FAfl. 
 S. Af.'ER. 
 
 The 
 
 Economic Future 
 of Mexico 
 
 By E. VALLE CAMBRE 
 
 NATIONAL THEATRE IN CONSTRUCTION (Mexico) 
 
 6 Million expended on this building; an amount which conld have 
 solve the Agrarian problem in two states. 
 
 Published by 
 
 LATIN-AMERICAN NEWS ASSOCIATION 
 1400 Broadway, New York City 
 
Does Mexico Interest You? 
 
 Then you should read the following pamphlets: 
 
 What the Catholic Church Has Done for Mexico, by Doctor 
 
 Paganel . 
 
 The Agrarian Law of Yucatan. 
 
 The Labor Law of Yucatan. 
 
 International Labor Forum. 
 
 Intervene in Mexico, Not to Make, but to End War, urges 
 
 Mr. Hearst, with reply by Holland. 
 
 The President’s Mexican Policy, by F. K. Lane. 
 
 The Religious Question in Mexico. 
 
 A Reconstructive Policy in Mexico. 
 
 Manifest Destiny. 
 
 What of Mexico. 
 
 Speech of General Alvarado. 
 
 Many Mexican Problems.. 
 
 Charges Against the Diaz Administration... 
 
 Carranza . > .. 
 
 Stupenduous Issues. 
 
 Minister of the Catholic Cult. 
 
 Star of Hope for Mexico. 
 
 Land Question in Mexico. 
 
 Open Letter to the Editor of the Chicago Tribune, Chicago, Ill. 
 
 How We Robbed Mexico in 1848, by Robert H. Howe. 
 
 What the Mexican Conference Really Means. 
 
 / 
 
 The Economic Future of Mexico. 
 
 We also mail any of these pamphlets upon receipt of 5c each. 
 
 Address all communications to 
 
 LATIN-AMERICAN NEWS ASSOCIATION 
 1400 Broadway, New York City 
 
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 1 . 
 
 LL well-known personalities who in a seri¬ 
 ous way are interested in the painful evo¬ 
 lution of the human masses, agree that the 
 apparent confusion or anarchy which pre¬ 
 vails at present in Mexico, presents soci¬ 
 ological problems as important, at least, as 
 the consideration of the enormous wealth which has been 
 destroyed during the present period of civil strife. 
 
 To date, the interest which the American people have 
 taken in the social jfhenomena which have developed south 
 of the Rio Grande, is largely of an ethical-sentimental order. 
 The literature published on the subject, is, in the majority 
 of the cases, a campaign undertaken by political parties 
 against one another, and for this reason the illustrious Dr. 
 A. Reppier justly exclaims: ^ 
 
 “SENTIMENT: There is enough of it in the 
 United States to fill our own orders, to stock Europe, 
 to leave a surplus for Asia and Africa. 
 
 “Candidates, congressmen, political bosses, ora¬ 
 tors upon every subject under heaven, deal with 
 sentiment to the exclusion of realities, and with 
 fantasies to the exclusion of facts!” 
 
 The interventionists who desire intervention merely as a 
 speculation, know very well that the current of American 
 sentimentalism,—showing at present a tendency towards 
 
 3 
 
the respect of Mexican sovereignty, will be succeeded, per¬ 
 haps to-morrow, by a sentimentalism of another kind, one 
 absolutely opposed to the former, either as its reaction, or 
 cunningly provoked by means of an active propaganda. 
 Consequently, the aspirations of such interventionists are, 
 at the present moment, limited to a desire that the disorder 
 in Mexico should persist, even though it be necessary to 
 foster it by unscrupulous methods; and they particularly 
 are anxious to conceal from the American people the real 
 causes of the unrest which is swaying all social classes in 
 the neighbor republic. 
 
 I am deeply convinced of the need to spread amongst the 
 social elements which lead public opinion in the United 
 States, the knowledge of the real motives which cause 
 our present uneasiness, as I consider this knowledge the 
 most efficacious means to prevent a disastrous breach in 
 the friendly relations of two countries which for innumer¬ 
 able reasons should always fraternize; and I am also con¬ 
 vinced that, in order to spread and defend a high spiritual 
 ideal (an anti-interventionist ideal), it is necessary to bear 
 in mind what Fouillee says, that the relation between the 
 material interests aiid the moral qualities of a people is 
 merely one of the many applications of the principle of the 
 equivalents of forces, which permits the transformation of 
 these material advantages into elements of the highest mor¬ 
 ality. I shall, therefore, apply my efforts exclusively to 
 demonstrate: first, that the present economic situation of 
 Mexico is almost the only cause of the persistence of an 
 abnormal state which at the present time is improperly 
 designated as revolutionary or anarchic; second, that this 
 economic condition, “the skeleton in the closet” of all our 
 political and social institutions, is a legacy of all previous 
 governments and administrations; and third, that any in¬ 
 dependent government which may become established in 
 the Mexican Republic, will find itself, in its effort for re¬ 
 organization, fatally circumscribed by the hopeless “vicious 
 circle” which foreign capital has cunningly built through¬ 
 out the republic, as a result of the concessions it has ob¬ 
 tained, concessions which it is impossible to keep in force 
 without enduring the constant threat of frequent revolu¬ 
 tionary periods of increased violence. 
 
 The Mexican Revolution, like the revolutions which have 
 
 4 
 
taken place in Europe, in the United States, in Japan, and 
 in other Latin-American republics, is characterized by the 
 free manifestation of the barbaric instincts which in a poten¬ 
 tial condition are existant in all societies restrained by the 
 influence of the medium, the respect to tradition and the 
 fear of law. 
 
 The populace, as it always happens in all the cases when 
 the multitudes assume absolute power, has fulfilled a role 
 of a ferocious and unconscious actor; the government has 
 offered a weak opposition; and its directors, are merely the 
 product of the “historical moment,” either succumbing un¬ 
 der principle supported by public opinion—as is the case 
 of Villa—or melting into impersonal elements in the form 
 of directive forces constituting the “Administration.” Any 
 criticism of the injustices and outrages committed by the 
 people during its despotic exercise of power, is, therefore, 
 useless; it limits itself to attribute responsibility to any par¬ 
 ticular group or political leader. 
 
 The Revolution, triumphing over the feudal system es¬ 
 tablished in the country since the time of the Spanish domi¬ 
 nation, found itself, as was natural, threatened by the army 
 of social and economic problems which had accumulated 
 throughout our history, and which were considered as use¬ 
 less by the different governments which have ruled the 
 country and which have always had a more or less revolu¬ 
 tionary-religious origin. Furthermore, as the principal 
 factors of those problems were usually the general economic 
 uneasiness and the hope of finding a satisfactory solution 
 to this, it is natural that any government of transition should 
 give preference to the reconstruction of the economic back¬ 
 bone in accordance with the new social needs, even though 
 employing there the only material at our disposal, and 
 which, as I have said before, has been considered useless. 
 
 It is easily explainable that the individual guaranties and 
 the respect of property should not have been effective at 
 the time of triumph, if we take into account the exceedingly 
 radical character of the revolution and the serious menace 
 of a new revolt within the heterogene elements which have 
 composed it; for, it is impossible to expect, within a 
 peremptory period of time, a state of normal morality when 
 the army is merely an undisciplined body which exacted 
 and persists in exacting a compensation disproportionate to 
 
 5 
 
the services rendered. In this case, the responsibility which 
 can be demanded of the Revolution is similar to that which 
 could be demanded of a convalescent. 
 
 Recently we have been informed that the greater part of 
 the confiscated property has been returned to its owners; 
 that individual guaranties are almost effective, and that the 
 “de facto” government is taking decided steps to promote 
 the development of the national wealth. Why, then, does 
 the press inform us that the situation in Mexico persists 
 in being anarchical, and that the American government 
 finds it necessary to order new troops to the border, afraid, 
 or so it seems, of new raids similar to that on Columbus? 
 
 The persistence of the abnormal state in Mexico is due 
 to the material impossibility of solving its economic situa¬ 
 tion, in a quick or drastic manner. The call which Mr. Car¬ 
 ranza sent out to industrials and farmers, that they con¬ 
 tribute with their respective efforts towards the re-estab¬ 
 lishment of order, has been answered by a discouraging 
 minority, as may be seen by the following estimates: 
 
 In normal times, the yearly production in Mexico aver¬ 
 ages : - I 
 
 Annual Industrial production.$230,000,000^00 
 
 Annual Agricultural production. 170,000,000.00 
 
 $400,000,000.00 
 
 The industrial production, at present, is limited to min¬ 
 erals, oil, and electric light and motive power. It is pos¬ 
 sible to estimate that the following industries are paralyzed: 
 
 Railways . $50,000,000.00 
 
 Wool, yute and cotton goods and expor¬ 
 tation of cotton (about 50% of produc¬ 
 tion) . 16,000,000.00 
 
 Sugar and manufacture of alcohol and 
 alcoholic drinks (50% of production). 7,500,000.00 
 
 Paper and soap industry. 1,500,000.00 
 
 Electric light and power. 1,800,000.00 
 
 Coal and coke industry. 6,000,000.00 
 
 Fifty per cent. (50%) of the mining in¬ 
 dustries paralyzed. 44,000,000.00 
 
 Total diminution in industrial pro- 
 ^ duction .$140,300,000.00 
 
 6 
 
With reference to agricultural production,—even accept¬ 
 ing the data furnished by the Agricultural chambers as 
 exact, which point to a diminution of forty-two per cent. 
 (42%), the remaining 58%, estimated in corn at the rate 
 of $50.00 (paper) the hectolitre (about 250 lbs.) represents 
 ninety-eight million six hundred thousand Dollars, ($98,- 
 600,000.00). Consequently, the annual production is as fol¬ 
 lows: 
 
 Industrial production. $89,700,000.00 
 
 Agricultural production. 98,600,000.00 
 
 Total . $188,300,000.00 
 
 that is, only about forty-seven per cent. (47%) of the normal 
 production. 
 
 With a normal production of about $400,000,000.00 per 
 year, the Mexican government receipts from customs dues, 
 taxes, railways, lottery, post office and telegraph tolls, and 
 other taxes, amounted to $72,978,000.00 (year 1914-15), that 
 is about 18% of the total production. Consequently, and 
 supposing this percentage to be constant, we might esti¬ 
 mate (being unable to secure at the present time accurate 
 statistical data) that the receipts amount only to $33,846,- 
 ' 000.00 since the entries on account of lottery, telegraph 
 and post office tolls, although collected in national gold, are 
 not very important. 
 
 If we do not take into account the payment of interest 
 due on the national debts (consolidated and floating, which 
 amounts to $45,000,000.00) the deficit in the budget, con¬ 
 sidering the latter similar to that of the fiscal year of 1914-15, 
 amounts to $45,262,000.00. Consequently, any government 
 that may establish itself in Mexico, having a revolutionary 
 or a conservative origin, or representing, generally, any of 
 the numerous political and socialist parties existing in the 
 country will be compelled, unless it secures a foreign loan, 
 to have recourse to new paper issues, a monetary commodity 
 which will unavoidably have a redeeming power, constantly 
 on the wane. 
 
 On the other hand, the Mexican people are fully aware that 
 the probability of securing such a loan (the only apparent 
 . remedy to an increasingly distressing economic situatioh) 
 is very remote, due to the causes which I shall expound 
 later; and unable to understand fully why the barest neces- 
 
 7 
 
sities of life have risen, commanding almost prohibitive 
 prices, it is evident that, by virtue of the above mentioned 
 principle of the equivalence of material and moral interests, 
 the morality of the people must decrease fatally, in direct 
 ratio to the acquisitive power of its money, and to its efforts, 
 whether these be in the material or the intellectual order. 
 
 Even accepting as facts the numerous imaginary out¬ 
 rages which are being committed in Mexico, daily, accord¬ 
 ing to the fantasy of the press interested in the future of 
 the millions of acres acquired by Mr. Hearst, in Mexico, 
 at a laughable price, which it would be interesting for the 
 American people to learn, we must meditate seriously on 
 the degree of responsibility which such outrages lay on 
 a people whose working class earns from six to ten cents 
 per day; the employees of the government and of private 
 concerns, earn from thirteen to seventeen cents per day, 
 and where transportation service is so irregular that even 
 in the cities of a certain importance, no staple articles for 
 the bare necessities of life were to be had at any price, 
 for weeks. The cable informs us of the disorders that are 
 occurring in cities of the old world due to the lack of food, 
 which is becoming scarce due to the European War; the 
 laboring class as well as the thinking classes, explain the 
 phenomenon in a reasonable way. Well; I dare any one 
 of the interventionists to investigate the attitude of the people 
 of the City of Mexico — our most populous city—during the 
 
 week of Sept. to .... 1916, during which the city had 
 
 no light, water or police service. Engineer Lorenzo Her¬ 
 nandez, — a brother to Mr. Rafael L. Hernandez who acted 
 as secretary of Fomento and Communications during the 
 Madero administration — related to me, considering it as 
 a sociological case worthy of interest, that the capital pre¬ 
 sented the interesting spectacle of tranquility during which 
 time no serious robbery or any other outrage occurred. 
 
 If, therefore, a people which can behave so well, and 
 silently bears the gnawing torment of hunger, in the 
 presence of the threat of intervention, is not worthy of 
 sympathy, no sympathy is deserved, either, by the people 
 of Belgium, Polonia, Serbia, etc., nor the thousands of 
 families who suffered heroically during the Civil War of 
 North against South in this country, and who never de- 
 
 8 
 
manded that England should intervene for the settlement 
 of their socio-political difficulties. 
 
 Resuming: the average morality of the poor class in 
 Mexico is at present such as can reasonably be expected 
 from a family composed of five members, and compelled 
 to exist in a condition of half-starvation, at the rate of one 
 cent gold per day for each member of the family. 
 
 9 
 
11 . 
 
 The economic history of Mexico is characterized by the 
 increasing depreciation of labor, whether it be of the in¬ 
 tellectual, the physical or the moral variety. Three factors 
 have contributed to determine this exponent of our civili¬ 
 zation: (a), the extensive cultivation of land and the abso¬ 
 lute impossibility of enriching it; (b), restriction of free 
 competition in social, political and economic matters; and 
 (c), the idiosyncracies of the multiple races which con¬ 
 stitute our social organization. 
 
 (a )—Intensive cultivation in Mexico demands, besides 
 the investment of an enormous amount of capital for ir¬ 
 rigation work, A MODERATE RATE OF INTEREST in 
 order that the settler, when acquiring land practically by 
 means of his own labor, may live by the product of those 
 lands, and fulfil his obligation of mortgage, mortise and 
 interest, charged to the account of labor-capital invested. 
 Due to the irregularity and permeability of the subsoil in 
 the regions where irrigation works are more indispensable, 
 the cost of these works is very high, and therefore it causes 
 the lands that can be worked to command a price scarcely 
 appealing to any one interested in intensive cultivation. 
 The private companies which have attempted to carry out 
 this kind of an investment have failed in most cases, despite 
 the selection that they made of agricultural properties 
 ideally situated and endowed with lands of the best quality. 
 We could cite numberless examples of this kind, where 
 the dividing company has had the same luck as the one 
 which took charge of the division of the beautiful fertile 
 “Chapingo” property, which is only a few miles distant 
 from the City of Mexico. But I will cite only such com¬ 
 panies which on account of their magnitude and importance 
 had gained the decided assistance of the government, by 
 means of the institution called “Caja de Prestamos para la 
 Agricultura y Fomentode la Irrigacion” (Loan association 
 for the promotion of Agriculture and Irrigation). The prin¬ 
 cipal operations carried out by this institution since its es¬ 
 tablishment in the year 1908, to date, are: loan of three 
 million pesos to “Campania Agricola y Ganadera de San 
 Carlos;” organization of the “La Sautena” company, with 
 land embracing 40,000 hectares; and the concession granted 
 
 10 
 
to Mr. Manuel Cuesta Gallardo for carrying out the drain¬ 
 age of a portion of Lake Chapala. These enterprises have 
 been offered at different markets in the United States with¬ 
 out any success, despite the advantageous conditions under 
 which they have been offered. The above mentioned insti¬ 
 tution, the only one existing in the Republic of Mexico, 
 has been unable, to date, to pay a single dividend. Un¬ 
 doubtedly, there must be some special reason which has 
 retarded the success or caused the failure of this kind of 
 company in Mexico; but in a general way this phenomenon 
 may be interpreted as follows:'^ 
 
 The law of supply and demand, implies a necessity to sell, 
 face to face to another necessity to purchase. In Mexico 
 there exists, without doubt, the desire and the necessity to 
 purchase lands in order to work them by means of extensive 
 cultivation, since the popular instinct has expressed it even 
 withwiolent manifestations, which have sometimes reached 
 a lamentable extreme, but which on the whole are impos¬ 
 ing, since they have a special significance both for the legis¬ 
 lator and for the sociologist. Unhappily, there is no equiva¬ 
 lent necessity to sell on the part of the landholder, who, in 
 the majority of cases secures, through the extensive culti¬ 
 vation of his lands, what he requires to satisfy his dues and 
 the needs of his more or less modest mode of living. His 
 attachment to the land of his forefathers does not permit 
 him to understand that the “hacienda” on which he lives 
 is slowly converting itself into the cemetery of his imaginary 
 wealth. Unable to fertilize the land, restituting to it the 
 vigor which it loses year by year, when he notices the dimi¬ 
 nution in the crops, he has recourse to artificial processes— 
 real marvels of ingenuity—intended to level his annual in¬ 
 come which decreases alarmingly. The newly installed 
 textile industries and the exploitation of “gayule,” “can- 
 delilla,” industrial alcohol, etc., flourishing in the middle 
 of the revolution, are classic proofs of our erring agricultural 
 tendencies, which seek an outlet when baffled by the impossi¬ 
 bility of remedying the empoverishment of the land which 
 is always on the increase. If we add to this the puerile 
 hope that in time, the natural increase in the price of his 
 land will liberally compensate him for any annual losses, 
 we will be in a position to understand clearly why the land¬ 
 holders in Mexico do not experience the necessity of sell- 
 
 11 
 
ing as is experienced by the manufacturer who, entertain¬ 
 ing no ethical sentimentality for his products and depending 
 essentially on their sale, is compelled to offer his goods until 
 he finds a suifable demand for them. When, therefore, the 
 landholder, for special reasons, finally makes up his mind 
 to sell his property in plots of adequate size to be cultivated 
 extensively, he demands a price which is extravagant for the 
 intelligent colonizer, and which causes the ruin of the in¬ 
 experienced settler. 
 
 When there is an offer of land, hut at a certain arbitrary 
 price, although the terms for payment may be ideal, the 
 economic phenomenon resolves itself into a case of a sale 
 at a long term, at an usurious interest, as may be seen by 
 the following example: 
 
 In the region of the Bajio, the price per hectare— two 
 acres and a half, approximately—varies from $150 to $300 
 gold. The average production is 10 hectolitres of corn 
 with an approximate value of $15 gold, at the rate of $1.50 
 per hectolitre. The expense of cultivation, at a low esti¬ 
 mate of $0.20 gold, per day, is $8.50 gold; therefore, the 
 profit, theoretically amounts to $6.50 gold per hectare, since 
 it is necessary to discount interest on the capital invested. 
 If, then, a colonist is bound to pay for each hectare he 
 acquires, within a certain term, in the first year: 
 
 Interest of 6% per annum on $150 gold-mini¬ 
 
 mum value of the hectare. $9.00 gold 
 
 Mortise at 4% per annum, approximately. .. 6.00 gold 
 
 Total .$15.00 
 
 on an investment which pays a profit of $6.50, it is evident 
 that he pays an interest of $23.1% on the real value of 
 $65.00 gold, which theoretically, is the highest value that 
 should be attributed to the hectare of workable land. For 
 even though the amount of $15.00 decreases within the term 
 fixed until it becomes zero, the owner of the land invests 
 the amounts received in other enterprises which, without 
 effort, on his part, will produce the initial 6% on each 
 amount of $150 gold per hectare gold. 
 
 No doubt by means of extensive cultivation, that is, by 
 the fertilizing of the land, its production would be higher 
 than $6.50 per hectare, but the increase will in reality be 
 due to the capital invested later on, in the form of intel- 
 
 12 
 
lectual and material work which the agriculturist applies to 
 his modified industry! 
 
 As the product of the land diminishes through lack of 
 fertilizers, the owner or the companies employing intensive 
 cultivation, are unavoidably compelled to pay a constantly 
 decreasing salary, which determines a constantly^ increasing 
 offer of labor to the mining and manufacturing industries 
 which can pay better salaries; thus bringing about a fatally 
 increasing depreciation of labor, painfully aggravated if we 
 take into account the increasing cost of the basis of living, 
 caused by the diminution of production of the land. 
 
 In a country where the owner of the land marches towards 
 ruin due to the material impossibility of fertilizing his land, 
 where the poorer classes are condemned to starve, where in¬ 
 dustries have a constantly decreasing demand, and where, on 
 the other hand, the people observe the extraction and disposal 
 abroad, of a fabulous wealth in the form of minerals and 
 oils, it is not strange that the people become demented and 
 seek the remedy of its ills, in revolt. 
 
 (B .)—As my object is to study the Mexican situation from 
 the economic point exclusively, I shall merely point out an 
 interesting phenomenon which demonstrates the lack of free 
 competition in socio-political matters. In Mexico, in pub¬ 
 lic places, one may imagine the following notices, which 
 would indicate the separation of classes, as in the South 
 of the United States is marked the division between white 
 and colored people: “Exclusively for the aristocracy,” “For 
 workingmen,” “For Peons.” When the transgressor of this un¬ 
 written social law will not comply with the remonstrances 
 of a private party, the police, representing the government 
 in such cases, is ready to punish the offense, which is an 
 offense only when it comes from the lowly. 
 
 The dictatorship of General Porfirio Diaz, was organized 
 as all dictatorships, with the support of the military party 
 and the approval of the privileged classes. During its era 
 of apparent wellbeing and thanks to the construction of 
 railways and the installation of new industries, the demand 
 for labor presented a glimpse of future economic equili¬ 
 brium. The agricultural question, either through ignorance 
 or political perversion, set aside the efforts of the Public 
 Finances tendered exclusively to the development of in¬ 
 dustries which was limited by the threat of a proximate 
 
 13 
 
period of lack of demand. As the eighty-five per cent, of 
 our rural population was sentenced to starvation or to in¬ 
 crease the ills of the working and domestic classes endanger¬ 
 ing these, due to the increasing lowering of salaries brought 
 about by the competition, the urban class in its turn, tried 
 to scale the professional and bureaucratic branches, already 
 too full in relation to the normal national demand. On the 
 other hand, as the success of all activities in Mexico de¬ 
 pends on the more or less active sympathy of the govern¬ 
 ment, all compensated service became, logically, a privilege. 
 This privilege was controlled, not only by the statesmen 
 who were in a position to handle bureaucracy at their will, 
 but due to the fact that private enterprises had to count on 
 the support of the former, all activities were practically 
 controlled by such men. Now, when man, either intuitively 
 or by reasoning, understands that his activity, in what¬ 
 ever form it may assume, will be sterile, for lack of com¬ 
 pensation, his ambition sickens or dies of that neurosis char¬ 
 acteristic of Mexico, and unjustly symbolized with the 
 phrase; “The country of to-morrow.” I say “unjustly,” 
 because a surprising majority of the workingmen or profes¬ 
 sionals who have emigrated to this country, despite the dif¬ 
 ference of customs and the handicap of language, which 
 constitute a serious factor toward failure, have distinguished 
 themselves for their efficiency and capability. 
 
 It is not, therefore, vices of race—as someone has stated— 
 that is the cause of our economic uneasiness, but the lack 
 of free competition in the economic field, which prevents 
 national industry from developing, for there is no competi¬ 
 tion possible against the foreign industries established in 
 Mexico by virtue of concessions so excessive as to be anti- 
 constitutional. The Revolution could not have invented 
 such an economic system, laboriously prepared, but brutally 
 absurd. If the Revolution is analyzed dispassionately, it 
 will be seen that to date, it has restricted itself to handle 
 with natural timidity our rotten skeleton, the only asset on 
 which it can count for the national improvement. 
 
 (C .)—An attempt has been made to implant different 
 educational systems among our Indian classes, which rep¬ 
 resent the majority of our social organization. To date, in 
 the majority of cases, the result has been a morality in the 
 Indian in inverse ratio to the sum total of knowledge ac- 
 
 14 
 
quired. This should not be surprising: in his ignorance, 
 he tries to stupify himself with alcohol in order to appease 
 the hunger which torments him, more intensely than our 
 “cult” theoreticians can imagine, and who do not know, 
 perhaps, that the bandit-revolutionist was bred from starved 
 alcoholic parents, (the national alcoholic drink, “pulque,” 
 contains a certain amount of cocaine the effect of which 
 is immediate, a fact which has given rise to the erroneous 
 belief that “pulque” has nutritious properties). When our 
 Indian becomes “kulturized”—borrowing the expression of 
 a German pedagogue, there happens to him what happened 
 to the colored hero of a popular American novel who, placed 
 in the category of a free man, when he had won a respect¬ 
 able social position, reniged of his freedom which had in¬ 
 duced him to dream of becoming the husband of his young 
 mistress empoverished when she granted freedom to her 
 slaves. 
 
 Maliciously, the Indian has been repeatedly accused of 
 being abject, servile, irredeemable. The Indian has at¬ 
 tempted to revolt, innumerable times, as a virile protest 
 against his inhuman destiny. In all cases, the law has 
 punished him with prison for life or with death. Impotent 
 in an unequal struggle of the bare arm against the fire¬ 
 arm, and always hungry, The Indian has sought forgetful¬ 
 ness in alcohol, and has made use of the most disgusting 
 animals as food to satisfy his hunger, thus trying to solve 
 his economic problem. On a certain occasion an American 
 lady, thinking of the ruin of the great Mexican family which 
 has sought refuge in this country, exclaimed: “Is it not 
 admirable, how the Mexicans endure their ruin philosophi¬ 
 cally?”—“yes,” I replied, “thanks to the Indian blood that 
 runs through the veins of practically all the Mexicans.” 
 
III. 
 
 We have stated that the call made to capital by the 
 triumphing Revolution in order to try to improve the eco¬ 
 nomic situation, has been answered only by a discourag¬ 
 ing minority. Consequently, if capital persists in this atti¬ 
 tude, the government of Carranza will meet with a con¬ 
 stantly increasing deficit which no doubt will provoke a 
 new revolt unless the government finds an efficacious in¬ 
 terior solution to the problem. This solution will be found 
 without fail, if American public opinion opposes the armed 
 intervention. 
 
 That new revolt would also belong to an economic order, 
 since it would be the result of an absolute lack of acquisi¬ 
 tive power of the paper money, and in the hope that a new 
 government will coin gold and silver coins, from the metal 
 obtained by the gracious and spontaneous cooperation of 
 the mining companies, composed, in their majority, by 
 foreigners. 
 
 Before all we must warn all those who dream with coun¬ 
 ter-revolutions, that the latter do not exist in the sense of 
 acts of vengeance or punishment against the disorders com¬ 
 mitted during a previous anarchical state, called “revolu¬ 
 tion.” The revolution represents the conflict of psycological 
 forces liberated by the rupture of the ties which held the 
 passions, the brutal instincts, and the atavic influences, 
 in a potential state which will again start a furious conflict 
 although apparently the later upheaval might be apparently 
 directed to punish the previous trouble. 
 
 Excluding the deliberately perverted ones, I sincerely be¬ 
 lieve that a majority of the revolutionary chiefs lament the 
 disorders caused by the Revolution and are exerting them¬ 
 selves to remedy them. This is logical for two reasons: 
 first, physically and morally tired of a brutal struggle, their 
 instinct of conservation pushes them towards a state of life 
 wherein they can safeguard the material and moral rewards 
 they have secured during the campaign; and secondly, the 
 fearsome spectacle of hunger, daily aggravated, is a present¬ 
 ment of the future when they would be the first victims. 
 
 Supposing that another Mexican faction became armed 
 through the support of the Republican party triumphant at 
 the next polls, we would see repeated, during the fight, the 
 
 16 
 
same abuses, the same savage outrages, and probably even the 
 same “raids” which Mexicans and foreigners have witnessed, 
 possessed with just indignation. The new mobs, headed by 
 chieftains psycologically identical to those who warred in 
 the past, would succeed at the most, in supplanting certain 
 names already registered now in that kind of corpora¬ 
 tion called government. The same vicious circle which we 
 will describe presently, would place them in the same 
 dangerous situation in which the present de facto govern¬ 
 ment finds itself, unless it limited itself exclusively to sell 
 our national sovereignty for a handful of gold. 
 
 In the monography published by the “Mechanical and 
 Metals Bank,” called “Mexico” we read: “So many prob¬ 
 lems confront Mexico that they would be deeply discourag¬ 
 ing were it not for the fact of the country’s vast natural 
 wealth,—riches which require peace and a properly ruled 
 people for their development!” “Whatever else be said 
 one thing stands out definitely: Mexico’s financial and in¬ 
 dustrial hope in the future lies with the bankers and financial 
 interests of the United States.” 
 
 No one can foresee what the organization of the civilized 
 world finances will be once the European conflict is ended; 
 but it is probable that if the United States can preserve its 
 peace, the association of the most important American banks 
 will rise to the category of a banking institution of world¬ 
 wide repute. Consequently, without entering into a com¬ 
 plicated and profound analysis of the statement of the 
 Mechanical and Metals Bank, we will accept it as an irre¬ 
 futable truth, or at least as an indication of the way Amer¬ 
 ican capital feels in regard to Mexico’s economic future. 
 
 No great exertion is necessary to understand the attitude 
 assumed by capital towards the Revolution and the de facto 
 government. Its protest against an anarchical state, is just, 
 although such protest is similar to the one made by a 
 farmer against heaven because the latter does not send an 
 opportune rain. Though the illogical campaign that capi¬ 
 tal is waging against acts of Mr. Carranza—acts which in 
 a last analysis are merely the natural process of a Revo¬ 
 lution transforming itself into a government—there is a 
 large amount of perfidy, but a still larger amount of inex¬ 
 plicable ignorance. What are the final pretensions of the 
 Mexican people? To witness the wonderful spectacle of the 
 
 17 
 
extraction of its riches for the exclusive benefit of foreign¬ 
 ers, and to entertain the hope that at last, some day, it be 
 able to relieve the condition of practical starvation which 
 tortures it from its sociologic origin to date. This relief can 
 be obtained only when the landholder pays the tax justly 
 imposed on him; when foreign companies operating in Mex¬ 
 ico, agree to a revision of their concessions, which for the 
 the greater part, are anti-constitutional. 
 
 Any government which establishes itself in Mexico will 
 have to deal: on the one hand with a people whose morality 
 is the psycological concomitant of the endemic state of star¬ 
 vation that afflicts it; and on the other, with the exigencies 
 of foreign capital which will not consent to the organization 
 of a new loan for Mexico unless the Mexican government 
 that seeks such loan guarantees to that capital the conces¬ 
 sions as granted by previous governments. As these con¬ 
 cessions even granting that they were demanded and granted 
 in good faith, are notoriously anti-constitutional and im¬ 
 moral, it stands to reason that the absolute future of Mex¬ 
 ico depends on Wall Street, if the American public opinion 
 does not oppose the injustice of an armed intervention. 
 
 When foreign capital is persuaded that the American peo¬ 
 ple will not be pleased to have a war against Mexico merely 
 because it so suits the foreign companies operating therein, 
 we will witness a curious spectacle: the Mexican loan con¬ 
 sidered at the present moment as the most stupid of in¬ 
 vestments, will be even overpaid within a period similar to 
 that needed for covering the recent European loans. 
 
 It is not foolish to make such a prediction, for in the 
 history of our national debts is seen that we have never 
 repudiated any obligations, however contracted. In the 
 “Journal of American Bankers Association” (May 1916), 
 we read, in the article published by Mr. T. W. Osterheld, 
 the following “Throughout the history of Mexico, its strug¬ 
 gles, its civil strife and revolutions, one dominant factor has 
 become an empiric law of that Republic, namely: never to 
 repudiate its material debt and the insistence by the central 
 government, that each state fulfill the obligations which it 
 may have contracted. The great proof of this statement 
 and the integrity of the Mexican Republic will be found in 
 the history of its first two loans, where the republic, in as¬ 
 suming the responsibility of the Spanish debt, received 
 
 18 
 
eleven million dollars for a thirty million loan, paid twenty- 
 nine million five hundred thousand dollars, and finally ex¬ 
 tinguished this debt by the payment of over sixty-two mil¬ 
 lion dollars. If it is true, as Lord Beaconsfield states, that 
 character is destiny in the individual, then the past actions 
 and work of the Mexican units will give to that nation a 
 future destiny of prosperity and progress as great as that of 
 any nation of our continent; moreover, it is unnecessary to 
 feel any repudiation of debt of interest contracted by her 
 past, present or future executives ” 
 
 Simultaneously with this fact, we will see that certain press 
 in the pay of the capital interested in Mexico, cease to pub¬ 
 lish the insults which it has been hurling at the Mexican 
 revolutionary people, and we shall also see the definite 
 cessation of “new raids” which at present are constantly 
 threatening the American frontier. 
 
 New York, October, 1916. 
 
 19