Mexico and its reconstruction/Chapter 13

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CHAPTER XIII

TRANSPORTATION

Among the elements in the life of Mexico, each of which in succession seems to the student to be the key that will open the door for the estabhshment of a well rounded and stable civilization, are transportation facilities.^[1]

In the colonial period transportation was improved by the introduction of riding, burden, and draft animals and through the building of a few rough roads between the principal cities. But even at the end of 300 years of Spanish rule the number of pack trails was small and the important through wagon roads fewer still. What passed for roads did exist from Mexico to Santa Fé and from there to Vera Cruz. Between Mexico and Acapulco and from Mexico to Vera Cruz there were still only pack trails. The smaller towns were communities practically shut off from the rest of the country and a large part of the burden bearing continued to be done by Indian carriers.^[2] In the rainy season communication became almost impossible. A traveler, in 1828, complains of the roads: "All that can be said about them is, that they are as bad as they possibly can be—passable only for mules, and that, often, at the risk of one's life.^[3]

The very high cost of transportation, which resulted from poor facilities, made it impossible for Mexico to develop trade outside the immediate zone of production in any but highly valuable articles, nor could foreign trade fare better. Long before the actual building of railroads it was evident to the more farseeing among the population that the stagnation from which the country suffered was due, to a large degree, to poor transportation facilities.

The first railroad built emphasized this need of the country at large, although the rates charged were so high that it continued to cost more to take a ton of goods from Vera Cruz to Mexico than from London to Vera Cruz. As soon as the railway reached out toward the capital, it began to disturb the old economic conditions far beyond its immediate neighborhood, illustrating the benefits that were to come from rail facilities and the great disadvantages that would fall upon cities left off the new routes. Tampico, for example, had been an important source of supply in the old days for a number of the states of the central plateau but, after the railroad from Vera Cruz to Mexico was established, the trade of the table lands began to be drained off southward instead of to the Gulf port to the east.

As to railroad policy, public opinion began to divide into two camps. In one were those who saw that the new day for Mexico meant investment of large amounts of foreign capital and the extension of the American railway net southward to include the Mexican system. In the other were the conservatives, who shrank from contact with the aggressive world around them for fear there might come with the new associations influences that would threaten the independence of the disorganized fatherland.

During the period before the Diaz régime the conflict between those who wanted the building of railroads and those who did not was largely theoretical, for railroad enterprise, with the exception of the line to Vera Cruz, was practically unknown. The poverty and disorder, which had so long characterized the country, made capital still reluctant to invest.^[4] The reëstablishment of what appeared to be a lasting peace gradually dispelled this fear and capitalists in the United States began to look more favorably on Mexican railway projects, but they showed a disposition not to invest their money "unless the protection of the Government of the United States, by some treaty stipulation or other convention, goes with it." At the same time the less sanguine Mexicans stiffened their opposition to railway enterprise and especially American railway enterprise. Many illustrations of these prejudices might be cited. A contract was arranged by the Mexican executive with the International Railroad Company of Texas in 1873, which provided that all the capital, shareholders, employees, and all persons connected with the company should be considered Mexicans in all that related to the enterprise within the republic and could not maintain claims as foreigners "even when alleging denial of justice." The charters of the pre-Diaz period had similar clauses. But though companies could be formed on such a basis, getting the money to put through the project under such conditions was found impossible. Capital was wary. As the American Minister reported, American contractors would not forswear their nationality for the sake of building a railroad in foreign lands, nor renounce the right to appeal for protection to their own government, a right recognized by international law.^[5]

Whenever railroads were under discussion in the Mexican Congress, the more timid showed themselves convinced that the border was in great danger of advancing southward with the rail heads. There was a firmly rooted suspicion that the United States had an ulterior interest in every move taken by its people involving Mexico. It was a part of the general fear of the foreigner, of the belief that the only safety for the weak lay in playing off the strong against each other. Railway building in itself, it was recognized, was desirable but railways to the northern border would destroy the natural defenses of the republic. Although the bills introduced into Congress included provisions to the effect that the property of the railroads could never be made the subject of international claims, the fear of closer neighborhood with the United States was so great that the projects met repeated defeat.^[6]

Contrary to popular opinion in the United States even Diaz did not see, from the beginning, the importance of railway development for his country. At least he was not above playing upon the popular prejudice against the foreigner to the disadvantage of his political enemies. In his "plan" dated at Palo Blanco, March 21, 1876, he charges the Lerdo government with having delivered the country over to an English company by the grant of a concession to the Vera Cruz railroad. He declared that it had been agreed to transfer the English debt to the United States "which is equivalent to selling the country to the neighboring nation." Such projects "rob us of our future and sell us to foreigners."^[7] In fact, during his first years of control in Mexican affairs, Diaz was as captious with the rights of foreigners as have been some of his successors. In the first issue of the Government Gazette, published after he secured control of the capital, he declared null railway contracts made by his predecessor. He later forfeited railway charters, changed schedules of railway tariffs in violation of contract, and confiscated construction work already done. The following quotation from a speech in the National Chamber of Deputies, on May 22, 1878, illustrates the sort of anti-foreign opinions that supported such acts. The executive had made a contract for a road from Mexico to the Pacific and to the frontier of the United States in Texas or New Mexico. A speaker opposing the project declared:^[8]

It is very poor policy. . . to establish within our country a powerful American company. . . we are going to establish within our territory an American influence. . . . Border nations are natural enemies. . . without referring to history, but considering only contemporaneous acts, who despoiled France . . .? The bordering nation, Germany. Who is invading Turkey at the present time? The bordering nation, Russia. . . . What war is there between Spain and Russia? None. It is a natural law of history that border countries are enemies. . .

Hence, sir, the United States. . . are naturally our enemy. . . . And will it be prudent in this case to place the enemy within our house?

There is also another law in history; nations of the North necessarily invade the nations of the South. . . .

Unfortunately, we do not need to recur to foreign histories; a rich part of our territory has become the prey of the United States. . . . Hence, we should always fear the United States.

We have seen that a hundred leagues of railroad from here to Vera Cruz have given such influence to the English company that many times this very influence has been sufficient to decide the votes of the chamber, and shall we be so insane as to consent to the establishment of an American company which will embrace the whole country. . . all our sections and all our roads?

Would you exchange your beautiful and poor liberty of the present for the rich subjection which the railroad could give you? Go and propose to the lion of the desert to exchange his cave of rocks for a golden cage, and the lion of the desert will reply to you with a roar of liberty.

The fears as to the consequences of railway development were especially strong in reference to the northwestern territory of the republic, but the circumstances there could be turned in favor of a liberal policy quite as effectively as they could be used in opposition. A representative from that region argued that only by the development of the border states could they be saved to Mexico. Their growth would create an equilibrium with the United States, otherwise "we exist in such a manner as causes us to represent in the eyes of the other nations the role of a sickly, decrepit man, by the side of a hale, robust one. . . ." If development is not brought about in these states, "exasperation will drive them nearer our neighbors than anything alleged by those who fear that the influence. . . of the American union may produce another mutilation of our territory. . . . It is very dangerous to see just beyond a conventional line prosperity and wealth, and on this side destitution and poverty. . . ."^[9]

With the cooling off of at least officially expressed anti-foreign feeling and the establishment of order the foreigners who were interested in railway development gradually weakened in their feeling that the right of appeal to the home government must be recognized before they could undertake projects in Mexico. At the same time the Mexican Congress came to realize that the advantage of rail connections with the United States overbalanced the attendant dangers.

When Diaz assumed control of the government in 1876 there were 666 kilometers of railroad in the country—the line from Mexico to Vera Cruz—and proposed American connections, as is indicated above, were unpopular. This prejudice was largely removed in the first term of the dictator and in September, 1880, the Mexican Central Railroad and the Mexican National Railroad received permission to build from Mexico City lines to the Rio Grande border. Thereafter the building of Mexican railroads was carried on practically without interruption to the end of the Diaz régime. At its close in 1910 the 666 kilometers of railway running at its beginning had increased to 24,559 kilometers. There were then two lines instead of one connecting the capital with Vera Cruz. There were two transcontinental lines and two connecting the capital with the American border.

It is hard to overestimate the benefits conferred on Mexico by the broader policy of railway development that had its beginning in the early '80s. Along each stretch of line there grew up a productive area contributing to national wealth and to the strength and stability of the government, which had been far sighted enough to abandon the conservatism and prejudice of the former generation. Agriculture flourished as never before. Mining interests could market products that formerly had been valueless and for industries conditions were created that made possible local production in many lines, in more than household industries for the first time in history. ^[10]

The advantages, which the early years indicated, were continued and increased throughout the Diaz régime. Heavy freight could now be carried long distances, ore, lumber, sisal, all the articles of large bulk that enter into Mexican domestic and foreign commerce came to have value where they had none before. The railroads were one of the important links in the chain of circumstances that made the Mexico of the Diaz régime a possibility and seemed to guarantee that the republic had entered at last on a period of peaceful development that would not be easily interrupted. In international relations, too, the railroads had had a beneficent influence. The improved communications had turned a large part of Mexican commerce in a north and south direction. The United States had come closer to the republic, not only in time but in economic interest and in understanding. The ill will of the pre-railway period had largely disappeared, due in no small degree to the iron bonds that drew the two republics together. Especially in the closing years of the Diaz régime friendship had replaced distrust. The new day, which had come with the railroads and had been hastened by their construction, seemed to promise continued peace and prosperity for the republic both in its internal and in its foreign relations.

Although the railroads built before the end of the Diaz régime did bring a revolution in the conditions of traffic, they never solved the transportation problem. Large areas were still far from the rail lines and the old disadvantages of isolation still applied to them—often almost to as great an extent as before the railway era. There was always need of still further railway extension to open up the resources of the country.

Moreover, the disadvantages of the railless regions were accentuated greatly by the lack of good wagon roads.

Spain did not create, in her colonies, either well kept trunk lines nor supplemental highways of good character. In fact, even to the present day the home country lacks them. The former colonies have not created them for themselves since their winning of independence. One of the most important problems that will confront the Mexican government of the reconstruction era will be to extend the transportation facilities of the country in a way that will effectively unlock the resources now held embargoed by their lack.

Unfortunately the developments during the revolutionary years have not been such that will let the governments of the new Mexico begin where the Diaz régime left off in the construction of means of communication. Transportation routes, one of the first objects of care among modern nations in times of peace, are often among the first to be neglected in time of war. Roads do not become impassable with temporary neglect and railroads can run for a time with a small expenditure on repairs. In the area of military operations they are carefully protected or ruthlessly destroyed according to what the contestants think will contribute to their advantage. The temptation for both parties in a civil war is to let them deteriorate where they do not directly contribute to the fortunes of war.

The history of the 16,000 miles of railroads during the decade of revolution in Mexico has been tragic for their owners and fantastic for those whom they served. The instrument that did so much to bring peace and order was made a means by which first one side and then the other was able to carry on operations against its opponents more successfully than otherwise would have been possible. Only illustrations of the sorts of conditions that arose can here be given.

The physical ruin of the roads is all but complete. A series of governments, each fighting with back to the wall, has had no resources with which to keep up repairs. The income of the roads themselves has suffered diminution because of falling traffic and the violent fluctuations of the value of the paper money in which services were paid. The extent of the demoralization of the service is illustrated by the report of the National Railways of Mexico for 1916.^[11] The president reported no receipts from operation and a debit of 21,870,213.02 silver pesos for the year. The debit since the beginning of the revolution was almost 80,000,000 silver pesos. The nominal reported receipts were extraordinarily high in some periods but they did not appear to reach the treasury and, even if they had done so, their real value was but a fraction of their face, since they were in the Vera Cruz issue, which was worth 14 or 15 cents gold in January, 1915, but later fell rapidly to two cents and and then so low that it refused to circulate.

The rolling stock gradually disappeared from active use. The military chiefs confiscated it to military uses in transporting troops or as spoils of war, if it was captured while in possession of the enemy. The various so-called generals used the cars "as barracks and permanent dwellings for the soldiers and their families, and frequently for freight transportation within their jurisdiction for personal profit."

The railway employees, or at least those in authority over divisions that were still in operation, seized the opportunity to create a system of graft seldom, if ever, equaled. It is true they are hardly to be blamed, for they could not live on the salaries the government paid to them in its own depreciated currency. Government officials in the railway administration shared the illegitimate returns directly or indirectly. The few cars available were eagerly sought by those whom rashness or necessity forced to keep shipping goods under the prevailing uncertain conditions. No cars were forthcoming without liberal gratifications. In short, the revolution brought to the railways, in the regions it affected, first neglect and then anarchy.

Unfortunately for Mexico it must face, during the reconstruction period, the necessity of repairing the system of communication, which was thus destroyed. It is a disadvantage not measured by the damages that must be paid to those whose property disappeared or depreciated in value because of the use to which it was put during the conflict. Perhaps even more serious will be the losses that the people of Mexico as a whole must suffer through the inefficient service, which is all that can be furnished during the period when the roads will operate with poor and insufficient equipment. To destroy the railroad system of a country is not only to destroy the property it directly represents but also to reduce the value of the property of the country that the railroad serves. ^[12]

The recent governments in Mexico have recognized that the reestablishment of communications is one of the first essentials for the economic revival of the country. The roadbed of the railroads suffered less during the revolution than the rolling stock. Bridges burned or blown up in the area of military operations first received the attention of the government but many have even now been given only temporary repair. Mexican railroads lost about 10,000 freight cars and 400 locomotives during the revolution. Large numbers of freight cars were burned or wrecked and, in order to encourage getting those that could be repaired back into use at an early date, a plan was adopted through which any concern might reconstruct cars at its own expense, receiving in return the right to control them for its own use for a period usually of one to two years.^[13] American railroad lines allowed their freight cars to go into Mexico when bonds were given for their safe return. On October 15, 1920, the Pullman Company began letting its cars enter the country without this restriction.^[14] An arrangement made with the American Railway Association on January 1, 1920, allowed a large number of freight cars to be taken across the border and the Mexican government announced its desire to set aside $30,000,000 Mexican to purchase additional rolling stock.^[15] On June 1, 1921, President Obregón appointed a personal representative to introduce improvements in the handling of traffic.^[16] Though congestion of freight at the ports still continued to be a serious problem, at least the first steps had been undertaken toward reëstablishment of that standard of communications reached at the end of the Diaz régime.

1. Only the internal transportation routes are here discussed. Ocean communication has shown itself more easy to adjust to the demands of traffic. The steamship services at the present time, too, are obviously less involved in the reconstruction in Mexico than are the roads and railroads. They are more easily reëstablished, their facilities have suffered less in the revolution and will rapidly respond to any development in the foreign trade. A description of the development of ocean communication with Mexico up to 1879 is found in Exposicion de la secretaría de hacienda de los estados unidos mexicanos de 15 de enero 1879. . . Mexico, 1879.
2. Karl Sapper, Wirtschaftsgeographie von Mexico, 1908, p. 31 et seq and Joseph Nimmo Jr., Commerce between the United States and Mexico. . . Washington, 1884, p. 20 et seq.
3. Mexican Company; extracts from the report of Justus Ludwig von Uslar, relative to the Negociacion of Yavesia in the State of Oaxaca, January 6, 1828.
4. Papers Relating to the Foreign Relations of the United States, 1878, p. 549.
5. Ibid., p. 639. A contract of November 12, 1877, similar to the one cited above, was presented to the Congress in which, in addition to forswearing their rights as Americans, the builders were required to build the branch to the American border northward from a point in Mexico instead of southward from the Rio Grande. The project was defeated because it was too favorable to the foreigner. The conditions as to nationality above cited, in their revival in recent legislation, have caused widespread protest. They are, in fact, no new thing. They were already a familiar feature of railway contracts early in the Diaz régime. Ibid., 1879, pp. 776-80.
6. The Sonora railroad project defeated. Ibid., 1880-1, p. 719.
7. An extract from this proclamation, which is a good example of revolutionary rhetoric, is found in ibid., 1879, p. 780.
8. Hon. Alfred Chavero, in ibid., 1878, p. 551. See also another remarkable document in ibid., 1879, P-828 et seq.
9. Antonio Morano, Senator from Sonora in ibid., p. 831.
10. An excellent description of the effect of the railways upon Mexican development is found in Bernard Moses, Railway Revolution in Mexico, 1905. See also Luis Pombo, México: 1876-1892, Mexico, 1893, p. 52 et seq.
11. Eighth Annual Report of the National Railways of Mexico, June 30, 1916, pp. 16-19, signed by Alberto J. Pani, who was president of the Railway and Minister of Railways at the same time.
12. Descriptions of the conditions on the railways brought about by the revolution, and of the plans of the Carranza government for improving the railway net are found in Railway Age, vol. 66, pp. 1531-4 and 1549.
13. W. H. Moseley Jr., "Mexico To-day" (pamphlet), New York, November, 1920.
14. Railway Age, January 7, 1921, p. 113.
15. Commerce Reports, February 18, 1921, p. 993.
16. Commerce Reports, June 21, 1921, p. 1650.