The Panama Canal Scandal

Before Dreyfus, the Panama Canal scandal had already shaken public faith in republican institutions. Ferdinand de Lesseps, hero of Suez, had promised to repeat his triumph in Central America. His Panama Canal Company, launched in 1880, attracted 800,000 French investors drawn by patriotic appeals and promised profits.

The reality proved catastrophic. Tropical diseases killed thousands of workers. Engineering challenges multiplied costs exponentially. By 1889, the company collapsed, wiping out billions of francs in middle-class savings. But the financial disaster was only the beginning.

Investigations revealed massive corruption. Company officials had bribed newspapers for favorable coverage, paid politicians to approve lottery bonds, and siphoned funds for personal use. The scandal implicated 104 deputies and senators, including former ministers. The banker Jacques de Reinach's mysterious death—suicide or murder—before testifying added sensation.

The involvement of Cornelius Herz and Baron de Reinach, both Jewish financiers, fueled anti-Semitic conspiracy theories. Édouard Drumont's "La France Juive" blamed "Jewish finance" for honest French investors' losses. The scandal's anti-Semitic interpretation prepared ground for the Dreyfus Affair's toxicity.

Women investors, managing household savings, suffered particularly. The feminist press documented widows losing pensions, shop girls losing dowries, teachers losing retirement funds. The scandal revealed how financial speculation affected those least able to afford losses. Yet women's financial suffering received less attention than men's political corruption.