Evening star., 1938-08-06

Mexican view
point is discouraging to future in
vestors. Indeed, it may start a wave
of liquidation which will tend to ruin
Mexico's economic opportunity. And
when economic chaos comes, DIS
affected elements usually find fertile
soil for revolt.
What the Mexican government has
overlooked Is that the theory of con-
flscation without proper payment
simply restores jungle law-the might
makes-right concept which diplomacy
throughout the last few generations
has been struggling to erase. Such
progress had been made that in re-
cent years the principle OF forbldding
the use of force to collect international
debts has been pretty we'll accepted
throughout Latin America.
Oil Becomes Tainted.
But when confscation takes arbi-
trary form and sovereignty is pushed
to arbitrary extremes, international
law being brushed aside and domestic
Judgment being given precedence, then
strange complications are bound to
ensue. Thus the oil wells may re-
main in possession of the Mexican
government but this does not mean
that the rest of the world will stand
by and purchase the confiscated oil.
To foreign governments the oil be-
comes stolen property and, as such,
the courts of various countries where
the oil is landed are bound to be asked
to impound the shipments till the
cases are adjudicated. 1t seems un-
likely that even the dictator countries
in Europe, which might. be disposed
to accept Mexican oil, will care to
risk friction on such an issue with the
British government.
It Is regrettable but nevertheless
true that the aggressivenes of British
policy alone is responsible for what
little attention the Mexicans have
given to the protests thus far made.
The American Government is in an
embarrassing position as the Mexican
note half satirically points out. The
Mexican foreign secretary naively re-
marks that the American Government,
meaning the New Deal, wouldn't allow
q
interrupt its reforms" Unfortunately,
that Is true. Conflscation of gold was
justified as an emergency and equal
payment in the old gold value was not
made to foreign governments or to
American citizens. Likewise, the New
Deal has instituted other reforms
which border on conflscation and
naturally the Mexicans look closely
at the acts Of the Roosevelt admins
tration and expect sympathetic treat
ment. An administration which con-
f1scates utility properties and makes no
arrangement to compensate the losers
who have invested their dollars is not
likely to be taken seriously below the
Rio Grande when it asks for payment
for oil wells copfscated.
Hull IS Key in Problem
The future of the controversy lies
IN the forcefulness which may be ex-
hibited by Secretary Hull in dealing
with the latest Mexican note Mr.. Hull
Is regarded throughout the world as
statesman of first rank and in Latin
America his prestige Is of unprece-
dented Importance. But there are
conservatives in Latin American co,ln-
tries who see radicalism and socialism
on the horizon. If forceful word
is not spoken now against conf1sca-
ton, whether in the domestic or in
ternational sense, the way is opened
to dislocation of the whole economic
system in Latin American countries.
Secretary Hull has for all practical
purposes conceded the legal right of
appropriation or confiscation, but he
has insisted that fairness and custom
require adequate payment. Mexico
insists that payment can be made or
not as sovereign nation pleases.
Again Mexico is right in theory, but
such a policy leads to the might
makes-right idea. For when q
sovereign country of Mexico's stature
starts confiscating property of larger
nations, the day is not far distant
when the policemen of the seas
the navies-will be quietly stationed
off the seaports and prevent products
from being exported which were il
legally taken from their owners. In
these days Of undeclared war there
are undeclared blockades and Mexico
Is making big mistake in stirring up
international friction at time when
she needs international cooperation
to help her conquer her economic
woes.
(Copyright. 193s)