of the first transcontinental railroad
since the Spaniards landed in the Isthmus of Panama for the first time in 1501,
Panama has been a natural transit route for merchandise and people attempting
to cross from one ocean to the other.
early as the 1520s the Spanish Crown explored the possibility of constructing
a Canal through the Isthmus, but the idea was later abandoned. In the 19th Century,
the United States also saw the opportunity of joining the two oceans, but they
had a railroad in mind instead of a Canal.
1832, Congress sent Col. Charles Biddle to Panama to negotiate a concession for
the construction of a railroad. He also inspected the country for the best route.
Biddle died shortly afterward, but interest in the project continued.
1848 a charter was granted to the Pacific Mail Steamship Company to deliver mail
between the U.S. and Panama. The incorporators were William H. Aspinwall, his
uncle, Gardiner Green Howland, Henry Chauncey, and Edwin Bartlett. Three wooden
paddle-wheel steamships were built; the California, the Oregon and the Panama.
They would deliver mail between New York, Panama and San Francisco, but the discovery
of gold in California in January 1848 took Aspinwalls attention away from
seekers chose the Panama route instead of the difficult, plodding journey across
the plains, desert and mountains of the uncivilized, Indian-infested overland
immediately sent John L. Stevens to Colombia, which controlled Panama, to negotiate
a concession for a Panama Railroad. The company would have the right to excavate
a Canal or build a highway or railroad across Panama. The concession was exclusive
for 49 years. They were granted 250,000 acres of land, and other government land
could be used freely.
Panama Railroad was incorporated in New York on April 7, 1849. In January 1849
the company hired Col. George W. Hughes to make a location survey. This was not
an ideal location to build a railroad. From June through December there were deluges
of rain in cloudbursts that often lasted as long as three days. The isthmus was
covered with dense, steaming jungles, and there was no durable timber for railroad
construction. The native population was unaccustomed to physical labor and was
undependable. Men, materials and provisions had to be imported from thousands
of miles away.
Executive Committee of the corporation met for the first time on July 9, 1849
to ask for bids. The construction contract was awarded October 12 to a company
headed by George M. Totten and John G. Trautwine.
sent an order to New Orleans to have a small pine board shack built and shipped
to him. This was the first permanent structure in what later became the town of
Aspinwall (later Colon). Other shacks were soon erected for the workers.
Island was cleared and protected with an earthen embankment above the high-tide
mark. Businessmen came, rented space and built stores, gambling halls, saloons
a typical town emerged. Docks were constructed to accommodate ships bringing
supplies, materials and machinery.
August 1850 construction began on the mainland around Monkey Hill, soon to be
called Mount Hope. Struggling across four miles of swamp, the men reached the
Chagres River and the native village of Gatun. Late in 1850, pile-driving equipment
first rails used were the inverted U type. These rails were first
used in 1835 and were called bridge rails. They weighed 40 lbs per
1, 1851 eight miles of track had been completed at a cost of more than $1 million.
Expectations of quick profits disappeared and the Panama Railroad stocks
value began to fall sharply. The California gold rush had begun two years earlier,
but travelers were still frantically making their way west. In December 1851,
two boats arrived at the mouth of the river in Panama with a thousand passengers.
They were amazed when they heard a locomotive whistle! The travelers rushed to
the railroads office. George Totten informed them that the railroad had
only seven miles of track laid, but the people wanted to ride anyway.
1,000 crazed men for a seven-mile train ride would certainly delay the construction
work and bring a reprimand from officials in New York. To discourage the crowd
he quoted a charge of 50 cents a mile and three dollars for each 100 pounds of
baggage. The excessive charge was eagerly accepted. Totten collected nearly $7,000!
The Panama Railroad was suddenly in the passenger business. Its worthless stock
on Wall Street began to rise rapidly. The railroad sold $4 million worth of stock
and construction proceeded in high gear.
population of Manzanillo Island was growing steadily. To commemorate the name
of one of the railroads originators, the place was named Aspinwall. The
government of Colombia rejected the name and insisted that it should bear the
name of Christopher Columbus, the man that first discovered the land. It should
be known as Colon. There was great resistance and the controversy continued for
38 years. Finally, the Colombian postal department refused to deliver mail addressed
to Aspinwall. Since 1890 the town has been known as Colon as it is still known
May 1, 1852, the rails reached Frijoles, 18 miles from Aspinwall and by July 6,
the rails reached Barbacoas where the Chagres River had to be crossed. The iron
bridge across the Chagres River was completed and at 11:00 a.m. on November 26
the first train (a locomotive and nine cars full of passengers and freight) rolled
across the new bridge.
January, 1854 excavation began at the summit of the Divide, where the cut was
40 feet long. Several months were spent digging the cut. Travelers arriving at
the end of the track were very surprised instead of a jungle of wilderness,
they found the new village of Culebra with about 2,000 inhabitants.
miles below the summit, the rails entered the high, beautiful valley known as
Paraiso. It was a place of tropical beauty. The grading was completed in November
the morning of January 27, 1855 two construction gangs working towards each other
could see each other. Darkness came. Large lanterns with rancid whale oil in their
fonts were lighted. The work gangs met and mingled, an air of anticipation and
excitement surrounded the area. The last rail was set in place on pine crossties.
The final spike was held in position. George Totten stood in the pouring rain
with a nine-pound maul ready. He swung the hammer and the spike sank into the
tie with a thud.
Sunday, January 28, 1855 a train ran from the Atlantic Ocean all the way across
the Isthmus of Panama to the Pacific Ocean for the first time. The Panama railroad
was in business. It was a single-track railroad 47 miles long with a maximum grade
of slightly more than one percent for four miles approaching the crest of the
Divide. Rails were laid on pine crossties, which disintegrated quickly in the
damp tropical heat. As a remedy, ties of lignum vitae were imported from Cartagena,
New Grenada. The wood was so dense and hard that holes had to be drilled before
spikes could be driven.
were laid at Matachin, Gatun, Barbacoas and at the Summit. There were four-yard
tracks at Aspinwall and three at Panama City. A roundhouse, machine shop, car
repair shop and blacksmith shop were located at Aspinwall. Stations were built
about every four miles with freight houses, depots and homes for employees.
were six heavy locomotives and four lighter ones. Rolling stock included 22 passenger
cars with a capacity of 60 passengers each, as well as 51 boxcars and 72 flat
cars. Wood was stacked along the road at intervals for $3.00 a cord as fuel for
the time the railroad was in operation it had cost $6,564,552.95. First class
passenger fare was $25, children under 12 years old $6.25; second class fare $10;
personal baggage ten cents a pound, mail .22 cents a pound; coal was $5.00/ton;
first class freight in boxes or bales was .50 cents a cubic foot. All freight
charges were paid in gold.
Panama Railroad was a very lucrative investment. Between 1855 and 1867 more than
$700 million in gold was carried on the railroad without the loss of a single
contract was negotiated between the Railroad and the government of Colombia on
January 30, 1875. The railroad would pay $1 million in gold plus $250,000 a year
during the life of the contract (99 years). The railroad would extend its rails
into the Bay of Panama so that deepwater ships could reach its wharves. Mail,
officials and troops of Colombia were carried free of charge.
completion of the Central Pacific Union Pacific railroad at Promontory,
Utah on May 10, 1869 was the turning point in the fortunes of the Panama Railroad.By
1877 the Panama Railroad had revenues of $1,284,000 and operating expenses of
$998,000, leaving a profit of $286,000. Essentially the railroad was bankrupt.
On Wall Street the stock plummeted from $369 per share in 1874 to less than $52