Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1882-01-06
RAILROAD BUILDING IN MEXICO.

several years there mas been growing |
movement towards the glorification of |
Mexican resources. The press has lent its
aid to the manufacture of this boom,
and it has been represented that all that
was necessary to the development of these
splendid capabilities was railroad sys.
tenn. Now American capitalists are begin
ming to understand what railroads will do,
and they doubtless applied this knowledge
to the case of Mexico without considering
that the situation was not identical with
that of new American State or Territory.
Had the two cases been similar the invest
ments IN Mexican railroads would have
been wise and no doubt remunerative.
But unfortunately for the investors there
is no analogy between the cases. In the
American State or Territory there is moth
ing to hinder the extension of railroads
and the evolution of commerce. The pro-
ducts Of the region to be opened up can be
exported, and the products of all the rest
of the country can be imported, without
any hitch while the only additional bur-
den imposed on the settlers in the new
region consists in the extra freight rates
which represent increased distance from
market. But in Mexico very different
state Of affairs exists. In attempting to
open up that country with railroads, and
to bring it into close commercial union
with the United States, the most formida-
BILE barriers must be encountered, not on
one side only, but on both sides. In fact
we are brought face to face with the pecu-
liar blessings of Protection, and we are
compelled to learn how insuperable an OBJ.
stacle to commercial reciprocity our tariff
system is.
1t is OF course presumable that when
Americans put millions of capital into
Mexican railroads, they expected to reap
large profits. But how can they do SO un.
der the circumstances Even if Mexico
had no tariff of her own it would puzzle
our Protectionist traders to secure her
custom in competition with English,
French and Belgian manufacturers all of
whom are prepared to offer her goods forty
to fifty per cent cheaper than our merch-
ants can sell them. What can be ex-
pected in such a situation Assuredly the
same reasons which have hitherto shut US
out of the foreign markets elsewhere must
operate here. We can no more hope to
control the markets of Mexico than we can
those of Brazil or Ecuador. We have cut
ourselves off from that line of business by
ought not, if we were consistent. to expect
or try for any foreign commerce whatever.
But this is not the only barrier erected
against US in Mexico. That Republic re-
joices in tariff system of its own. Nat
urally enough it has patterned after its
powerful neighbor, and, also naturally
enough, it has improved somewhat upon its
model. It has not only National tariff
system, but series of State tariff systems.
At the frontier everything imported has to
pay heavily. That is the national tariff.
When the first State line is PASSED new
line of duties has to be paid, and this is re-
peated every time another State is entered.
Among other things it follows from this
that the further one gets from the frontier
the more it costs to buy foreign articles of
all kinds, and of course the less chance
there is of getting them. 1t is said that
by the time an article reaches the City of
Mexico it costs three times as much as it |
sold for in Vera Cruz, for example. This
is the state of affairs with which our capt.
talists who invest in Mexican railroads
have to deal, and it appears to us that they
must be very sanguine if they expect to
make their fortunes out of these invest |
ments. The plain truth is that commerce
is crushed between the upper and neither
millstones of the American and Mexican
tariffs. All expectation from Mexico to
the United States is prevented by the
American tariff; and all Importation into
Mexico is prevented by the Mexican
tariff. How is Mexico to be developed in
the teeth of these distractions? Do
American capitalists imagine that they
have influence enough to bring about the
repeal or modification of the Mexican
tariff? But how can Americans recon.
mend the abrogation OF a fiscal system
which is modelled upon their own What
arguments can they supply to persuade the
Mexicans that system which is alleged
to be good for one country is bad for the
other: Truly it is an embarrassing prob
lem, and unless our capitalist friends are
able to pave the way by securing soma
change in our tariff, we fear they will have
very little success in their negotiations.
And yet it is certain that If nothing is
done to remove these barriers, every dollar
spent in the Mexican railways must be
lost. There is no escape from that con.
clusion. The Mexican tariff fatally handi-
caps native industry, and completely
excludes foreign commerce. It prevents
the development of the remoter regions
as effeetually as anarchy. So long as it is
in existence it is hopeless to look for any
prosperity in the sister republic. Almost
as much may be said of the American
tariff. 1t shuts Mexican produce out of
American markets. It prevents American
merchants from competing for the custom
of Mexico. 1t forces us back upon our.
selves, and restrieA US in every way. And
yet Americans are at this very time pIung-
ing enthusiastically into great Mexican
railroad projects, and talking as wildly
about the profits of them as though they
were TO be constructed in one of the West
ern States. Is all this capital to be thrown
away! Are all these energetic men to be
disappointed? Are all the calculations of |
future benefit to both countries to be I
abandoned The answer to these cues.
tions must be that unless Congress uodi-
fes the tariff, and unless Mexico revises
its own fiscal system, and unless it is
thus made possible to have free inter.
change of goods between the two countries,