In 1901, when Roosevelt assumed the presidency, shippers between the Atlantic and Pacific oceans suffered the long, perilous route "round the Horn" at the southern tip of South America. Crossing the narrow, S-shaped Isthmus of Panama instead would cut 3,000 miles from the East Coast to Asia and 5,000 miles from Ecuador to Europe. The New York-San Francisco trip would be 7872 miles shorter. First, however, they had to build it.

The French had tried, exhausting 10 years, $300 million, and 20,000 lives in a failed effort to emulate their earlier success of the Suez Canal. Finishing the job meant moving a quarter of a billion cubic yards of jungle, building a fifteen-mile bridge of water, and quashing malaria and yellow fever. All in a new world power's work, said Roosevelt.

Colombia, then-owners of the isthmus, balked at American ambitions. Roosevelt ordered U.S. battleships and marines to back an independent Panama. In 1903, the tiny new nation offered the United States complete control of the fifty-by-ten-mile canal zone for $10 million. "When nobody could or would exercise efficient authority," Roosevelt said, "I exercised it."

Army engineers blasted through mountains and tore through jungles, covering, clearing, or killing deadly mud puddle mosquitoes along the way. The incidence of malaria in the area fell from eighty percent to seven. A new railroad removed the earth and waste of the excavations. In the canal itself, a system of locks and hydraulics lifted ships to and through an enormous artificial lake 80 feet above sea level, letting them down on the other side as would a bridge.

"The size, the magnitude of the undertaking surpassed anything in prior experience for any country in the world," describes historian David McCullough. "Everything 2,000 miles from the base of supplies, including the personnel, every steam shovel, every paper clip, every nurse, engineer, secretary, doctor, every stick of dynamite, every rail track needed-all of that was brought from very distant points to one of the most difficult and inhospitable climates on Earth."

The Panama Canal officially opened August 15, 1914. In its economic and military importance, the canal proved a cornerstone of the American century. According to CountryWatch, 40 percent of U.S. exports and imports are typically shipped via the canal. Historians credit the project's success for other"impossible" federal engineering projects from the Hoover Dam to the moonlanding.

Ownership of the Canal was ceded to Panama by the U.S. in 1977 (it was revealed in 1997 that the Torrijos government had a plan in effect to sabotage the canal if the U.S. failed to ratify the treaty). Panama now officially operates, administers, and defends the canal. A Hong Kong-based conglomerate manages the two ports at either end. This year the canal will accommodate almost 200 million long tons of cargo on about 15,000 ships, a new record, and four percent of the world's sea-to-sea commerce.

This May, Panamanian President Mart'n Torrijos announced plans for a national referendum on expanding the waterway. The most ambitious plan would massively increase capacity by converting the canal to a sea-level passage. This next great construction project, designed to accommodate 300,000-ton cargo shipments, means dredging almost another billion cubic meters of earth and rock and building Grand Canyon-sized water retaining structures-all without interfering with existing traffic.