How Wall Street Created a Nation: J.P. Morgan, Teddy Roosevelt, and the Panama Canal

In the verion I read, the author has Morgan as being from Louisiana. Tyler moved to Alabama from Tennessee as a very young child and was involved in that state's politics for more than 50 years, 30 of them as a Senator. Louisiana never sent anyone named Morgan to the Senate (and only one to the House).

The book reads well, but a sloppy error like that makes you want to backtrack a lot of other information.


A HISTORY BOOK THAT WILL MAKE HISTORY   November 16, 2003
 1 out of 5 found this review helpful

There are few history books that will make history. This is one of those rare books. In only 300 pages, the author, a New York lawyer and a Panamanian, has shaken 100 years of history about how the United States gained the rights to build the Panama Canal and how his country gained its independence from Colombian on November 3, 1903 with a complex, eye-popping account that has caused a stir in his native country.

To introduce a fresh view at the beginnings of the U.S. presence in Panama is no small feat considering that there are several dozens books on the library shelves about it, including a National Book Award by famed writer David McCullough. What makes Diaz-Espino's book so compelling and a must read is the fact that its conclusions are entirely logical; every event that occurred during and after the revolution can be explained through the prism of the author's main thesis, something that previous books failed to do.

The author's main argument is that the secession of the republic of Panama from Colombia was planned, financed and executed under the direction of a group of Wall Street and French promoters, which included J.P. Morgan, lawyer William Nelson Cromwell, as well the heads of Citibank, Banker's Trust, and Credit Lyonnais, all of who had a lot to gain from ensuring that a Canal was built through Panama instead of Nicaragua. That is, money, and not President Theodore Roosevelt's "manifest destiny" to expand in Central America or Panamanian's desire for independence as people in Panama want to believe, led to the independence of the country 100 years ago.

To someone who functions in the modern world and studies how policy is made, it seems entirely plausible that a powerful lobby well connected with the Republican Party, a trans-continental economic elite, an impetuous American President, and an expanding superpower have the right credentials to liberate this tiny Central American country whose greatest asset has always been its strategic Isthmus in which to build a canal. However, the book has caused a violent debate in Panama, where traditions die hard.

Having been present at Panama's centennial celebration on November 3, 2003, I realized that the country is polarized between those who accept and those who reject the book's main argument. The former include young professionals who are suspicious of the "official version" which glorifies the founding fathers and leave no role for Americans, and who are hungry for a fact-based history made up of people with fear, greed, honor, and cowardice - people like us- which Diaz-Espino's book provides to them. The latter and more vociferous group include an unusual alliance between descendants and friends of the aristocratic founding fathers who want to cling to their past honors, and left-leaning university professors who find it hard to swallow after a century of Yankee bashing that they owe their independence to greedy American businessmen and Washington's geo-political agenda.

Not since the 1977 Panama Canal treaty was debated have Panamanians so fiercely re-examined their own history vis-a-vis the American occupation which lasted one century, all thanks to the convincing evidence presented in Diaz-Espino's book. Indeed, it is a sign of a great book to stir such a debate.

But Diaz-Espino's account is not only of value to Panamanians and the few Americans academics. By revealing the inner workings of how business elites gain influence and set the course of American foreign and military policy, the book is a must read for anyone interested in U.S. -Latin American relations and world politics today.

Christopher Carnoy
Independent Columnist


It was not only Wall Street   November 5, 2003
 11 out of 12 found this review helpful

WAS PANAMA A MERE CREATION OF WALL STREET --O WAS ITS INDEPENDENCE THE EFFECT OF THREE POWERFUL FORCES?

by: Roberto N. Mendez (*)

Panamanian lawyer Ovidio Diaz-Espino's essay, "How Wall Street Created a Nation", whose Spanish version recently became available, informs us about a few, little-known but important, historical facts related to Panama's independence from Colombia, which happened on November 3, 1903. Un-fortunately, the essay's argument is simplistic, aside from the fact that it turns out to be contradictory and unoriginal.

The book's title, its Preface, its first chapter, and the author's own public statements, all align themselves with the "black legend" which surrounds Panama's independence.
According to it, Panama's independence from Colombia was conceived, promoted, financed and led by a group of New York bankers, headed by cunning lawyer William N. Cromwell, who acted in liaison with President Theodore Roosevelt.

Also according to the legend, Panama's founding fathers were little more than corrupt puppets, who merely followed Cromwell's instructions word for word, all in exchange for the classic handful of silver coins.

Such viewpoint is not only simplistic -it contradicts several historical sources and evidences, some of which, paradoxically, are mentioned by Diaz-Espino himself.

For one thing, it is well known that Jose A. Arango and other Panamanians started the conspiracy between June and July of 1903, at great personal risk. In other words, the separatist plot began spontaneously in Panama, and much before the Colombian Congress rejected the Herran-Hay Treaty, which occurred on August 12, 1903.

Only after the treaty was rejected did President Theodore Roosevelt began to lean in favour, not of Panama's independence, but of the odd thesis of American jurist John Basset Moore. According to Moore, the Mallarino-Bidlack Treaty of 1846 allowed to US to build a Canal through Panama, regardless of the wishes of the Colombian government.

Well-known historical documents testify to this fact. French investor Phil-lipe Bunau-Varilla provided one of them, in his book "From Panama to Verdun". Bunau-Varilla describes there how he met, in early October of 1903, with Roosevelt, and how he convinced the American President to abandon Moore's thesis, and to lend support to the separatist plot.

Surprisingly, Diaz-Espino mentions the meeting in his book, but he never realizes that it contradicts his essay's central thesis.
The essay's ending is no less of a surprise. On chapter 11, Diaz-Espino asserts that Panama's independence from Colombia was the joint result not of one, or two, but of three "powerful forces"; the first, Roosevelt's "ambi-tions" relative to the Canal; the second, Wall Street's "greed"; the third, Panamanians' "century-old aspiration to independence".

"Does not such a statement imply a contradiction vis a vis the essay's cen-tral argument?", Diaz-Espino was asked publicly in mid 2003, while visit-ing Panama on occasion of Panama's yearly Book Fair. As expected, the author was unable to offer a coherent answer.

In addition to that incongruence between central thesis and historical evi-dence, Diaz-Espino's essays suffers from a lack of originality, derived, ap-parently, from the author's unawareness about previous works on the sub-ject.
Indeed, Colombian journalist and historian Eduardo Lemaitre, whose work "Panama and its separation from Colombia", was published already in 1972, described the role that Cromwell and his group played in detail. And before Lemaitre, Colombian intellectual Oscar Teran, in his voluminous essay "From the Herran-Hay to the Hay-Bunau-Varilla treaty" (published in the thirties of last century) also divulged a large amount of information on the subject. What is more, Teran used the same sources that Diaz-Espino uses. It is therefore amazing that neither of these two previous and well-known works is even mentioned in Diaz-Espino's essay.

Yes, Ovidio Diaz-Espino's essay informs us of a few interesting and little known historical facts; unfortunately, his viewpoint is simplistic, contradic-tory, and lacking of originality. His purpose seems to be convincing us that Panama's independence was an episode characterized solely by the selfish-ness, corruption and cowardice of its participants. But in doing so Ovidio-Diaz contradicts himself, and seems to forget that all historical events are the result of interactions between positive and negative elements, which in one way or another contribute to the material and spiritual advancement of the people.

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(*) Roberto N Mendez (www.rnmendez.com) is a professor of economics at Panama's National University.