To build the canal required the labor of some fifty thousand men. To induce these men to go to Panama, to stay there, to work there, and to work there efficiently, was no light undertaking. Health was promised them by the most efficient sanitary organization that ever battled with disease. Wealth was promised them, relatively speaking, in the form of wages and salaries much higher than they could obtain at home for the same work. But health and wealth, much desired and much prized as they are, can not of themselves compensate for transplanting a man to an alien shore and an alien atmosphere, especially if that shore be tropic and that atmosphere hot. There must also be comfort.

And comfort was promised to the canal diggers by the commissary department. Good food at prices cheaper than one pays in the United States, and quarters of the best—these things the commissary held out as a part of the rewards at Panama.

Of course this was not the chief object of the commissary department—it was the incidental factor that in the end almost obscured the main issue. The main business was so well done that everybody took it for granted, just as no one will remark about the sun shining although that is the most important fact we know. The main business of the commissary was to keep the canal diggers fed and housed so that they would have the strength for their tasks. How this was done, how fresh beef and ice cream were made daily staples in tropic Panama, how the canal army was fed, is a big story in itself.

The history of the French rÉgime was such as to prejudice the whole world against the canal region and to deter any but the most adventurous spirit from entering there into a gamble with death. The Americans soon found that without extraordinary inducements it would be next to impossible to recruit a force able to build the canal. Therefore it was determined to make the rewards so great that extra dollars to be gained by going to Panama would outweigh the fears of those who had any desire to go. It was decided to pay the employees of the Canal Commission and the Panama Railroad Company wages and salaries approximately one-half higher than those obtaining at home for the same work. Furthermore, it was decided that the Government should furnish free quarters, free medical service, free light, and other items which enter into the expense budget of the average family. It was found advisable to establish Government hotels, messes, and kitchens, where the needs of every employee from the highest officer to the most lowly negro laborer could be met, and to operate them at cost.

Still another problem had to be faced; that of providing places where the people employed in building the canal could escape from the high prices fixed by the merchants of Panama and Colon. With this end in view, a great department store, carrying upward of 5,000 different articles, was built at Cristobal. This store established branches in every settlement of canal workers where patrons could go to ship and receive the benefit of prices much lower than those prevailing with regular Panaman merchants.

Anyone who will study carefully the annual reports of the operation of the commissary of the Panama Railroad Company, will realize what great profits are made by the various middlemen in the United States who handle food products between the producer and the consumer. In 1912 the commissary had gross sales amounting to $6,702,000, with purchases amounting to $5,325,000. This represents a gross profit of 26 per cent. The cost of transportation from New York and distribution on the Isthmus, amounted to about 24 per cent, leaving a net profit of approximately 2 per cent on the sales of goods. When it is remembered that transportation of commissary products from New York amounted approximately to a quarter of a million dollars a year, and that wagon deliveries on the Isthmus added $50,000 a year to this, it will be seen that the expenses of distribution at Panama were approximately on the same footing with those in the United States.

In the case of dressed beef, one finds a most illuminating example of how it is possible to sell the ordinary items of a family budget to the consumer at rates much lower than those obtaining in the United States. According to the most authentic information dressed beef laid down at Panama costs more, quality for quality, than it costs the ordinary retail butcher in the States. At one time in 1912 the commissary was paying $11.94¹/₄ a hundred pounds for whole dressed beeves laid down in New York. This was for the best corn-fed western steers, a grade of beef that is found only in the best retail butcher shops of any American city. Yet, with the expense of ocean-refrigerator carriage added, and with other operating costs equal to those of the retail butcher in the States, the commissary found it possible to sell to the consumer, delivered at his kitchen door, porterhouse steaks from this beef at 20 cents, sirloin steaks and roasts at 19 cents, and round steaks at 13 cents a pound. At this same time the average American housewife was paying from 26 to 30 cents for porterhouse steaks, from 22 to 26 cents for sirloin steaks and roasts, and from 17 to 22 cents for round steaks; and in the butcher shops in the United States where grades of meat comparable to those at Panama were handled the figures were usually around the top quotations.

One cannot escape asking the question how it is that if the Panama Railroad commissary could pay approximately 12 cents a pound for dressed beef at New York, deliver it in refrigeration at Cristobal, thence to the housewife by train and wagon, and make a gross profit of some 26 per cent by the operation, that the American retail butcher can reasonably claim that at the price he sells his meat he is making little or no net profit.

One finds the same scale of prices on other commodities at Panama as meats. Only the very best goods are handled in the commissary. Any reasonable need of any employee could be supplied by the commissary at prices probably lower than a retail merchant in the United States could buy the same commodities.

A few instances of how the commissary fared when its supply ran short will serve to illustrate the grasping disposition of the average Panaman merchant.

In one case high waters in the Chagres interrupted traffic on the Panama Railroad, and the price of ice in Panama City promptly jumped from 50 cents to $1 a hundred pounds. At another time a ship bringing coffee to the Isthmus ran aground and the commissary had to buy coffee in the Panama market. It had to pay 6 cents a pound more at wholesale for the coffee than it was selling for at retail in Panama the day before the ship went aground. On another occasion a vessel carrying a supply of milk went ashore and the wholesale price of that commodity jumped a hundred per cent overnight. The Panaman merchants made a long and persistent fight to get the privilege of doing the business which is done by the commissary, but the canal officials were too wise to allow the working force to be dependent upon native business men for family budget needs.

Although the commissary did an annual business of nearly $7,000,000 a year during the height of the construction period, it received comparatively little actual money for the commodities it sold. A great deal of this business was with the subsistence department of the Canal Commission, furnishing supplies for the hotels, European laborers' messes, and common laborers' kitchens. Practically all of the remainder was with the employees of the commission, and was done through coupon books. When an individual wanted to buy from the commissary he asked that a coupon book be issued him. If it were found that he had sufficient money coming to him for services rendered to cover the cost of the book, it was issued to him and the clerk in the commissary detached coupons to cover the purchases. When the monthly pay roll was made up, the cost of the coupon books was deducted from the amount due the employee for services. Many employees and their families lived too far away from the commissaries to make daily visits, so they simply deposited their coupon books with the main commissary at Cristobal and sent their orders in by mail from day to day. The commissary clerks would fill these written orders, sending the goods out on the first train.

In addition to buying and selling products for the benefit of the canal workers, the commissary operated a number of manufacturing establishments. It had a bakery using some 20,000 barrels of flour, baking 6,000,000 loaves of bread and other things in proportion annually; an ice-cream plant freezing 138,000 gallons of ice-cream annually; a laundry washing 4,250,000 pieces a year; a coffee-roasting plant; and a large cold-storage warehouse. About 70,000 people were constantly supplied with commodities from the commissary.

In its efforts to meet the needs of the several classes of employees on the Canal Zone the commission established four different kinds of eating places,—a large general hotel, a score of line hotels, Spanish messes, and West Indian laborers' kitchens. At Ancon it built the large Tivoli Hotel costing half a million dollars, for the accommodation of visitors; and of those high-class employees who desired modern hotel facilities. This hotel is the social center of the Canal Zone. Here practically all of the tourists come and stay while on the Isthmus.

During the year 1912 this hotel cleared $53,000 in its operations. The cost of the supplies for the meals served, of which there were 161,000, was approximately 51 cents per meal. The cost of services was approximately 19 cents, making a total of 70 cents per meal. The rates were $3 up to $5.50 a day, employees being given special concessions.

The line hotels were, more properly speaking, merely dining-rooms where the American employees were furnished substantial meals for 30 cents each. Outsiders paid 50 cents each for these meals. They were up to a very high standard. Once the late Senator Thomas H. Carter, of Montana, was a member of a Senate committee visiting the Isthmus and he invited the subsistence officer, Maj. Wilson, to come to Washington and show the manager of the Senate restaurant how to prepare a good meal. A year later, after Senator Albert B. Cummins, of Iowa, had eaten one of the lunches at Gatun, he renewed the invitation of Senator Carter, telling Maj. Wilson he was sure that if he were to come Senators would get better meals for their money. At one of the Congressional hearings on the Isthmus Representative T. W. Sims, of Tennessee, asked that the menu of a meal he had eaten at one of these hotels be inserted in the record. Major Wilson inserted the menu for several days instead. The following is the menu at the Cristobal Hotel for January 20, 1912:

Breakfast.—Oranges, sliced bananas, oatmeal, eggs to order, German potatoes, ham or bacon, hot cakes, maple sirup, tea, coffee, cocoa.

Lunch.—Vegetable soup, fried pork chops, apple sauce, boiled potatoes, pork and beans, sliced buttered beets, stewed cranberries, creamed parsnips, lemon meringue pie, tea, coffee, cocoa.

Dinner.—Consomme vermicelli, beefsteak, natural gravy, lyonnaise potatoes, stewed beans, sliced beets, stewed apples, carrots a la Julienne, hot biscuits, ice-cream, chocolate cake, tea, coffee, cocoa.

The line hotels in 1912, which were operated at a loss of $12,000, served over 2,000,000 meals. The cost of the supplies per meal amounted to $0.2504 and the service to $0.0165, making the average meal cost $0.3065, while the employees were charged 30 cents. Approximately 2,000 Americans were continuous patrons of the line hotels.

The messes for European laborers were operated in 1912 at a total cost of $405,000. The returns from their operations amounted to $443,000, showing a net profit of $38,000 on 1,108,000 rations. The net profit per day's ration approximated 3¹/₂ cents. The supplies entering into the ration cost $0.3106 and the service of preparing it $0.0547.

The national diet for Europeans would appear very monotonous to Americans. For the Spaniards who constituted the major portion of the European employees, it was a "rancho," which is a mixture of stewed meat, potatoes, cabbage, tomatoes and garbanzos heavily flavored with Spanish sweet pepper. Their soups were made very stiff, really a meal in themselves, since they were about the consistency of Irish stew mashed up. A day's ration for Spanish laborers ran about as follows:

Breakfast.—Roast beef, pork sausage, corned-beef, sardines or bacon, one-half loaf of bread, chocolate and milk.

Dinner.—Garbanzos or macaroni, roast beef or hamburger steak, fried potatoes, oranges or bananas, one-half loaf of bread, coffee.

Supper.—Rice soup, peas or beans, rancho, one-quarter loaf of bread, tea.

The Government charged the European laborers 40 cents a day for their meals. Their mess halls were large, airy, comfortable and conspicuously clean. The European laborers nearly all patronized these mess halls; about 3,200 of them constantly were fed at these places.

Wherever there was a West Indian negro settlement along the line of the canal the commission operated a mess kitchen. These kitchens were kept scrupulously clean and the laborers were furnished meals at 9 cents each. Each laborer who patronized the kitchen had his little kit into which the attendants put his meal, and he could carry it anywhere he desired to eat it. In spite of the fact that these meals corresponded almost exactly to the American Regular Army field rations, they were never popular with the West Indian negroes. Although there were some 25,000 of these laborers on the canal in 1912, only a little more than a half million rations were issued to them during the year. Less than 15 per cent of the negro force patronized the commission kitchen.

The following is a specimen day's ration in a West Indian kitchen:

Breakfast.—Cocoa and milk, porridge, bread, jam.

Dinner.—Pea soup, beef, doughboys, rice, bread, bananas.

Supper.—Stewed beef, boiled potatoes, stewed navy beans, bread, tea.

During the construction period of the canal the average American received approximately $150 a month for his labor. Those who were married and remained in the service a reasonable time were provided, rent free, with family quarters. Their light bills were never rendered, the coal for their kitchen stoves cost them nothing, and the iceman never came around to collect. The bachelors were provided with bachelor quarters with the necessary furniture for making them comfortable. The average married quarters cost from $1,200 to $1,800 each, and the average quarters for a bachelor about $500 to construct. The higher officials had separate houses; lesser officials were furnished with semi-detached houses. The majority of the rank and file of American married employees were housed in roomy, four-flat houses. The verandas were broad and screened in with the best copper netting, and all quarters were provided with necessary furniture at Government expense.The assignment of quarters and furniture called for a great deal of diplomacy on the part of the quartermaster's department, since, if Mrs. Jones happened to visit Mrs. Smith, and found that she had a swell-front dresser in her bedroom, while her own was a straight-front dresser, an irate lady was very shortly calling on the district quartermaster and demanding to know why such discrimination should be practiced. Perhaps she had been on the Canal Zone longer than Mrs. Smith, and felt that if anyone were entitled to the swell-front dresser she was the one. The district quartermaster had to explain with all the patience at his command that it was not a case of discrimination but merely that the commission had bought swell-front dressers at a later date for the same price that it formerly had paid for the straight-front ones, and that consequently the people who furnished houses later got them.

On another occasion Mrs. Brown, calling on Mrs. White, found that Mrs. White had an electric light on her side porch. She immediately fared forth to pull the hair of the quartermaster for this discrimination, but was somewhat taken back when that official calmly informed her that the light had been put there for a few days in anticipation of a children's party that was to be given by Mrs. White one night that week.

The marvelous success of the commissary, not only in affording its patrons better service at lower prices, but also in making a substantial profit on the undertaking, had been referred to as the most valuable lesson taught by the whole canal digging operation. It has proved the efficiency of government agencies in fields far removed from the ordinary operations of government, and it may be that its experience will be used to advantage in combating the high cost of living in the United States itself.