You didn’t build that – Midway Atoll edition

Well there must be a presidential election on this summer, because the media has been sensationalizing something other than shark attacks and missing white women.

Political Washington has spun itself dizzy in the last few weeks over some clumsy remarks that President Obama made in July on the role that government plays in supporting entrepreneurs and small businesses.

In a campaign event in Virginia, Obama remarked that government and the American people “helped to create this unbelievable American system that we have that allowed [small busineses] to thrive.” Pointing to the existence of roads, bridges, and even the Internet, Obama proclaimed that “If you’ve got a business—you didn’t build that. Somebody else made that happen.”

Republicans have seized on the remarks by launching the “you didn’t build that” campaign meme, along with adds featuring American business icons like Henry Ford and Steve Jobs.

The Obama campaign has plenty of historical examples to support its case, from the Transcontinental Railroad to the Hoover Dam and NASA. Former Minnesota Governor Tim Pawlenty proved last year that political ads spliced with stirring music and iconic American images can make even the most boring politicians look like they belonged in a Michael Bay movie.

But one great public work we’ll never hear about on the campaign trail was the effort to bridge the Pacific Ocean via steam transportation after the Civil War, an effort that took several years at the cost of millions of dollars in federal subsidies. US ownership of Midway Atoll—the first offshore possession annexed by the US government in 1867—is an enduring legacy of this enterprise.

Well into the 1850’s, wind remained the fuel of choice for transpacific travel, even though transatlantic steamers were operating by 1840. The distance between North America and Asia—twice that between Europe and North America—explains this, as ships’ storage capacities were not large enough to carry passengers, cargo, and coal while still allowing ship owners to turn a profit.

This began to change as the Civil War drew to a close. Demand for a steamship line connecting the American West Coast with the Far East increased amid construction of the Transcontinental Railroad. For steamship lines already operating between the American West Coast and Panama, the railroad promised a quicker route between east coast factories and Asia, and, therefore, increased American trade to Japan and China.

In order to inaugurate a profitable transpacific trade, Congress in 1865 passed legislation to subsidize—at the cost of $500,000 annually, equivalent to about $7 million in 2010—monthly service between San Francisco, Japan, and China. The Pacific Mail Steamship Company, which was already operating a government-subsidized line between Panama and Oregon, received the contract.

Congress initially required steamers running the “China Route” to call at Honolulu, Hawaii—at the time a foreign port—en route to their final destination. Presumably, the steamers could have refueled there, allowing them to devote more storage space to revenue-generating cargo rather than the large amount of coal needed to cross the Pacific. San Francisco business interests, however, opposed the rule because it could have curtailed their influence over the China trade. Congress annulled the provision a month after the Pacific Mail launched the route in 1867, and no steamers ever stopped at Honolulu.

Establishing the service cost the Pacific Mail some $6 million, partly due to another federal rule that the company operate new, larger steamers that the navy could requisition in wartime. The rule spurred on naval engineering and construction, but smaller ships had to run the route until the larger ships could be built. Without mid-ocean refueling in Honolulu, the space these smaller shiops devoted to extra coal storage all came at the expense of cargo. The Pacific Mail barely turned a profit in 1867, only doing so because of the federal subsidy.

As the company looked for ways to turn a profit, naval planners were looking for a new mission as the once formidable US Navy was being downsized during Reconstruction. After years spent blockading southern ports, the Navy was tasked with reestablishing its global presence and protecting American overseas merchant trade. In 1868, Navy Secretary Gideon Welles called for the establishment of US overseas coaling stations, which he deemed necessary to maintain naval power in waters distant from American shores. Welles is almost never credited with introducing the concept of sovereign US overseas bases into American naval thinking, but his ideas were parroted decades later by people like Alfred Thayer Mahan and Teddy Roosevelt before the Spanish-American War.

So imagine the Secretary’s delight when just a few months after the China route was launched, he received a letter from Allan McLane, Pacific Mail Steamship Company President, urging the Navy to survey the uninhabited northwestern Hawaiian archipelago in search of a suitable location to establish a mid-Pacific coaling station. McLane, almost certainly motivated by profit and increasing the cargo capacity of his ships, found an ally in Welles, who favored the cheaper option of annexing unclaimed territory rather than purchasing land from foreign powers, an approach favored by Secretary of State William Seward.

In his letter to Welles, McLane identified a barren, 2.4-square-mile atoll called Brooks Island as a potential location. He even supplied the Secretary with the atoll’s probable coordinates and suggested that a US Navy ship stationed at Honolulu, the USS Lackawanna, be sent to locate it. Welles agreed, and a few days later ordered the Lackawanna to search for Brooks Island. If located, the Lackawanna’s commander was to take possession of it for the United States.

When the Lackawanna arrived at Brooks Island in August, a Pacific Mail schooner was waiting for it, its crew having set up camp on the island two weeks earlier in anticipation of the government establishing a coal depot there. As ordered, the Lackawanna’s commander landed on the island and, with a Pacific Mail representative present, raised the Stars and Stripes and claimed Brooks Island for the United States. Captain Reynolds, the Lackawanna’s commander and an advocate for annexing Hawaii, wrote to his superior in San Francisco that he hoped it would be the first of many island territories to come under US control.

On the Pacific Mail’s recommendation, the Navy renamed the island Midway, recognizing its geographical position on the route between California and Japan. Although the harbor Reynolds found at Midway proved suitable for naval and merchant vessels, its entrance was too shallow for ships to transit. Congress, angling for a mid-Pacific harbor under American control, in 1869 appropriated $50,000 to dredge the harbor. The Navy dispatched the USS Saginaw, commanded by Lt. Commander Sicard, to commence work on the project.

Honolulu newspapers, no doubt alarmed by the prospect of the United States creating a rival harbor 1200 miles to the northwest, panned the project, noting that $50,000 was woefully insufficient to dredge the harbor. The Hawaiian media’s doubts were confirmed when Sicard concluded that the project probably would cost upwards of $1 million after burning through Congress’ appropriation in a matter of months. With the project’s funds depleted, the Saginaw weighed anchor and abandoned Midway in October 1870. The Pacific Mail, having realized the atoll’s physical limitations, had abandoned Midway two years prior.

In the end, the failure at Midway did not hamper US businesses from engaging in the China trade, as larger and more capable ships were eventually built and other steamship lines sprung up. Midway remained abandoned until the early 20th century, when it was used as a cable relay station for the transpacific cable. By June 1942, when the atoll lent its name to the nearby naval battle that turned the tide of the war in the Pacific in the United States’ favor, Midway had realized its potential as a mid-Ocean naval base.

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