The Panama Canal

The French tried first and it killed them. In 1881, Ferdinand de Lesseps launched the most ambitious engineering project of the nineteenth century. He would cut a canal through fifty miles of Panamanian jungle to connect the Atlantic and Pacific oceans. Within eight years, twenty two thousand workers were dead from malaria and yellow fever, the company was bankrupt, and the project was abandoned. The jungle won. The Americans took over in 1904 and made a decision that changed everything. Before laying a single piece of concrete, they spent two years draining swamps, fumigating buildings, and eliminating the mosquitoes that carried disease. They solved the upstream problem first. The canal opened in 1914 and immediately transformed global trade. A ship no longer had to sail thirteen thousand miles around South America. The journey dropped to five thousand. The pricing model is where the business genius lives. The Panama Canal Authority charges each vessel based on a proprietary measurement called PC/UMS tonnage, which is calculated differently from standard shipping tonnage.