# The Mexican Problem (1917)/Business And Not Politics Can Redeem Mexico

CHAPTER III
BUSINESS AND NOT POLITICS CAN REDEEM MEXICO
The United States can never take its proper attitude in cooperative democracy toward its sister republic until two popular, yet absolutely false, impressions of Mexico are removed. These popular fallacies are: —
First, that the natural wealth of Mexico has furnished a base for contending business interests from the United States to promote Mexican quarrels.
Second, that the land question is at the bottom of the Mexican troubles.
The writer must frankly confess that for many years he believed these popular superstitions, and only his recent trip into Mexico dissipated them.
The history of the Standard Oil Company as popularly presented has been that of a record of oil monopoly checked intermittently by courts and legislatures,—a monopoly overriding individual and popular rights and promoting peace or war for financial ends. ​Suspicions concerning the Standard Oil Company in Mexico have been prevalent on both sides of the Atlantic.
Many times the representatives of American oil interests at Mexico have been interrogated at Washington as to their relations with the Standard Oil Company, and each time the response has been emphatic that the Standard Oil Company was neither openly nor secretly promoting the oil development in Mexico or behind any important independent producing companies.
THE POSITION OF THE STANDARD OIL COMPANY
The fact is that the Standard Oil Company has aimed at a monopoly of markets, a monopoly of transportation, and a monopoly of refining. It has always avoided ownership in the producing field. The late H. H. Rogers used to declare that the Standard Oil Company wanted no more than an eighty-five per cent monopoly in oil; but that its fifteen per cent interest in the production was more than it desired in that line. The Standard Oil Company has prospected or mined for oil only where others could not be induced to take the risk. The hazard of mining the Standard Oil Company has always endeavored to avoid. ​The Amalgamated Copper Company was a failure under Mr. Rogers because he was not a miner and hesitated to take a miner's risk in opening the Butte copper district at depth.
The men who opened the Mexican oil territory were prospectors and miners and never sought the manufacturing or distribution ends of the business. Even to-day E. L. Doheny both in California and in Mexico declares he prefers the profits of production on a large scale to the details of manufacturing or the business of retailing, which he regards as distinct fields from oil production.
The Standard Oil people are buyers of oil at Tampico and are building a refining plant there to become larger buyers of oil, and they have some producing interests south of Tuxpan. The Pierce Oil Company also has a refinery at Tampico and the British, or Lord Cowdray, interests ship from both Tampico and Tuxpan and refine at Tampico and Tehuantepec.
The Mexican Petroleum Company is the largest producing interest in Mexico, with a present production of fifty-five thousand barrels per day. The Cowdray interests are second with about thirty thousand barrels a day on present restricted shipping facilities. Other interests ​represented at Tampico are the Pierce Oil Company and the Royal Dutch or Shell interests and the Standard Oil Company of New Jersey. The outlook is that the Shell interests will soon be the third largest producers. But the major interests of the Pierce Oil Company and the Standard Oil companies here are in the refining of oil.
A WORLD MAGNET IN MEXICO
It is because of these interests, American and European, in the Tampico field, both as producers and refiners, and because such evidences of underground wealth can command the capital of both Europe and America and because petroleum fuel is working revolutions on both land and sea, that the development, the regeneration, and the hope of Mexico and of the Mexican people must have their base at Tampico, and not in the commerce of Vera Cruz or the inland productions of Mexico, mineral or agricultural.
No redivision of lands in Mexico, no partition of haciendas or ranches, can solve the problems of Mexico or bring her forward to the position she is entitled to occupy by reason of her natural wealth and millions of human hands ready for work.
Land is cheap in Mexico and is to be had ​almost for the asking, but of what use is an acre or a hundred acres to a peasant without plough, animal power, or machinery, and, above all, without transportation or near-by markets?
In the oil regions of California, rich in soil and markets, the underground wealth is reckoned at just twenty times the value of the soil wealth.
From Tampico to Tuxpan is a tropical jungle but not, as often assumed, a miasmatic marsh. It is a jungle of luxurious foliage over soil that can grow anything in the world; but where are the markets and where the incentives for the native population to labor?
The beginnings of markets, the beginnings of transportation, the beginnings of incentive, the beginnings of accumulation, are in the uncovering of large natural or planetary wealth. Outside capital will take the risk for the prize, will employ the labor, will create the transportation, the markets, and the interchange of commodities that make foundations for modern civilization. Natural wealth outside the path of development has no value. The Mexican petroleum fields had absolutely no value in 1900 and, undeveloped, will have the same value in two thousand years that they had two thousand years ago.
To him who would study fundamentals, the ​future of Mexico is already on the map at Tampico because there is here exactly what European and American civilization are demanding for the world's progress, and whatever comes, whether the development is by Great Britain or Germany or by North or South America, the wealth that thence can give light and power to the world will never be surrendered back to the chemistry of Mother Earth.
The writer traveled thirty-five miles west into the oil fields and ninety miles south beside parallel pipe lines carrying oil, gas, and water; visited the terminals, machine shops, carpenter shops, tanks, reservoirs, and shipping wharves, and saw the Mexicans with work and wages never dreamed of half a generation ago.
THE CONTRAST
Boston people put the Mexican Central Railroad into Tampico more than thirty years ago, and between that railroad and the banks of the Panuco River are still the half-naked Mexican babies, the wan mothers, the listless boys and girls, without opportunity, and the fathers without ambition to keep in repair the roofs of their low huts.
A dug-out cedar log for a canoe with a red ​blanket for a sail is picturesque, but not industrially expansive. The fishing is good, and existence calls for but little energy. On the other side of the river are well-dressed Mexican families with comfortable homes, pure water, electric lights, moving pictures, wages, and opportunity for more. There are great possibilities of savings in these wages and of personal development therefrom; but throughout all Mexico there is not yet a savings bank.
The Mexicans are good workers when tools and instruction come to their hand. So far as operated, the railroad lines of the country and the railroad repair shops are manned entirely by Mexicans. There are several independent Tampico shipbuilding and repair yards all owned and operated by Mexican graduates from the repair plants of the Mexican Petroleum Company on the other side of the river.
FAITHFUL MEXICANS
When in 1913 all the Americans were called out of Mexico, the native employees of the Mexican Petroleum Company, who had been assisting in the pumping stations and in the shops, saw to it that never a stroke was missed, nor was there a barrel less oil produced, nor any ​damage or harm to the company's property entrusted entirely to its own faithful Mexican workmen.
When in June, 1916, the military governor of Tampico declared war on the United States and the Mexican Petroleum Company took out nine hundred Americans on two oil steamship carriers and the yacht Casiana, again the pumps never missed a stroke and the Mexican employees in about ten days put 461,000 barrels of oil in the tanks and also loaded two steamers for export; nor was there any thought of interference or of attack upon the property.
Superintendent Green declared that after such faithfulness the Mexicans should continue to run the pumps and the machinery.
It is no wonder, therefore, that the party of Americans visiting Tampico in March, 1917, were everywhere welcomed with smiles or that a Mexican youth in sandals, mistaking the writer for a company manager, applied in Spanish for work, declaring that he had a wife and babies and that he needed food and clothing.
That is the need of Mexico to-day opportunity to labor, opportunity for the family, opportunity for food, clothing, better shelter, and better social conditions. ​And this is exactly what American and European capital and organization have brought to Tampico, attracted by its underground wealth, and this is what will ultimately redeem Mexico and forward her people by industrial opportunity.
INTO THE JUNGLE
Nowhere in the tropics can one make a more interesting trip than to take a swift launch or a lazy stern-wheel barge and at daybreak stir the flying-fish and the jungle parrots of the Chijol Canal, pass on through shallow Tamiahua Lake, where the waterfowls before their migration may be seen spread out in all directions for twenty miles, note the electric light of the oil pumping stations, contrasting with the distant dark mountain peaks, and glimpse through the jungle the cleared hillside fields where the British oil interests, represented by Lord Cowdray, have planted the mark of English thoroughness in field and building construction.
The water trip now terminates sixty miles south at San Geronimo, but later may reach Tuxpan, forty miles beyond. Here at a small inlet dividing the British and American developments you mount motor handcars and fly like ​the wind through the canebrake and the bamboo of the jungle up hill and down and around sharp curves. Before you can get your breath you are amid the oil derricks of several American and English companies drilling on their border lines as in Texas and California.
But here the contests between contending interests must be sharper, for no man knows in this country to what extent at two thousand feet in depth a neighboring oil well may exhaust his land.
The Mexican Petroleum Company would appear to have the advantage at this point, as no other American company has yet a pipe line.
MEXICAN GUSHERS
Pausing before Chinampa Number 1, the oil was found bubbling up around the drill, and orders were given by Mr. Doheny to entertain the American party if possible on the return trip in the afternoon with the bringing in of the well. A few more strokes on the drill and the gas and oil bubbled higher, but it did not flow that day.
​and a half minutes over the crown pulley, eighty-two feet high. Then they shunted the flow into the pipe line and the later report was ten thousand barrels per day from this well, with expectation that she would later "drill herself in." This means that when cleared for action she might be a third great well for the Mexican Petroleum Company with capacity of several times ten thousand barrels per day.
As this is the one well in competitive territory, the supply at other wells of this company must be still further shut in to permit full flow here.
On the hilltop, high above the surrounding country, blaze day and night twelve gigantic gas flames relieving the pressure on the famous Casiano well of the Mexican Petroleum Company which is in the valley beyond, with beautiful surrounding hills, and probably geologically isolated in this oil country.
You climb in and out of this valley by team or in saddle and a clearer picture one would go far to see cultivated fields, neat houses, pumping machinery moving like clock-work, but set in a tropical fruit and flower garden.
"Casiano Number 7" came in September 10, 1910, at seventy-five thousand to eighty thousand barrels a day and is now shut down to ​twenty-five thousand barrels a day under two hundred and sixty-five pounds pressure; but more than double this amount could be taken from the well were there shipping facilities from Tampico. "Casiano Number 6" was flowing fifteen thousand barrels a day when it was closed in a month before Number 7 came in.
It is possibly immaterial from which well the Casiano district is tapped, for no man knows to what extent in this valley Number 7 is drawing from the territory of Number 6, as the geology in these oil fields is not analogous to anything else known on the continent. Number 7 cannot be shut in more closely without danger, for any increased restraint causes the ground to break forth with oil a few hundred feet distant.
Nearly twenty miles farther south by the Mexican Petroleum Company's railway and pipe, water and gas lines is the greatest oil well in the world to-day, Cerro Azul, which means "blue hill," and which "blew in" February 9, 1916, and shot 1,400,000 barrels of oil into the air before it could be capped. One half of this was saved by a quickly constructed reservoir. The column of oil measured six hundred feet, and when it was shut in the delivery was at the rate of more than 260,000 barrels per day.