On December 5, 1911, the Company's agent, Mr. F. H. Allen, again addressed the State Department with a proposition designed to soften its objections. In the company as now designed the Japanese, said Allen, would control only thirty-five per cent of the stock, with an option on an additional fifteen per cent; Americans would have a majority in the board of directors, and would name the company's president. To this the Secretary replied on December 18th that he had nothing to add to his previous declarations. Whereupon with great persistence, Allen addressed the Assistant Secretary, Mr. H. Wilson, but from him received no greater satisfaction.

Public opinion was now directed to the case, and on February 29, 1912, Henry Cabot Lodge frankly put the question to the Senate: "Suppose, for example, some great Eastern power should directly or indirectly take possession of a harbor on the west coast of Mexico for the purpose of making it a naval station. . . . It is not very long since an indirect movement was begun, and it is apparently still on foot to obtain possession for a foreign power of Magdalena Bay. . . If it did, we should immediately intervene. We should declare that this was a violation of our constant policy known as the Monroe Doctrine." 18

On April 2d, the Senate passed a resolution demanding all the information in the government's possession respecting the transfer of land at Magdalena Bay to either the government of Japan or a Japanese corporation. To which the Secretary of State replied that neither Mexico nor Japan was interested as a government, but outlined what he knew of Allen and the company's plans.

The report being before the Senate, Lodge on May 1, 1912, made an historical survey of the case, and pointed out the dangerous proximity of such a corporation as was planned. "The fact," said Lodge, "that a colony is contemplated at Magdalena Bay composed of citizens or subjects of a foreign government, who would hold a point of great military value and might establish a coaling station, is just as much

18 Ibid. p. 233.

to be guarded against by the United States as if it were done directly by a foreign government. The thin veil of a corporation does not alter the character of the act." 19 Lodge contended that every nation has a right to guard its own security, and that if it feels the possession by a foreign power for military or maritime purposes of a particular harbor or spot is dangerous to its safety, it is as well its duty as its right to guard against it.

This point of view was a distinct departure from that of 1866 when the United States gave full approval to Ecuador's intention to surrender the Galapagos Islands to English creditors of the Republic. At that time Seward went on record to the effect that "If Ecuador is invested with the title to those islands, I know no reason upon which the government could question the right of Ecuador to convey the soil to such private persons as should desire to buy, whether they should be the subjects or citizens of one state or country or of another." 20

The Magdalena Bay case was thus a departure in more ways than one. It was the first application of the Monroe Doctrine to Japan. It was an extension of the doctrine to the occupation of American soil by a foreign corporation on the score that such possession would afford an opportunity for political influence. Not least significant, it extended the Monroe Doctrine to cover private commercial transactions in America.

THE PANAMA CANAL TOLLS

If his general policy in Mexico was humane, and the Magdalena Bay development was constructive, in another field of policy the precedent bequeathed by Taft was less felicitous. The Panama Canal was nearing its completion, and the problems of its management and operation therefore grew acute. The United States had no desire to block the traffic of the world by unwarranted or excessive rates. Indeed a Canal Act of August 7, 1912, restricted these to

19 Quoted in Kraus, Herbert, Die Monroedoktrin (Berlin, 1913). 20 Ibid.

$1.25 a ton-a rate to which the world did not object. The joker lay, however, in exemption from the toll of vessels engaged in the coastwise trade of the United States. Here was an open and a flagrant breach of the Hay-Pauncefote Treaty, and the British Foreign Office immediately protested. Former Secretary Elihu Root pleaded eloquently for arbitration, failing which, he said, "we shall not only violate our solemn obligation, but we shall be false to all the principles that we have asserted to the world and that we have urged upon mankind." "1 He offered in the Senate in January, 1913, an amendment to the Act designed to obviate its objectionable features. But Secretary Knox was obliged, as actively in charge of the State Department, to uphold as best he might the existing legislation.

21

There was really no excuse to offer. The treaty was worded with precision. Its interpretation lay beyond the realm of doubt. The best that Knox could do was to contend that Britain had no ground for protest till the act was in effect and injuries could be proved and estimated. Then, he granted, resort to arbitration might be necessary. To which the British government rejoined through its distinguished ambassador, James Bryce, that its complaint already was sufficient to demand relief, and urged The Hague Tribunal for its settlement. The British reply took the form of a series of "observations," which were presented on February 27th when but five days were remaining to the Taft Administration. They constituted, therefore, an immediate problem for Wilson and his Democrats.

The Taft Administration is too near us to venture with much confidence on an estimate of its spirit and achievements. Yet as everything before the War now apparently belongs to another age, one may risk the attempt. Undoubtedly the President himself impressed upon our foreign policies the imprint of his personal character. In relations. with our immediate neighbors, Canada and Mexico, his genial spirit exercised a salutary influence. Toward Nic

21 Panama Canal Tolls. The Obligations of the United States. By Elihu Root in World Peace Foundation Pamphlet Series, vol. III, No. 3, March, 1913, page 21.

aragua and the Chinese loans, especially the latter, the President perhaps acceded too completely to the influence of imperialists and financiers. His successor, at any rate, saw reason to reverse the "Dollar Diplomacy" of the State Department under Knox, though financial supervision has remained a permanent policy toward Nicaragua, with benefit to the latter and ourselves. Nor was the final settlement of the seal disputes a negligible achievement. The importance of the fisheries and the establishing of precedents for a new law of the seas were notable considerations. To generalize quite broadly, Taft's years in office were in respect to foreign policies, however, a tranquil era. They partook in some slight measure, one may say, of the genial character of the President.

T

CHAPTER XXVI

THE OLD ORDER PASSES

HE election of 1912 raised to power a subject of more controversy than any other in the history of

the United States, a man whose motives, objects, achievements, and reverses, whose titanic contests with contemporaries, and whose eventual martyrdom render him a world figure, and the center of high tragedy, a man who was the object of pride, envy, reverence, bitterness and pity, who experienced in himself the whole gamut of emotions, and roused them correspondingly in others. Imperishable as the rivalries of Cæsar and Pompey, remote posterity will find their parallel in the bitterness of Roosevelt and Wilson. Our age has witnessed momentous enterprises and great men. To do them justice is impossible but the attempt must be assayed.

Prior to his entry into office, the career of Wilson had been one of constant preparation for ever greater tasks. It was enlivened also by almost constant conflict. In law and teaching, in collegiate administration, in literature and politics, the President had displayed originality and constructive thinking. He made effective contributions to progressive thought in all these varied fields. In intellectual equipment he was best prepared of any President in the history of the United States. He had, however, in each of these departments been unquestionably a storm center. Experience thus forecast that as such he would continue.

The President was conscious of his mission. He believed himself appointed to restore America to democratic principles. Like Roosevelt he believed himself to be the logical successor of Abraham Lincoln. Unlike his rival he was never able to make the popular appeal which Lincoln made. But in intellectual comprehension of the master liberal and