# Popular Science Monthly/Volume 29/June 1886/An Economic Study of Mexico III

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* AN ECONOMIC STUDY OF MEXICO.
By Hon. DAVID A. WELLS.
III.
Occupations of the People of Mexico. Agriculture.—Although the main business of the country is agriculture, this branch of industry is carried on under exceptionally disadvantageous circumstances. One of its greatest drawbacks is, that the whole country is divided up into immense haciendas, or landed estates; small farms being rarely known; and out of a population of ten million or more, the title to the soil is said to vest in not more than six thousand persons. Some of these estates comprise square leagues instead of square acres in extent, and are said to have irrigating ditches from forty to fifty miles in length. Most of the land of such estates is uncultivated, and the water is wasted upon the remainder in the most reckless manner. The titles by which such properties are held are exceedingly varied, ​and probably to a considerable extent uncertain. Some came from the old Spanish Government, through its viceroys; some from Mexico, through its governors or political chiefs; while over a not inconsiderable part of all the good land of the country, the titles of the Church, although not recognized by the Government, are still, to a certain extent, respected. Added to all this, there is a marked indisposition on the part of the large owners of real estate in Mexico to divest themselves of such property; and this for various reasons. Thus, in the heretofore almost permanently revolutionary condition of the country, the tenure of movable or personal property was subject to embarrassments from which real estate, or immovable property, was exempt. Under the system of taxation which has long prevailed in Mexico, land also is very lightly burdened. And, finally, from what is probably an inherited tradition from Old Spain, the wealthy Mexican seems to be prejudiced against investing in co-operative (stock) or financial enterprises—the railways, banks, and mines, in both Old Spain and Mexico, for example, being to-day mainly owned and controlled by English or other foreign capitalists. Under such circumstances, there is no influx of immigrants into Mexico with a view to agriculture, and settlements, such as spring up and flourish in the United States almost contemporaneously with the construction of the "land-grant" and other railroads, are unknown, and are not at present to be expected; all of which clearly works to the great disadvantage of all Mexican railway enterprise and construction. It is also interesting to note, in connection with this subject, that it is the immobility and uncertainty of these same old Spanish or Mexican land-grants, which cover a vast portion of New Mexico, that constitute at present the greatest obstacle in the way of the growth and development of that Territory.
Statutes offering great inducements for permanent immigration such as a bonus to each immigrant, the right to purchase public lands at moderate prices and on long terms, the right to naturalization and citizenship, and the like were enacted by the Mexican Congress as far back as 1875, but as yet do not appear to have been productive of any marked results.
On the other hand, the Mexican land laws discriminate very rigorously against the acquirement of land by foreigners who do not propose to become Mexican citizens, and seem to be especially framed to prevent any encroachments on the part of the United States. Thus, no foreigner may, without previous permission of the President of the Republic, acquire real estate in any of the border States, within twenty leagues (sixty miles) of the frontier; but such permission has of late been freely given to citizens of the United States for the acquirement of ranching property on the northern frontier. The ownership of real estate by a foreigner in either country or city, within fifteen miles of the coast, is, however, absolutely forbidden, except on the condition of a special act of Congress granting it. It is only, ​furthermore, through a direct permission of the Minister of Foreign Affairs that a foreigner in Mexico is accorded any standing in a court of justice. By the Constitution of Mexico, a foreigner who purchases any real estate in that country, without declaring that he retains his nationality, becomes a citizen of Mexico; and it is difficult to see how under such conditions he could properly invoke any protection from the country of his prior citizenship, in case he considered his rights in Mexico to be invaded. Again, the laws regulating mining property in Mexico are very peculiar. No one in Mexico, be he native or foreigner, can own a mine absolutely, or in fee, no matter what he may pay for it. He may hold it indefinitely, so long as he works it; but under an old Spanish law, promulgated as far back as 1783, and still recognized, if he fails "to work it for four consecutive months, with four operatives, regularly employed, and occupied in some interior or exterior work of real utility and advantage," the title is forfeited and reverts to the state; and the mine may be "denounced," and shall belong, under the same conditions, "to the denouncer who proves its desertion." The denouncer, to keep the property, must, however, at once take possession and begin the prescribed work within a period of sixty days. This practice has one great advantage over the American mining system; and that is, that litigation about original titles, and conflicting claims to mining property are almost unknown in Mexico.
On the plateau of Mexico, where nine tenths of its present population live, there is undoubtedly much good land; but the great drawback to this whole region is its lack of water. During the rainy season, which commences in June and lasts about four months, there is a plentiful rainfall for Central and Southern Mexico; but in Northern Mexico the rainfall, for successive years, is not unfrequently so deficient as to occasion large losses, both in respect to stock and to crops. For the remainder of the year, or for some eight months, little or no rain falls, and the climatic characteristic is one of extreme dryness. During the most of the year, therefore, the whole table-land of Mexico is mainly dependent for its water-supply upon a comparatively few springs and storage-reservoirs; and agriculture can not be generally carried on without resorting to some form of irrigation. One rejoinder to what may be an unfavorable inference from these statements has been the counter-assertion that "in the immediate neighborhood of the large cities enough grain is raised by irrigation to keep constantly more than a year's extra supply ahead to provide against a possible failure of crops"; and, further, that the storage capacity of the existing reservoirs of Mexico might easily be increased, and thus greatly extend the area of land capable of cultivation. But, admitting this, how great must be the obstacles in the way of developing any country where there is a liability to an almost entire failure of the crops from drought; and where the small agricultural proprietor, ​who depends on each year's earnings to meet each year's needs, has always got to anticipate and guard against such a possibility! There are vast tracts of land also in Mexico, especially in the northern part, where grass sufficient for moderate pasturage will grow all or nearly all the year, but on which the water-holes are so few, and so entirely disappear in the dry season, that stock can not live on them. In a report recently sent (January, 1885) to the State Department, by Warner P. Sutton, United States consul-general to Matamoros, the statement is made, that the annual value of the agricultural products of the State of South Carolina, having an area of 30,570 square miles, is at least two and half times as great as the whole like product of the six States of Northern Mexico—namely, Tamaulipas, Nuevo Leon, Coahuila, Chihuahua, Lower California, and Sonora—which have an area of 355,000 square miles, and represent about one half of the territory of the whole republic; or, making allowance for the areas of land under comparison, the annual agricultural product of South Carolina is from twenty to twenty-five times as valuable as that of the whole northern half of Mexico!
On the "tierras calientes or comparatively narrow belt of coast-lands, on both the Atlantic and Pacific sides of Mexico, there is abundance of wood and water, cheap and fertile land, and most luxuriant vegetation; but the climate is such that the white races will never live there in the capacity of laborers. When one hears, therefore, of possibilities of these regions in respect to coffee, sugar, tobacco, and a wide range of other valuable tropical products, this fact has got to be taken into account. They would, however, seem to be particularly adapted to the introduction and employment of Chinese labor; and during the past year delegations from the associated Chinese Companies of San Francisco have, it is understood, entered into negotiations with the Mexican Government, with a view of promoting an extensive immigration into these portions of the national territory.
Again, much of the best land of the plateau of Mexico is in the nature of valleys surrounded by mountains, or of strips or sections separated by deserts. Thus, for example, to get from the city of Mexico into the fertile valley of Toluca, a comparatively short distance, one has to ascend nearly three thousand feet within the first twenty-four miles; while between Chihuahua and Zacatecas there is an immense desert tract, over which the Mexican Central Railway has to transport in supply-tanks the water necessary for its locomotives. It is true that in both of these instances the natural difficulties have now in a great measure been remedied by railroad constructions; but when it is remembered that, outside of the leading cities and towns of Mexico, there are hardly any wheeled vehicles, save some huge, cumbersome carts with thick, solid, wooden wheels (a specimen of which, exhibited as a curiosity, may be seen in the National Museum at Washington); that the transportation of commodities is mainly ​effected on the backs of donkeys or of men; that the roads in Mexico, as a general thing, are hardly deserving of the name; and that, even with good, ordinary roads and good teams and vehicles at command, a ton of corn worth twenty-five dollars at a market is worth nothing at a distance of a hundred and twenty miles remembering these things, one can readily accept the statement that, in many sections of Mexico, no effort is made to produce anything in the way of crop products, except what has been found necessary to meet the simplest wants of the producers; and for the reason that experience has proved to them that it was not possible to obtain anything in exchange for their surplus.
The plow generally in use in Mexico is a crooked stick, with sometimes an iron point. American plows are beginning to be introduced to a considerable extent; but the Mexican peasant on coming into possession of one generally cuts off one handle, in order to make it conform, as far as he can, to his ancient implement. A bundle of brush constitutes the harrow. "Their hoes are heavy grub-hoes, and grass is cut by digging it up with such a hoe."
Nothing exhibits more strikingly the present poverty of Mexico, and the present inefficiency of her agriculture—notwithstanding the natural advantages claimed for this industry, and that it is undoubtedly the principal occupation and support of her people than a brief comparison of some of the results which have been recently reported for Mexico and the United States. According to a report published in 1883, by M. Bodo von Glaimer, an accepted Mexican authority, and other data, gathered and published by Senor Cubas, United States Consul-General Sutton, and the Agricultural Bureau at Washington, the value of all the leading agricultural products of Mexico—corn, wheat, sugar, tobacco, beans, coffee, and the like—for the year 1882 was estimated at about $175,000,000. But the present estimated value of the oat-crop alone of the United States is $180,000,000. Again, corn constitutes the staple food of the Mexican people, and its product for 1882 was estimated at about 213,000,000 bushels; which, with an assumed population of ten million, would give a product of 21310 bushels per capita. But for the United States for the year 1885 the product of corn was about thirty-three bushels per capita.
Although much of the soil of Mexico is undoubtedly well adapted to the cultivation of wheat, it is as yet a crop little grown or used—wheat-bread being eaten only by the well-to-do classes. Its product ​for 1882 was estimated at 12,500,000 bushels, or at the rate of about 1210 bushel per capita; while for the year 1885, with a very deficient crop, the wheat product of the United States was in excess of six bushels per capita. Mexican coffee is as good as, and probably better than, the coffee of Brazil, and yet Mexico in 1883-84 exported coffee to all countries to the value of only $1,717,190, while the value of the exports of coffee from Brazil to the United States alone, for the year 1885, was in excess of $30,000,000. Much has also been said of the wonderful adaptation of a great part of the territory of Mexico for the production of sugar, and everything that has been claimed may be conceded; but, at the same time, sugar is not at present either produced or consumed in comparatively large quantities in Mexico, and, in common with coffee—another natural product of the country—is regarded rather as a luxury than as an essential article of food. Thus the sugar product of Mexico for the year 1877-'78, the latest year for which data are readily accessible, amounted to only 154,549,662 pounds. Assuming the product for the present year (1886) to be as great as 200,000,000 pounds, this would give a Mexican per capita consumption of only twenty pounds as compared with a similar present consumption in the United States of nearly fifty pounds. The further circumstance that Mexico at the present time imports more sugar than it exports; and that the price of sugar in Mexico is from two to four times as great as the average for the United States—coarse-grained, brownish-white, unrefined sugar retailing in the city of Mexico for twelve and a half cents a pound (with coffee at twenty-five cents)—is also conclusive on this point. With the present very poor outlook for the producers of cane-sugars in all parts of the world, owing mainly to the bounty stimulus offered by the governments of Europe for the production of beet-sugar; and the further fact that the only hope for the former is in the use of the most improved machinery, and the making of nothing but the best sugars at the point of cane production, the idea so frequently brought forward that labor and capital are likely to find their way soon into the hot, unhealthy coast-lands of Mexico, in preference to Cuba and South America, and that the country is to be speedily and greatly profited by her natural sugar resources, has little of foundation. And, as additional evidence on these matters, the writer would here mention, that a statement has come to him from a gentleman who has been long connected and thoroughly acquainted with the Vera Cruz and City of Mexico Railroad, which runs through the best sugar and coffee territory of the country, that not a single acre of land more is now under cultivation along its line than there was at the time the road was completed, thirteen years ago.
Whatever, therefore, may be the natural capabilities of Mexico for agriculture, they are certainly for the future rather than of the present.
Manufactures.—Apart from handicrafts there is very little of manufacturing, in the sense of using labor-saving machinery, in ​Mexico; and, in a country so destitute of water and fuel, it is difficult to see how there ever can be. In almost all cases where the employment of machinery is indispensable, mule or donkey power seems to be the only resource; as is the case in the majority of the mines and silver-reducing works of the country—not a pound of ore, for example, being crushed through the agency of any other power, in connection with the famous mines of Guanajuato. Many years ago an English company bought the famous Real del Monte mine, near Pachuca, which is reported to have yielded in a single year, with rude labor, $4,500,000. It was assumed that two things only were requisite to insure even greater returns; namely, the pumping out of the water which had accumulated in the abandoned shafts, and the introduction of improved machinery for working at lower levels. Large steam-engines and other machinery were accordingly imported from England, and dragged up by mule-power from Vera Cruz, at immense cost and labor. But the new scheme proved utterly unprofitable, and after some years' trial was abandoned. The expensive machinery was sold for about its value as old iron; the mines reverted to a Mexican company; the old methods were again substantially introduced, and then the property once more began to pay.
Deposits of coal of good quality are from time to time reported as existing, and readily accessible. But the fact that the Mexican Central Railroad supplies itself from the coal-fields of Colorado, nearly fifteen hundred miles from the city of Mexico, and that the Vera Cruz Railroad imports its coal from England, is in itself sufficient evidence that no coal from any Mexican mine has yet been made practically available for industrial purposes. In Central Mexico, wood commands at the present time from twelve to sixteen dollars per cord, and coal from fifteen to twenty-one dollars per ton.
According to the best information available, the number of factories of all kinds using power, in the republic, is about a hundred, representing a valuation of some $10,000,000, and employing about 13,000 hands. Their range of manufacturing is exceedingly limited, and comprises little besides the coarser cottons and woolens, the coarser varieties of paper, a few (cloth) printing and dye works, milling (flour), and the manufacture of unrefined sugar. The textile factories (cotton and wool) are said to contain 250,000 spindles and 9,500 looms.
No country affords such striking illustrations as Mexico of the fallacy and absurdity of the so-called "pauper-labor" argument for "protection"; or of the theory, which has proved so popular and effective in the United States, for justifying the enactment of high tariffs, that the rate of wages paid for labor is the factor that is mainly determinative of the cost of the resulting product; and that, therefore, for a country of average high wages, the defense of a protective tariff against a country of average low wages, is absolutely necessary as a condition for the successful prosecution by the former of its industries.
​Wages, on the average, in Mexico, are from one half to two thirds less than what are paid in similar occupations in the United States; and yet in comparison with the United States the price of almost all products of industry in Mexico is high. Thus, in the city of Mexico, where wages rule higher than in almost any part of the republic, the average daily wages in some of the principal occupations during the year 1885 were as follow: Laborers, porters, etc., forty to fifty cents; masons, seventy-five cents to one dollar; assistants, thirty-seven and a half to fifty cents; teamsters, fifty cents; blacksmiths, one dollar and fifty cents; printers, one dollar; saddle and harness makers, sixty-two cents; tailors, seventy-five cents; painters, eighty-seven and a half cents; weavers in the cotton-mills at Tepic and Santiago, four dollars per week of seventy-two hours; spinners, three dollars ditto. In the cotton-mills in the vicinity of the city of Mexico a much higher average is reported. The operatives in the woolen manufactories of Mexico are in receipt of higher average wages than those in almost any other domestic industry; and Mexican woolen fabrics are comparatively cheap and of good style and quality. Underground miners, at the great mines of Zacatecas and Guanajuato, receive an average of nine dollars per week of sixty hours; underground laborers, three dollars ditto; agricultural laborers in the district of San Blas average nineteen cents per day, with an allowance of sixteen pounds of corn per week. On a hacienda near Regla, in Central Mexico, comprising an area some eighteen miles in length by twelve in its greatest breadth and including an artificial lake two miles in its principal dimensions, the wages paid in 1883 were six cents a day for boys and thirty-seven cents for the best class of adults. In other districts the wages of agriculturists are reported as from eight to ten dollars per month, with rations.
The following are the retail prices of some of the principal articles of domestic consumption in Mexico: Fresh beef, twelve to eighteen cents per pound; lard, twenty to twenty-five cents; coffee, twenty-five cents; sugar, unrefined, twelve to twenty cents; table-salt, six cents; potatoes (city of Mexico), twenty-five cents per dozen; flour, ten to twelve cents per pound; corn-meal, not usually in the market, unless imported; candles, thirty to fifty cents; unbleached cottons, ten to fifteen cents per yard; calicoes, fifteen to twenty cents per yard. Utensils of tin and copper are fifty per cent dearer than in the United States; while the retail prices of most articles of foreign hardware (and none other are used) are double, treble, and even four times as much as in the localities whence they are imported. "Between the extremes, a modest and economical lady's wardrobe will cost, at the city of Mexico, about fifty per cent more than the same style in the United States. This, however, is modified by the climate, which requires no change of fashions to suit the seasons, as the same outfit is equally appropriate for every month in the year."—(Strother.) ​Imported articles of food are exceedingly high at retail at the city of Mexico. American hams, in canvas, forty to fifty cents per pound; American salmon, cans of one pound, one dollar; mackerel, eighteen to twenty-five cents each; codfish, twenty-five cents per pound; cheese, fifty to seventy-five cents. The industry of Mexican pottery, a handicraft exclusively, employs a great many laborers, but has no organization—every community, and almost every family, in the districts where the conditions for production are favorable, making its own wares, as iron, tin, and copper cooking utensils are almost unknown in the domestic life of the masses of the Mexican people. The Indian manufacturer packs his pottery into wicker crates, about two feet square and from five to six feet long, and starts to different portions of the country, on foot, with the crate. on his back. Consul Lambert, of San Blas, states that he has known one "to travel more than two hundred and fifty miles to find a market, and dispose of his articles at prices varying from one and a half to twelve, and, in the case of large pieces, as high as eighteen cents; receiving, in the aggregate, for the sale of his cargo, from twelve to fifteen dollars."
The manufacture of leather is also one of the great industries of Mexico; but, with the exception of the sewing-machine, which has been largely introduced in this and other occupations, the product is exclusively one of handicraft. In a country where everybody rides who can, the saddlery business is especially important; and by general acknowledgment there are no better saddles made anywhere in the world than in Mexico; and yet the United States has for many years exported from twenty to thirty thousand dollars' worth of saddles annually to Mexico. The explanation is, that the mechanical appliances used in the United. States for making the "trees," and for stamping, cutting, sewing, and ornamental stitching, enable the American manufacturers to pay an import duty of fifty-five per cent, and undersell the hand-product of the low price (but dear cost) Mexican artisan. Consul-General Sutton, of Matamoros, reports to the State Department, under date of July, 1885, that Mexican dealers send to the United States model saddle-trees and designs for trappings, and find it more profitable to have the major part of the work of saddle-making done there, than to do it all by the low-wage hand-labor of their own country.
In short, this condition of affairs in Mexico, in respect to wages and the cost of production, is in strict accord with what has been deduced within recent years from the experience of other countries; namely, that the only form of labor to which the term "pauper" has any significant or truthful application, is labor engaged in handicrafts as contradistinguished from machinery production; and that, where such handicraft or ignorant labor is employed in manufacturing, the final cost of its product, as represented by the amount of time required, or the number of persons called for in any given department, ​must of necessity be high. Hence, wages under such circumstances (as exist in Mexico and elsewhere) will be very low, and the conditions of life very unsatisfactory and debasing.
On the other hand, when machinery is intelligently applied for the conversion or elaboration of comparatively cheap crude materials—coal, ores, metals, fibers, wood, and the like—a very little manual labor goes a great way, and production (as in the United States) is necessarily large. This being sold in the great commerce of the world, gives large returns, and the wages represented in such production will be high, because the cost of the product measured in terms of labor is low, and the employer is thereby enabled to pay liberally; and in fact is obliged to do so, in order to obtain under the new order of things what is really the cheapest (in the sense of the most efficient) labor. Or, to state this proposition more briefly, the invariable concomitant of high wages and the skillful use of machinery is a low cost of production and a large consumption.
The following circumstance curiously illustrates the prevailing low money rate of wages in Mexico, and the obstacle which such cheap labor interposes to the attainment of large production: At one point on the Mexican Central Railroad, while journeying south, a machine, the motive-power of which was steam, for pumping water into tanks for the supply of the locomotives, was noticed, and commented upon for its compactness and effectiveness. On the return journey, this machinery was no longer in use; but a man, working an ordinary pump, had been substituted. The explanation given was, that with hand-labor costing but little more than the (Colorado) coal consumed, the continued employment of an engine and an American engineer was not economical.
But at no point within the observation of the writer, either on the Continent of North America or in Europe, do wages, or rather remuneration for regular labor, reach so low a figure as at Santa Fé, within the Territories of the United States. At this place, one of the notable industrial occupations is the transport and sale of wood for use as fuel. The standard price for so much as can be properly loaded upon a donkey (or burro) is fifty cents. The money price of the wood is high: but, as it is brought from a distance of fifteen, twenty, thirty, or even more miles, each load may be fairly considered as representing the exclusive service of a donkey for two days—going, returning, and waiting for a purchaser—and the services or labor of an able-bodied man, as owner or attendant, apportioned to from three to five donkeys for a corresponding length of time. The gross earnings of man and donkey can not, therefore, well be in excess of twenty-five cents per day; from which, if anything is to be deducted for the original cost of the wood, its collection and preparation, and for the subsistence of the man and beast, the net profit will hardly be appreciable. Or, in other words, able-bodied men, with animals, are willing to work, and ​work laboriously, at Santa Fé, in the United States, for simple subsistence; and a subsistence, furthermore, inferior in quality and quantity to the rations generally given to acknowledged paupers in most American poor-houses; and yet no high-priced laborer in the United States has any more fear of the industrial competition of the pauper laborers of Santa Fé than he has of the competition of the paupers who are the objects of charitable support in his own immediate locality.
The largest, best-conducted, and most profitable of the cotton-factories of Mexico, and the largest manufacturing establishment in the country, is the "Hercules" mill, located near Querétaro, 152 miles from the capital. Taking a tramway, with comfortable cars of New York (Stevenson's) construction, for a distance of about three miles from the plaza, the visitor, on approaching, finds an establishment, embracing several acres, entirely surrounded by a massive, high, and thick wall, with gateways well adapted for defense and exclusion. On entering, the objects which first arrest attention are an attractive little park, with semi-tropical trees and shrubs; handsome residences for the owner and his family, and a stone armory or guard-house—with men in semi-military costume lounging about—containing a complete military equipment for thirty-seven men, horse and foot—Winchester rifles and two small pieces of artillery. Without being too inquisitive, the visitors are given to understand that all this military preparation was formerly more necessary than at present; but that even now it was prudent for the officers or agents of the mill to have an armed escort in making collections, contingent upon the sale of its products, from the country dealers and shopkeepers. Back of the guard-house were the mill-buildings proper, warehouses, stables, boiler-house, etc., all well arranged, of good stone construction, scrupulously clean, and in apparently excellent order.
The machinery equipment was 21,000 spindles and 700 looms; its product being a coarse, unbleached cotton fabric, adapted for the staple clothing of the masses, and known as "manta." Both water-and steam-power were used. In the case of the former, a small stream, with a high fall, being utilized through an iron overshot-wheel, forty-six and a half feet in diameter—one of the largest ever constructed; for the latter a fine "Corliss" engine from Providence, Rhode Island. The spinning-frames and a part of the looms were from Paterson, New Jersey. The remainder of the looms, the steam-boilers, and the immense water-wheel, were of English workmanship. Wood, costing sixteen dollars per cord, was used for fuel; and the motive-power was in charge of a Yankee engineer, who had been induced to leave the Brooklyn (New York) water-works, by a salary about double what he had received there; but who declared that nothing would induce him to remain beyond the term (two years) of his contract, which had nearly expired. The motives prompting to this conclusion were suggested by observing, on visiting his quarters ​outside of the gates, that a revolver hung conveniently near the head of his iron bedstead, while another was suspended from the wall, in close proximity to the little table on which his meals were served; and also by the following remark, called out by a suggestion from one of the visitors, that a rug on the hard, unattractive red-tile floors would seem to be desirable: "If you had to examine your bed every night, to see that a scorpion or centiped was not concealed in its coverings, the less of such things you had to turn over the better."
According to information furnished on inquiry, the hours of labor in this typical Mexican cotton-mill were as follows: "help" work from daylight until 9.30 p. m., going out a half-hour for breakfast at 9.30 a. m., and an hour for dinner, at 2p. m.; Saturday night the machinery runs later. The spinners earn from thirty-seven and a half to fifty cents per day; weavers from six to seven dollars per week. On hearing these statements, one of the visiting party, more interested in humanitarianism than in manufactures or economics, involuntarily remarked, "Well, I wonder if they have got a God down in Mexico!" There were present at this visit and inspection a representative of one of the large cotton-factories at Fall River, and one of the best recognized authorities on mechanics and machinery, from Lowell, Massachusetts; and the judgment of these experts, after taking all the facts into consideration, was, that if this Mexican cotton-factory, with all its advantages in the way of hours of labor and wages, were transferred to New England, it would, in place of realizing any profit, sink a hundred thousand dollars per annum. And yet the proprietor of this mill (Don Rubio) and his family are reputed to be among the richest people in Mexico.
The adoption of the theory of "free trade," or "protection," as the basis of a national fiscal policy, does not appear to have as yet interested, to any extent, either the Government or the people of Mexico; and it is doubtful whether, since the country achieved its independence from Spain, it has ever been seriously discussed or considered by anybody. Under the tariff act in force in 1882, there were one hundred and four specifications of articles which could be imported free of duty—including vessels of all kinds, machinery, and most railroad equipments and cars—and eleven hundred and twenty-nine specifications of articles subject to duties, nearly all of which (only thirty-two exceptions) are simple and specific. No other rule seems to have been recognized and followed in imposing duties on imports than that "the higher the duty (or tax) the greater will be the accruing revenue"; and the ad valorem equivalents of many of the apparently simple and moderate duties levied on imports into Mexico are consequently so excessive that the average rate of the Mexican tariff is probably greater than that adopted at present by any other civilized country. All domestic manufacturing industries that could be exposed to foreign competition as, for example, the ​comparatively few cotton and paper mills, and one or two (calico) print-works—accordingly enjoy a degree of protection that nearly or quite amounts to prohibition of all competitive legitimate imports; though it may be doubted whether the fiscal officers who advised or determined such rates had any knowledge or care for any economic theory, but they may have been, and probably were, influenced in their conclusions by the representations of interested parties. But, be this as it may, the practical working of such a tariff, in such a poor, undeveloped country as Mexico, is well illustrated by a recurrence to Don Rubio and his cotton-mill. The average fabric produced at this establishment is protected by a duty on similar imports of nine cents per square metre, or about eight cents per square yard, and sells for about fifteen cents per vara, or thirty-three inches. Domestic industry is thereby promoted, and the family of Don Rubio amass great wealth.
But let us look at the other side of this picture. The number of operatives who obtain opportunities for employment by reason of the existence of cotton manufacturing in Mexico is probably not more than six or eight thousand, certainly not in excess of ten thousand. The population of Mexico, to whom cotton-cloth is the chief and essential material for clothing, may be estimated at ten million. Free from all tariff restrictions, the factories of Fall River, in Massachusetts, could sell in Mexico at a profit a cotton fabric as good as, or better than, that produced and sold by the factory at Querétaro, for five cents a yard, or even less. A population of ten million, poor almost beyond conception, have therefore to pay from two to three hundred per cent more for the staple material of their simple clothing than needs be, in order that some other eight or ten thousand of their fellow-citizens—men and women—may have the privilege of exhaustively working from fourteen to fifteen hours a day in a factory, for the small pittance of from thirty-five to seventy cents, and defraying the cost of their own subsistence. Nor is this all. Under such excessive duties as now prevail, few or no cheap coarse cotton fabrics are legitimately imported into Mexico, and the Government fails to get the revenue it so much needs. The business of smuggling is, however, greatly encouraged, and all along the northern frontiers of Mexico has become so well organized and so profitable as to successfully defy the efforts of the Government to prevent it. On the shelves of the stores of all the Mexican towns and cities, within two hundred and fifty to three hundred miles from the northern frontier, American cotton fabrics predominate. Five hundred miles farther "southing," however, seems to constitute an insuperable obstacle to the smuggler, and similar goods of English and French manufacture almost entirely replace at such points the American products. The present loss to the Mexican Government from smuggling along its northern frontier has been recently estimated by the "Mexican Financier" at not less than $1,500,000 ​per annum—a matter not a little serious in the present condition of Mexican finances; while all intelligent merchants along the frontier are of the opinion that neither the United States nor the Mexican Treasury officials can, by reason of this great illicit traffic, have any accurate knowledge of the amount of international trade between the two countries.
But if the present Mexican tariff on the import of foreign cotton fabrics were to be materially reduced, or abolished, would not, it may be asked, the cotton-factories of Mexico be obliged to suspend operations? Undoubtedly they would; but who, save the rich Don Rubio and his few associate manufacturers, would thereby experience any detriment? The Mexican people would continue to have cotton-cloth the same as now, and probably in greater abundance; for there is no other so cheap and suitable material available to them for clothing. But as the American and European manufacturers would not make their cloth a gift, or part with it for nothing, the Mexican would be obliged to buy it; or, what is the same thing, give some product of his labor in exchange for it. Consequently, the opportunity for the profitable employment of the Mexican people as a whole could not be restricted, if, in consequence of the abolition of the existing tariff on the import of cotton fabrics, they were relieved from an exorbitant and unnecessary enhancement of the cost of their clothing.
Mines and Mining.—The mining for the precious metals, and more especially for silver, has been, since the conquest of the country, and is now, one of the great industries of Mexico. That the product and profit of silver-mining in the past have been very great is certain; that a considerable number of mines are yet worked to a profit, and that future mines of great value will be discovered in the future, is also altogether probable. The popular ideas concerning the amount of the precious metals that have been furnished by the Mexican mines since the discovery and conquest of the country by the Spaniards, and the present annual product of gold and silver by Mexico, are, doubtless, a good deal exaggerated. The coinage records since the establishment of mints in Mexico, in 1537, down to 1883-'84, which are accepted as substantially accurate, and which indicate approximately the value of precious metals produced by the country during this period, are as follows:
From 1537 to 1821 (the last year of the Spanish colonial epoch), gold, $68,778,411; silver, $2,082,260,656; total, $2,151,039,067.
From 1822-'23 to June 30, 1884, gold, $45,605,793; silver, $1,023,718,366; total, $1,069,324,159. At the present time the annual product of gold and silver in the United States is far greater than that of Mexico. Thus, for the year 1883 the gold production of the United States was estimated to have been, gold, $30,000,000; silver, $46,200,000; total, $76,200,000. For Mexico, the estimates for the year 1883-'84 were, gold, $500,000; silver, $24,000,000; total, $24,500,000. ​The greatest obstacle in the way of the successful prosecution and development of the mining industry of Mexico, as also in the case of manufactures, is the scarcity of fuel and water for the generation and application of mechanical power. The impression which an American visitor to one of the great Mexican silver-mines, or reducing-works, at first receives, is almost always that of surprise at the apparent rudeness and shiftlessness of the methods of working. But a further acquaintance soon satisfies him that what is done is the result of long experience, and is the best that probably could be under all the circumstances. Thus, for example, for the purpose of extracting the silver from the ore by amalgamation, the rock, ground to a fine powder and made into a paste with water, is spread out on the floor of a large court, and then worked up, with certain proportions of common salt, sulphate of iron, and quicksilver into a vast mud-pie, by means of troops of broken-down horses or donkeys, which for two or three weeks in succession tramp round and round in the mass—animals and Indian drivers alike sinking leg-deep in the paste at every movement. When the amalgamation is completed, it is brought in vessels or baskets, rather than with wheelbarrows, to washing-tanks, where half-naked men and boys further "puddle" it until the metal falls to the bottom, and the refuse runs away. The process is hard, and even cruel, for both man and beast, and is not expeditious; but it is economical (considered in reference to the cost of other methods involving power), and is effective.
The number of mining properties at present worked in Mexico by American companies is understood to be about forty.
The popular idea that there are a considerable number of old Spanish mines in Mexico which were worked to great profit before the revolution, and then abandoned when their original proprietors were driven from the country, and are now ready to return great profits to whoever will rediscover and reopen them, has probably very little foundation in fact. Sixty-five years have now elapsed since Mexico achieved her independence, and during all this time the Mexicans, who are good miners, and to whom mining has to a certain extent the attractiveness of lottery ventures, have, we may be sure, shrewdly prospected the whole country and have not concealed any of its business opportunities. Capital, furthermore, has not been wanting to them. For, in the early days of the independence of the republic, the idea that the working of old Spanish mines in Mexico promised great profits, amounted to almost a "craze" in England; and millions on millions of British capital were poured into the country for such objects; while the mining districts of Cornwall were said to have been half depopulated, through the drain on their skilled workmen to serve in the new enterprises. It is sufficient to say that the results were terribly disastrous.
Silver Monometallism.—Until within a very recent period, Mexico has furnished to the world a most curious and interesting example of ​a somewhat populous country conducting its exchanges almost exclusively by means of a monometallic, silver currency; no other form of money, with the exception of a small copper coinage, being practically used or recognized. The results were most instructive. Thus, if one proposed to trade, even to a retail extent, or go on a journey, a bag of coin had to be carried. If it were proposed to pay out a hundred dollars, the weight of the bag would be five and a half pounds; if two hundred dollars, eleven pounds; if five hundred, twenty-seven pounds. Where collections or payments were to be large, and the distance to be traversed considerable, regular organizations of armed men, and suitably equipped animals—known as "conductas"—were permanently maintained; and severe and bloody fights with bandits were of common occurrence. At the great cotton-mill at Querétaro, as already noted, the organization of a "conducta"—men, arms, and horses—for making collections, was as much an essential of the business as the looms and the spindles. "It was obviously impossible to carry even a moderate amount of such money with any concealment, or to carry it at all with any comfort; and the unavoidable exhibition of it, held in laps, chinking in trunks or boxes, standing in bags, and poured out in streams at the banks and commercial houses, was one of the features of life in Mexico," and undoubtedly constituted a standing temptation for robbery. Within a comparatively recent time, however, a national bank and banks of foreign incorporators have been established in Mexico, and authorized to issue notes, on what appears to be very inefficient security. The Mexican National Bank is understood to be authorized to issue $60,000,000 notes upon a capital of $20,000,000, which notes are legal tender from individuals to the Government, but not from the Government to individuals, or between individuals. The possibilities, if not probabilities, therefore, now are, that a flood of depreciated paper will ultimately drive silver out of circulation in Mexico.