Railroad and Commercial Progress:
Foreign Capitalists and Adventurers
In modern times the development of a country depends very largely on its facilities for travel, transportation of goods from place to place within its limits, and ocean carriage to and from its borders. For the first the railroad has become indispensable; for the second the steamship. It is necessary here to state what progress Mexico has made in this direction, and what degree of commerce, internal and external, has in consequence arisen. The railroad in Mexico is a recent institution. Half a century ago it was not known in that old land except for preliminary work in building a pioneer road. In the earlier era the burro and mule were the great burden-carriers, and the backs of stalwart Indians aided in the task. The load some of these human beasts of burden could bear from place to place was and is at times startling in appearance. For travel the horse was in general use and in a measure the stage coach served. It still serves to some extent, the coaches being great, lumbering, mule-drawn vehicles, of which the weight doubles the load borne. Hung on leather straps instead of being poised on steel springs, the jolting was such that the unhappy victims within needed to be strapped to their seats.
The first railroad built in Mexico was in respect to its boldness of conception the most interesting one. Begun in 1858, it was not finished until 1875, fifteen years later. There was good reason for this slow work. During the interval Mexico was disturbed by the French invasion, the empire of Maximilian, and the successful revolt against the latter. Aside from this the enterprise itself was a daring and ambitious one and its successful completion a marvel of engineering. The road runs from Vera Cruz to the Mexican capital, and ascends from the coast level up the steep slopes of the Sierra Madre to the elevation of the plateau and the Valley of Mexico, its highest station being more than a mile and a half above the level of its starting point.
Such an enterprise as this was one far beyond the power and skill of any Mexican engineer and the work was done by a firm of English builders. The road is still under British control. Some remarkable feats of similar character have been performed in the Andes of South America, but this work compares well with them in point of engineering enterprise. From its terminus at Vera Cruz the road crosses the coastal plain and climbs the hill side through a tropical forest, reaching the level of 2,713 feet at Cordova, 4,028 at Orizaba, and 5,151 at Maltrata. The latter station, alike from an engineering and scenic point of view, has much of the remarkable. Here the road sweeps boldly around dizzy barrancas, brosses profound canyons on lofty iron bridges, or curves along a bed excavated in the solid mountain side, while the passenger may look down on the picturesque town spread out below, or enjoy the view of the tropical scenery a mile farther down.
Passing steadily upwards, it reaches Esperanza, 8,000 feet high, and gains its highest level in the mountain heights at Acocotla, near San Marcos, at an elevation of 8,310 feet. This height is much surpassed by the trans-Andine lines in Peru and between Argentina and Chili, but the difficulties overcome here were of the same nature. From Acocotla, high up in the Sierra Madre, the road winds and creeps down the opposite mountain cliffs, and finally reaches the capital, at 900 feet lower level. The length of the line is 264 miles, or if its branches to Puebla and Pachuca be added, 321 miles. The cost of construction was nearly $40,000,000, or about $125,000 a mile. It is solidly and substantially constructed, and is highly regarded as a marvel of engineering, while for scenic effects it holds a high rank, magnificent views being obtainable from both sides of the mountain slope.
The passenger cars do not compare well with those on the roads of the United States, many of them being old and shabby, though some improved cars have recently been introduced for first-class travel. The company cannot afford to add Pullman cars to their day trains, there not being enough foreign passengers to warrant their use. As for the native travelers, they are very apt to prefer low fare to comfort. Only night trains use Pullman cars. All trains are divided into first, second and third class ears, the first class corresponding to what are called "day coaches" in the United States.
Next to this line in importance, and much greater in length, is the Mexican Central, opened for traffic from Mexico City to El Paso on the United States border in 1884. It traverses the length of the great plateau, following a rising gradient southward, which increases as the hill-bound Valley of Mexico is neared. The highest point reached is at La Cima ("the summit"), 9,895 feet above sea level, from which a descent to the city level of 7,400 feet is made. On reaching the valley rim the passengers are treated to one of the most entrancing views that could well be conceived. Before their eyes lies the broad, umbrageous valley, with the city, reduced to pygmy size, visible in the distance, the two towers of the cathedral being its dominating points. This road was built by Americans, in the cheaper and more rapid American fashion, and lacks the enduring character of the British-built line.
The main line of the Mexican Central extends 1,225 miles along the center of the country, traversing seemingly endless miles of dry and treeless plains, with many squalid hamlets along its route. With its numerous branches, one of which reaches the Gulf coast at Tampico, another to Guadalajara and beyond, and a third to Cuernavaca, it has a total length of 3,823 miles. The line to Tampico traverses the same kind of tropical scenery as the Vera Cruz route and yields magnificent views to the traveler. The Guadalajara branch, after passing that city, descends the western sierra, its projected terminus being Manzanillo, a Pacific coast port. Another branch has for its final projected terminus the seaport Acapulco, the best harbor, after San Francisco, on the Pacific coast of North America.
The branch to and beyond Cuernavaca, which is about seventy-five miles from the capital, lies through a wonderland of picturesque scenery, climbing the Sierra Madre to a height of 10,000 feet above sea level. Cuernavaca, a beautiful city, has a historic interest, it having been a home of Montezuma and a place of importance under the Aztec government until its capture by Cortes. It is one of the show places for travelers in Mexico. The Guadalajara branch traverses a very rich mining region, prolific in gold, silver, copper and lead. It runs within a few miles of the volcano of Colima, 12,000 feet high, which was built up by recent volcanic activity under what was previously a level plain.
There is another line of railway traversing the plateau region, known as the National Railroad, its route extending from Laredo, on the United States border, to Mexico City. This is a subsidized narrow-gauge road, built by American enterprise, and put in operation near the end of 1888. The narrow-gauge feature proved an error and it became necessary to widen it to standard-gauge, this being completed in November, 1903. The length of the line is 800 miles, it being the shortest route from the northern border to the capital. It has a number of branches, one being the Interoceanic Railway now open from the Western Sierras to Vera Cruz, via the city of Jalapa. It has also communication westwardly with the city of Durango, and eastwardly with Matamoros. The Interoceanic was originally designed to continue westward to the port of Acapulco, and though it has not reached the coast it descends into the fertile State of Morelos, where it makes a junction with the Mexican Central.
The lines of railway above spoken of, with the International, from the border to Durango, have been consolidated into one general system, since the government controls 85 per cent of the capital stock. The authorized capital is 615,000,000 pesos, or $317,500,000, and the profits of its management, after interest in bonds and dividends on preferred stock are paid, will go to the national treasury.
There are in addition a number of railway lines traversing the southern section of the country. One of these, a British enterprise, is a narrow-gauge road between the cities of Puebla and Oaxaca, 223 miles long, known as the Mexican Southern Railway. Vera Cruz is the starting point of two other roads besides those mentioned. One of these, the Vera Cruz and Pacific, extends from Cordoba, a station on the Mexican Railway to Vera Cruz, southward to Santa Lucretia, a station on the Tehuantepec Railway. This was financed in the United States but is now a government line. The other, the Vera Cruz Railway, is a narrow-gauge along the coast to Alvarado, 44 miles long. There are several lines also in Yucatan.
Much the most important of the southern lines is the Tehuantepec Railway, which crosses the republic at its narrowest point, the Isthmus of Tehuantepec, and forms a short transcontinental line from the Atlantic to the Pacific, in position to compete to an important degree with the Panama Canal. The distance in an air line is only 125 miles, the road being 192 miles long. Here the plateau and its mountain borders sink to a low level, the road crossing the backbone of the land at the Chivela Pass, only 730 feet above sea level.
This isthmus has attracted attention ever since its discovery by the Spaniards under Cortes. During the past century several projects for crossing it were devised, the schemes including a canal and a ship railway. Finally an ordinary railway was decided upon as the most feasible project and the existing road was built in 1894. But its construction was faulty, and its terminal ports, Coatzacoalcos on the Gulf side and Salina Cruz on the Pacific side, proved inadequate. In consequence the rebuilding of the road and the improvement of its terminal ports were intrusted in 1899 by the government to a British firm, the same one that constructed the harbor works at Vera Cruz and the drainage canal and tunnel of the Valley of Mexico. The work was completed in the solid and enduring method for which British railway builders are famous, and a fine harbor and large dry dock were constructed at Salina Cruz. As this line of railway is 1,200 miles north of the Panama Canal, thus saving a voyage of considerable length, it is expected to pick up a good share of the transoceanic traffic.
In the northern section of the republic several other railway enterprises have been undertaken under American auspices, one of these being the Rio Grande, Sierra Madre and Pacific Railroad, westward from El Paso, Texas, and designed eventually to reach the Pacific. Another enterprise of importance is that of the Kansas City, Mexico and Orient Railway, this also being intended to reach the Pacific. Of its 634 miles in Mexican territory more than half are completed. The Sonora Railway runs from Nogales on the border line to Guaymas on the Gulf of California, a distance of 265 miles.
There are a number of shorter lines, and Mexico is fairly well supplied with railroad facilities, extending through the length of her territory from north to south and across its breadth from ocean to ocean. The total length of lines is about 10,000 miles. Other lines are under consideration, and the republic has shown active enterprise in this direction, as also that of obtaining control of its railways as governmental enterprises. In this respect Mexico differs greatly from the United States. The management of the National and Central Railways was long almost entirely American, but the government is actively engaged in getting rid of foreigners and replacing them with Mexicans wherever available.
The active railway enterprise shown in Mexico has had a marked effect on the distribution of population. The great mass of the people has always dwelt in the plateau region, the torrid coast strips being avoided. As a result transportation of goods from the coast to the center of population was long a slow and costly process, being by mule trains and a small army of human carriers over the rough mountain trails. The coming of the railroad has made a decided change in this particular, and has aided greatly in the development of commerce.
Telegraph and telephone communication have accompanied the railroad progress, the facilities of electric light and power have come widely into use, and passenger travel in cities has been greatly improved by the introduction of the electric street car, in place of the old-time mule-drawn traffic. These until recently were confined to Mexico City, but are being extended elsewhere, American enterprise being actively engaged in this line of improvement. The cars in use are of American make and carry passengers inside only, the strap-hanging abomination being commonly in use. There are two styles of cars, first and second class, fares in the first class being from three to ten cents, according to distance. In the second class the fares are a few centavos lower.
Various steamship lines reach the Mexican ports, including a number of lines from both the Atlantic and Pacific coasts of the United States, with others connecting with the ports of Europe and South America. A considerable number of these have contracts with the government for carrying the mails. Ship building has made little progress in Mexico as a national industry, it having proven more convenient to encourage foreign enterprise in this direction. There are, however, some ship-building plants for the construction of steel, iron and wooden ships.
As regards commerce, it appears to be in a good state of development, as shown by the returns for exports and imports. The trade with the United States in 1913 reached a total of $54,383,424 in imports, and $71,543,842 in exports. The total of imports was nearly $100,000,000 and of exports nearly $150,000,000. The exports are nearly all of mineral and vegetable products and of cattle and sheep, those of manufactures being confined to sugar, tanned hides, palmetto hats and minor articles. The great bulk in value of the exports consists in the precious metals, while of vegetable products henequen fiber comprises a considerable percentage of the total value.
Mechanical industries are making some encouraging advance, but the products are chiefly consumed by the home demand. As Mexico is very rich in water-power, this is likely to be employed to a large extent in future industrial development, and there are several important hydraulic plants now in operation, especially those of the jute mills of Orizaba, which use some 5,000 horse-power. This is a British enterprise.
Of other industries, those of textile manufactures are the most important. The cotton mills are of great capacity, the factories being splendidly built and the output large. The mills in operation in 1907 employed 33,000 operatives and had 698,000 spindles, and this has since been increased. The great advantage to capitalists is the cheapness of Mexican labor, and unfortunately this has been exploited to a terrible extent, as stated in a former chapter. Other textile mills include those for jute and woolen manufacture.
The manufacture of tobacco is an active industry, the cigarette factories being among the largest and best equipped in the world. Chief among these is the Buen Tono factory, with a daily turnout of five million cigarettes. There is another nearly as large, and there are in all about five hundred tobacco factories in the country. The iron and steel works of Monterey, the chief in importance, were founded in 1900, and have a capital of $5,000,000. The company possesses large coal and iron deposits. The works include a rolling plant, dating from 1906, which produces structural iron, bar iron, steel rails and wire to a large annual total. There are three iron plants in the State of Hidalgo and one in Guanajuato, all owned by an English firm.
The San Rafael paper mills in the State of Mexico are the leading manufactories of this kind, yielding over 20,000 tons annually and producing paper of great variety. These are situated near the lofty mountain Ixtaccihuatl, in a well-wooded region, the extensive forests giving it an abundant field for pulp. In the cotton-growing district of La Laguna are works for the making of cottonseed oil and soap, and there is a dynamite factory in the same region.
The flour mills of the country number about four hundred in all. There is a large cement works at Hidalgo, and the meat-packing and cold-storage business is well developed in the livestock center of Michoacan. The brewing interest is also well represented, enough good beer being produced to satisfy most of the demand and largely to put an end to the import trade in this commodity. The other industries include distilleries, potteries, chemical works, chocolate factories, leather works and various others of minor importance. Of these industries the large ones are mainly under foreign control and. financed by foreign capital, home enterprise playing a minor part in the development of manufactures.
What has been said would go to indicate that foreign enterprise has taken a leading part in the development of Mexico, and this is undoubtedly the case, so much so, indeed, that the vital interest taken by foreign nations in the existing troubles in Mexico is a very comprehensible one. Humboldt has called Mexico "The Storehouse of the World," and apparently it is the world that has taken it in hand; especially the United States, which has gone far in advance of other nations in exploiting the vast natural wealth and splendid opportunities of this country.
The rebels of Mexico and their Federal adversaries can play at war with little harm to anything belonging to themselves. They can tear up railroads, burn bridges and factories, and injure their own people but slightly, the bulk of the loss falling on the confiding foreign capitalists, who are in considerable measure the owners of Mexico. On a railroad journey in this country the traveler will find himself riding in an American car, drawn by an American engine and handled by an American engineer. In the cities he rides in a trolley car of American build, under electric lights installed by Americans, the power being produced by oil from Mexican wells, but owned and pumped by American and English enterprise. If he wishes to deposit money he will do so in banks owned by foreigners, principally French and German. Even the mines, the greatest source of Mexican wealth, he will find to have been largely absorbed by foreigners. In fact the Mexicans themselves are chiefly interested in lands, houses and live stock, the great sources of wealth having passed largely out of their possession. The American capital invested in Mexico is estimated to figure somewhere near $1,000,000,000, and the suggestive statement has been made that the real capital of the republic is not Mexico City, but New York.
The Mexican "Year Book" says that the capital invested in the mining industry amounts to $647,000,000, of which $500,000,000 is American, $87,000,000 English and $29,000,000 Mexican. Every grade of mining operation is managed by Americans, from the work of the prospector on the flanks of the Sierra Madre to the great smelting plants of the Guggenheims.
Not only has foreign capital made its way in increasing quantities into Mexico, but foreigners themselves have sought that country in increasing numbers. They number probably from 60,000 to 70,000, of which from 15,000 to 20,000 are citizens of the United States. There are probably still more Spaniards, though the latter are not to be classed largely among the exploiters. There are about 4,000 French, 3,000 British and several thousand Germans, the remainder being Italian and other Europeans, Chinese and Japanese. The total population of Mexico, less than 15,000,000, averages only about twenty to the square mile; yet were it populated as fully as parts of Europe it would possess a population of 180,000,000. As may be seen, there is plentiful room for development.
The fact of there being so many Americans in the country in positions of business prominence renders some knowledge of English speech important to those who come in contact with them, and this language is fairly well understood by the better classes in the capital and the other large cities, though little is known of it in the country at large. It is taught somewhat generally in the private, and in many of the public, schools, and some of the merchants of the country are learning it for purposes of correspondence. On the other hand many of the Americans and Britons residing in Mexico are able to converse fluently in Spanish, though very few are competent to write in that language.
While the Americans are so largely represented in the mining and transportation interests of Mexico, the British have taken a considerable part in enterprises of this character and Canadian capital has also been invested in that country. The Spanish, the most numerous of foreigners in Mexico, are chiefly interested in the cities in the grocery trade, the Germans largely control the hardware trade and are engaged in banking, as are the French also, the latter taking active interest in the sale of fancy articles, drapery and clothing. As for the trade of Mexico, it is in great part controlled by Americans and Germans, who have largely superseded the British, once the principal traders. The German commercial travelers, who take care to learn the language and speak it fluently, are especially active in seeking trade for their home houses.
Baron Geiser, writing recently on the Germans in Mexico, tells us that they take no part in the great enterprises, such as railroads, bridges, and other engineering works, these being in the hands of the Americans, and in a measure the English, who control important lines of trade, manage two railroads, and are owners of the largest petroleum industry. The Germans, on the contrary, are foremost in many retail lines of business and are prominent in promoting the electrical interests. They are, as might be expected, the leaders in the brewery business, and handle much of the coffee trade.
When we consider the great extent to which foreigners have pushed themselves into the various lines of business, the Americans and British in the greater interests, the Germans, French and Spanish in the retail business in the cities, it is not easy to see where the Mexicans come in, or of what line of business they have control. Certainly the state and its cities have been largely exploited by foreigners, alike in person and with capital, and we can well understand the deep concern that is felt as to the safety of foreign residents in times of turmoil such as Mexico has been subjected to for several years past. The large moneyed interests there also call for intent care, and the presence of the army of the United States on the border line, and of its fleet on the Gulf coast, is no more than a wise precaution under the distracting circumstances.
The occupation of Vera Cruz in April, 1914, was a natural result of the vacillation of Provisional President Huerta regarding proper reparation for an insult to the United States flag. As the case then stood no prophet existed capable of foreseeing the. future, but President Wilson declared in positive words, when ordering the movement of the Atlantic fleet against Vera Cruz, that the government under his leadership had no thought or intention of permanent occupation of any country of America.
The position of Americans in Mexico has long been one of importance, and concerning this it will be of interest to quote from a competent and careful observer, Mr. Percy F. Martin, author of "Mexico in the Twentieth Century." The preface to his volume contains the following appreciative words:
"The ready welcome which Mexicans are extending to American capital, the unrestricted commingling of Mexicans and Americans upon the same Boards of Directors, joined in the same management and side by side in many social and charitable enterprises, form one of the most convincing signs of future prosperity. There is little of that anti-foreign jealousy and deep-seated suspicion which so often strangle success and poison it when achieved, which characterize inter-commercial association in the Argentine and Brazil.
"The clean-cut, trim-built, stern-faced young American is a familiar sight nowadays in all parts of the world. I have met him in Japan, in Australia, in South and Central America, in the British, German and Dutch colonies, and occupying positions of responsibility and trust in his own new over-seas possessions. Always one notices the same inflexible purpose, the noble earnestness, the indomitable will to succeed. It is as if he took Fortune by the throat, exclaiming: 'No, you shall not avoid me! I will have you hear me! You shall yield me of your treasures. You shall recognize my worth! Do you heed me?' And Fortune is caught by the mere audacity of the pursuit."
This unprejudiced eulogy of the young American business man abroad is not overdrawn. And its statement of the position held by the American capitalist and projector in the business world of Mexico is no doubt correctly stated. But such is not the case when the political world is considered, and as regards the great mass of the people, who stand between both these classes, there is certainly a considerable remnant of enmity remaining. The Americans in Mexico evidently felt this in their recent flight from the interior to the coast. They knew the insurgent class and feared to trust themselves to their tender mercy. It may have been somewhat of a panic, but it was one felt by those familiar with the situation and in touch with the sentiment which prevailed, and the warning of the administration to them breathed the same tone, indicating the danger felt of trusting their lives to the tender mercy of an armed body of Mexican peasantry.