New-York tribune., 1919-03-18
Wcnl Our Friendship

and eXperencc.'
WGni Our Friendship
In word what Mexico desires most of
all at this time is the friendship of our
country, because Mexico believes that
cooperation in business matters will follow.
During a civil war finance moves in a
mysterious way, its wonders to perform.
Ask any of the older generation in the
South where the notes and bonds OF the
Confederate States of America are still
treasured because of a sentimental value
which cannot be destroyed. Study the his
tory of the Greenback party or the rise
and fall of the 16 to 1 epidemic and it will
appear that, even in period of reconstruc-
tion, financial problems are not clear to
all alike
The evolution will frankly welcome for
eign capital; the revolution aware that
foreign support could not be obtained at
any price. The revolution maintained itself
by revolutionary methods. The evolution
will be developed by constructive methods.
The first step has been taken in the estab-
lishment of metal currency which is abun-
dant, at least in this city, where exchange
is maintained at the rate of one peso and
ninety centavos to the American dollar.
The MEXICAN problem is triangular. 1t
Involves:
1. Either a foreign loan or increased rev.
enues to meet the cost of necessary recon
struction work and for the expansion of
agricultural interests.
2. Settlement of the controversy over
petroleum.
Arh, or = a.,
bondholders of the railways, which have
been nationalized.
To the Mexican who faces conditions
here, whose present living and future state
depend upon the security of internal
credits, his side of the triangle is all
important. To the foreigner, whether
American French or British, either petro-
leum railways looms much larger To
unprejudced observer whose interests
are aloof from Mexico and from foreign
capital invested here as we'll, the problem
is complex, and equally important in all
phases, but by no means impossible of
solution.
The matter of foreign loan need not
be discussed until something tangible
develops from the visit of the American
Anglo French bankers. The petroleum con-
troversy hangs fire for the present in the
Mexican courts. The railway interests are
no worse Off for the moment than in our
own country. Let try to understand
something of Mexico's budget therefore as
a foundation for comprehension of the
whole problem
Experts Called In
Mexico has been trying to work out
financial system adapted to present day
conditions. To this end President Car
rama appointed a Comson de Reorpan-
izacion Administrative y Financiera. which
at once availed itself of the services of
foreign economists A preliminary sur
vey OF the Mexican revenue problem. with
suggestions for the reconstruction of the
system, was published in July last by DR..
Henry Alfred +. Chandler, professor of
economics in Columbia University with
foreword by Professor Edwin r. A SeNg-
man, of the same institution Professor
Seligman pointed out that "a fundamental
defect of the old system was the multi
plicity Of taxes" And he asserted that
"just the French Revolution swept awav
at one blow the heterogeneous mass OF
complicated medieval taxes in order to re-
place them by small number of we'll Sc
lected imposts, so the first task Of the
fiscal reformer in Mexico must be to in
troduce simplicity in the tax system A
few carefully chosen sources of revenue
will be preferable to tumble OF partial
and Ineffective mposts"
This statement, much amplifed by Pro-
fessor Chandler, has been deeply pondered
by Mexican statesmen
To prevent waste Of public funds and
provide "a modern system of accounting.
Henry Bruere, of New York, was invited to
bring to Mexico staff of accountants in
order to install audit Office, and, notE
withstanding some opposition on the part
y