After 1897, the great economic depression began to fade into Americans' memories. As recovery set in, a consolidation and centralization of power became visible across the United States. A flurry of statemaking activities began to restructure America's political economy, beginning in 1898 with the Spanish-American-Cuban-Filipino War, and continuing afterwards as state managers in the army, navy, civil service, and many other areas pushed to develop the size and capability of their own bureaucracies. The federal government's budget increased significantly during these years, making it a major employer of labor. Military strength and commercial enterprise received new emphasis as the federal government's twin goals, leading the state into interventionist adventures around the globe.

Perhaps the Panama Canal provided the best symbol of this new climate, a project heralded by President Theodore Roosevelt as “the colossal engineering feat of all the ages.” For years, American government and business leaders had dreamed of a canal that could strengthen the navy's strategic capabilities while enhancing the flow of commerce. After negotiations with Colombia proved fruitless, construction of the canal became possible in 1901 when the United States gave its support to a revolution engineered by a group that included representatives of the New Panama Canal Company. Construction finally began in 1906; before its completion in 1914, the canal would require the labor of more than 45,000 men, women, and children, who excavated more than 230 million cubic yards of earth.