Scandals and opportunities: how the Panama canal changed Bordeaux

by Charlie Leary

“Panama! Panama! A name still synonymous with hope and success,

always later changed to a cry of disillusion.”

Revue Philomathique de Bordeaux, 1913

No two 19th century worlds could have contrasted more sharply than Bordeaux and Panama cities: the former bourgeois, stolidly urban, bordered by vineyards bathed by a cool maritime climate; the latter poor, tied and bound by humid jungles, scorching heat, and disease, a mere appendage of a larger former Spanish colony from which it was isolated by the impenetrable Darien province, a vast wilderness known as the ‘Darien gap’.

The former represented the Old World and the latter the New World. Both were wine markets. One knowledgeable observer described Panama in the early 20th century:

“Panama . . . had already developed a personality of its own. Its culture was the result of Spanish traditions, French inspirations and some North American imitations. The country’s upper class reflected most fully these trends. The lower class was composed of native blacks, Indians, mulattoes and mestizos that found a common link in the Spanish culture. As a result, the latter was enriched with the contributions received from the influx of these different groups”.

19th century commerce
Over the 19th century, in grasping at growing international commerce, Bordeaux and Panama connected. Why? As the U.S. Bureau of Commerce summarised in 1913, reporting on potential traffic through Panama canal: “The prosperity of the port of Bordeaux is directly bound up with that of South America, as it is one of the great centres of export and import trade with that continent, where so many of the shopkeepers are French . . .” Chile, in particular, lay in Bordeaux’s sights.

In the era of the Panama Railroad, completed in 1855, and the California Gold Rush, the Bordeaux-Aspinwall (the Atlantic-side port town in Panama) line of sailing vessels started plying the waters, contributing in many ways to California viticultural history. “A merchant house in Bordeaux (Hue et Cie) had the happy thought of creating a clipper service between Bordeaux and Aspinwall, under these good market conditions, such that San Francisco can be reached from Bordeaux in about 60 days, less than half as much as by way of Southampton.” So significant was the French population on this line that a monthly mail ship Havre-Bordeaux-Colon began transiting in 1875. By 1915, when the US government opened its Panama Canal, the Bordeaux-Colon (as Aspinwall had been called since 1890) line included as its final destination “Le Pacifique” (and all that lay therein – effectively the West Coast of America).

Where was the wine in all of this? At the centre – and the reason that Bordeaux endured such a long love/hate relationship with this Central American territory.

In 1886, the Histoire du Commerce de Bordeaux depuis les origines jusqu’à nos jours (History of Bordeaux Commerce from its Origins to Our Time, Théophore Malvesin) exclaimed, “The most important article of export is wine.”

Wine counted among the freight transported by the Panama Railroad connecting the Atlantic and the Pacific Oceans, though we don’t know the quantities. The railroad, however, had reached its carrying capacity. The Histoire observed: “The transformation of sailing into steam navigation cannot escape our attention any more than the importance of creating new lines developing a regular service either with France or abroad.” The book perfectly portrayed contemporary Bordeaux sentiment. And, sponsored by the Bordeaux Chamber of Commerce, the author devoted a special section to the French diplomat Ferdinand de Lesseps, who was involved in the Panama canal project from its inception – as he had previously been with the Suez canal.

The Great Frenchman
An 1895 article in The Atlantic gives a colourful and rather personal summation of de Lesseps, once acclaimed as the Great Frenchman:

“Ferdinand de Lesseps was not a man of great intellectual calibre. He originated no new idea; he was not even an engineer; he was simply a promoter, though a promoter of the first order, and his services as such terminated in 1869 with the opening of the Suez Canal. All that he did afterwards either might have been done by anybody else, or should not have been done at all. Nevertheless he was a remarkable man, and as an eye-witness of the rise and fall of the Panama Canal Company I shall not soon forget that thick-set, corpulent figure, the piercing eye and ample forehead redeeming a flabby face, those snowy locks, that confident tone, that persuasive voice. In a crowd you would have singled him out, and have asked who he was. I was present, in 1879, at the so-called Congress of Engineers and Geographers — a transparent farce got up to ratify a foregone conclusion — at which the Panama scheme was launched; as also at the successive meetings of the company till its collapse in 1888”.

On the eve of de Lesseps momentous failure in building his (in retrospect, ill-conceived) inter-oceanic passage through the narrow isthmus, the Histoire was written just too late — in December 1886 — to include revelations about de Lesseps’ financial deceptions, to which the Bordeaux commercial elite had fallen foul, their eyes on growing New World wine markets.

Panama itself was such a market, though a small one, and the “French inspirations” inevitably included wine culture. Plenty of evidence for this exists, and it was Bordeaux merchants like Hue et Cie. that supplied the market, not just with ships but also retail shops. Panama City gave birth to the Champagne Cocktail according to an 1855 account: a sugar cube dropped into the base of a rocks glass, bathed in aromatic bitters, over which cognac was poured, topped up with Mumm’s and “fresh ice.” In 19th century Colon (Aspinwall), an entire alley behind Front Street was paved with wine bottles turned bottom-side up. In the late 1960s, American Canal Zone collectors uncovered “early French wine bottles” “underground along the Las Cruces trail” near the Gold Rush-era Panama Railroad.

Panama was also an entrepôt, and at times a controversial one. In 1879, testimony submitted by the San Francisco Chamber of Commerce against the proposed Franco-American Commercial Treaty specifically mentioned Bordeaux wine sales directed to Panama, suggesting chicanery:

“How to produce a brilliant red wine with fine flavour and bouquet, and sufficient strength to stand transportation, at 320 francs [per tonneau] was therefore the problem which the Panama trade sent to Bordeaux. The fault is not always on this side of the ocean. I know of Chateau Margaux sent to San Francisco during the last year for less than two francs a bottle, while the price current was not less than nine francs.” Bordeaux wine, then, counted among the important commodities sent to Panama, and from there onward via the railway, just before de Lesseps’ canal project commenced – and clearly its provenance could not always be trusted.

Later, when de Lesseps took one of his few voyages to Panama to begin the canal works, the plan included his young daughter ceremoniously pressing the button igniting the first blast breaking through the mountainous Culebra uprising, the awesome “Culebra Cut.”

“After due preparations, including wine, the fair hand of Mlle. Ferdinande De Lesseps pressed the button—and nothing happened. Some fault in the connections made the electric spark impotent,” recounts a contemporary source. This neatly foreshadowed the “Panama Affair,” which rocked Bordeaux and the country. The project ended with “the ruination of some half million middle class Frenchmen,” according to Hannah Arendt.

Corruption and scandals
This became the largest monetary corruption scandal of the 19th century. Gustave Rothschild, owner of Château Lafite-Rothschild, bankrolled Lesseps Suez Canal venture, but recoiled from Panama. So too did the Pereire brothers, owners of Chateau Palmer (also former backers). The success of Suez had gotten to Lesseps’ head. He figured conditions in Panama resembled those in the Middle East. They didn’t.

Had the Bordeaux Chamber of Commerce not backed the concept of a chauvinistic French canal cutting through a whisp of land connecting North and Central America with South America, the financial disaster may have never occurred. In addition, at least 22,000 people (many Afro-Antilleans, Indians, and Chinese) died during his efforts, a figure I suspect is gravely conservative.

To gain acceptance for his canal project, De Lesseps focused on Bordeaux. He travelled to the city numerous times to give lectures and presentations, starting in 1879. The Chamber threw its substantial weight behind the venture, which helped convinced the French state to also support it.

The Histoire recounted how “the persevering energy of M. de Lesseps” included coming “to give lectures in Bordeaux” alongside Chamber-sponsored “explorations and studies made in the Isthmus of Panama by engineers, several of whom went from Bordeaux with M. de Lesseps.” This contributed to gaining “capital raised from a large number of subscribers, funds necessary for the incorporation of the Company; and later the achievement of a considerable figure by various emissions of bonds.”

The Bordeaux Chamber of Commerce, dominated by wine traders, welcomed the invitation addressed to it by M. de Lesseps to appoint a delegate as part of the Commission he was establishing to travel to Panama to see the work’s progress. The Chamber appointed its delegate, and in the report made upon his return, he expressed the hope that these works would be finished near the time indicated and insisted that the [French] Ministry promote the necessary measures to bring to a successful conclusion this gigantic work, which was hoped to exert a considerable influence on the general trade of France and that of Bordeaux in particular.

Towards a truly international wine market
The Panama Canal we know today was finally completed, using locks, by the United States government around 1914. Such a transportation route for ships, connecting the Atlantic and the Pacific Oceans, had captured the imaginations of intrepid explorers since the 16th century. De Lesseps latched onto the idea although he scarcely knew this part of what was then called New Granada. He raised private funds based on mostly wild estimates of the true cost of transecting 80 kilometres of earth, lakes, snakes, jungle, rivers, crocodiles, and mountains – and failed as a result.

A few decades later, however, and the world had arrived at the age of steam. Locomotives, excavators, and ships provided the mechanical brawn necessary to envisage not only creating the canal, but also the riches it would generate as the age of great worldwide commerce reached new heights.

The contrast between the Bordeaux Chamber’s attitude towards de Lesseps’ doomed venture in the 1880s and the attitude to the canal’s predicted final opening in 1914 is telling. The circumspect tone 30 years later represented a perspective comprehending a more multifaceted global wine trade. And despite earlier losses, Bordeaux needed greater markets, not in the least for its wine, and would still have to use this new canal, even if finished by US investors rather than its own – but the trading world into which it emerged would be forever changed.

In 1912, a newspaper article pronounced on the upcoming International Congress of Chambers of Commerce in Boston. “On the eve of the opening of the Panama Canal,” the article singled out Bordeaux as the most obvious loser if French companies remained “disinterested” in the “markets of the New World.”

Another author in 1913 wrote of the “increase in navigation at the passage of Panama” and its benefits for the Bordeaux wine trade – while being remarkably clear sighted about the future development of other wine regions. “Bordeaux is also cited as one of the future metropolises of the cross-country trade… I am inclined to believe that the beautiful and rich maritime metropolis of the Southwest will meet, one day, in the markets of New Zealand and Australia the best conditions for wine sales… but… this requires taking into account … these countries’… legitimate desire to develop their [wine] production. On the other hand, California and Chile, not to mention many other sunny countries of the American Pacific Rim, are already wine producers and exporters.”

The future of fierce competition in a truly international wine trade lay visible on the Garonne river horizon.

Once finally complete, the wine trade immediately took advantage of the Canal, although not without challenges. In 1915, for example, mud slides at Culebra Cut stopped traffic, where one single detained vessel, the Alaskan, was carrying $35,042 worth of wine .

Another footnote in the challenges of building the canal perhaps – except for one telling detail. The wine on the Alaskan was travelling not from Bordeaux to the US, but from the Pacific Ocean to the Atlantic and European markets. In one fell swoop, the Panama canal had changed the international wine market forever and the place of Bordeaux within it.