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.
THE CATHEDRAL OF MEXICO AND ZOCALO,
SHOWING THE MODERN TRANSIT SYSTEM IN THE CITY OF MEXICO. THE CATHEDRAL, BUILT ON
THE SITE OF THE AZTEC TEOCALLI, WAS BEGUN IN 1573 BUT NOT COMPLETED UNTIL ALMOST
A CENTURY LATER AND THE COST WAS ABOUT THREE MILLION DOLLARS.
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
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
A GLIMPSE OF AMERICAN ENTERPRISE IN MEXICO.
THIS HANDSOME STORE IN MEXICO CITY IS DEVOTED TO THE SALE OF AMERICAN AGRICULTRAL IMPLEMENTS, AND IS AN
EXAMPLE OF THE LOSSES SUSTAINED BY AMERICANS WHO HAVE BEEN COMPELLED TO GIVE UP THEIR
INVESTMENTS, BUSINESS INTERESTS, AND HOME AND FLEE FOR THEIR LIVES.
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
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
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
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.