Today, the California Diamond Jubilee Commemorative Silver Half Dollar Coin remembers when the Panama Railroad’s first train traveled the distance between the Atlantic and Pacific on January 28, 1855.
This railroad made it easier for the trip from the east coast states to the gold fields of California and the surrounding areas.
From The Americans in Panama by William Rufus Scott, published in 1912:
Luckily for the American promoters, the discovery of gold in California in 1849 came just as they were seeking to float their company.
The Isthmian route to California at once became heavily traveled and the eyes of the whole world, particularly of the United States, were again fastened upon Panama.
Our government in 1846 had concluded a treaty with Colombia which provided for the joint construction of a canal in Panama, and the stimulated interest in the Isthmian route in 1849 made this appear a fortuitous treaty, because it excluded any European power from that territory.
A controversy arose between the United States and England over the Nicaraguan canal route, culminating in a treaty between the two governments known as the Clayton-Bulwer treaty of 1850.
This treaty provided substantially the same as the Colombian treaty of 1846, that in the event of the construction of any canal in Central America, Great Britain and the United States guaranteed its neutrality and use on equal terms to all the world.
The addition of the territories of Oregon and California to the United States still further emphasized the need of quick communication between the Atlantic and Pacific.
The Panama Railroad, therefore, took hold upon the popular imagination.
Aspinwall and his associates pushed the construction of the road under James L. Baldwin, an American civil engineer of uncommon ability.
Labor of a desirable kind was not obtainable. Many nationalities were tried, with a tragic failure on the part of the Chinese, who seemed unable to face the terrors of the jungle.
Hundreds committed suicide, and disease and accidents claimed other hundreds.
The life cost of the Panama Railroad in the five years it was building has been estimated at 6,000 persons.
The route selected started at an island near the coast on the Atlantic side, the site of the city of Colon, crossed the hills into the valley of the Chagres River and followed that valley to the continental divide, over which it passed with a maximum elevation of 263 feet above sea-level, and thence down to Panama on the Pacific side.
Treacherous swamps, almost impenetrable jungles, and formidable streams and mountains necessitated incredibly hard labor and continuous work from 1850 to January 28, 1855, when the first train reached Panama from Colon.
The line was forty-seven miles long, built of Belgian rails and on a gauge of five feet.
The standard gauge in the United States is four feet nine and a half inches, so that all locomotives and cars used on the Panama railroad have to be specially built with wheels set farther apart.
When it comes to disposing of surplus equipment after the canal is finished, the government will have to allow for the cost of modifying the rolling stock from the five-foot to the standard gauge.
It is estimated that the axles on locomotives may be shortened at an average cost of $750 a locomotive, and for cars, from $27 to $31 each.
California gold-seekers used the railroad as far as it was built during the years immediately following 1850 and made the rest of the trip across the Isthmus by mule-back.
There were no buccaneers waiting to relieve them, as they had the Spaniards, of their treasure, but bandits and outlaws haunted the route with almost equal success.
Thus the railroad had an income from the start, and ten years after completion it was known as the best-paying property in the world.
The total cost had been $7,407,553, or about $158,000 a mile. Dividends were paid every year from 1853 to 1892, and from 1901 to 1903, when it became United States property.
The largest year’s earnings was in 1868 when 44 percentum was paid, or $4,337, 668.48 in both dividends and undivided profits. Total $94,958,890.36; operating expenses, $57,036,234.46; leaving for surplus and dividends, $37,922,655.
Rather eloquent figures as to the Isthmian freight and passenger traffic!
The great prosperity of the railroad suffered a serious set-back with the completion of the California overland railroad in 1869.
Thenceforward the valuable bullion shipments avoided Panama as well as passenger and freight business.
The company’s business shows a steady decline from that year, and some wooden-headed management contributed to the momentum.
Still it was a valuable property, and to the French a very expensive property, as they found in 1881, when they had to buy the railroad in order to obtain a concession to build a canal.
The California Diamond Jubilee Commemorative Silver Half Dollar Coin shows with an artist’s image of the Panama Railroad, circa 1855.