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21-06-2015, 00:47


National sovereignty over natural resources was a beautiful constitutional provision which was totally removed from reality.

Arnaldo Cordova, 200727

Shortly after Calles took office in 1924, U. S.—Mexican relations began another downward spiral. Calles declared that the Bucareli Accords had been merely informal arrangements between Obregon and the United States and therefore were not binding on Obregon’s successors.28

Once again the dispute revolved around oil. Rather than abandoning the goal of Mexican control of oil, in 1925, Calles promulgated a law that limited concessions acquired before 1917 to fifty years, even if positive acts had been performed. This posed little threat to the oil companies, since as experience would demonstrate, fifty-year concessions could be pumped dry in much less than fifty years. Once again, oil companies—afraid of the precedent that might be set for other areas— refused to accept the new legislation, which also held oil companies responsible for damages to fishing and agriculture.29

U. S. President Calvin Coolidge, who took office in 1923, firmly supported the status quo.30 In the summer of 1925, Secretary of State Frank Kellogg stated:

It should be made clear that this Government will continue to support the Government in Mexico

Only so long as it protects American lives and American rights and complies with international

Engagements and obligations. The Government of Mexico is now on trial before the world.31

The continued seizure of American-owned property for land reform further strained relations. Of the 6.2 million acres expropriated by 1925, 494,000 had belonged to Americans. The bonds agreed to as a form of payment for small properties in the Bucareli Accords were clearly inadequate as a means of payment since Mexico was unable to service the bond debt.32

The oil issue dragged on into 1927, with both sides refusing to give ground. Mexicans viewed Calles as a dedicated nationalist. Americans considered him as anti-capitalist. Mexicans viewed oilmen as foreigners exploiting non-renewable resources and leaving behind only ruined land. Oil companies portrayed themselves as creators of jobs and as taxpayers.33

Tensions continued to rise during the first half of 1927. Oil companies were drilling without the permits they were legally required to have, apparently in hopes of provoking a confrontation. In response, the government would seal wells, and the companies would break the seals. Calles would then order troops to close the valves. In response to the imminent threat of military intervention, Calles ordered the military commander in the oil-producing area, General Lazaro Cardenas, to set the wells on fire in the case of a U. S. landing.34

Fortunately for both nations, the U. S. Senate passed a resolution calling for arbitration of all outstanding issues with Mexico. This resolution was spearheaded by the chairman of the Senate Foreign Relations Committee, Senator William Borah of Idaho. Borah felt that in the long run, continued armed intervention in Latin America was counterproductive. His views later became the accepted wisdom in Washington and would be incorporated into FDR’s Good Neighbor Policy (see later in the chapter).35

A definitive shift in the tone of U. S.—Mexican relations came with the mid-1927 appointment of Dwight Morrow as U. S. ambassador. Morrow, an Amherst College classmate of Coolidge, had served as a corporate lawyer and partner in the banking firm of J. P. Morgan. At the time of Morrow’s arrival, U. S.—Mexican relations had sunk so low that a Mexican newspaper ran the headline, “After Morrow come the marines.”36

Morrow’s instructions from Coolidge were short and to the point: “Keep us out of war with Mexico!” As a friend of Coolidge’s, Morrow had more leeway than most diplomats. He also had a knack that was rare for diplomats of the time—he could see both sides of an issue.37

Morrow’s appointment reflected the shift that was occurring in U. S. Latin American policy. Before arriving in Mexico City, Morrow had stated unequivocally that private debts ought not to be collected by government coercion. None of his predecessors had made such a statement publicly. Morrow’s strength lay in persuading, not threatening.38

Morrow soon began traveling around Mexico with Calles as a friend and advisor, and he became a major influence on the Mexican president. His greatest success at persuasion was ending the impasse created by the 1925 oil law. Morrow suggested that a face-saving solution could be arrived at if the Mexican Supreme Court would declare the law to be ex post facto and therefore illegal. Such a ruling would defuse the situation, without Mexico recognizing a U. S. veto power over Mexican legislation.

Calles passed Morrow’s suggestion on to the Supreme Court, which was not noted for its independence. Within a month, Calles had the ruling he wanted. The following month, January 1928, a new oil law took effect that reflected this decision, thus ending the oil crisis. The 1928 law declared that lands improved before 1917 would remain in oil company hands.39

Similarly, the problem raised by taking land owned by Americans for land reform was defused as Morrow persuaded Calles that providing land to illiterate peasants was counterproductive. Morrow’s influence extended not only to Calles but to his cabinet as well. Colonel Alexander Macnab, who served under Morrow as military attache in the Mexico City embassy, commented on this influence: “There is no department of government in Mexico which he has not advised and directed. He took the Secretary of Finance under his wing and taught him finance.”40

Morrow caught the Mexican public’s imagination as few U. S. ambassadors ever have. He had a genuine interest in Mexican culture, studied Spanish, and decorated his home with Mexican handicrafts. His biggest public relations coup was inviting Charles Lindbergh to Mexico. Lindbergh flew his plane non-stop from New York City to Mexico City. Morrow’s biographer described the effect of Lindbergh’s visit: “During the next week Mexico City abandoned itself to the cult of Colonel Lindbergh. Ambassador Sheffield [Morrow’s unpopular predecessor], the oil magnates, Porfirio Diaz, and even the Treaty of Guadalupe Hidalgo, were forgotten.” The trip had a lasting effect on Lindbergh. While in Mexico he met ambassador Morrow’s daughter Anne, whom he later married.41

Morrow did not betray U. S. interests, even though his detractors often accused him of that. He only defended a broader set of interests than oil. He commented on his surprise at the “extent to which responsible oil companies seem to believe it is the duty of the State Department to run their businesses in foreign lands.” He balanced the interests of oilmen, bondholders, and those who had lost land to the land reform while exacting payment of as much of Mexico’s foreign debt as its weak economy could bear. Unlike his predecessors who had ignored Mexican interests, he observed,

Figure 20.1 Dwight Morrow inspecting pottery in Oaxaca Source: Courtesy Amherst College Archives and Special Collections

“It would be short-sighted policy for the creditors to insist that they be paid at whatever the cost to the people of Mexico.”42

In his last annual address, Calles stated that the Mexican government was “free of all vexatious difficulties with the neighbor republic of the north.” Between 1928 and 1934, relations between the two countries remained cordial due to Calles’s increasing conservatism and the settlement of conflicts to both U. S. and Mexican satisfaction.43

Once the oil question had been dealt with, stability in Mexico became the primary U. S. concern. Rather than risking a change in government, when Escobar rebelled in 1929, the United States supplied 10,000 Enfield rifles, 10 million rounds of ammunition, airplanes, and pilots to suppress the rebellion. The United States also allowed outnumbered troops loyal to Calles to leave Ciudad Juarez, pass through U. S. territory, and then return to Mexico through Eagle Pass, Texas.44

Throughout the 1920s, U. S. influence continued to increase. In 1928, trade between Mexico and the United States totaled $241 million. That year the United States accounted for 68 percent of both Mexican exports and imports. In addition, the Mexican elite increasingly sent their children to college in the United States. This trend was decried by nationalists and Hispanophiles alike— former Education Secretary Jose Vasconcelos commented that children of the elite were sent to study in the United States “so they might become lackeys of imperialism.”45