Vexful Waiting

"Just now Mexico is seeking. . . to change the nature of property ... in Mexico. . . .

"Mexico, of course, has a right to any kind of property system she wants."

The speaker, forthright, vehement, was not the President of Mexico, Plutarcho Elias Calles. He was instead the Chairman of the U. S. Senate Foreign Relations Committee, Senator William Edgar Borah. He was commenting on the release to the press last week of an exchange of notes between the U. S. and Mexico. He concluded: "There is a difference of view between the two Governments as to the effect of Mexico's Constitution and laws upon property of Americans. . . . Undoubtedly emphatic language has been used. . . . But I do not find in the notes any threat, any ultimatum. ... I do not think there is going to be any break with Mexico.

Alarums. U. S. administration news organs thought differently. They thought that the Secretary of State had threatened to do something (perhaps withdraw recognition from the Calles Government, perhaps lift the embargo which prevents arms being shipped into Mexico over the U. S. border) if the Calles Administration does not come to heel in the matter of its land and oil laws (TIME, Jan. 25) which the Coolidge Administration deems retroactive and confiscatory. As a matter of fact Secretary Kellogg had spoken as if the Administration might do something, but everyone knew that Congress was in no mood to fight or intervene in Mexico at present.

The Notes. Secretary Frank B. Kellogg and Foreign Minister Aaron Saenz have now corresponded for a year about the Mexican oil and land laws which were promulgated last December and January, respectively, and become operative next January.

During the languid summer months there was a lull in their interchange, which was taken by the press to mean that Mexico City had persuaded Washington that the laws were not so very retroactive and confiscatory.

With the coming of autumn, however, Secretary Kellogg was moved to inform explicitly Foreign Minister Saenz that: 1) The U. S. considers that she recognized President Obregon in 1923, on the explicit understanding that U. S. property rights acquired prior to the adoption of the Mexican Constitution of 1917 should not be jeopardized by legislation enacted thereunder; 2) The U. S. expects (demands) that these rights be respected by the Mexican Government.

Foreign Minister Saenz has now replied that: 1) The recognition of Mexico by the U. S. is not regarded by Mexico as having been effected in exchange for the understanding mentioned by Secretary Kellogg, which Mexico does not consider binding as a treaty because it was a mere exchange of notes not ratified by the parliament of either nation. 2) Mexico expects (demands) that the U. S. will wait until the Mexican laws in question are in effect and have done some alleged damage to U. S. property rights which can then be thrashed out case by case in the Mexican courts and between the two nations.

The final U. S. and Mexican notes both intimated politely that the governments concerned have said all there is to say on the subject. Secretary Kellogg's last note, in fact, read like the first half of an "ultimatum" but was not completed by the specific threats popularly associated with such a document. A period of vexful waiting loomed.

Desperate Alternative. In Mexico, U. S. land and oil owners were in a desperate quandary. The new laws require them to "apply for confirmation" of their oil titles before Jan. 1, 1927, and accept "concessions" to operate their properties for not more than 50 years from the time they first began to do so. This form of "title con firmation" perfectly illustrates what was meant by the Chairman of the U. S. Senate's Foreign Relations Committee when he said: "Mexico is seeking... to change the nature of property. . .in Mexico. . . ." If the oil titles are not thus "confirmed" or "changed" into 50-year leases, the properties in question may be seized by the Mexican State. What will the U. S. property holder in Mexico do?

Will he refuse to have his titles confirmed, suffer seizure and trust the U. S. Government to secure for him redress; or will he accept a 50-year lease in exchange for a title in perpetuity, on the assump tion that the U. S. Government never will secure for him what it considers his rights ?

Last week the smaller U. S. companies and the British and Dutch oil interests in Mexico hurried to exchange their titles for leases. The largest U. S. oil group, The Huasteca Oil Co. (once Doheny, now Standard Oil) made no applications for "confirmation" of its titles last week. Rumors flew that desperate U. S. oil owners in Mexico are even considering the shocking possibility of defending their property by armed civilians.