Many of the Colombian Senators took the position that it would be lawful and more expedient to declare a forfeiture upon the French company, and take over the canal under the terms of such forfeiture as provided by the franchise. The Republic of Colombia would then be in a position to sell the same to the American Government for forty million dollars, and since then they would secure ten million dollars for a zone and a perpetual rental of a large sum annually, the financial condition of the country would be very much improved. As the finances of the Republic of Colombia were at that time in a desperately depleted condition, this prospect of their rehabilitation must have had powerful effect with many of the Senators. [Illustration: GATUN MIDDLE LOCK, LOOKING SOUTH FROM EAST BANK.] These four reasons operating, no doubt caused the Colombian Senate to refuse ratification to the Hay-Herran treaty. But in Panama the people and the authorities were determined not to submit to the action of the Colombian Senate. The Panamanians were aware of the fact that the President of the United States had been authorized by Congress to make a choice between either the French Panama or the Nicaraguan route, and that under that authority he would at once proceed to close a contract with the Maritime Canal Company of Nicaragua if he could not secure a canal zone. They also realized that if once the American Government began the work of excavating a canal through Nicaraguan and Costa Rican territory, in all human probability, the French Panama Company’s project would be abandoned. Thus the cities of Colon and Panama, and the territory surrounding, would be relegated to obscurity so far as world’s trade was concerned, for many years. This the Panamanians were determined to prevent if possible, so they took every step necessary to inaugurate and successfully carry out a revolution in case of the refusal of the Colombian Government to ratify the Hay-Herran treaty. They sent Dr. Varilla as their representative to New York and instructed him to remain in close touch with the cable, and should he receive a cablegram that Panama had thrown off her allegiance to Colombia and had resumed her old-time independence, he should proceed at once to Washington, D. C., notify President Roosevelt of the fact, demand recognition of the new Republic of Panama as an independent power, and enter at once into negotiations with the United States for the recognition of that independence and the transfer of a canal zone. The New Republic of Panama