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The Status of
Americans in Mexico

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BULLETINS

OF THE

AMERICAN ASSOCIATION OF MEXICO

1921

Digitized by the Internet Archive

in 2008 with funding from

IVIic'rosoft Corporation

http://www.archive.org/details/bulletinsmexicoOOamerrich

TTPON request by letter, this Association will forward
copies of its collected bulletins to persons interested
in Mexican affairs. Members and others who receive
this pamphlet are advised that, if they wish copies sent
to friends, they should furnish names and addresses with-
out delay as the edition is limited. Applications should
state whether the English or Spanish text is desired.

1

i

The Status of
Americans in Mexico

BULLETINS

OF THE

AMERICAN ASSOCIATION OF MEXICO

1921

PUBLISHED BY

The American Association of Mexico
112 Park Avenue, New York

FOREWORD

FROM its inception, the American Association of
Mexico has directed its activities toward securing
justice for Americans in Mexico. It has labored to
secure protection for the legally acquired rights of our
nationals resident in that country. It has stood, and it
stands, upon the principles contained in the program enun-
ciated by Secretary of State Hughes, convinced that friendly
relations established upon such terms will possess the
essential quality of permanence. It believes that temporary
adjustments would prove harmful to both peoples, that
fundamental questions at issue must be settled before
these two neighbors can live together in harmony upon a
basis of goodwill and real reciprocity.

First of any of the organized bodies which have to do
with the protection of American interests in Mexico, the
American Association of Mexico made public announcement
that it was opposed to the recognition of any Mexican gov-
ernment until just and fair treatment and proper legal
status were assured for such interests. Previous to the
announcement of the Hughes policy, on January 31, 1921,
this Association published its program, embodying this
principle. It was actuated by a desire to see justice done;
in no sense was this organization moved by a spirit of
hostility to Mexico and things Mexican.

This Association has the most friendly interest in the
Mexican people; it is the enemy of no individual Mexican
administration; it does not advocate armed intervention in
Mexico, nor has it done so in the past. As an American
organization the field of this Association is restricted ; it
must confine its work to those things which touch Amer-
icans and their legally acquired interests. It takes pride
in the fact, however, that the organization and its directors
have advocated no program and no set of principles which
would not benefit Mexicans fully as much as Americans and
other foreigners.

The suspension of negotiations between Mexico and the
United States with respect to recognition, due to the definite
and final refusal of Mexico to comply with the conditions

M T675

of the American government is regarded as a propitious
time to comply with the requests of many Mexicans, as well
as Americans interested in Mexico, for a complete collec-
tion of our bulletins in convenient form. A decision was
reached to issue this pamphlet in both an English and a
Spanish edition. To the collection of eight bulletins has
been added a hitherto unpublished paper on certain phases
of the Mexican question, the essential features of which
were placed before Secretary of State Hughes in the form
of a memorandum. In fact, this collection of documents
comprises the case of Americans in Mexico as presented to
our State Department by the American Association of
Mexico. The reader will find in this pamphlet a faithful
presentation of our policies and purposes in the past ; these
remain, without change, the principles and policies of this
Association today.

THE AMERICAN ASSOCIATION OF MEXICO.
January, 1922.

PROGRAM ADOPTED BY THE AMERICAN
ASSOCIATION OF MEXICO

(Issued January 31, 1921)

That no government in Mexico be accorded recognition
by the American Government until it has agreed to the
following conditions:

1. The return to their owners of all properties of Ameri-
can citizens confiscated or administered by the Mexican
government.

2. An acknowledgment of the duty of the Mexican gov-
ernment to reimburse American citizens for damages suf-
fered during the series of revolutions beginning in 1910,
and the appointment of a joint commission to determine
such damages.

3. The elimination of all provisions of the Constitution
of 1917 that have as their effect the confiscation of prop-
erty of American citizens. This includes the articles that
provide for the nationalization of the oil-bearing subsoil of
private property, and other stipulations furnishing a basis
for the confiscation of American holdings.

4. The elimination of those provisions of the Constitu-
tion of 1917 that impose restrictions on the development
of American enterprise in Mexico, or an agreement not to
apply them to American citizens. Among these are the re-
strictions with regard to the purchase of rural and city real
estate, and those forbidding the acquisition of mining and
oil properties by American citizens.

5. The elimination of the humiliating provision of the
Constitution of 1917 that requires that an American citizen
shall waive the benefits of his nationality in acquiring prop-
erty of any kind.

6. The elimination of the provision of the Constitution
of 1917 that forbids an American clergyman of any denomi-
nation to exercise his sacred office in Mexico.

7. The elimination of the provision of the Constitution
of 1917 that authorizes the federal executive to expel an
American citizen from the country without cause and with-
out trial.

8. The removal of all other governmental restrictions
on legitimate American enterprise.

LEGAL STATUS OF AMERICAN CITIZENS IN
MEXICO UNDER THE CARRANZA CON-
STITUTION OF 1917

(BULLETIX Xo. 1 — Issued April 20, 1921)

1. An American citizen may be deprived under a num-
ber of pretexts, by executive decree, of land already acquired
in Mexico.

2. An American citizen is deprived of the right here-
tofore enjoyed of acquiring land. He must now, in each
case, ask permission from the president or governor, depend-
ing on the location of the land ; the executive may arbitrarily
grant or deny permission. He must also file with the Mex-
ican Department of Foreign Affairs a waiver of his citi-
zenship with respect to such land, that is, he must renounce
his right to appeal to his government for protection, under
penalty of forfeiture of his property if he should violate
this undertaking.

3. In the case of non-urban land, if an American citi-
zen should succeed in securing a permit, his right to pur-
chase and retain the property will still be subject to a
program of socialistic legislation in the several states which
attaches to titles such insecurity as to affect materially the
value of his holdings.

4. Whether urban or non-urban, under no conditions
may an American citizen acquire real property within sixty
miles of the land frontiers of Mexico and within thirty miles
of either coast. These zones comprise about forty per cent,
of the area of the Mexican republic, and inc'ude some of
the most desirable land in Mexico and the land which
American citizens would most naturally wish to purchase.
The effect of this prohibition, for example, is to prevent an
American from purchasing real estate in the Tampico oil
field and in the other prospective fields along the entire
coast of the Gulf of Mexico.

5. In the prohibited zones just mentioned, American
citizens will not even be permitted to retain real estate
which they acquired prior to 1917. There is pending before

the Mexican Congress a bill presented by Carranza which
provides for the virtual confiscation thereof.

6. An American corporation may no longer acquire
title to real property in Mexico.

7. American citizens may no longer acquire title to
agricultural land through a Mexican corporation ; it is gen-
erally believed that, by implication, grazing lands are also
included in this prohibition. This provision, and the one
mentioned in Paragraph 3, effectively put an end to colon-
ization and the purchase by Americans of small farms in
Mexico, and such was the design of the framers of the
Constitution.

8. To acquire title to oil or mineral rights, an Amer-
ican citizen must likewise waive his citizenship as defined
in Paragraph 2.

9. To acquire title to stock or bonds in a Mexican
corporation, an American must likewise waive his nationality
and his privilege of diplomatic protection.

10. The Carranza Constitution provides for the confisca-
tion of the oil-bearing subsoil of properties owned or leased
by American citizens in accordance with previous Mexican
law. This affects thousands of Americans of small means
who own land in fee throughout the Republic acquired be-
fore this Constitution went into effect.

11. An American clergyman may no longer, under any
circumstances, exercise his office in Mexico; he may not do
so even by becoming a Mexican citizen.

12. An American citizen may be expelled from Mexico
by arbitrary order of the President, without right of trial
by the Mexican courts or of appeal to his own government.

PROTECTION FOR AMERICAN CITIZENS
ABROAD

If We Are to Extend Foreign Trade, the Rights of Our

Nationals Residing In Other Countries

Must Be Assured

(BULLETIN No. 2— Issued May 15, 1921)

The American Association of Mexico has taken a firm
stand on the platform that neither the present Mexican
government nor any Mexican government should be accorded
recognition by the American government until an agree-
ment is made in which the Mexican government shall give
pledges to restore to American citizens the rights of which
they have been deprived through an illegal constitution en-
acted by the military faction of which Carranza was the
head. This Association was led to this conclusion not only
because of the strict justice of such a demand, but because
it is of fundamental importance in the development of our
foreign trade that the rights of Americans resident in for-
eign countries be fully respected in accordance with the
guarantees of international law and the precedents estab-
lished by common acceptance among civilized nations in
their relations with one another.

It has been the too common practice during recent years
to group all Americans resident in other lands under the
title of "expatriates" with all the contemptuous implication
which the word carries with it in every day usage. We are
firm in our conviction, however, that our nationals resident
in new and undeveloped countries are entitled with very few
exceptions to the highest praise as business pioneers doing
a work vital to the future welfare of the United States.
The American business man living in ^exico must possess
the sterling virtues and high courage of the pioneer if he
is to weather the storm of revolution and hostile laws which
has beat about him. It is a disgrace to this country that he
should have been permitted to play a lone hand.

We are pleased to reproduce, therefore, the statesman-
like exposition of basic principles by Senator Henry Cabot
Lodge, Chairman of the Senate Committee of Foreign Re-

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lations, in a speech on the Colombian treaty delivered in the
Senate on April 12th, 1921. Senator Lodge said:

"We must stand behind our own people wherever
they may be in the world, whether in business or merely
as travelers. In this direction, the United States has
been careless and indifferent and in some instances,
notably in Mexico, much worse than careless. If we
are to extend our foreign trade in South America and
the East, Americans who invest their money in those
countries and who live according to the laws of the
foreign country in which they are placed, must always
be sure that they have behind them their own govern-
ment and that they will receive the protection to which
they are entitled. Our Government in the past has in
certain cases actually gone to the point of taking the
position that an American citizen or an American cor-
poration making investments in another country was
not entitled to any protection, that they were to be
frowned upon instead of encouraged. I regard this as
an absolutely false policy, and if we persist in it we
shall not only make the expansion of our commerce im-
possible, but we shall find ourselves very much weak-
ened in securing those articles necessary to our busi-
ness life and to the life of our people, like oil, rubber,
and other great raw materials of equal importance. If
American capital is willing and ready, with the assur-
ance that its rights are to be protected in foreign
countries, to invest in those countries and thereby de-
velop and enlarge our trade, it should be encouraged
and praised, not berated and attacked."
Such eminent Americans as President Warren G. Harding,
Secretary of State Charles E. Hughes and Secretary of In-
terior Albert B. Fall, have given public expression to
opinions entirely in harmony with the views set forth by
Senator Lodge and with particular application to our rela-
tions with Mexico.

In his speech as Chairman of the Republican National
Convention in Chicago, June, 1916, Mr. Harding said:

"Whatever the ultimate solution may be, history will
write Mexico as the title to the humiliating recital of
the greatest fiasco in our foreign relations. Uncer-
tainty, instability, Mexican contempt and waning self-

respect will be recorded in every chapter, and the piti-
able story of sacrificed American lives and the destruc-
tion of lawfully-held American property will emphasize
the mistaken policy of watchful waiting and wobbling
warfare.

"When the spirit of American accomplishment, or
the mercies of American ministration, or the inclina-
tions of American teaching, or the adventures of Amer-
ican development take our people abroad, under the
compacts of civilization, they have a right to believe
that every guaranty of American citizenship goes with
them. When it does not we have forfeited the Ameri-
can inheritance."
At Marion, Ohio, July 22, 1920, in his speech accepting

the Republican nomination for the Presidency, Mr. Harding

referred to the Mexican situation as follows:

"I believe there is an easy and open path to righteous
relationship with Mexico. It has seemed to me that our
undeveloped, uncertain and infirm policy has made us a
party to the governmental misfortunes in that land.
Our relations ought to be both friendly and sympa-
thetic; we would like to acclaim a stable government
there and offer a neighborly hand in pointing the way
to greater progress. It will be simple to have a plain
and neighborly understanding about respecting our
border, about protecting the lives and possessions of
American citizens lawfully within the Mexican do-
minions. There must be that understanding else there
can be no recognition, and then the understanding must
be faithfully kept."
Mr. Hughes, in replying to the committee which notified '

him of his nomination as the Republican candidate for the

Presidency in 1916, said:

"We demand from Mexico the protection of the lives
and property of our citizens and the security of our
border from depredations. Much will be gained if
Mexico is convinced that we contemplate no meddle-
some interference with what does not concern us, but
that we propose to insist in a firm and candid manner
upon the performance of international obligations. To
a stable government, appropriately discharging its in-
ternational duties, we would give ungrudging support."

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Addressing the National Association for the Protection of
American Rights in Mexico, in a letter dated January 19,
1921, Senator Fall outlined his views on Mexico, insisting
that Americans damaged by Mexican revolutions should re-
ceive proper reparation and that Americans should not be
deprived of their rights by the Carranza Constitution of
1917. Referring to a written agreement or protocol as a
prerequisite for recognition of Mexicb by the United States,
Senator Fall said :

"So long as I have anything to do with the Mexican
question, no government in Mexico will be recognized,
with my consent, which government does not first enter
into a written agreement practically along the lines
suggested."

Both the great political parties in the United States in
their national platforms insist that Mexico give guarantees
of intent to protect American rights before recognition is
accorded Mexico by the American government. The Mexi-
can plank of the platform of the Republican National Con-
vention of 1920 says in part:

"We should not recognize any Mexican government,
unless it be a responsible government willing and able
to give sufficient guarantees that the lives and property
of American citizens are respected and protected, that
wrongs will be promptly corrected, and just compensa-
tion will be made for injuries sustained. The Republi-
can party pledges itself to a consistent, firm and effec-
tive policy towards Mexico that shall enforce respect
for the American flag and that shall protect the rights
of American citizens, lawfully in Mexico, to security of
life and enjoyment of property in accordance with es-
tablished principles of international law and our treaty
rights."
The Democratic National Platform adopted at San Fran-
cisco in July, 1920, has this to say of the Mexican question :

"When the new government of Mexico shall have
given ample proof of its ability permanently to main-
tain law and order, signified its willingness to meet its
international obligations and written upon its statute
books just laws under which foreign investors shall
have rights as well as duties, the government should

11

receive our recognition and sympathetic assistance.
Until these proper expectations have been met, Mexico
must realize the propriety of a policy that asserts the
right of the United States to demand full protection for
its citizens."
The recognition or non-recognition of the Mexican govern-
ment is a great national question. It is in no sense a partisan
issue. This is clearly shown by the quotations from the
platforms of the two dominating political parties in this
country. Furthermore, the recent Democratic administra-
tion placed our Government on record when Secretary of
State Robert Lansing protested formally to the Carranza
government against the confiscatory and anti-foreign clauses
of the Constitution of 1917. This protest was entered be-
fore the constituent convention at Queretaro had adopted
the final draft of the Constitution. The convention con-
temptuously ignored the American protest. This protest
has never been withdrawn.

The provisions against which objection was made outrage
justice and act in definite restraint of our foreign trade.
Moreover, as already pointed out by Senator Lodge, they
tend to weaken us in securing "those articles necessary to
our business life and to the life of our people, like oil, rubber
and other great raw materials of equal importance." In
other words, respect for our rights in Mexico affects the
welfare and interests of every American citizen even though
he has not a cent invested in Mexico and never expects to
have.

We feel that the quotations from opinions of the leaders
in the present administration will serve to reassure those
interested in a just and proper solution of our problems
with Mexico that American rights in that country will be
fully protected. They show that the foremost men of the
government are fully and correctly informed with regard to
the real issues in Mexico.

The opinions quoted give hope that the American foreign
policy in general, and particularly with respect to Mexico,
is soon to be turned right side up again; that instead of
attempting to dictate to Mexico and say to her that she shall
or shall not have a certain man for president, we shall get
back to the sane and proper policy of demanding from
Mexico, as from any other country, just treatment for

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American citizens in Mexico and adequate protection for
their lives and property.

Just how Mexico shall reinstate Americans in their rights,
provided it is done effectively, under what form of govern-
ment Mexico shall be ruled, or by whom that government
shall be administered, are internal matters for Mexicans
alone to decide.

We believe, however, that to demand protection of our
nationals in Mexico is the right and duty of the American
government.

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ESSENTIALS OF A JUST POLICY TOWARDS

MEXICO

Memorandum Presented to the Honorable the Secretary of

State of the United States on the 11th Day of April,

1921, by the American Association of Mexico in

Which It Submits Its Views With Respect to

the Mexican Situation

(BULLETIN No. 3— Issued June 20, 1921)

The American Association of Mexico desires to present its
views on the Mexican situation for the consideration of the
American Government in the formulation of its Mexican
policy. The importance of our Mexican relations and the
underlying facts are so well known to the Secretary of State
that discussion of them here would be superfluous.

In the formulation of a Mexican policy it is apparent that
three fundamental considerations present themselves.

First, the status of American citizens in Mexico and the
attitude of the American Government toward those citizens.

Second, the effect of the American policy on other for-
eigners in Mexico and on the relations of other countries
with the Mexican government.

Third, the effect of the American policy on the Mexican
people.

In our opinion, the prime duty of the American Govern-
ment is to its own citizens, and requires insistence upon the
following points:

First, just reparation for the lives of Americans killed
and for property damaged in the series of Mexican revolu-
tions.

Second, restoration to American citizens of the rights
they enjoyed prior to the enactment of the Carranza Con-
stitution of 1917.

Third, guarantees for the protection of American citizens
and their property in the future.

The fortunes of Mexicans, Europeans and Americans in
Mexico are so linked together that justice to any one class
will bring tranquility and happiness to all. Our obligations
to foreign governments arising from our traditional policy
on this continent, and humanitarian considerations for the
welfare of the Mexican people, will be cared for automatically

14

as a natural result of safeguarding the lives and property of
American citizens by a firm and just attitude on the part of
our Government.

Two questions at once present themselves to our mind in
considering the Mexican policy of our Government. First,
will the American Government acquiesce in the continued
refusal of the Mexican government to do justice to American
citizens? And, second, if the American Government does
not acquiesce in such treatment, what course will it pursue
to remedy this situation? On the assumption that the gen-
eral expressions from the present administration indicate a
return to the policy of protection for American interests
abroad, which, naturally, must include Mexico, we beg to
submit a few suggestions for the consideration of our Gov-
ernment in formulating a policy for the effective protection
of American citizens in Mexico.

The American Association of Mexico is of the opinion that
neither the present Mexican government nor any Mexican
government should be accorded recognition by the American
Government until an agreement is made in which the Mexi-
can government shall undertake to compensate Americans
who have suffered in the series of revolutions which have
afflicted that country since 1910, and shall give pledges to
restore to American citizens the rights of which they have
been deprived through an illegal constitution enacted by a
military faction.

In considering this matter, it is important to bear in mind
that, while there has recently been a change in government
in Mexico, there has been no real change in either party or
policy. The same military faction has controlled Mexico
for the past seven years. No distinction can be drawn be-
tween the Carranza government and that of General Obre-
gon, since they represent the same party and are composed
of virtually the same men. It is of the utmost importance
that this fact be fully appreciated. It was General Obregon
who first occupied and held Mexico City for Carranza in
1915. When the American Government protested against
his conduct there, it directed the protest to Carranza at
Vera Cruz. Parenthetically, in view of demands for uncon-
ditional recognition, the following excerpt from this protest
is now of interest:

"The Government of the United States has noted with

IS

increasing concern the reports of General Obregon's
utterances to the residents of Mexico City. The Gov-
ernment believes they tend to incite the populace to
commit outrages in which innocent foreigners within
Mexican territory, particularly in the City of Mexico,
may be involved. This Government is particularly im-
pressed with General Obregon's suggestion that he
would refuse to protect not only Mexicans but foreign-
ers in case of violence, and that his present manifesto
is a forerunner of others more disastrous in effect. . .
"The Government of the United States is led to be-
lieve that a deplorable situation has been wilfully
brought about by Constitutionalist leaders and forces
upon a populace submissive to their incredible demands,
and to punish the city on account of refusal to comply
with them. When a factional leader preys upon a starv-
ing city to compel obedience to his decrees by inciting
outlawry and at the same time uses means to prevent
the city from being supplied with food, a situation is
created which it is impossible for the United States to
contemplate longer with patience. Conditions have be-
come intolerable and can no longer be endured."
General Obregon was later Secretary of War in the Car-
ranza government. Under leave of absence as a general in
the army, he conducted his campaign for the presidency and
in the course of this campaign headed the revolution which
overthrew Carranza. Nearly all of the members of the
Obregon cabinet formed a part of Carranza's government.
Pani, now Minister of Foreign Affairs, was Carranza's
Minister to France; Calles, now Minister of Interior, was
Carranza's Minister of Commerce and Industry — he secured
a f(:w weeks' leave of absence to start the revolution against
Carranza in Sonora; de la Huerta, now Minister of the
Treasury, was governor of Sonora, first appointed by Car-
ranza; Zubaran, now Minister of Commerce and Industry,
was Carranza's Minister to Germany ; Ortiz Rubio, Obregon's
Minister of Communications until a few weeks ago, was
governor of Michoacan under Carranza. The officials in
the Department of Commerce and Industry who had charge
under Carranza of the scheme to confiscate American oil
properties, are still there in the same capacity.

When the Carranza-Obregon party began its revolution,

16

Americans had suffered only the incidental consequences of
revolutionary strife. Until that time, Mexico's laws with
reference to foreigners and to property rights were in keep-
ing with the practice prevailing in the most civilized coun-
tries. The Mexican government, by constant effort through
a quarter of a century, had established for Mexico a well-
earned reputation for recognizing and complying with its
national and international obligations.

With the rise to power of the Carranza-Obregon party,
the policy of the Mexican government changed. This mili-
tary faction came into power on a program of war on Ameri-
cans, war on property rights, and war on religion. It is
unnecessary to recount here the pathetic story of the wanton
destruction of American lives, in many instances by soldiers
in the service of the government, of the contempt with which
the Federal authorities treated the representations of the
American Government, and of the action of the courts in
withholding punishment from military assassins and bandits
alike. The long list of these outrages is a matter of record
in the State Department. Only one case of reparation dur-
ing all of these years has come to the knowledge of the
American Association of Mexico, and that an award of
damages for the death of an American while Mexico City
was in the possession of a faction at war with Carranza and
Obregon. The American Association does not know of a
single instance of punishment for the murder of Americans.

We believe that now is the time to settle all the differences
that exist between the American Government and the de
facto government of General Obregon. To defer settlement
until after the recognition of that government would be to
repeat, with more dangerous consequences, the mistake that
was made in the recognition of the Carranza government,
and to render future negotiations difficult by the introduc-
tion of matters foreign to the relations of the two countries.

The necessity of a formal agreement with the present
Mexican government will be readily seen when it is recalled
that the Carranza government was given de facto recogni-
tion on the basis of a proclamation which that government
issued to the Mexican people, the text of which had been
approved by the American Government in advance, and of
a public statement by the Carranza representative at Wash-
ington, in both of which the most ample assurances were

17

given of protection to American citizens and the recognition
of their rights. Hardly had recognition been granted when
the Carranza government began by executive decree its anti-
American program, which culminated in the adoption, by
the Carranza military faction, of the so-called Constitution
of 1917. The Carranza government was granted de jure,
but conditional recognition, by the presentation of Ambassa-
dor Fletcher's credentials on March 3, 1917, after protest
against various articles in the constitution, and after verbal
assurances had been given to Ambassador Fletcher by Car-
ranza's Minister of Foreign Affairs that such articles would
not be invoked to the detriment of American interests.

The Carranza constitution destroys the foundation of
private property in Mexico and establishes a basis for the
gradual elimination of American citizens from business en-
terprises in that country. We will not take the time of the
Secretary to analyze this instrument with respect to its
effects on American citizens, but will merely recall to his
mind that under this so-called constitution, American citi-
zens have been deprived of the right to purchase real estate
in Mexico, an American minister of the gospel may not exer-
cise his sacred office in that country under any circum-
stances, an American citizen may be expelled by the federal
executive without right of trial by Mexican courts or of
appeal to his own government, that he may be deprived of
his real property by executive decree, and that in the ac-
quisition of any property he must renounce his citizenship
and waive his right to diplomatic protection.

This constitution has been accepted unchanged by the
government of General Obregon, and if this government is
recognized by the American Government, the disabilities of
American citizens will be crystallized and rendered perma-
nent- Both before the adoption of the so-called Constitution
of 1917 and subsequent thereto, the American Government
protested against the anti-foreign provisions of that instru-
ment. So far as we know, those protests have never been
withdrawn, nor has the American Government recognized
the validity of those provisions.

The recognition now of the Obregon government without
a prior written agreement as to the effects of the constitu-
tion on American citizens would, in our opinion, constitute
an embarrassing acceptance of the constitution and the

18

validity of laws based thereon, and might be tantamount to
a waiver of the rights of American citizens in that country.
It would probably have the effect of placing the American
Government in the disadvantageous position of submitting,
or refusing to submit, the determination of these matters
to foreign powers who might with propriety offer their good
offices in the arbitration of differences between the American
Government and a Mexican government, recognized by the
American Government, and in consequence thereof recog-
nized by all other governments.

This Association does not subscribe to the belief which
prevails in some quarters that the United States should con-
sult Latin America in the determination or execution of its
policy with respect to Mexico. Nevertheless, we feel that
unnecessary complications and much criticism would be
avoided by securing a definite and binding agreement with
Mexico as a basis for recognition, an agreement which can
only concern the American Government and the de facto
Mexican government. Negotiations would assume a differ-
ent form if the United States should first, by extending
recognition, give to the Obregon administration the status
of a de jure government. Prior to recognition we deal with
a dominant revolutionary faction, to which we may give or
withhold recognition as best suits the interests of our people ;
subsequent thereto we deal with a government, and in mak-
ing demands lay ourselves open to the charge of attempting
to impose our will on a weaker government, constituted and
accepted under the rules of international law.

It is patent that a fundamental basis for the recognition
of a government is the ability and intention of that govern-
ment to comply with its international obligations. We sub-
mit that the espousal of the Carranza constitution by the
present de facto government of Mexico constitutes in itself
indisputable evidence of intention not to comply with such
obligations. ^ij

The American Association regards the choice of an am-
bassador as an important part of the Mexican program of
the American Government. While we realize that, previous
to recognition, consideration of this matter would be pre-
mature» we ask that we be permitted to avail ourselves of
this opportunity to present for consideration some phases
of this matter that have impressed themselves on us in our

19

long residence in Mexico. We trust that our suggestions
will be understood to be tentative and general and as being
made in an endeavor to present to the American Government
a view of the situation that particularly impresses us as resi-
dents of Mexico. Also, it has seemed to us that it might not
be inappropriate to express our views because of the active
campaign in connection with the selection of an ambassador
that is now being made in the United States, apparently on
the assumption that the Mexican de facto government has
the right not only to demand recognition, but to be heard
in the selection of an ambassador.

Some years ago, the American Government, in recognition
of the importance of its relations with Mexico and of its
responsibility to its own citizens and to other nations as well,
raised its diplomatic post there to the dignity of an embassy.
Today the American Ambassador is the only diplomat in
Mexico holding that rank, and, as such, is the dean of the
diplomatic corps and its leader and spokesman. If that post
has been important in the past, when the relations of the
two countries were formal and cordial, how much greater
responsibility it will bear now as the channel for the expres-
sion of important policies of far-reaching influence ?

From our observation, we would submit that the character,
attainments and prominence of the American ambassador
are of peculiar importance and grave concern. This is
evidenced by the interest now manifested in this selection
by the Mexican press and by the diplomatic corps in Mexico
City. We believe that our new ambassador should, of course,
be a man without business interests in Mexico and one who
has not represented such interests ; he should be free from
the local border point of view and should be unencumbered
by present or past factional relations in that country.

The next ambassador should measure up fully to the re-
quirements of his position in this delicate situation. If not
selected from the corps of trained diplomats who have seen
service abroad, he should, in our opinion, be an American
of national prominence who would lend prestige to the post
and whose appointment would in itself be an indication to
Mexico and the world of the importance which the American
Government attaches to the execution of its policy in Mexico.

While the American Association has no candidate for the
Mexican post, it would suggest as illustrating the type of

7ft

man it has in mind, such Americans as John Bassett Moore,
David Jayne Hill and General Leonard Wood.

The Association is of the opinion that the next ambassador
to Mexico should be a man of wide vision, free from present
or previous connections which would give suspicion of biased
judgment. Such qualities would enable him to judge wisely
of men, conditions and events. His opinions would be ac-
cepted by his own Government and would carry weight in
Mexico and abroad.

21

THE INTERNATIONAL FACTOR IN MEXICO'S
INTERNAL POLITICS

A Sound American Program Based on American Rights
Not the Road to Intervention

(Not Issued as a Separate Bulletin — April 16, 1921)

Though the Harding administration is little more than a
month old pressure is already being brought to bear on high
officials at Washington for immediate and unconditional
recognition of the Obregon government. Special envoys are
employing methods similar to those used in the cases of
Carranza and others. It is urged that Obregon is the only
available man capable of giving Mexico a just government,
that his overthrow would mean chaos, as a result of which
Americans resident in Mexico would suffer in their persons
and business, and armed intervention on the part of the
United States would become compulsory. These and other
related matters were brought up in the audience granted
by the Secretary of State on April 11, 1921, to committees
from the American Association of Mexico and the National
Association for the Protection of American Rights in
Mexico. To make its position clear, the American Associa-
tion has submitted a supplementary memorandum to Secre-
tary Hughes covering the following points :

1. The statement that General Obregon is the only man
in Mexico capable of giving the country a just government
is far from the truth. A nation that could in a single gen-
eration produce Porfirio Diaz, Limantour, Pablo and Miguel
Macedo, Ignacio Mariscal, Justo Sierra and many others of
the type could not be entirely lacking today in men of
political and executive ability. Men of this type do not hold
office now, as their political activity has been proscribed by
the Carranza and Obregon governments and consequently
they are not known abroad. They are intimidated and help-
less under present conditions because they believe it to be
the deliberate policy of the American government that in-
dividuals like Carranza and Obregon should rule Mexico.
These Mexicans have sufficient knowledge of international
relations and world conditions to appreciate the necessity,
today as never before, for Mexico to be in close harmony
with the United States. They realize that in working out

22

the problems of Mexico's reconstruction after ten years of
internal strife, the friendly cooperation of this country is
imperative.

2. The negotiations between the representatives of
President de la Huerta and Secretary of State Colby were
abandoned when the then head of our State Department
suggested that verbal assurances of reforms be embodied in
a convention to be signed by both countries. That incident
illustrated the elusiveness of representatives of successful
Mexican revolutionists in the matter of binding promises.
This Association believes that such a protocol or treaty is a
necessity to assure American rights in Mexico and holds
that speculation as to the inclination or ability of General
Obregon to sign a convention of this character are beside
the question. It is our judgment that the American gov-
ernment should not deviate from a sound policy of requiring
such an agreement, whatever the temporary consequences.
If General Obregon fails to sign a convention because he is
unwilling or unable to do so, in our opinion he is not entitled
to recognition.

3. This Association is informed that Mexican envoys
have urged upon our government the expediency of conduct-
ing negotiations confidentially, alleging that a public an-
nouncement of an American policy containing demands upon
the Obregon administration might embarrass him and con-
tribute to the overthrow of his government. Suggestions
from outsiders, on this point, in our opinion overstep the
limits of propriety. It is to be presumed that the negotia-
tions will be conducted in a manner conducive to securing
the ends desired. However, it is the view of this Association
that in the event of failure of negotiations to secure a treaty
or other convention, the policy of the United States should
be publicly announced, as a matter of justice to the American
people and in order to give the Mexican people opportunity
to remedy the situation if they so desire.

4. This Association is informed that an effort is being
made to secure recognition from our government on the
ground that chaos in Mexico would result from the fall of
the Obregon government. In the judgment of the American
Association, it is imperative that our government adopt a
policy based solely on principles of right and justice and re-
gardless of temporary effects . in Mexico or the attitude of ,

22

General Obregon. This Association prefers a temporary
state of chaos in Mexico to a continuance of present condi-
tions. It believes, in making this statement, that it voices
likewise the general feeling of Americans in Mexico, and
has no doubt that it expresses the opinion held by the Mexi-
can people. Americans there have been ready and willing
during the recent years of trouble to take whatever chances
might come in consequence of the action of their government
in making vigorous representations to the Mexican govern-
ment. We submit that the record of the last ten years
proves that American lives and property have been de-
stroyed, not as a result of just demands upon Mexico, nor
even during the several periods of physical intervention, but
on the contrary almost invariably because of a weak and
vacillating policy based on a misconception by our govern-
ment of its duties.

5. This Association is an ardent advocate of returning to
the practice of formulating a policy based on the rights of
American citizens — if the policy be sound, the result must
be beneficent. To speculate upon the effects on internal
Mexican politics would be to bring into the formulation of
our policy considerations that are not sanctioned by the
precepts of international law.

6. The American Association has not regarded it to be
within its province to advocate any particular remedy for
the Mexican problem. It has limited its efforts to pointing
out the menace to American citizens in the present situa-
tion, and to advocating the non-recognition of any Mexican
government until this menace shall have been removed.
The officers of this Association, however, do not hesitate to
express their opinion as individuals (the Association itself
cannot have an opinion in this matter) that the alternative
to General Obregon is not armed intervention but rather a
state in which Mexico shall be ruled by those of her citizens
who have conceptions of the national and international
duties of the Mexican government. A continuance of Presi-
dent Obregon on a basis other than unreserved recognition
of the rights of American citizens, which will bring as a
corollary justice to other foreigners and to Mexicans, is
the sure road to armed intervention, just as the recognition
of the Carranza government was the first step toward the
present situation bordering on intervention. We are getting

24

away from intervention when we cease attempting to dictate
who shall, or who shall not, be president of Mexico, and get
back to the sane and unassailable principles that should
guide one government in its relations to another.

7. We cannot emphasize too strongly the fact that the
Mexican people are not in sympathy with General Obregon
in his espousal of a constitution which must eliminate the
AmeHcan from Mexico, just as they were not in sympathy
with Carranza in this respect. We believe that if it should
become known that the American government has refused
to recognize the Obregon government because of its failure
to agree to do justice to Americans, and consequently to
other foreigners in Mexico, the Mexican people would them-
selves apply the remedy.

8. We are convinced that the present inertness of the
Mexican people is due to inability to react promptly after
the intimidation and bullying to which they have been sub-
jected by the American government for the past eight years,
and that they will not believe that our government has
changed its policy of meddling in their internal affairs in
the interest of revolutionary chieftains until there is un-
equivocal indication of the new policy from the proper offi-
cials of the American government.

25

AMERICAN RIGHTS AND MEXICO'S LAND

LAWS

Discussion of the Provisions of the Constitution of 1917 as

Affecting the Acquisition and Ownership of

Real Estate by Foreigners

(BULLETIN Xo. 4— Issued August 25, 1921)

The American Association of Mexico desires to place be-
fore its members certain observations with respect to re-
strictions placed upon American citizens by the so-called
Constitution of 1917, denying to them the right to acquire
land in Mexico. The question is one of such importance from
a political and economic standpoint that the Association be-
lieves its members should be advised of the effects of this
provision on the status of Americans in Mexico, on the
peace and prosperity of the Mexican people and on the per-
manence of cordial relations between the two countries. It
may be mentioned that the views embodied in this Bulletin
have been placed before Secretary of State Charles E.
Hughes.

With reference to allowing aliens to acquire land in
Mexico, the Constitution of 1917 divides the territory of the
republic into two great zones. In the prohibited zone, which
comprises about 40% of the national territory, an American
may not acquire land under any circumstances. In the re-
mainder of the country, which may be termed the zone of
tolerance, he is equally denied the right to purchase land
but he may be permitted to do so as a matter of executive
grace or favor after complying with defined conditions.

The prohibited zone consists of all land within approxi-
mately sixty miles of the northern and southern frontiers
and within approximately thirty miles of either coast. It
includes precisely the districts in which American citizens
would, as a rule, desire to purchase land, and it is within this
territory that the greater part of the American holdings in
real estate now lies. Within its boundaries are the land
nearest the United States, the productive land along the
Atlantic and Pacific seaboards, the present Tampico oil field,
and prospective oil fields along the entire Gulf Coast. It
will serve to illustrate the effect of this provision to state

26

that not one of the four thousand Americans who make
their homes in Tampico may purchase a lot in that city.

An American citizen, seeking to obtain land in the zone
of tolerance, must in each case ask permission of the execu-
tive, and in the event that permission be given, he must
agree to waive his right to diplomatic protection with re-
spect to the property. While waiver of diplomatic protec-
tion is required of an American before he is permitted to
acquire real estate, it is not mandatory on the executive to
grant permission where this condition is fulfilled. The
executive enjoys unrestricted power to grant or deny the
petition as he sees fit; the law allows the petitioner no
appeal or legal recourse in case his petition is denied. These
conditions place the American in the position of an applicant
for a privilege ; he possesses no rights whatsoever under the
law.

This fundamental change in Mexican law creates a situa-
tion, in our opinion, which it behooves the American govern-
ment and people to face frankly as it is filled with potential
trouble for the future.

The American Association is of the opinion that no gov-
ernment in Mexico which insists on this policy should be
recognized and that it is important for our government to
study the situation thoroughly and to take no step toward
giving sanction to these principles withou-t a full understand-
ing of the far-reaching consequences of its action.

From a political and economic standpoint, the following
objections lie against the provision depriving Americans of
the right to own and acquire land :

1. It threatens the virtual confiscation of American-
owned land in the prohibited zone.

2. It accomplishes the partial confiscation of American-
owned land in the zone of tolerance.

3. Its restrictions are tantamount to a prohibition
against the immigration of American farmers and ranchers
desiring to settle in Mexico.

4. It inflicts a needless humiliation on Americans, which
affects their standing and influence.

5. It may be used to involve us with other countries.

6. It places the acquisition of land by Americans on the

27

basis of a concession, thus supplying a fruitful source of
difficulty between this country and Mexico.

7. It violates the principle of reciprocity.

8. It will retard the economic development of Mexico
and work against internal peace.

9. If sanctioned by our government, it will establish a
dangerous precedent, affecting the influence of the United
States throughout Latin America.

Each of the points mentioned merits a somewhat detailed
analysis and discussion. They will be considered in the fore-
going order:

1. There is pending before the Federal Congress a bill
submitted by President Carranza, which, if enacted into law,
will authorize the Mexican government to expropriate
American-owned properties in the Tampico district for a
fraction of their actual value.

2. The provision accomplishes indirectly a partial con-
fiscation of property acquired by Americans previous to the
adoption of the Constitution, in that it does away with a
profitable market for their land. It is proverbial that Mexi-
cans will not pay as high a price for land as foreigners, par-
ticularly Americans. Now that aliens have been deprived
of the right to purchase land, they are no longer feared as
competitors and Mexicans will be able to purchase such land
cheaply.

The memorandum of protest against the Agrarian Law
of the State of San Luis Potosi, delivered to General Obregon
by American Charge d' Affaires Summerlin in Mexico City
in April, indicates that the State Department is thoroughly
alive to the situation arising from government expropriation
and subdivision of land without other compensation to the
owners than that of worthless state bonds.

3. The provision is designed to stop American immigra-
tion and to eliminate the American citizen as a factor in the
development of the resources of Mexico. If allowed to stand,
it will accomplish this purpose. It erects an international
spite-fence, an artificial barrier to our natural outlet to the
south, and will keep differences alive as spite-fences usually
do. .

Mexico is within a special sphere of American influence
and Mexicans and Americans resident in Mexico realize that

no Mexican government can prosper and endure unless it
enjoys the cordial friendship and support of the United
States. Nominally, the European powers and Japan deal
directly with Mexico. In practice they take no important
step without consultation with Washington, virtually hold-
ing our government responsible for its southern neighbor.
The United States not only accepts this special position but
insists it shall be recognized by other nations.

We feel that these hard facts should be faced frankly and
given their due importance in the shaping of our Mexican
policy. Failure to do so now will result in the establishment
of precedents which will multiply trouble for the future.
Recognition of Obregon under present conditions would be
regarded as an acceptance of existing land laws and future
Mexican governments would rely on this as a precedent.
These laws affect other aliens as well, thus placing a double
responsibility upon our government.

We would object if Mexico attempted to cede Magdalena
Bay to Japan as a naval base because it would be a threat
at the prestige and influence of the United States. Equally
we believe our government should not recognize and support
a Mexican government upholding measures working toward
precisely this same end, the injury of Americans and the be-
littling of their influence and prestige.

Arguments based on restrictions placed by certain state
governments of the United States on immigration from
other countries we do not regard as pertinent. Suffice to say
there are no national restrictions in the United States on the
rights of a Mexican citizen to acquire real estate in this
country.

Furthermore, the American landowner through his con-
stant and compulsory contact with natives is, of all classes
of Americans resident in Mexico, the best medium for estab-
lishing a more intimate understanding between the peoples
of the two countries. To suppress or curtail his activities
in Mexico is to put obstacles in the way of attaining a com-
plete resumption of friendly relations on a permanent basis.

4. The requirement that an American citizen shall waive
his rights to the protection of his own government when he
acquires land is a humiliation which, in our opinion, the
American government should not permit. If the American
government regards this waiver as effective and binding,

29

then certainly no Mexican government should be recognized
which insists on this provision. If the American govern-
ment maintains that this waiver is not binding, we feel that
it should not permit its citizens to be humiliated by sub-
mitting to it.

The waiver of diplomatic protection also has its effect in
this respect: Since no nation recognizes the force of such
waiver, by including it in the Constitution of 1917 Mexico
assumed the position of gratuitously providing a cause for
diplomatic differences with other countries. The very fact
of the requirement is evidence of intention to commit wrongs
calling for diplomatic interposition.

The American citizen who does business in Mexico is re-
minded each day of the inferior position which he occupies.
This provision is in its very nature anti-American and its
inclusion in nearly all contracts that Americans make in it-
self forecasts the intention of the Mexican government to
deprive American citizens of thdr rights. Any honorable
Mexican government would not require a waiver, because
such a government would realize that while he received jus-
tice at the hands of the judiciary or government officials, the
American citizen would not appeal to his own government,
just as he seldom appealed to his government but submitted
his rights to the Mexican courts during the thirty years
preceding the recent series of revolutions.

5. Since the powers of the Mexican executive in per-
mitting aliens to acquire land are not restricted by law,
but are unlimited and to be exercised at his discretion, con-
ditions may be made so burdensome to American citizens,
and they may be discriminated against to such an extent as
to menace the peaceful relations of the two countries. For
example, in the exercise of the authority vested in him by
this law, the executive might colonize all the border states
of the north, save districts in the prohibited zone, with
Japanese and exclude Americans and all other aliens. Should
a Mexican executive decide to show favoritism of this char-
acter at a time when our relations with Japan were strained,
the reaction of our government under such conditions may
be easily imagined. This contingency is not mere idle specu-
lation, for the disposition in the past of Mexican officials to
negotiate with Japan against the interests of the United
States is well known.

6. The provision puts in the hands of Mexican officials

30

the power to extort large sums from those seeking as a
privilege what they formerly enjoyed as a right. It places
the acquiring of real estate by Americans on the basis of a
concession or franchise, concessions being perhaps the most
productive source of differences arising between this coun-
try and Latin America.

Arguments against a law under ordinary conditions are
usually made with the assumption that it will be honestly
and justly enforced. We submit, however, that in the
Mexico of the last ten years no sound argument may be
made on any other than the contrary assumption, if the law
peaces in the hands of officials untrammeled power to grant
or withhold franchise or privilege. Subornation of officials,
bribery and corruption invariably result. This is true his-
torically to so great an extent as to demonstrate that the
primary object of such laws has often been to provide offi-
cials with an instrument of extortion.

7. In the United States, there is no national legislation
which prohibits a Mexican from owning or acquiring land
in American territory, nor is he placed at a disadvantage in
this respect as compared with the American citizen. He is
free to buy land along the frontier and on the seacoast. In
our border states, hundreds of Mexicans own and cultivate
farms. Should the United States desire to respond in kind
to Mexico's land laws and exclude Mexicans from the right
to own real estate in American territory, there is a legal
question as to whether our government would not be in-
hibited from enforcing such a law in our border states be-
cause of provisions in the Treaty of Guadalupe Hidalgo. In
yielding this territory, Mexico took due precaution to secure
a guarantee of the free enjoyment of liberty and property
for Mexican citizens resident therein. This circumstance
furnishes an added reason for protest against the enforce-
ment by the Mexican government of restrictions on Ameri-
cans in the acquisition of land in Mexico.

8. It will to a vital degree retard the economic develop-
ment of Mexico and the establishment of a decent standard
of living for the mass of the people. Geographic proximity
and our commercial and political relations make this a mat-
ter of concern to the United States.

Attention must be called to the stabilizing influence of the
proper sort of immigration and the necessity for encourag-

31

ing the American small farmer and rancher to settle in
Mexico in order to provide a needed stimulus to agricultural
development.

The American farmer and ranchman is par excellence the
American pioneer. He settles on the land with his family
and stays there. He would be a stabilizing element of im-
measurable value during troublous times. The day there
are fifty to one hundred thousand such men with their fam-
ilies in Mexico will mark the end of revolution in that
country. Disturbed conditions would not drive them from
their land and homes as employes of American corporations
were driven from their jobs by the rising tide of revolution.
The enormity of the sacrifice and the spirit of the men would
have made them stay and defend their property. It is the
opinion of the American Association that if the American
money invested in oil and mining and railroads in Mexico,
or 10% of it, had been used by American settlers to buy
lands, civil war in that country would be virtually a thing
of the past.

Mexican revolutions which do not culminate quickly in a
coup d'etat start with small bands scattered over the coun-
try. The majority of these are composed of bandits, pure
and simple. They live upon the country, taking stock and
foodstuffs from the hacendado and ranchman. The forma-
tion of revolutionary armies comes later and is a slow pro-
cess. American pioneers fight for their own. Resistance to
small bandit bands in" the early stages would cut off Mexican
revolution at the root by depriving these gangs of marauders
of supplies upon which to live. We regard this as especially
important because we believe that the solution of the Mexi-
can problem essentially lies in making personal revolutions
impossible.

By her land laws, as has been pointed out, Mexico effec-
tively bars this needed element from her territory. The
American small farmer, fruit grower and ranchman was
just beginning to establish himself in Mexico when the
Madero revolution came. Another decade of peace would
have found the type so numerous as to have made general
revolutionary conditions impossible. A factor for peace,
he would be a greater influence still as an economic asset
of Mexico, as an example of industry and thrift, and an in-
structor in modern methods of cultivating the soil. The

32

record of this class of Americans in Mexico during the latter
years of Porfirio Diaz demonstrates this.

The Mexican people are facing a desperate economic situa-
tion. Foreign property has been destroyed and obligations
incurred by the Mexican government amounting to hundreds
of millions of dollars remain unpaid. Ranching, one of the
greatest industries of Mexico, virtually has been wiped out
as a result of the depletion of the live stock in that country ;
farm productivity has been greatly reduced and the Mexican
people deprived of their cash resources by the issue of hun-
dreds of millions of pesos in paper money, long since re-
pudiated ; banks were looted and closed, thus destroying the
means of public and private credit. Taxes for the purpose
of internal government have been raised to a point that
borders on confiscation.

The greater part of the wealth of Mexico is in her land.
Consequently, the landowner must bear the burden of the
taxation that will be necessary to rehabilitate Mexico. The
only possible way for him to meet this situation is to dispose
of a part of his land to the best purchaser — the American
citizen. There is little anti-American sentiment among the
people of Mexico and the schemes of the demagogues who
have controlled that country since the advent of Carranza
to deprive Americans of the right to own land, are not sup-
ported by the sentiment of the Mexican people or Mexican
landowners.

The principal need of the Mexican people is the develop-
ment of their land, and this can best be accomplished by the
example of the American farmer and ranchman. The Mexi-
cans also need lessons in industry, in frugality and in re-
spect for constituted authority, and these things they will
learn from American neighbors. The Mexican farm laborer
needs better wages, better living conditions and better
schools, and his best chance to get these is to work for the
industrious and humane American, whose influence for the
betterment of the Mexican working class is recognized by
every impartial observer in that country.

The Indians of the rural districts of Mexico do not know
how to farm except in the most primitive fashion and efforts
at subdivision of rural lands for their benefit have demon-
strated that the majority of them care neither for the land
nor for the responsibility of tilling it at their own risk, nor
have they means to purchase implements or work animals,

33

At this point it may be well to quote from the pamphlet
"Essay On the Reconstruction of Mexico," of which Mr.
Manuel Calero, former Secretary of Foreign Affairs and
former Ambassador to the United States ; Mr. Francisco S.
Caravajal, former President of Mexico and former Chief
Justice of the Federal Supreme Court; Mr. Jorge Vera
Estaiiol, former Secretary of Public Instruction; Mr. Jesus
Flores Magon, former Secretary of the Interior, and other
distinguished Mexicans are co-authors. The following is
taken from chapter 4 on "The Naturalization and Civil Status
of Aliens" :

"Article 27 of the Queretaro Constitution embodies
the principle that aliens may not own real estate, nor
be granted concessions covering waters, mines, and the
like, except by the grace of executive authority, after
the interested party has made formal waiver of the
right to invoke the protection of his government.

"While it is true that certain countries do not grant
aliens the right to acquire real estate, we are, neverthe-
less, of the opinion that Mexico should return to the
liberal system that prevailed under the Constitution of
1857. Having due regard for the cultural and economic
situation of our native population, coupled with the
facts of its sparseness, it appears advisable to encourage
the establishment of foreigners in Mexico. Experience
has shown them to be elements of moral progress and
factors in the development of public and private wealth.
"Provisions fixing the civil capacity of aliens have
no place in the political constitution of the republic.
They belong in general statutes, in special laws on
naturalization, and in international treaties. In the
absence of express treaty stipulations, Mexico must
accept, in general terms, the principle of equality of
civil capacity of Mexicans and aliens, excepting limita-
tions required by the principle of reciprocity, and such
other limitations as arise out of the needs of domestic
safety or of insurance against international complica-
tions.

"With regard to foreign corporations, we believe that
the incapacities placed on them by the Queretaro Con-
stitution, in provisions similarly incongruous in a Con-
stitution, reveal in the framers a mistaken appreciation

34

of the present day needs of the country. We are not
opposed, in principle, to the establishment of the in-
capacities, insofar as they are confined to the owner-
ship of real property ; but, at the same time, we believe
that the legislator should mitigate the severity of his
theories when the great interests of the nation so de-
mand. The position in which Mexico now finds herself
as the result of the internecine strife and the condition
of the world money market caused by the European
war compel the Mexican statesmen to adopt a generous
policy which shall attract to the country capital to de-
velop our resources and contribute to the moral and
economic betterment of our down-trodden people. In
harmony with this policy, it is necessary to return to
the former system and to permit foreign companies to
enjoy the same rights they enjoyed before the Quere-
taro Constitution, as the most practical method of in-
ducing foreign capital to engage in Mexican enterprises.
At a later date, when the political equilibrium has been
restored, when the methods of government admit of no
question as to their probity, when, in a word, we have
conquered the confidence abroad which we once en-
joyed, the time will have come slowly to force foreign
capital to operate in Mexico within the forms of asso-
ciation prescribed by Mexican law; but everything
which at the present moment is done in this regard will
affect adversely the economic progress of Mexico."
9. As a direct influence in the development of American
trade, in making a market for American goods, the Ameri-
can settler can do more than a dozen traveling salesmen.
If the precedent of barring the American pioneer is per-
mitted to become established in Mexico, it will spread
throughout Latin America to an extent such as seriously to
affect our position in this hemisphere.

If the American government should recognize the Obre-
gon government, it would thereby establish the principle
that American citizens have not the right to own land in
Mexico. If the American government does accept this prin-
ciple, it must reconcile itself to the application of the same
principle to all Latin America.

Acceptance of this doctrine as part of our Latin American

35

policy, in our opinion, would make it incumbent upon our
government as a matter of honesty and justice to our citizens
to make public announcement of the fact. Furthermore,
that Americans be warned against purchasing land in
Mexico even where permission is given or at least the in-
security attached to such precarious title be pointed out to
them. Also, that in the treaty to be negotiated with Mexico,
provision be made for compensation based on real value in
the sequestration of American-owned lands in the prohibited
zones.

If the American government reject the principle that an
American citizen shall not have the right to own land in
Mexico, then the form of an agreement with Mexico that
will safeguard those rights is of the greatest importance.
Rumors are current that a Supreme Court decision is to be
handed down or a law passed by the Mexican Congress to
solve all questions at issue between the two governments
arising from the Constitution of 1917. We are at a loss to
understand how either can give to American citizens the
right to purchase land in the forbidden zones when the Con-
stitution absolutely denies this right, or how either can give
American citizens the unconditional right to purchase land
in the rest of the Republic when the Constitution plainly
provides that this right shall be conditioned on executive
permission.

36

OIL COMMITTEE TO CONFER WITH OBREGON

Petroleum Producers Abandon Their Stand for Complete
Settlement and Arrange for Negotiations on Oil

(BULLETIN No. 5— Issued August 27, 1921)

The Executive Committee of the American Association of
Mexico desires to place before its members its views with
regard to the departure for Mexico City of a committee
composed of the presidents of five of the largest oil com-
panies of the United States for the purpose, as announced
by President Teagle of the Standard Oil Company, of "dis-
cussing, and, if possible, adjusting the differences growing
out of the recent tax decrees."

We feel very strongly that it is unfortunate, just at this
time, when negotiations between the American Government
and the government of Mexico for a general settlement of
the differences between the two countries seem to be reach-
ing a climax, that so imposing a committee should go to
Mexico and give undue prominence and importance to one
phase of the international situation.

The American Association was formed last February,
when it was evident that the large oil companies operating
in Mexico were planning a campaign to secure temporary
relief through compromises that were in no way comprehen-
sive and that could not be considered fair to the great bulk
of American interests in Mexico.

The oil companies apparently became convinced that the
best policy was for all American interests to stand squarely
together and support the reasonable and equitable conten-
tion of the American Government that Mexico make certain
just commitments before recognition be accorded any gov-
ernment in charge there. The Association of Producers of
Petroleum in Mexico (commonly referred to as the Oil Asso-
ciation) in an official statement, published on March 3, 1921,
stated, that "the oil companies also realize, as anyone
familiar with recent and present conditions in Mexico must
understand, that the particular problem of the American
petroleum producer in Mexico cannot be solved satisfactorily
apart from the solution of the entire Mexican problem as it
affects various American interests. Any permanent solution
of the particular problem confronting the oil companies de-

Z7

pends upon a full recognition of the principles of equity and
international law, the violation of which underlies the diffi-
culties not only of the oil companies, but of all other Ameri-
cans interested in Mexico. . . ."

Now, we again see the Oil Association, without consulting
other interests, after making hurried arrangements, dispatch
a committee to Mexico for the purpose of securing relief
for the petroleum interests. This committee departs with
the intention of discussing oil business exclusively, notwith-
standing the repeated official declarations of the Oil Associa-
tion that no satisfactory settlement of the Mexican ques-
tion could be secured except as a whole. The inevitable
effect of the committee's visit will be to paralyze absolutely
all other and more general efforts until petroleum interests
have finished their specific parleys on oil.

The prominence of the members in American business and
finance cannot be divested from this committee. It will be
credited with a semi-official character by the Mexican Gov-
ernment, and the Mexican people. And why should not this
be the impression in Mexico, when the American press is
already predicting the early recognition of the Obregon gov-
ernment because the oil companies have sent a committee
to Mexico. This indicates that the press does not believe
that the purpose of the committee is merely to discuss the
latest tax decree, but rather that it will endeavor to settle
all of the oil companies' difficulties with the Mexican gov-
ernment. Press notices also indicate a general belief that a
settlement of the oil question will lead to recognition by the
American government.

We realize that, while the announced intention of this oil
committee is to adjust differences with regard to the new
tax, in all probability the conference with President Obregon
will not be limited to tax matters. But, just as the question
of an excessive export tax is not the only problem of the oil
companies, the oil companies' troubles do not constitute the
entire oil question in Mexico, and the whole oil question is
only one of the important items to be considered in the total
case against the injustice in Mexico today in constitutional
provisions, in laws and executive decrees and in official atti-
tude, against which the responsible American interests in
Mexico are aligned with the American Government.

Attempts to settle the oil companies' troubles apart from

38

a general adjustment of international differences can only-
result in the adoption of expedients that will be neither
satisfactory nor lasting in benefits, and will hinder the
Government's negotiation of a treaty with Mexico which
would bring permanent relief to oil interests along with
others, large and small, equally deserving of consideration.
On the other hand, the continued cooperation of the pe-
troleum producers with other interests in Mexico, and their
support of the position of the American Government, un-
doubtedly would aid very materially in a settlement of the
various questions regarding property rights and the inter-
ests in general of Americans in Mexico.

If, through the efforts of this formidable committee, the
oil companies should be able to force a compromise on the
oil tax, or secure relief in connection with their various
complaints, every effort would be made by Mexico, through
her active propagandists, to have such a settlement accepted
as a settlement of the whole Mexican question. The Obregon
government, in exchange for special concessions to the oil
companies, will endeavor to gain the cooperation of these
companies in securing recognition without doing justice to
other American citizens.

This, we feel, must not be permitted. The American
people should be made clearly to understand, and the Mexi-
can government must also comprehend, as we know the
authorities at Washington do, that an adjustment simply of
the oil companies' troubles cannot by any means be consid-
ered as compliance with the requirements of the American
Government and would not constitute the complete and
permanent settlement of all the important questions at issue
with Mexico which the present situation demands.

For instance, the right of an American citizen to buy land
in Mexico, which is now denied by the Constitution of 1917,
would be in no way affected by a ruling on Article 27. This
point is fully discussed in Bulletin No. 4 of this Association.

In conclusion, we beg to submit herewith a brief mem-
orandum to show that a settlement by the oil companies on
a basis of the limited non-retroactive effect of Article 27, as
now contemplated by the Mexican government, will not even
solve the Mexican oil problem.

The views embodied in this bulletin have been placed be-
fore the Secretary of State.

39

THE RETROACTIVE EFFECT OF ARTICLE 27 OF THE
MEXICAN CONSTITUTION OF 1917

Memorandum Pointing Out the Menace to the American Oil
Industry in the Acceptance of a Limited Non-
retroactive Effect of Article 27, as Now
Contemplated by the Mexican Government

The future of the oil industry in Mexico should be con-
sidered in its effect on the interests of the American people,
and not merely as relating to present investments in Mexico
by American oil companies.

It is claimed in Mexico, and is apparently believed in some
quarters in the United States, that a decision by the Supreme
Court, or a law of Congress, declaring that Article 27 of the
Constitution should not apply to leases held by foreign com-
panies prior to May 1, 1917 — the date the constitution be-
came effective — would constitute a settlement of the Mexi-
can oil question. This judicial decision is expected daily in
Mexico, and a bill giving this interpretation to Article 27
has been introduced in Congress.

It must be borne in mind that until recently — and possibly
even now — the demands of the oil companies did not go be-
yond this.

It will be perceived that this is a limited application of
the principle of non-retroactivity. It is quite obvious that
if Article 27 is not retroactive, it will apply merely to land
which on May 1, 1917, belonged to the Mexican govern-
ment, and that consequently property owners may continue
freely to lease land acquired prior to that date. This would
be the case whether the owners were Mexicans or Amer-
icans.

It is clear that a limited application of this principle will
give temporary relief to oil companies in that it will permit
them to develop the lands they acquired before May 1, 1917.
It is equally clear, however, that new American capital may
not under such conditions make investments safely in Mexi-
can oil lands, and it is also obvious that the oil companies
which have already invested in Mexico could not invest in
new territory with assurance. It is also apparent that
American citizens who acquired land prior to May 1, 1917,
and who have not leased the same, would lose the subsoil
without compensation, just as effectually as would the com-

40

panies lose their property if their leases were declared to be
invalid.

The fundamental objection to this scheme is that it is un-
just. There are also many other objections. They are
based, of course, on the assumption that it is vital to the
interests of the American people that the oil resources of
Mexico be developed, and that American industry get a fair
share of this oil.

1. The Carranza government did not have the right to
confiscate the subsoil of land that belonged to individuals;
neither has the Obregon government the right to give this
effect to Carranza's laws. We presume there can be no
question about this. Assuming that the oil companies enter
into the agreement with the Mexican government that we
have in contemplation, and that the American Government
recognizes the Obregon government, this action will un-
doubtedly lead to the investment by American citizens of
large sums in oil leases taken directly from the Mexican
government on land which, prior to May 1, 1917, belonged
to individuals. It is likely that the Mexican government
will, within the next few years, again come under the control
of its law-abiding element. In such case the Supreme Court
of Mexico will undoubtedly decide that the subsoil belonged
to the owners of the surface on May 1, 1917, and could not
legally be appropriated by the government. The subsoil
and all oil discovered therein by American capital would
thereby be restored to the land owners. In such eVent,
Americans who had invested in such leases and development
would appeal to their government. What would the attitude
of the American Government be then? Will the American
Government insist that its citizens are entitled to their
leases on the ground that the American Government recog-
nized the Mexican government after the latter had confis-
cated these properties, and on the basis of such confiscation ?

2. Mexico fell into the hands of the anti-American ele-
ment of the population with the accession of Carranza; it
is still in possession of this element. If Carranza could have
secured the American Government's approval of the con-
fiscation of the oil-bearing subsoil of Mexico, he would un-
doubtedly have leased this territory to German interests, or
to Japanese or English. Certainly American citizens would
not have secured much of this territory. If the American

41

Government had given its assent to the above interpretation
of Article 27, it could not have objected to the right of
Mexico to sell its resources wherever it pleased. The Obre-
gon government will do likewise under similar circumstances.
What will the American Government do then?

3. The most fruitful source of conflict between Mexico
and the American Government is the "concession." As
matters have been in the past, American citizens have com-
peted with each other and with other foreigners on terms of
equality in their efforts to secure leases from the land own-
ers. If the Mexican government seizes the subsoil, the oil
companies of all countries will concentrate their energies
to dealing with the Mexican government, and Mexico City
will be the seat of activities of the agents of these companies
and unscrupulous concession hunters. It is easy to foresee
the corruption that would result and the charges of corrup-
tion even where it did not exist. The American Government
and other governments will be called upon to support their
citizens in concessions which on their face are legally valid,
but which are unjust in substance, with the result that this
will be a constant source of friction with the Mexican gov-
ernment.

It will be recalled that the present Minister of Finance, de
la Huerta, devoted most of his last day in oflSce as President
of Mexico to the signing of oil concessions in favor of his
frie'nds and associates. These concessions covered a consid-
erable portion of the territory of Mexico and were given on
terms that would have created great opposition among the
Mexican people, if they had been negotiated. That these
eleventh-hour concessions were not negotiated is due to the
refusal, so far, of the American Government to recognize
the confiscatory effects of. Article 27. These concessions and
others like them will be taken up if representatives of Amer-
ican oil interests accept a settlement along the lines above
suggested, and if the American Government approves this
settlement by recognition. The method of acquiring oil
territory in Mexico then will be to apply to the relatives and
friends of the President and his Cabinet. These applica-
tions will be anticipated, undoubtedly, by blanket concessions
to favorites. Under such circumstances it is of interest to
consider what the attitude of the American Government
would be. What will our Government do when, after the

42

investment of millions of dollars under such concessions, a
subsequent Mexican government declares them to be void
because of fraud ?

If the principle of non-retroactivity is really and fully
applied it will give not only temporary but permanent relief
to oil companies, and, at the same time, will safeguard the oil
rights of other American citizens who own land in Mexico.
It will also give such guarantees to Mexican citizens that
the oil resources of Mexico will continue to be open to de-
velopment along business lines and in strict accord with
justice and law.

This is the only just and permanent solution of the oil
question. ,

43

AGREEMENT OF OIL COMMITTEE WITH
OBREGON GOVERNMENT

(BULLETIN No. 6— Issued September 16, 1921)

Two salient facts stand out as the result of the conference
of the Committee of Five of the Association of Producers of
Petroleum in Mexico held recently with officials of the Obre-
gon government. One is the acceptance of a total tax of
more than 100 per cent of the price of oil at the well and
agreement to pay taxes in the future greatly in excess of
imposts against which the companies protested as con-
fiscatory at a time when oil brought two or three times its
present price. The other is an apparent about-face of the
companies which in the past flatly endorsed the requirements
laid down by Secretary Hughes as essential to recognition
of the Obregon government.

Though neither the oil committee nor the Mexican gov-
ernment has made public the terms of the agreement, the
American Association of Mexico learns that the following
are the outstanding points:

The decree of June 7 last, imposing a total tax of ap-
proximately thirty-eight cents American money a barrel, is
suspended until December. The ad valorem tax under the
previous decree of May 24, which amounts to approximately
twelve cents per barrel, is allowed to stand except that it
becomes a production tax instead of an export tax. This
tax is therefore paid on all oil in storage and all oil sold
within Mexico. The companies have already paid, or are in
the process of paying, this tax. Since this tax is based on
the price of oil, it is assumed that when oil, now worth at
the well in Mexico about fifteen cents a barrel, reaches its
normal price of from thirty to fifty cents a barrel, the tax
will be increased proportionately. In addition to this ex-
orbitant tax, an export tax of eight cents per barrel has
been agreed upon. The total oil tax is therefore now twenty
cents American money per barrel. The highest tax in the
United States is levied in Oklahoma — 3 per cent of the value
of the oil. At present, the Mexican tax is forty times as
great.

This agreement merely lasts until December 25 of this
year, at which time taxes are to be adjusted and, if past
procedure be adhered to, increased. The final decision in

44

this matter rests with the Mexican government. One effect
o:f the settlement is that oil companies have for the first time
deviated from their policy of paying taxes under protest
on the ground that they were confiscatory and collected
under duress, and have now accepted this tax as just. This
is inferred from the terms of the agreement and is further
confirmed by Mr. Teagle's statement to the effect that "we
feel the adjustment made represented concessions on both
sides and was all that could be desired in the circumstances."
When the price of oil was much higher than it is today and
taxes were much lower, the oil companies protested to the
American Government and the American people that such
taxes were confiscatory.

It will be noted that the large corporations represented
by this committee have succeeded in shifting a part of the
burden of taxation to the small producer. Americans of
small means, who do not control pipe line outlets to the
sea, have within the last eight months invested more than
four million dollars in the drilling of wells. These men are
not represented in the Oil Association and consequently
have had no voice in this agreement. Another effect of
changing the major part of the tax from an export to a
production tax will be that the Mexican government will not
be under the obligation of devoting this new tax to the pay-
ment of its foreign debt. It will be recalled that the Obregon
government was committed to this policy. On June 13 last,
the Mexican embassy in Washington issued the following
statement :

"The Mexican embassy has been authorized to offi-
cially announce that the President of the Republic, in
a decree dated the 12th instant, directed the Minister
of Finance to issue the necessary order to the effect
that beginning the 1st of July next, the sums collected
by virtue of the new tax on petroleum be in their en-
tirety deposited in the Banco Nacional (National Bank),
said sums to be accumulated at the above mentioned
banking institution in order that they may be fully
applied to the resumption of Mexico's external public
debt.'.'
The American oil companies moved to the seat of the
Mexican government, and as a result the Mexican govern-
ment seems to have dictated a compromise. The total nomi-
nal tax (for it had not been collected) before the committee

, 45

went to Mexico was approximately thirty-eight cents Amer-
ican money per barrel, which we are justified in believing
the Mexican government had no real hope of obtaining in
full. The government probably secured from this manoeuvre
a far greater tax than it anticipated and has established a
basis in principle for such taxes as it may desire to impose
after December. In the meantime, it expects recognition.
The basis of this arrangement consists in the expectation
of the Mexican government that the Oil Association, in con-
sideration for this temporary concession, will change its
policy and advocate recognition of the Obregon government
by the American government. Every move that the Mexi-
can government is making now is directed toward recogni-
tion. This purpose can be seen in every statement, every
law, every decision of the Supreme Court.

On August 24, the day the oil committee started for
Mexico, the American Association of Mexico published a
warning in the Associated Press and addressed a memoran-
dum to the Secretary of State in which it predicted that:

"If through the efforts of this formidable committee
the oil companies should be able to force a compromise
on the oil tax, every effort will be made by Mexico,
through her active propagandists, to have such a settle-
ment accepted as a settlement of the whole Mexican
question. The Obregon government, in exchange for
special concessions to the oil companies, will endeavor
to gain the cooperation of these companies in securing
recognition without doing justice to other American
citizens."
The oil committee did make a partial settlement of the
tax question, though one of doubtful value, and the day the
committee left Mexico City, the "Excelsior" voiced the
opinion of the Mexican press and public when it announced
in seven column headlines that "The Difficulties of the Oil
Men Have Ended; General Obregon Will Be Recognized by
the United States."

Coincident with the return of the oil committee to the
United States, the Associated Press carried a report from
Mexico City expressing the general belief in Mexico that, as
a result of the oil conference, "something is going on behind
the scenes in an attempt to break the deadlock (on the ques-
tion of recognition) ." This report of the Associated Press
contained the following statement:

46

"The return to New York of the heads of the five oil
companies is expected here to result shortly in the
publication of the detailed terms of the agreement be-
tween the oil men and the Mexican officials, which is
construed as containing elements which will contribute
to a speedy clearing up of the international situation.
Local newspapers persist in expressions of the belief
that something more than taxes was talked of during
the week of oil conferences, and that the heads of the
American companies will make some definite recom-
mendation to the State Department at Washington."
The heading placed over this report by the New York
Times said : "Mexico Encouraged Over Recognition — Efforts
Said to be in Progress Behind the Scenes to Bring About
Accord — New Basis Is Now Sought — Believed That Heads
of Oil Companies Will Make Representations to Hughes."

On September 12, the International News Service carried
a dispatch from Mexico City to the effect that an agreement
was made by the presidents of the American oil companies
to float a loan for Mexico and also that:

"Mexican newspapers, in commenting today upon the
international situation, said they expected that the re-
port of the American oil presidents to President Harding
and Secretary of State Hughes will change Washing-
ton's policy toward Mexico."
These news reports have resulted in many mistaken edi-
torial and verbal comments to the effect that Mexico's oil
question having been settled, the Obregon government doubt-
less would be recognized.

These news reports and comments have been in circula-
tion in Mexico and the United States now for two weeks and
the oil committee has allowed them to go unchallenged. It
is clear that either the oil committee's agreement with
Mexico does contain an understanding that the Oil Associa-
tion is to help Obregon secure recognition or that the Asso-
ciation thinks it has something to gain by allowing this im-
pression to stand. The failure to deny in any way the many
statements regarding the far-reaching effects of the oil com-
mittee's visit is creating a general opinion regarding its im-
portance that is unjustified and is placing the Oil Associa-
tion in a position of now giving support to a situation that
in every formal utterance of the Association since last Feb-

47

ruary has been vigorously attacked as unjust and illegal.

The Oil Association, so sensitive to publicity, in failing to
correct this widely spread impression, has given tacit con-
firmation to the version of the Mexican government. This
is perhaps one reason that the shroud of secrecy has been
thrown over this agreement. The Committee of Five re-
ported to the Oil Association last Wednesday that this agree-
ment was being kept secret because it was so unfavorable
to the Mexican government that to divulge it would expose
that government to an attack by the radicals. The radicals
must be hard to please if they are not satisfied with a tax
of twenty cents a barrel until December, any tax they desire
to impose thereafter, and (if the press reports be correct)
the removal of one great obstacle to recognition, the opposi-
tion of the large oil companies.

While the oil committee was in Mexico, the Justices of the
Supreme Court, by the finding in the Texas Company case,
forecast a decision and a Congressional Committee recom-
mended, that Article 27 should be so interpreted as to save
from confiscation leases held by the large foreign oil com-
panies on May 1, 1917. It was not a coincidence that these
two instruments of the Mexican executive authority should
have given these decisions while the oil committee was in
Mexico. Under the terms of the court's finding only that
small district in the present oil field held by large oil com-
panies, from which most of the oil has been exhausted, is
saved from confiscation ; all the rest of the subsoil of Mexico,
including the property of thousands of American citizens,
is confiscated. The decision refers merely to oil lands and
gives relief only to oil companies. It does not in any way
affect those provisions of Article 27 which provide for the
confiscation of American-owned land and deprive American
citizens of the right to purchase land in the Republic of
Mexico. The interpretation given to this decision by the
Mexican papers and the New York papers is entirely errone-
ous, as it is a most limited application of the principle of
non-retroactivity.

The present conduct of the Oil Association is a direct
violation of its previous declaration of policy, of its pledges
to other organizations interested in the welfare of Amer-
icans in Mexico and its pledges to high officials of the Amer-
ican government. On March 3 last, the Oil Association
issued a statement to the effect that:

48

"The oil companies know from experience the futility
of relying upon mere verbal assurances. In spite of
repeated assurances that the rights of American
petroleum producers in Mexico would be respected, their
properties have been for four years and still are men-
aced by the threat of confiscation contained in the new
Mexican Constitution and the Carranza petroleum de-
crees. . . . The oil companies therefore agree
with the conclusions of the Senate Sub-committee that
we have the legal right and it is our duty to refuse to
recognize any government in Mexico until it has given
assurances in writing that the lives and property rights
of American citizens in Mexico would be respected and
protected. The oil companies also realize, as any one
familiar with recent and present conditions in Mexico
must understand, that the particular problem of the
American petroleum producer in Mexico can not be
solved satisfactorily apart from the entire Mexican
problem as it affects various American interests. Any
permanent solution of the particular problems con-
fronting the oil companies depends upon a full recog-
nition of the principles of equity and international law,
the violation of which underlie the difficulties not only
of the oil companies, but of all other Americans inter-
ested in Mexico."
The following resolution was passed at a meeting of the
Oil Association at Galveston on March 17 last:

"Basing its stand on the fundamental principles of
natural justice, and sound precepts of international and
constitutional law, the Association of Producers of
Petroleum in Mexico again records its unalterable
determination to maintain rights legitimately acquired
according to pre-existing laws of Mexico and to oppose
the confiscation thereof, threatened or already actually
accomplished, under executive decrees and orders based
on Art. 27 of the so-called Constitution of Queretaro.

"We reiterate our conviction that the present Mex-
ican constitution was irregularly and illegally adopted
and that, in any event, no interpretation of that con-
stitution which does not limit the application of Art.
27 to the vacant and national lands as they existed on
May 1, 1917, and so preserve to all private owners and

49

lessees of Mexican lands on that date complete enjoy-
ment of petroleum subsoil rights, is consistent either
with the rules of legal construction, or with principles
of national or international justice."

The above represented the uncompromising attitude of
the oil companies before they secured temporary relief for
themselves. In the absence of any unequivocal declaration
from the Oil Association, Americans are justified in assum-
ing that the Mexican government and press and the Amer-
ican press are correct in representing that the Oil Associa-
tion has changed its program and is now numbered among
the advocates of recognition of the Obregon government.

For some mysterious reason, for thirty days after the
receipt of a letter from Senator A. B. Fall, who had been
requested to outline a proper Mexican policy, the Associa-
tion of Producers of Petroleum in Mexico failed to make
public endorsement of this policy, either directly or through
its associated organization, the National Association for the
Protection of American Rights in Mexico. The question
was then raised : Were the Mexico City agents of the vari-
ous oil companies negotiating at the time with the Obregon
government, and promising to secure recognition for it if
that government would refrain from piling up oil taxes?
It is certain, at least, that the delayed public endorsement
of the Fall policy by the Oil Association and the National
Association was soon followed by promulgation by the
Obregon government of new and burdensome oil tax decrees.

Does a similar situation exist today?

The silence of the Committee of Five in the face of the
many newspaper reports that, as a result of the tax com-
promise, recognition would be accorded Obregon, brings up
a similar question: Was there explicit or implied promise
that in return for the tax compromise the oil producers
would lend their influence to securing for Obregon recog-
nition of his government by the United States? If not,
why have the oil companies failed to deny the repeated
public announcements that, as a result of their committee's
efforts and the Supreme Court decision, the Mexican prob-
lem has been settled and recognition is near /

Can it be possible that a policy is being pursued of advo-
cating recognition at Mexico City while opposing it at
Washington ?

50

RESULT OF THE OIL COMMITTEE'S VISIT TO
MEXICO CITY

(Supplementary to Bulletin No. 6)

(BULLETIN No. ?— Issued Beptcmher 24, 1921)

The American Association of Mexico, in its discussion of
the Mexican question, has consistently opposed half-way
measures and make-shift compromises in the belief, estab-
lished by long experience and the evidence of many futile
experiments, that the whole problem could be solved as
readily as any part of it. And this Association has urged
since the day of its organization that the differences
between Mexico and the United States be adjusted definitely
and completely by the two governments as the only course
offering assurance of a permanent remedy.

Our opposition to the recent visit to Mexico City of the
committee of the Association of Producers of Petroleum in
Mexico was based upon the belief that undue importance
would be given in both countries to but a single point of
one of the many questions at issue. Our fears have been
more than justified. Many newspapers and individuals in
both countries have attributed exaggerated scope and im-
portance to the mission of the committee. This committee
of big business men went to Mexico to discuss, according to
their own announcement, excessive taxes with the Obregon
government. Upon the strength of a hastily arranged and
still incomplete agreement with regard to a readjustment
of export duties, oil shipments from Mexico have been
ordered resumed and large payments have been turned into
the Mexican treasury.

The Mexican question as a whole, therefore, is just where
it was before the American oil companies suspended expor-
tation of oil July 1, with the added disadvantage placed
upon all interests other than oil, of having to explain and
convince anew those who are not well informed about Mex-
ico, that nothing has been settled permanently by the trip
of the Oil Association's committee, not even the oil question.

The prediction of the American Association that the
Mexican propagandists at home and abroad would fasten
upon any kind of minor agreement with the imposing oil

51

committee and give it undue importance, was promptly ful-
filled. Before the terms of the agreement on this phase of
the oil question were fully known, optimistic reports were
launched that the Mexican question had been settled and
prospects, consequently, were bright for an early recogni-
tion of the Obregon government.

The advantage to be secured in the compromise arranged
on the oil export tax is considered of doubtful value by oil
men themselves, and, even if the committee had secured
the absolute abrogation of the new tax, the oil question
would be just where it was before. Neither the oil ques-
tion nor the Mexican question in their larger aspects would
be in any way altered. It is to be noted that the Oil Asso-
ciation has not denied the press reports that the oil ques-
tion has been settled ; has not denied the reports that Article
27 has been satisfactorily eliminated; has not denied the
reports that the Oil Association would advocate recognition.

The recent statements of the justices of the Mexican
Supreme Court in the case of the Texas Company have also
been generally hailed as an interpretation of Article 27 and
a judgment of the highest tribunal that the famous confis-
catory article of the Mexican Constitution was not to have
retroactive effect. The fact is that no decision has yet been
made in this case and the manner in which the truth has
been distorted for publicity purposes furnishes a good exam-
ple of Obregon recognition propaganda. The justices of the
Supreme Court in a public hearing merely gave their indi-
vidual verbal opinions and, we are reliably informed, the
members of the Obregon cabinet are now engaged in a
controversy as to the nature of the decision yet to be written
by the Supreme Court.

The essential facts of the situation can be set forth in
very few words. Article 27 of the so-called Constitution of
1917 provides that the oil-bearing subsoil of all lands in
Mexico shall be nationalized (confiscated) as of May 1, 1917.
It is contended, and we understand this to be the position
of the American government, that the provision may legally
apply only to such land as on that date belonged to the
Mexican government and, consequently, it could not apply
to land the title to, which had vested in individuals prior
thereto; that to construe this article otherwise would give

52

it a retroactive effect equivalent to confiscation. The fore-
going is the interpretation for which the American Asso-
ciation has stood from the beginning, in the belief that it
is the only just and reasonable construction which can be
placed upon Article 27. It was the contention of the Oil
Association last March. On the other hand, the Carranza
government contended and the Obregon government now
holds that the Mexican government, under the Constitution
of 1917, has the right to expropriate without compensation
(to confiscate) private property. This is the big issue in-
volved with respect to the retroactive effect of Article 27:
Does this article apply only to national lands or do private
lands also come within its provisions?

We shall see now whether this issue has been decided. In
a contract executed before May 1, 1917, the Texas Company
leased a parcel of land from an individual. Subsequent to
that date, the Carranza government gave title to a third
party who made application for it under the provisions
of Article 27. The Texas Company appealed to the Mexican
courts, and the case finally reached the Supreme Court. The
Carranza government and later the Obregon government
contended that the subsoil of this particular lot, under the
terms of Article 27, belonged to the government, and not
to the Texas Company and that, consequently, the govern-
ment could give title. The Texas Company alleged (1) that
Article 27 could not be interpreted retroactively as applying
to this lot because the company had leased it prior to May
1, 1917, and (2) that even if Article 27 could be so con-
strued, the government might not extend title to a third
party because it (the Texas Company) had spent money
in developing the property and thus saved it from the appli-
cation of Article 27 under a Carranza decree which pro-
vided that a denouncement title (patent) might not be given
by the government to a third party where the original
lessee had spent money on the land in exploring for oil.
It is clear, therefore, that" only the Texas Company case
was involved and that, even if the decision were made on
the first ground, and were made applicable to all similar
cases, by no stretch of construction could this decision apply
to any land outside of that already leased on May 1, 1917.
It could not apply to land owned in fee, and consequently,
would not protect the unleased land owned by thousands of

53

American citizens. This decision could not possibly affect
any land outside of that strip in the Tampico oil field some
forty miles in width by some one hundred miles in length
leased to foreign oil companies. All the rest of the subsoil
of Mexico remains confiscated under the contention of the
Mexican government. The interpretations given the so-
called decision in the Texas Company case serve to demon-
strate how the truth may be twisted and how propagandists
have deceived the American press.

This is particularly the case with legal matters, due to
the striking difference between American and Mexican
procedure and methods. In Mexican jurisprudence prece-
dent is not binding on the courts. Even a superficial study
of Mexican law shows how very careful the lawmakers of
the country have been to prevent the establishment of
precedents, and to make it compulsory upon the courts to
consider each cause upon its special merits and not in the
light of decisions in similar cases.

In amparo proceedings, such as the Texas Company case,
the court is specifically inhibited from making any general
•statement with regard to the law or the act upon which
complaint is based. The new law of amparo regulative of
Articles 103 and 104 of the Constitution of 1917, promul-
gated by decree of October 18, 1919 says in Article 2, Title
1, Chapter 1:

"The forms and procedure laid down in this law shall
be observed in amparo proceedings and the judgment
shall always be so drawn as to affect exclusively private
individuals and shall confine itself to affording redress
in the special case to which the complaint refers ; BUT
IT SHALL MAKE NO GENERAL STATEMENT AS
TO THE LAW OR ACT THAT MAY HAVE FORMED
THE BASIS OF THE COMPLAINT."
Of what value as a precedent is a decision of the Supreme
Court of Mexico in an amparo proceeding? Articles 148,
149 and 150, Title 11, Chapter 11 of the law just cited dem-
onstrate clearly that it has none whatever. An isolated
decision of the Supreme Court may be disregarded by in-
ferior courts, whether federal, state or territorial. Article
148 provides that a judgment of the Supreme Court shall
become a part of the jurisprudence of the country only after
the court has handed down "five successive judgments, the

54

succession being unbroken by any contrary judgment."
Then, and then only, does the judgment become "binding
upon the Circuit and District courts and the State, Federal
District and Territorial tribunals." (Art. 149.) This same
article further provides that the Supreme Court shall have
authority to reverse its own "established judgments" but
in so doing must present reasons for its action which shall
deal with the grounds upon which the judgment originally
was affirmed.

Article 150 provides that when a party to an amparo
proceeding or appeal invokes an "established judgment" of
the court in support of his cause, the court shall give due
consideration to the judgment invoked and in rendering a
decision in the case at bar "shall set forth the court's rea-
sons or motives for SUSTAINING OR REVERSING the
judgment cited."

The Supreme Court of Mexico has handed down many
judgments denying amparo in connection with Article 27
of the constitution. Now, in the Texas Company case, the
court reverses its action. It may complete the cycle of
five and in such case the judgment will become "estab-
lished." But, since precedent has virtually no standing in
Mexican jurisprudence, nothing could hinder the Supreme
Court from making a contrary decision; for example, the
day after Mexico had obtained recognition from the United
States, and reverting to its decisions of 1917 and 1918, in
which it was held that there is nothing in the Mexican con-
stitution of 1917 incompatible with laws having retroactive
effect.

The court's decision is merely a part of the campaign of
the Mexican executive to secure American recognition.
Obregon's Supreme Court decides this point in favor of the
oil companies because thereby Obregon hopes to secure
recognition, whereas Carranza's Supreme Court decided
identically the same point in a contrary sense because
Carranza already had recognition. The actual affect of
this decision is as follows: The property of the oil com-
panies will not be confiscated for otherwise the oil com-
panies might continue their anti-recognition propaganda.
The property of all Mexican land owners is confiscated, as
there is no one to protect them. The property of American
citizens owning land in fee is confiscated because the ma-
ss

jority of these owners are poor men, who, Mexico feels,
cannot reach the ear of their government.

The warning given in our Bulletin No. 5 that a decision
of such limited application could not in any sense be con-
sidered a general remedy is well grounded. The older com-
panies operating in Mexico, who secured their holdings
some five or more years ago, will find a measure of partial
relief in the Texas Company ruling. For the great majority
of private landowners, for those who have acquired prop-
erties in recent years, and for future operations, it indicates
that the oil development of Mexico will fall under the blight-
ing influence of absolute government domination.

The concerted effort to have the non-retroactive effect of
the new Mexican Constitution restricted to certain oil leases
made before May 1, 1917, is not confined to Mexico's active
propagandists at home and abroad. Almost simultaneously
with the decision of the Supreme Court, in the Texas Com-
pany case, the Petroleum Commission of the Chamber of
Deputies made a report which follows exactly the lines laid
down by the justices of the Supreme Court. This is the
sop the Mexican government is willing to throw to the oil
companies in order that all private holdings and all future
oil development of every kind may be placed under govern-
ment control.

In our last bulletin, we stated that the oil companies had
not seen fit to deny the reports that the oil question has
been satisfactorily settled, that the so-called decision of the
Supreme Court had now eliminated Article 27, and that
these companies were now advocating the recognition of the
Obregon government. The oil companies, always so ready
to give their side of any controversy to the press, still
remain silent. This attitude is persevered in, notwithstand-
ing the resolution of March 17 last to the effect that:

"We reiterate our conviction that the present Mex-
ican Constitution was irregularly and illegally adopted
and that, in any event, no interpretation of that con-
stitution which does not limit the application of Article
27 to the vacant and national lands as they existed on
May 1, 1917, and so preserve to all private owners and
lessees of Mexican lands on that date complete enjoy-
ment of petroleum subsoil rights is consistent either

56

with the rules of legal construction, or with the prin-
ciples of national or international justice."

Again we ask: Have the oil companies changed their
policy ?

Objection to the spirit and manner of the visit of the
Oil Association's committee to Mexico is not captious criti-
cism on the part of the American Association. The Oil
Association is on record as acknowledging the necessity of
settling the entire Mexican problem and specifically stating
that the oil producers' troubles cannot be settled perma-
nently and satisfactorily apart from those of all other
Americans interested in Mexico. On July 1, the oil pro-
ducers suspended exports and restricted development work
in Mexico in protest against an unjust and confiscatory tax.
The companies should have known at that time what the
consequences of this embargo would be.

It was with surprise and indignation, therefore, that
those whose Mexican interests are not in oil, and who have
long been laboring to secure an adjustment of the whole
Mexican situation which would relieve oil interests equally
with others, saw the oil committee suddenly depart for
Mexico, not only without consultation with other interests,
but without even general conference among the oil com-
panies themselves, to negotiate a partial and selfish settle-
ment that must inevitably react against all other interests.
It has placed those outside the oil group in a most unfavor-
able position and has greatly delayed the complete adjust-
ment of Mexican problems that alone can give real and
permanent security to all.

If objection be made to the use of firm, methods in deal-
ing with the Mexican government, it must be considered that
what American interests in Mexico and what the American
government are asking are not onerous and unjust conces-
sions from Mexico, but simple justice and restoration of
rights. There is nothing harsh and unusual in the guaran-
tees and safeguards that are asked of Mexico. In the light
of the violated assurances the demands are amply justified.
And in standing out for a fair written agreement, the posi-
tion of the American Association is in accord with the judg-
ment of both the present and previous administration at
Washington.

The visit of the committee caused a suspension of all

57

efforts along the line of a general settlement. The com-
mittee made the preliminary arrangements for a partial
agreement on the oil question as it affects the big com-
panies, but at what cost? Obrfgon's arrogant attitude has
been strengthened by large cash payments, while his self-
importance has been magnified until it will now be impos-
sible to negotiate with him and his satellites for some time
to come on any basis of reason and common sense. It also
remains to be seen whether the visit of the oil committee
to Mexico has changed the attitude of the oil companies
toward the recognition of Obregon.

The fundamental objection to their action is, that, as in
all negotiations heretofore between the oil companies and
the Mexican government, the oil companies have gained a
temporary advantage in money by yielding in principle. On
the contrary, it has been the consistent policy of the Mex-
ican government to purchase permanent advantage at the
price of temporary concession. The result is plainly seen
in the excessive taxation of today.

On the whole, the visit of the oil committee has resulted,
as it was easy to foresee, in much positive harm to the
cause of a general settlement of the Mexican question, while
only temporary and very questionable benefits have been
secured for the oil companies themselves. It is evident that
those who are interested in seeing the international rela-
tions between Mexico and the United States permanently
adjusted for the best interests of all concerned must not
count upon the co-operation of the great oil companies, for
their pledges of support, when withdrawn at the most crit-
ical period of negotiation, become not only detrimental to
the common cause, but such action accords to misguided
Mexican authorities moral and financial assistance that is
most prejudicial.

The American Association is confident that the govern-
ment at Washington is not misled by the inevitable hurrah
of propaganda following the oil committee's trip to Mexico.

Definite announcement has been made that a represen-
tative of the International Committee of Bankers will go
to Mexico to discuss financial matters with the Obregon
government. Similar visits to Mexico to secure considera-
tion for their respective interests have just been made, or
are in progress, by influential agents, not only of the big

58

American oil companies but also of the locomotive and
steel interests. In view of the pending negotiations of the
Department of State looking to an equitable settlement of
the entire Mexican question in a manner that would pro-
tect the interests of thousands of individual Americans and
small investors, just concern is felt because of the probably
harmful effect upon the cause of the unrepresented majority
resulting from the partial settlements being arranged by
these great and wealthy groups. The former have no voice
and are not being considered, while the representatives of
the business organizations are adjusting their own specific
problems.

The American Association was organized last January
when the Oil Association would not consent to the National
Association for the Protection of American Rights in Mex-
ico making public endorsement of a letter from Senator
A. B. Fall outlining his policy in the Mexican situation. The
National Association had approved this letter but was not
allowed to publish it. At that time the Oil Association was
suspected of "Playing with the hare and running with the
hounds." It was privately urging Washington not to recog-
nize Obregon. What the agents of the company were doing
in Mexico City can be inferred from the belief of the Obre-
gon government that the oil companies were advocating
recognition.

The National Association originally was organized by
representatives of all the larger interests in Mexico, but,
unfortunately, owing to the fact that for financial support
it was soon forced to depend solely upon the oil companies,
it fell under the domination of the oil interests. Even the
separate ofl!ices of the National Association were abandoned
and it was installed as an adjunct of the Oil Association
where it is used to plead the cause of oil under the guise
of interest in the rights of Americans in general. When
the rights of the oil companies are affected, the National
Association fights boldly; when the oil companies see a
chance to get something for themselves by negotiation, the
National Association remains quiescent. It is for this rea-
son that the National Association cannot be depended upon
to look after the interests of all Americans, so that in a
crisis such as the present the American Association has to
carry on without organized assistance.

59

The American Association addressed the following letter
to the National Association on the 16th instant:

"When it was announced that the Committee of Five of
the Oil Association would go to Mexico City for the pur-
pose of attempting to adjust tax troubles with the Obregon
government, the American Association of Mexico addressed
a letter to your Association in which it asked if you ap-
proved of this Committee going to Mexico, if you did not
think that the result would be detrimental to American
interests in that country, and if you would not join the
American Association in a public statement of disapproval.
In your long reply you did not answer these questions.

"On September 8th this Association directed another
letter to your Association from which we quote the follow-
ing:

'An authoritative statement should be issued within
the next few days, in our opinion, with respect to the
negotiations between the Committee of Five and the
Mexican Government. We believe that the National
Association, because of its professed interest in the
welfare of all Americans in Mexico and also because of
its intimate relations with the Oil Association and the
oil companies, should issue this statement. I am sure
the press would be glad to use it and that it would
have the effect of defining once for all the situation
resulting from these conferences. If the National Asso-
ciation does not wish to issue a statement, the Amer-
ican Association will probably do so within the next
few days. If you decide not to make a statement, will
you be good enough to write me and give the National
Association's version of these conferences. Needless
to say, we shall not quote the Association if you do
not wish it quoted.'
"We concluded by stating that 'this situation cannot be
allowed to stand and the American Association is deter-
mined that it shall be defined in the very near future and
will appreciate the co-operation of the National Association
in this respect.' The American Association has in no sense
abandoned this purpose, and so far we have received no
co-operation from the National Association.

"No reply has been received to the above letter, and in

60

an informal conference with several of your directors on
the 14th inst., the latter were of the opinion that the
National Association should not intervene in this matter
as an association. We should now like to have your definite
reply to the following questions, with the understanding
that we shall publish the substance and possibly the letter
of this correspondence:

"1. Does not the National Association think that the
visit to Mexico of the oil committee has had an adverse
effect on American interests in that country?

"2. Does not the National Association believe that the
Mexican government expects in return for such concessions
as may have been given the oil people, that the latter will
now work for recognition by the American government
instead of opposing it?

"3. Does not the National Association think that in view
of press reports, both Mexican and American, the American
people and the Mexican people are justified in thinking that
the oil companies and the Oil Association are now com-
mitted to work for recognition?

"4. Does not the National Association consider that by
refraining from denying these universal reports the Oil
Association is violating the spirit of its announcements,
on the 3rd and 17th of last March, to the effect that it
would oppose recognition until the rights of all American
citizens were taken care of?

"5. Will not the National Association address the Oil
Association and advise the latter that it is of the opinion
that it should issue an unequivocal statement of its posi-
tion, first, with respect to whether it considers the recent
Supreme Court ruling as settling the oil question; second,
as to whether it regards this ruling as solving the difficul-
ties of Americans under Article 27 ; third, as to whether it
is of the opinion that the American government should
accord recognition to the Obregon government?

"I am enclosing herewith copy of Bulletin No. 6 which
defines the attitude of the American Association of Mex-
ico with respect to the above matter.

"We should like to hear from you at your early con-
venience."

The National Association has not replied to this letter,

61

but we learn authoritatively that at a meeting of the direc-
tors of the Association, they did not decide to request the
Oil Association to make public its attitude on the Mexican
question, and, of course, did not decide to publish a con-
demnation of the conduct of the Oil Association in failing
to make its position clear at this critical juncture.

Finally, convinced that no co-operation could be secured
from the National Association, which because of its rela-
tions with the Oil Association should have made this
request, the American Association on September 22
addressed the following letter to the Oil Association:

"A few days ago I sent you an advance copy of Bulletin
No. 6 of the American Association of Mexico which dealt
with the effects of the recent negotiations of the Committee
of your Association with the Obregon government. In it
reference was made to the universal impression that your
Association now favors the recognition of the Obregon gov-
ernment by the American government. In view of the
continued silence of the Oil Association on this subject, the
American Association of Mexico, an organization devoted
to the interests of all American citizens in that country,
cannot allow this situation to continue undefined without
taking up this matter directly with your Association.

"The Oil Association has gone on record to the effect:

(1) That it would not regard the Mexican Oil controversy
as being settled until,

(a) The Mexican government agreed that Article 27
of the so-called Constitution of 1917 should apply only
to lands which on May 1, 1917, belonged to the Mexican
government.

(b) The Mexican government should agree to a
scheme of oil taxation which was not confiscatory. At
the time these statements were made your Association
regarding the existing tax of approximately twelve
cents a barrel to be confiscatory.

(2) That your Association would oppose the recognition
of the Obregon government by the American government
until the claims of all American citizens were adjusted and
their rights in the future assured, and the interests of the
American people secured, as outlined in a letter dated

62

January 19, 1921, by Senator A. B. Fall to the National Asso-
ciation for the Protection of American Rights in Mexico.
"We now ask you:

1. Do you consider that the Obregon government has
agreed that Article 27 shall apply only to lands which
belonged to the Mexican government on May 1, 1917?

2. Do you regard the present oil tax as just or satis-
factory ?

3. Do you consider that the questions between American
citizens and the Mexican government, and the controversy
between the American government and the Mexican gov-
ernment, have been satisfactorily adjusted?

4. Does the Oil Association now favor the recognition
of the Obregon government by the American government,
or is it opposed to such recognition?

"An immediate reply will be greatly appreciated."

We shall advise our members as to the reply of the Oil
Association.

In its present campaign the American Association is in-
terested in nothing more than having the just and reason-
able demands of the American Department of State com-
plied with before recognition is extended to any govern-
ment in Mexico. We simply want to see American rights
in Mexico restored and safeguarded. The political and
official leaders of both parties in this country have all agreed
for the past several years upon the steps necessary to be
taken. It is not that we fear the authorities in Washington
are weakening in their stand for a full and equitable settle-
ment of the Mexican question, but we do feel that the utter-
ances of the veritable army of propagandists that Mexico
is employing to create favorable sentiment in this country,
often by positive misrepresentation of actual conditions,
must not be allowed to go unchallenged.

Likewise, capitalistic groups that are making temporarily
favorable contracts should be urged to lend their support
and influence to the general settlement of the entire Mex-
ican question which alone can bring permanent prosperity
and security for Mexicans and foreign investors alike. It
is to this end alone that we ask co-operation and assistance
in making known the truth about Mexico, namely, the adop-
tion of the only policy which will protect all interests, large
and small, in that country.

6Z

OBREGON AND HIS PROPAGANDA FOR
RECOGNITION

(BULLETIN No. S—Isstted November 3, 1921)

Certain typical and related inquiries have reached the
American Association of Mexico in number sufficient to
warrant the deduction that the American public is in a
confused state of mind regarding Mexico. Misinformation
is combined with misinterpretation of events. The purpose
of this bulletin is to answer these questions and to clear
up this confusion. Here are some of the things which
prove puzzling to American small stockholders in mining,
oil or land companies in Mexico; to uplift workers touched
by the condition of the lower classes there, to persons inter-
ested in the missionary field or to those who have merely
a general interest in seeing a near neighbor to the United
States and normally a good customer get his house in order :

Why does the State Department withhold recognition
despite Gen. Obregon's public assurances that his govern-
ment will give every protection to American and other for-
eign interests and rights?

Is there a dangerous bolshevist movement in Mexico and
do radicals dominate the Obregon cabinet? Obregon denies
this, why not take him at his word?

If Mexico is not enjoying internal peace, if foreigners are
being deprived of their rights and their property confis-
cated, why do American chambers of commerce and gov-
ernors of border states, who ought to know the truth, urge
immediate and unconditional recognition?

If conditions are unfavorable to Americans and American
enterprises how can the attitude of American chambers of
commerce in Mexico be explained? The Tampico and Mex-
ico City bodies stand behind the Obregon government; they
participated in invitations to American business organiza-
tions to send excursions to Mexico and these excursionists
have returned with glowing reports. Certainly American
business men in Mexico would be frank and truthful with
their compatriots.

These and other questions of a like nature indicate that
the average American is perplexed by the contradictory

64

news from Mexico and finds it difficult to reach a definite
conclusion as to the truth. To those not students of the
Mexican situation, we believe a somewhat detailed consider-
ation of Obregon propaganda methods will prove enlighten-
ing. This bulletin is intended primarily for those interested
in Mexico but lacking sources of first-hand information.

In considering Obregon propaganda it must be borne in
mind that Mexican executives know they stand or fall
on recognition by the United States. First, a foreign loan
cannot be obtained without recognition. An empty public
treasury is a chronic condition and money is needed to keep
political henchmen satisfied, particularly high army officials
for it is among these that successful revolutions generally
start. Second, Mexican presidents know that revolution-
ists hesitate to start a revolt against a government recog-
nized by Washington. For these reasons self-preservation
and recognition become synonyms to Mexican executives.

The Obregon recognition campaign therefore possesses
two features which make for effectiveness: Singleness of
purpose and the vital necessity of attaining that purpose.
This explains why the one sure method of getting money
from a seemingly bare Mexican treasury in the past ten
years has been to approach the ruler of the day with a
scheme to obtain recognition or influence American public
opinion to that end. On coming into power Obregon did
not find it necessary to experiment with propaganda meth-
ods or personnel. Carranza's efficient machine was inherited
by de la Huerta and passed along to Obregon. Methods and
purposes are the same. But few changes have been made
in personnel. Many individuals, Americans unfortunately
as well as Mexicans, have kept their names on the govern-
ment payroll from Madero's time to the present because
of their ability as propagandists. Clever propagandists are
passed from one administration to the next. Talent of this
order is too vitally necessary to be dispensed with lightly.

Despite these many advantages Obregon is confronted by
a formidable difficulty, which embarrassed his predecessors
as well. This difficulty is the fixed idea shared by almost
every Mexican politician that to appear to yield or truckle
to the United States would result in the overthrow of any
ruler who tried the experiment. To the mind of the Mex-
ican politician this means that the president of Mexico must

65

carefully avoid making any sort of concession to the United
States, no matter how just the demand of the Washington
government. Thus Obregon is seen today, fishing for rec-
ognition with words and promises, attempting to hoodwink
Washington into giving something for nothing while pos-
ing at home as the champion of all Latin America against
the "Colossus of the North." This was precisely the Car-
ranza method and Obregon is encouraged by the fact that
Carranza was successful in securing recognition.

Early in the game propagandists discovered that facts as
to internal conditions in Mexico could be misrepresented in
the United States with impunity; furthermore, that official
announcement of programs, never intended to be put into
effect, to alleviate and improve the lot of the Mexican lower
classes has an effective appeal north of the Rio Grande,
being accepted at face value. They have a rejoinder ready
when attempts are made to set the American public right
as to the facts. "Propaganda of the big American corpora-
tions" they cry; "Enemies of our government which pre-
vents them from looting the natural wealth of the country
and exploiting the peon as they were permitted to do in
the time of the Dictator Diaz."

The discovery that the American people are ready to
believe virtually anything bad said about a rich corpora-
tion has been very useful to Mexican propagandists. It
explains to a large degree why there is a shout of "oil"
from Mexico every time Article 27 of the Constitution is
under fire. The provisions of this article affect virtually
every foreign interest in Mexico and virtually every for-
eigner doing business there, no matter in what line, yet the
Obregon propaganda organization has convinced a large por-
tion of the American people that the adjustment of the oil
problem would remove all objections on the part of foreign
governments endeavoring to protect the rights of their
nationals in Mexico.

The American belief in democracy and the rights of the
masses is played upon constantly. Any Mexican opposing
the methods of his government is branded as a conservative
or reactionary. Confiscation of rural estates has been pal-
liated in the United States by alleging that the peons are
land hungry and that Mexico can never return to the path
of peace and prosperity until the country is dotted with

66

small farms. Propaganda of this sort is being circulated
today, at a time when most of the reputable newspapers in
Mexico are bitterly condemning the agrarian policy and
demonstrating that the mass of farm laborers are lacking
not only in capacity for independent operation of farms but
in inclination to attempt it even when supplied with tools
and work stock in addition to land. These newspapers
charge that the system is a vicious instrument of graft and
is destroying agriculture. They point out that within the
past few years, the farm productivity of the country has
been so lowered as a result of the agrarian policy that Mex-
ico will have to import more corn this year than ever before
to prevent the people from starving. Yet the Obregon gov-
ernment is bringing in corn, announcing that it is being sold
to the people at cost and praising itself for its action, with-
out assuming any of the discredit for producing the condi-
tions which made this necessary.

Believing Americans to be materialists and mere dollar
worshipers, the propagandists regard the appeal to the busi-
ness side of the American as perhaps the strongest weapon
in their armory. Articles are published regarding the inex-
haustible wealth and resources of Mexico and foreign cap-
ital is invited to come in and aid in development. Mer-
chants and manufacturers are told of the vast trade await-
ing them, once recognition is accorded. Trade excursions
from the United States are encouraged by free transporta-
tion over Mexican railroads and visitors are entertained
lavishly at government expense. Experience has demon-
strated that such visitors learn nothing of real conditions,
forget business and thoroughly enjoy themselves in a coun-
try which has no Volstead law, and repay generous hospi-
tality by returning to the United States and supporting
recognition of Obregon. Having seen only the bright side
of things in Mexico, they are sincere more often than not
in their glowing pictures of conditions.

These are a few of the general methods employed by the
Obregon propagandists. A more potent factor comes into
play when the attitude of American organizations in Mex-
ico and certain individual Americans resident there comes
up for consideration. This factor is the power of the Mex-
ican president to make or break any foreigner doing busi-
ness in the country. Favors he may dispense with a lavish

67

hand; his power to do harm is virtually unlimited. Under
Article 33 of the Constitution he may expel from Mexico
any foreigner whose presence he may deem inexpedient and
is not even required to show cause. No legal recourse is
allowed the victim; he is specifically denied the right to a
day in court. Moreover, under a resolution of congress,
Obregon enjoys extraordinary powers in the treasury
department. This means that he is invested with the tax-
making powers of congress and by executive decree may
impose or remove federal taxes. The following extract from
an article published by El Universal, a leading Mexico City
newspaper, on October 2, 1921, serves as a timely illus-
tration :

"In view of the fact that there is no proportion be-
tween the taxes paid by large and small rural proper-
ties in Mexico, the Ministry of Agriculture is consid-
ering the advisability of readjusting taxation. It is a
fact that small properties pay as high as 5 to 12 per
thousand while large properties pay barely 2 per
thousand. EACH LARGE PROPERTY WILL BE
TAKEN INTO CONSIDERATION SEPARATELY and
it has been decided to begin with the properties of
Gen. Terrazas. Next in turn will be the properties of
the Palomas Ranch and Cattle Company."

Correspondents of American newspapers resident in Mex-
ico City know that under Article 33 they may be expelled
from the country at the whim of the president ; they know
that without access to official sources of information their
services are valueless to their papers. They can not afford
to offend the governing powers and must exercise great care
in what they cable, confining themselves largely to bare
reports of happenings. They are inhibited from indulging
in that frank and open comment and interpretation of the
news which would give a real picture of the Mexican situa-
tion. They remember cases of other correspondents ex-
pelled from the country and are taking no chances and will
take none until a story comes along big enough to warrant
the risk of being sent out of the country. This gives the
Obregon propagandists free rein to distort facts in order
to create a favorable impression in the United States.

Representatives of Adolfo de la Huerta, president ad

68

interim of Mexico after the murder of Carranza, were ex-
ceedingly active at Washington during the months imme-
diately preceding Gen. Obregon's induction into office last
December. It was known in Washington at the time that
the Mexican agents showed great interest in immediate
recognition and were apathetic to suggestions that action
might come after Obregon's inauguration. It was openly
charged that if the ad interim government secured recog-
nition it would endeavor to remain in power despite Obre-
gon. If such hopes existed, they were dispelled by the
note of Secretary of State Colby delivered to Roberto Pas-
queira, official representative of de la Huerta. Mr. Colby
said in substance: Our conversations indicate substantial
agreement on pending questions, the time has come to re-
duce that understanding to a solemn written compact bind-
ing on the two nations. An abrupt termination of negotia-
tions was the result.

This incident serves to throw light on the present attitude
of the State Department with regard to assurances from
Obregon agents and to the published statements of Presi-
dent Obregon. Mr. Colby was serving a Democratic admin-
istration which had shown itself most friendly to the revo-
lutionary element represented first by Carranza, later by
de la Huerta and now by Obregon. For nearly eight years
that administration had been dealing with Carranza and
representatives of his movement; recognition had been ac-
corded Carranza after he had made solemn promises which
never were fulfilled; the State Department had learned a
bitter lesson and was fighting shy of trading "sight unseen"
with Mexican executives springing from Mexican revolu-
tions. The present officials of the State Department are
profiting by that experience in insisting on written guar-
antees.

In the New York Times of July 3, 1921, "A Diplomatic
Correspondent" pointed out that, in a letter to Mr. Colby
given to the press October 30, 1920, Mr. Pesqueira proifered
three of the essentials which, Secretary Hughes insists,
Mexico must embody into a treaty. The Pesqueira letter
contained a disavowal of the retroactivity of Article 27, a
pledge that Mexico would assume full responsibility for all
her international obligations and a proposal of an Inter-
national Claims Commission to adjust and settle the claims

69

of all foreigners for damages arising out of the revolution.
Pesqueira was recalled and did not return to Washington.
Meantime other methods were resorted to in the campaign
for recognition.

Opportunity for propaganda in connection with the Obre-
gon inaugural ceremonies was not overlooked. The occasion
therefore, offered the unusual spectacle of governors of
states of the United States participating as guests of honor
at an official ceremony of a government not recognized by
our own. These governors with staffs and civilian entour-
age had gone to Mexico as guests of the Mexican govern-
ment. They were royally entertained, free trains and free
entertainment being at their disposal. American cities also
sent trade excursions. Effusive speeches on the part of
hosts and guests marked the occasion but nothing was said
of the rights of Americans in Mexico. It was subsequent
to this junket that legislatures began to pass resolutions
asking our government to recognize Obregon, and American
business men, who had participated, began to secure action
from their local chambers of commerce to the same end.
The governor of Texas, if accurately quoted by La Prensa,
of San Antonio, stated that the Obregon government had
been recognized by Texas if not by the United States. Two
governors of states, whose terms recently expired, are now
spending much of their time in Mexico City, looking for
business connections.

The next step in the propaganda campaign was an appeal
to the American business man. In the spring of this year
W. F. Saunders, secretary and publicity man for the Amer-
ican Chamber of Commerce in Mexico City, made an ex-
tended trip in the United States, visiting chambers of com-
merce and laboring to create sentiment in favor of the
Obregon government. In a speech at Philadelphia he said
Mexico was rapidly getting back to normal, that Americans
in Mexico had no grounds for complaint and predicted a
tremendous trade boom the moment full diplomatic rela-
tions were resumed between the two countries. His work
was unmistakable recognition propaganda. Whether the
American Chamber of Commerce in Mexico was reimbursed
by the Obregon government for the expenses of this repre-
sentative, we are not informed.

Later an ingenious scheme was devised in sending the

70

so-called Good Will Commission to the United States for
the ostensible purpose of inviting American business men
and chambers of commerce to an International Trade Con-
ference to be held in Mexico City in June, 1921. The Com-
mission represented the Confederated Chambers of Com-
merce of Mexico, which numbered amonjj its members or-
ganizations in Mexico made up of European business men
such as the French, Italian and Spanish Chambers of Com-
merce. The Commission, specifically disclaiming a political
purpose, talked trade with Mexico. Suspicion as to the
real object of the Commission was aroused as no reasonable
explanation could be oifered as to why Europeans should
be assisting in financing an enterprise intended to promote
trade between the United States and Mexico. In view of
this, the American Association of Mexico sent a telegram
of inquiry on April 4, 1921, directed to the president of the
American Chamber of Commerce in Mexico City, which is
copied herewith. The reply of the president has been placed
in parenthesis after each question.

"In the opinion of the American Association of Mex-
ico the object and effect of the tour of the so-called
'Good Will Commission' are political and not commer-
cial. We have undertaken so to advise commercial
bodies in this country. The Department of State and
the Chamber of Commerce of the United States deny
the report that they have sponsored or endorsed this
tour. We should now like to know whether it has the
endorsement of your American Chamber of Commerce
and what i-esponsibility that Chamber assumes. Kindly
wire reply at your earliest convenience.

"First. Are Bruno Newman and W. E. Vail repre-
senting the American Chamber of Commerce? (Bruno
Newman does represent this Chamber. William Vail
is director of service of this American Chamber. He
is a guest on this trip of the Confederacion de Camaras
de Comercio de los Estados Unidos Mexicanos.)

"Second. Are they both American citizens? (Both
are registered at American Consulate as American citi-
zens.)

"Third. How much is your Chamber contributing
to the trip? (American Chamber contributes nothing
to the trip.)

71

"Fourth. Are the Associated Chambers of Com-
merce paying the entire cost of the trip? (Under-
stand Confederation directly paying cost of trip.)
"Fifth. If not, who is?

"Sixth. Is the American Chamber paying for the
car on which ^he delegates are traveling ? If not, who
is? (Have no knowledge who is paying for car.
American Chamber pays nothing.)

"Seventh. Is the Mexican government contributing
to this trip, and if so, how much ? (Understand unoffi-
cially that Mexican government is making an allowance
to Confederacion de Camaras account cost this trip.)

"Eighth. Have not Vail and Newman a concession
or contract with the Mexican government under which
they enjoy privileges and derive profits in conducting
such excursions as they are attempting to organize in
this country? (Understand Vail and Newman have a
contract with the Mexican government by which they
get special rates for excursion parties.)
These facts would seem to demonstrate a willingness on
the part of the American Chamber of Commerce, or at least
the dominating figures who control it, to lend the name and
support of the chamber to an excursion which was clearly
intended as part of Obregon's propaganda campaign to
secure recognition. The president of the American Cham-
ber admits he knew enough "unofficially" to have warranted
an investigation in order to obtain official information for
an official report to the board or to a general meeting, had
he felt that there would have been real opposition by the
leaders of the chamber to participation in the government's
propaganda.

The directing powers of the American Chamber of Com-
merce knew, or should have known, that the chamber's en-
dorsement of this so-called trade excursion could have but
one possible interpretation in the United States, namely,
that the American colony of Mexico believed that the Obre-
gon government was such as to give Americans in Mexico
protection in their rights and that normal conditions were
restored to the point where it seemed proper for an Amer-
ican trade organization in Mexico to encourage Ameri-
cans to enter the Mexican field again and invest their
money in developing trade with Mexico. These ruling pow-

n

ers knew, or should have known, that with Obregon and his
following in the saddle, the Carranza faction was being con-
tinued in power and that this faction had never shown the
slightest concern for the commerce of Mexico as such, or
for the rights of foreign investors. They knew that the
confiscatory Constitution of 1917 was in force and were
acquainted with the burdens and disabilities imposed upon
foreign investors by this charter. They knew that the
Wilson administration was unpopular with Americans in
Mexico who felt that their own government had refused
them protection and abandoned them ; they knew that high
hopes were entertained that, with the incoming adminis-
tration at Washington, American rights in Mexico would
be protected. An intimate acquaintance with the sentiment
of Americans in Mexico warrants the statement that the
American Chamber of Commerce's participation in this
trade excursion was not popular with the American colony
in Mexico because the real purpose was understood. In
the face of all these facts, it would be interesting to know
what influences were at work to secure endorsement and
participation of the Chamber in the junket, and whether a
majority of the Chamber itself approved it. The allegation
that some members of the board, lacking in broad perspec-
tive, misread the obvious facts in the situation, may be
offered in palliation but it does not explain.

The International Trade Conference proved a false alarm
from a commercial standpoint. American delegates had
their eyes opened when a Cuban delegate presented a reso-
lution calling upon the American government to recognize
Obregon. They were surprised at this political move, when
the Good Will Commission had given assurances that there
was nothing political in the conference, in extending invi-
tations to Americans to participate. Many declared that
they had no authority from their commercial bodies to vote
on such a question and, after something of a tempest in a
teai'ot, the resolution was withdrawn. Excelsior, a Mexico
City newspaper of high standing, reviewing the conference
after its close, said the program lacked topics of interna-
tional commercial interest and that American merchants
and business men, who had attended for the honest purpose
of assisting in developing methods of trade between Mexico

73

and the United States, had been grossly deceived and had
wasted their time.

Not all the American delegates seem to have been taken
unawares when the political purpose of the conference devel-
oped. The delegate from the San Antonio, Texas, Chamber
of Commerce made an impassioned plea for recognition, and
criticized American excursionists for accepting free trans-
portation and other gratuities from a bankrupt Mexican
government. The American Association heartily endorses
the latter statement and feels it would be more just for
the Mexican government to pay its school teachers and
employees than to squander large sums in futile trade excur-
sions and conferences.

If further proof be needed that there was an ulterior
motive in having American politicians attend the inaugural
ceremonies, in the Good Will Commission junket and in the
Trade Conference, it is furnished by Gen. Obregon himself
in his signed statement in the New York World dated Mex-
ico City, June 26, 1921. Herewith are given the first and
part of the second paragraph of this lengthy statement:

"The States of Texas, New Mexico, California and Ari-
zona, acting independently and without the slightest inspira-
tion, have made official requests upon Washington for re-
sumption of the formal relations that will permit proper
and complete expression of friendship between Mexico and
the United States. The action of these states, so intimately
in contact with my country, tells its own story of peace and
c rder along the border at this moment of writing.

"The First International Commercial Congress is holding
its sessions in the City of Mexico, many delegates being in
attendance from the United States. These men, returning
to their homes, will be compelled to report the reign of ^aw
in every one of the twenty-seven states that compose the
Mexican Union."

What would "compel" this report on the part of the dele-
gates? Certainly not first hand information regarding
'every state of Mexico ; certainly not a review of the Mexican
press for the period immediately preceding the congress;
certainly not a reading of the daily press of Mexico City
during the period the congress was in session. The slaugh-
tei* of Catholics by radical official elements during street
fighting in Morelia, Michoacan, the invasion of the Chamber

74

of Deputies by a bolshevist labor group, the abortive revo-
lution in Oaxaca and the application of the notorious ley
fuga to one of its leaders, newspaper articles on the graft
running riot on the nationally operated railroads and the
corruption among customs officials at Veracruz where a
freight congestion of many months standing was bringing
merchants in all parts of the country to the verge of finan-
cial ruin, these and similar incidents were too recent to
have escaped the attention of any delegate who made even
the most casual investigation into the real internal condi-
tions in Mexico. The only compelling force which possibly
can be suggested is the law of courtesy which impels a
guest to refrain from criticizing his host.

Upon returning from their tour of the United States, the
representatives of the American Chamber of Commerce
undertook the promotion of a lottery in the name of the
American charities of Mexico City. We understand that
the plan was repudiated by various American organizations,
some of which would have been beneficiaries. We are in-
formed that certain of the promoters, formerly high in the
councils of the American Chamber of Commerce, are no
longer members of that body. This Association is firmly
convinced that infinitely greater harm to Americans resi-
dent in Mexico and to American interests was done by the
Good Will excursion than possibly could have resulted from
any purely local enterprise, in Mexico City and environs,
however reprehensible its opponents might consider it, and
that the directors of the American Chamber of Commerce
in endorsing the Good Will Commission assumed a much
graver responsibility than would have been the case had
they tacitly approved the lottery.

Recently the Mexico Country Club, of Mexico Citv, com-
posed largely of Americans, received 40,000 pesos from the
Obregon government in settlement of c'aims for damages
done the club's property during 1916. These damages were
inflicted, not by the revolutionary faction which the present
government represents, but by the Zapatistas, with whom
Obregon and his followers were at war. Among hundreds
of Americans claims, this is one of the two or three to be
adjusted. The motive behind the government's action may
have been merely the justice of the claims. However, it
was the sort of thing which every American excursionist

75

to Mexico City would hear about, and precisely the sort of
news which Obregon would wish excursionists to carry
back to the United States. Furthermore, it was not con-
ducive to making club members particularly hostile to the
Obregon administration.

The latest move in the Obregon propaganda campaign
was the centennial celebration at Mexico City, commemorat-
ing the date of Mexico's independence from Spain. Page
advertisements were inserted in American newspapers re-
garding the International Commercial Exposition in con-
nection with the centennial. Again the old trade camou-
».ij^ flage — again the call of the dollar. A single quotation will
be sufficient to show the character of this advertising :

"This great exposition during the centennial festivi-
ties will be held in the National Legislative Palace,
Mexico's $5,000,000 wonder building, occupying two
city blocks, and the largest building in Latin America.
Nearly three million business men will surge to Mexico
City during the centennial festivities to discuss with
their compatriots their part in the building of a new
Mexico."

To persons acquainted with Mexico this sort of stuff is
mere rot — not even an intelligent lie. The average of one
business man to every five inhabitants is a fantastically
impossible ratio and of Mexico's fifteen million inhabitants,
largely engaged in agriculture, just about three millions are
able to read and write and the cultured Mexican turns nat-
urally to literature or to the professions rather than to
business. Mexico's wonder building is the steel skeleton of
a structure started by Porfirio Diaz, a grim rusting reminder
of the days when the public money went, in part at least,
into public improvements. With temporary roofing and
temporary floors it doubtless made an excellent exposition
"palace."

Excelsior, in an editorial published September 19, 1921,
refers to the scenes of animation in connection with the
centennial, "the city refurbished and hastily decorated,
defects hidden, blemishes concealed, the skeletons of build-
. ings of another era covered or partly covered but skeletons
still," and explains that this was done "with the clearly
manifest intention of creating a favorable impression upon

76

our guests, the representatives of foreign nations." The
editorial continues:

"The impossible has been accomplished in order to im-
press upon our guests that Mexico is in the midst of a
period of abundance and fruitful progress, in the full enjoy-
ment of prosperity and development, without difficulties
and without problems. But how different if our guests
could look beneath the surface and see things, which though
concealed, vitally affect Mexico.

"Our guests do not see or do not care to see that back of
these festivities is a country which is going to harvest a
crop insufficient for its needs; that famine impends and,
with no savings in the public treasury as in times past, we
are unprepared for evil days. They do not see that under
the name of 'agrarian program' a series of confiscations
and offenses against private property have been committed
which keep the farmers in a state of natural anxiety. They
do not see that the destruction of credit, so essential to
modern society, has left the farmer and manufacturer with-
out resources. They do not see that traffic delays prevent
the free an^ easy distribution of merchandise and result
in higher prices. They do not see that prices have not
dropped from wartime levels as in other countries; that
there has been no readjustment in Mexico and that the
economic crisis continues acute. They do not see that each
day brings a new conflict in some state government; that
each day some bolshevist or semi-bolshevist legislation is
enacted against capital and industry. They do not see that
the states of Yucatan and Morelos, whose prosperity was
proverbial in other times, are in wretchedness and ruin,
without hope for reconstruction. They do not see that at
these centennial festivities there are, in addition to the for-
eigners, other guests imploring pity with hands outstretched
in a gesture of despair."

Felix F. Palavicini, editor and owner of El Universal, of
Mexico City, in a signed editorial published October 19, 1921,
says:

"The Foreign Relations department has failed yet every
one knows how serious a thing it is for Mexico to be lack-
ing the friendship of the United States, England and
France, and our foreign policy consists of nothing more
than good administration at home; that is, vigilance over

77

and protection for foreign capital invested in Mexico. The
government's agrarian policy has resulted in a scarcity of
the prime necessities of life. The right of property has
disappeared in Mexico, and there is no agricultural credit.
If there is no guarantee for the possession of land, what
hope is there for any citizen of fair legislation and justice?
If this is a communist state, then we should amend our
laws to conform. The Department of Agriculture is Mex-
ico's greatest deterrent to amicable foreign relations, and
the Department of Industry is of the same type."

These quotations are from the two leading newspapers
of Mexico. Palavicini was a supporter of the revolution
from the beginning, a member of one of the early Carranza
cabinets and a delegate to the convention at Queretaro
which framed the radical Constitution of 1917.

Optimistic statements from officials of the Mexican gov-
ernment and pronouncements that, foreign interests in Mex-
ico receive full protection, the enthusiastic published inter-
views of returned excursionists about the wonders and the
prosperity and peace of Mexico should be paralleled with
the editorials of these representative Mexican newspapers,
and then perhaps the American public will begin to see the
light. Confusion of public opinion in this country with
regard to Mexico exists because Obregon propaganda pur-
posely creates confusion by misrepresentation of the facts
in order to obtain recognition without giving anything in
return.

78

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