This lottery is a veritable gold mine to those who own it. Each ordinary drawing brings in $10,000--$1 for each ticket issued. The grand prize takes $3,000 of this, the next 9 prizes calling for a total of $900, the next 90 for a total of $450 and the remaining prizes for $2,070. Thus, $6,420 in prizes is paid out of the total of $10,000 received. Out of the remainder, 5 per cent goes to the ticket sellers and 5 per cent to the Panaman Government. Once a month the drawing is made for a grand prize of $7,500. Most of the money which the lottery people make is contributed by workers on the canal. Only 64 per cent of the money received from the sale of tickets is won back by the ticket buyer at each drawing. The net profits approximate a hundred thousand dollars a year. On the whole, however, the relations entered into between the two Republics in 1904 have been such as to leave no serious ground for complaint. They have permitted the satisfactory construction of the canal, and they will permit its satisfactory operation. With the United States as the ultimate judge of every question vital to American interests, little is left to be desired. The fact is that the canal has been built with less friction and fewer difficulties with the Republic of Panama than could reasonably have been hoped for at the outset. This has been due principally to the fact that the Americans responsible for the success of the work have approached the Panaman situation with tact where tact was needed and with firmness where firmness was essential. CHAPTER XXI THE CANAL ZONE GOVERNMENT The Canal Zone is a strip of territory ten miles wide, its irregular lines following the course of the canal, which is its axis. Over this zone the United States, under its treaty with Panama, exercises jurisdiction "as if it were sovereign." The American Government was unwilling to undertake the great and expensive work of constructing the canal without having this guaranty to protect it from possible harassment at the hands of the Panaman authorities. One of the first tasks that confronted the United States authorities when they entered upon the work of building the canal was that of providing a civil government for this territory named by law the Canal Zone. Postal facilities had to be provided; a police system had to be established; customs offices were required; fire protection was necessary; a court system was needed; a school system was demanded; and, in short, a sort of territorial government had to be put in operation before the work of building the canal could go forward satisfactorily.