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==== Canal diplomacy ==== The U.S. used the "big stick" during "Canal Diplomacy", the diplomatic actions of the U.S. during the pursuit of a canal across Central America. Both [[Nicaragua]] and [[Panama]] featured canal related incidents of big stick diplomacy.<ref name="Conniff">{{Harvnb|Conniff|2001|p=63}}</ref> ===== Proposed construction of the Nicaragua Canal ===== {{Main|Nicaragua Canal}} In 1901, Secretary of State [[John Hay]] pressed the Nicaraguan Government for approval of a canal. Nicaragua would receive $1.5 million in ratification, $100,000 annually, and the U.S. would "provide sovereignty, independence, and territorial integrity".<ref name="Berman">{{Harvnb|Berman|1986|p=149}}</ref> Nicaragua then returned the contract draft with a change; they wished to receive, instead of an annual $100,000, $6 million in ratification. The U.S. accepted the deal, but, after [[United States Congress|Congress]] approved the contract, a problem of court jurisdiction came up. The U.S. did not have legal jurisdiction in the land of the future canal. This problem was on the verge of correction until pro-Panama representatives posed problems for Nicaragua; the current leader ([[José Santos Zelaya|General José Santos Zelaya]]) did not cause problems, from the outlook of U.S. interests.<ref name="Berman" /> ===== Construction of the Panama Canal ===== {{Main|History of the Panama Canal}} In 1899, the [[Isthmian Canal Commission of 1899|Isthmian Canal Commission]] was set up to determine which site would be best for the canal (Nicaragua or Panama) and then to oversee construction of the canal.<ref name="WebDocPAN-HISTORY">{{cite web| title = The Panama Canal: History| website = eclipse.co.uk| date = December 30, 1999| url = http://www.eclipse.co.uk/~sl5763/panama.htm| access-date = August 20, 2008| archive-date = May 15, 2008| archive-url = https://web.archive.org/web/20080515050735/http://www.eclipse.co.uk/~sl5763/panama.htm| url-status = dead}}</ref> After Nicaragua was ruled out, Panama was the obvious choice. A few problems had arisen, however. With the U.S.'s solidified interests in Panama (then a small portion of [[Colombia]]), both Colombia and the French company that was to provide the construction materials raised their prices. The U.S., refusing to pay the higher-than-expected fees, "engineered a revolution" in Colombia.<ref name="Zinn1">{{Harvnb|Zinn|1999|p=408}}</ref><ref name="Davis2">{{Harvnb|Davis|1990|pp=224–227}}</ref><ref name="UncleSam1">{{Harvnb|Bishop|1913|p=23}}</ref> On November 3, 1903, Panama (with the support of the [[United States Navy]]) revolted against Colombia. Panama became a new republic, receiving $10 million from the U.S. alone. Panama also gained an annual payment of $250,000 and guarantees of independence.<ref name="Davis2" /> The U.S. gained the rights to the [[Panama Canal Zone|canal strip]] "in perpetuity". Roosevelt later said that he "took the Canal, and let Congress debate".<ref name="Davis2" /> After Colombia lost Panama, they tried to appeal to the U.S. by the [[Separation of Panama from Colombia#Reactions|reconsidering of treaties]] and even naming [[Panama City]] the capital of Colombia.<ref name="Reaction1">{{cite web| last = Vargas| first = Diego Uribe| title = Capitulo XIV: Memorial de Agravios | publisher = Biblioteca Luis Ángel Arango| date = January 12, 2007| url = http://www.banrepcultural.org/blaavirtual/historia/canal/can13.htm | access-date = August 21, 2008|language=es}}</ref>
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