERIN. No, sir; not the slightest. Mr. MORGAN. Why not? Mr. SCHWERIN. Because they would not know but what some person on a ship might have had contact with a person on shore, and they could not watch everybody, and they would not know but what that party that had contact on that ship would be just the one that might come ashore at their port. So they get hysterical the moment there is any bubonic plague noted anywhere in those countries, and I believe they have the same rights that we have. We have to suffer exactly the same thing in San Francisco and Honolulu with our steamers. They are just as rigid on that thing with us, absolutely the same, as those Central American people are, in the case of our steamers operating on that coast. Senator MORGAN. According to the statements that you make about the dealings with that steamer that went up and down the coast there, the question of building the canal depends very largely upon the statement of some doctor that there is a case of bubonic plague on the Isthmus, or a case of yellow fever? Mr. SCHWERIN. I noticed here some time ago that there was publicity given to every case of yellow fever on the Isthmus. I have gone through our company records and asked the old masters and officers, and I find that we have never lost anybody down on the Isthmus with yellow fever. We have had the boys get malarial fever once in a while, and when La Boca, this entrance to the canal, was opened and we handled the ships at La Boca instead of down the bay with lighters they were all very uneasy about going up there. But we insist upon their drinking our water. We have special water for everybody, and we are very rigid about their food and clothing and meals, and we never have had a sickness of any kind known as yellow fever. the men do get malarial fever every once in a while down there, and they lay off and seem to get all over it in two months, and during that time they lay off the ship. But Senator DRYDEN. Is not this about the summation of the whole case as it relates to your interest: That the Commission, representing the Government, perhaps impatient, feeling, probably, that the American people might be impatient, have proceeded in their work before they had completed their organization, before they had developed a system, before they had settled, well-defined plans for prosecuting work, and that as a natural and almost inevitable consequence of that some confusion has arisen, temporarily at least, but confusion has arisen which has resulted, among other things, in the congestion which has occurred on this road, and that what remains to be done and ought to be done is now to complete their organization, to develop their system, to perfect their plans so that all will work smoothly and harmoniously? Mr. SCHWERIN. That is exactly what the French did before they started in. Senator DRYDEN. Is it not about what is required now by the conditions existing on the Isthmus? Mr. SCHWERIN. Undoubtedly, Senator; the idea of building the canal should absolutely cease until they are in a position to do it. Senator DRYDEN. And therefore, I suppose, we may infer that there has been no great waste of money, no great squandering of the funds of the Government, no great mistake made, but temporary errors owing to the haste which has been shown, which can be cured and overcome without any serious difficulty? Mr. SCHWERIN. Well, Senator, if you have considered that I am here before this committee to criticise anything of that kindSenator DRYDEN. I do not; no. Mr. SCHWERIN. I am here as a mother to protect her own; that is all. I have no desire whatever-I think that Mr. Shonts and Mr. Stevens are doing their best so far as the canal is concerned. Senator DRYDEN. I did not mean that. Mr. SCHWERIN. They are doing their best so far as the canal end of it is concerned. Now, the freight end is the end that I know about. Senator DRYDEN. It was not my intention to put you in the attitude of unfair criticism at all. Mr. SCHWERIN. Well, I hope that you will withdraw that, Senator, because it looked as though what I have said to-day might be interpreted in that way. Senator DRYDEN. Well, if anyone got that impression from what I did say it certainly would be removed by what I say now-that I have no such intention and I did not so understand you. If there is a doubt left, I want to clear that up by saying that I have not so understood you at all in your testimony. But we are aiming to get at facts, to get all the light upon this subject that we can get, and it is only by getting the evidence and testimony of gentlemen like you, who are familiar with the different phases, that we can get the necessary information. Now, as I understand it, what remains to be done is to perfect our system. We have gone ahead pretty fast, and we have entered upon the serious phases of this work before we had really perfected our plans sufficiently to do that. Mr. SCHWERIN. That is right. The dirt was to fly the first week that they turned the canal property over; the "dirt was to fly." Senator DRYDEN. That sentence had become rather hackneyed, and I did not care to use it. I had it in mind. Mr. SCHWERIN. Pardon me for using it. Senator MORGAN. About how soon is the Panama Railway to be in competition with the railway at Tehuantepec? Mr. SCHWERIN. In next June. Senator MORGAN. Is that likely to be an important competitor? Mr. SCHWERIN. I think it will practically clean out all the American cargo that we now handle via the Isthmus, on account of being very much shorter, and undoubtedly they will have no other freight on that 175 miles of road than this New York freight, and they can devote their whole energies to putting it through, and they can reduce the time very materially, probably to twenty-three or twenty-four days, between New York and San Francisco; and that simply means that all this freight is likely to go that way. Senator MORGAN. Then you expect the Tehuantepec Railway to put the Panama Railway out of business? Mr. SCHWERIN. Yes, sir; they will put us out, too. Mr. SCHWERIN. It will put us out. I do not see any help for it. Of course no one can tell, in the traffic business, how these things will switch; you may study it as much as you please. Under the present arrangement with the American-Hawaiian Line they propose to run the steamers from Salina Cruz to San Francisco and to the islands and back to Salina Cruz. That does not provide for any freight originating on the Pacific coast to New York. It provides for taking freight from New York out, but none back. Now, it might be that we might work in there and do that business and still hang on. The shippers are nearly all sick of the Panama route, gentlemen, and will withdraw their patronage very rapidly, except those that are actually compelled to use that route in Central America and Mexico. There are lots of large shippers in San Francisco that have withdrawn their patronage. (Mr. Schwerin having finished his statement, he was excused, and the committee went into executive session; after which an adjournment was taken until Monday, February 5, 1906, at 10.30 o'clock a. m.) ISTHMIAN CANAL. COMMITTEE ON INTEROCEANIC CANALS, UNITED STATES SENATE, Washington, D. C., Monday, February 5, 1906. The committee met at 2.30 o'clock p. m. (no morning session hav ing been held). Present: Senators Millard (chairman), Kittredge, Dryden, Hopkins, Ankeny, Morgan, and Simmons. Present, also, John F. Wallace, esq. TESTIMONY OF JOHN F.. WALLACE, ESQ. Mr. Wallace was duly sworn, and testified as follows: Senator KITTREDGE. And what is your age? Mr. WALLACE. I am 53 past. Senator KITTREDGE. Where is Mr. WALLACE. In Chicago. your residence? Senator KITTREDGE. What is your profession? Mr. WALLACE. I did not graduate. It was a classical school, and I was not able to get all of my engineering education there, and I had to supplement it by private instruction. I dropped those studies that I did not think were necessary, among which were Hebrew and one or two things of a theological nature, so that I did not take a diploma from it, although afterwards I was given a degree from the college. Senator KITTREDGE. Now you may take your business career, in a general way, from that time until you became connected with the Isthmian Canal Commission. Mr. WALLACE. Between 1871 and 1876 I was engaged as an assistant engineer on the improvements of the Mississippi River, principally on the Rock Island rapids, under the United States Engineer Corps organization. My work consisted in rock excavation under water, and river and harbor surveys. During that time I was generally the executive officer in charge of the working parties that conducted the surveys, and on the Rock Island rapids, and on the upper Mississippi River, and on the surveys for the guard lock on the Keokuk Canal a Montrose. Later I was employed as chief engineer and superintendent of construction of what is now the Iowa Central Railroad in Illinois. I constructed that line from Peoria, Ill., westward to the Mississippi River, and also had charge of its operation. Later on I had charge of the construction of the steamboat transfer over the Mississippi River at Keithsburg, Ill., and was associate engineer on the construction of a |