The idea of a trans-isthmian canal seemed likely in the 'fifties of last century to prove a cause of discord, if not of war, between England and the United States. Under the rather "pushful" foreign policy of Lord Palmerston, England rapidly increased her influence and possessions in Central America. In 1835 "British Honduras" was practically constituted a British colony, and British influence was subsequently extended into Nicaragua and Mosquitia, thus covering the favourite route for an isthmian waterway. The United States were establishing themselves on the Pacific through their encroachments on Mexico. In 1846 they acquired the states of California, Nevada, Arizona, and New Mexico, and naturally began to attach more importance to the canal project and to feel more sensitive as regards rival ambitions in Central America. Soon after they had acquired these Pacific territories, began the great rush for gold to California, and some shorter way from east to west became necessary than the sea-trail round the Horn or the weary wagon-trek over the broad North American continent. Already in 1846, before the Mexican War and the discovery of gold in California, the United States had made a treaty with New Granada, by which the former secured rights of transit over the isthmus "upon any modes of communication that now exist or may hereafter be constructed," and by which they guaranteed the sovereignty of New Granada over all the territories at the isthmus. It was under this treaty that the Panama Railway was constructed which brought the town of Colon (formerly Aspinwall) into existence, and was subsequently taken over by the United States government. This railroad made the isthmus for the first time a highway of world-traffic. It had a monopoly of isthmian transportation, and was able to make any charges it pleased. Steamship services to the southern and northern coasts of America from Panama were developed, and the railway succeeded so well that it paid down to 1895 an average dividend of 15 per cent. It was bought by the first French Panama Company for the outrageously high sum of L5,100,000. The existence of the railway really determined De Lesseps' choice of the Panama route, and the immense amount of excavation done by the French had a great deal to do in turn with the American choice of the same route, so that the construction of the Panama Railway was a highly important event at the isthmus. The United States took over the railroad from the French with the unfinished canal, together with a steamship service from Colon to New York, owned by the railroad.