"March 29.
In connection with the expropriation of British and "American oil concerns by the] Mexican Government, this journal had occasion on March 22 to publish a short criticism of the action taken by President] Cardenas's administration. It was unlikely that local Mexicans would entirely appreciate what was then written, and the Mexican Legation sought to refute this journal's remarks in a communication addressed to a local contemporary. The Legation appears to have been under the impression that such a letter might not have been published in this Journal, but, as evidence that it would, a communication appearing in the correspond ence columns to-day is sufficient proof, This! journal is not concerned to answer the) Legation''s communication as it has not appeared in these columns, but rather to give here a general review of the process which this present expropriation. Since Porfirio Daiz, who, with the excep-which no fewer than eleven presidents Sguzed have continued with varying degrees of {intensity and considerable irietion—amounting almost to a stale of war—arose with the United States. In 1014, Venustiano Carranza assumed control of the' government {introducing anti-foreign legislation and giving every indication of xenophobia, He started off with the seizure of many properties, some of them being British, and. this led tothe refusal of she British Government to recognize hhis administration, The degree to which Carranza departed from his declaration of neutrality during the Great War undoubtedly influenced the British Government when this policy was adopted. Following Carranza's fall brought about by a further revolution in 1920, when he is believed to have been shot by: the insurgents, de la Huerta became provisional President, and he, on: December 1, 1920, succeeded by General Obregon, whose coup tat had brought about Carranza's downfall.
'The new government.determined to uphold the Carranza constitution. drawn up in' 1017 which had led to confiscatory measures. in connection with the nationalization of the petroleum of the country, and contained, among other departures rom the accepted comity of nations, provisions restricting' the Tights of foreigners which' caused" the British, American, French and, Belgian governments to adopt a policy of non-recognition of Obregon's administration. Under. his regime hundreds. of properties were ex-Propriated without compensation. Considerable foreign indignation was aroused and protests were made, but eventually all the Powers with the exception of Great Britain conceded recognition, the latter holding out until 1925 when relations between the two countries were re-established. The passage of Jegislation providing for expropriation may make that proves perfectly "Jegal-so far as [the country itself is concerned, but the fact Whine the Jegislation iteelt is just as, immoral 4s the end which the legislature had'in view. There have "been expropriations, of "land where-compensation has been pald.in bonds which have sadly depreciated, 'There are indications in the reports which are coming to hoid that President Cardenas's Govern= ment is seeking to create counterclaims against the companies they have' contisca to offset the demands for compensation are being made, Those counterclaims will undoubtedly be heard by the Mexican Courts, and,, in furtherance of the Government's policy, will be held to be valid, a proceeding just a5 immoral as the original expropriation. What the Mexican government. has un~ doubtedly had in mind ever since the passage of Carranza's constitution has been the confication of the property of the gringoes, and of recent years the socialization of the whole country, President Cardenas has apparently timed his stroke for a moment when it was thought: European. preoccupations would prevent energetic action by either the United States or Great Britain, and. is another example of the deterioration of international morality which is giving rise to such universal anxiety. But there is something more. As this journal has already said the poor state of Mexico's finances Nias been one of the immediate causes of President' Cardenas's action:
It is reported from Mexico City that the Government is seeking customers. for the expropriated' il, ai lack of an. export, market for the oii had impressed upon it the realization that foreign exchange credit was necessary to finance Mexico's Importations of maize and wheat, Despite boguing. the peso {s falling, and in view of these facts the claim of the Mexican Legation that the country is orderly and prosperous must be taken' for exactly what it appears to be worth, and that is not very much, It is clear from the reports appearing in to-day's issue that the Unit Slates is in a position to being very consider= able pressure' to bear upon Mexico, The United States can, if it so desires, decide to abrogate the USMexico silver agreement major factor in the stabilization of the Mexican currency. The decision will not be taken until after April 1, but if the U.S. Treasury decides to cease the purchase of silver from Mexico as from that date a severe blow will be struck at the financial structure the country, and probably reduce the pesos lower levels than It has at present reached, 'That might have very. serious effects upon President Cardenas's government for it is doubtful "whether it' could survive the reduction of the state of Mexico's currency to tone of-chaos, That there is this danger is
to replace paper hol hard metal, eer a wob while the Muctuations in the value of the paper peso have been so wide that some merchants have refused to accept anything Dut silver, There has been some talk of raising a loan of $400,000,000 to pay off the cil companies, "In view of the behaviour of the Mexican Government it is quite unlikely that it will secure foreign assistance, though Japan might help, while the issue of such a joan internally, with the country in the state is, and the peso in the condition it is Wkely be, would be foredoomed to failure, if there ever were an instance in tional morality can be to assist any longer currency at its normal to stew in its own juice, that country only have its rulers to blame.
Text read from the printed page and cleaned; old type leaves the occasional error.