The canal is fifty miles (about eighty kilometers) with three locks linking the Caribbean Sea with the Pacific Ocean. It is situated on the isthmus of Panama which is generally agreed upon as the physical dividing line between North and South America (due to it being the thinnest point on the American supercontinent).
The canal was a massive achievement of engineering. Before a ship travelling from New York to San Francisco would have to travel 14,000 miles (22,500 kilometers). After the canal's completion the trip was reduced to only 6,000 miles (9,500 kilometers). While it was possible to travel down to Panama, unload people and goods and then travel overland to the Pacific to catch a ship, it was generally considered too costly, time consuming, and dangerous due to tropical diseases like malaria and yellow fever.
Originally the isthmus of Panama was the site of a French effort in 1880 to create easy sea access. However, tropical disease killed over twenty-thousand workers and the effort failed. Later, as the United States began influence-expanding operations around the world, the desire for a canal grew. Originally a canal through Nicaragua was sought. A story though tales that the canal-idea was defeated because of a stamp which showed active volcanoes in Nicaragua. The fear was that volcanoes and the related earthquake activity would be a constant threat of destruction to a Nicaragua canal. Because of this, Nicaragua's economic and global development has been handicapped while Panama received the benefits of foriegn investments in its economy and political structure.
So the United States turned its attention to the isthmus of Panama which was ruled by Colombia. After the Colombians refused to deal with President Theodore Roosevelt, pro-independence forces in Panama partook in a revolt which ended with Panama's freedom. A treaty was signed allowing not only for the canal but also giving the canal and adjacent territory to the United States. From 1903 to 1979 the Canal Zone was part of the United States and not Panama.
The construction took ten years to complete start to finish. During this time doctors like Walter Reed, who the military hospital is named after, made great improvements in combating tropical diseases. Today, many people's lives are still saved because of efforts first implemented during the canal's construction.
From 1903 to 1977 relations between Panama and the United States slowly got worse over the canal. The 1960s saw violence as Panamanians began demanding the canal back. In 1977 President James Carter signed a treaty with Panamanian military dictator that would establish a joint-control of the canal and give the canal to Panama in 1999.
Today the Panama Canal is owned and operated by the Panamanians. The globalized market has come to Panama with Chinese companies, businessmen, and even restaurants found all throughout Panama City. The canal's enlargement will continue to allow it to service the mega tankers that feed the world's economies.