CHAPTER VII

THE RAPE OF YUCATAN

From the golden wheat fields of Kansas to the barren sands of Yucatan, from the loaf of bread on your table to the loot of Mexican revolutions--these seem mighty leaps of imagination or of fiction. Yet the link is closer than imagination could ever forge, the analogy a stranger tale than the yarns of Captain Kidd.

The modern industry of wheat farming depends, by one of the romantic balances of world commerce, upon the supply of binder twine for the mechanical harvester, a supply which comes alone, to-day, from the cultivation of a humble cactus plant in far-off Yucatan. The great Mexican industry of raising this henequen or sisal hemp was prostituted by Mexican revolutionists to the manipulation of the binder twine market so that in four years more than a hundred million dollars in artificially inflated prices were dragged from American farmers. Thus it was that through the helpless years of the Great War, all who ate the bread of the wheat, from you and me in America to the starving children of Belgium, paid bitter tribute to the greed of Mexican agitators.

The story of Yucatan is no mere tale of the by-play of revolution, the “fortunes of war” or the “necessary accompaniments of a great social upheaval.” It is the history of the deliberate looting of a commonwealth and of an indispensable international industry. In the name of socialism, shouting the battle-cries of the age-long struggle for human freedom, Mexican revolutionary leaders turned the richest agricultural state of Mexico into a desert waste, prostituted the only creative industry in the whole country to the looting of the world’s farmlands and the taxing of every loaf of bread consumed in the world. The vast tribute which thus poured into the coffers of revolutionary government was utterly lost to public vision almost before it had left the market-places, and not one cent of it was ever turned to the easing of the sorry human burden of the Mexican peon or devoted to the education and upbuilding of the Mexican people.

The story of Yucatan is the story of as gruesome a rape of Mother Earth as man has known. Beginning with the familiar picture of the downtrodden peon of the Diaz time, it runs the gamut through the marching armies of conquerors, through a cycle of high-sounding socialism to bloody oppressions, and on to a newer despotism and finally to utter economic collapse. In the end it flattens down into the present, an era of capitalistic struggle in which the state, by the laws of economics which its despots perverted so vigorously, is being ground between the millstones of opposing forces of the very business which was once the source of all its wealth and all its progress.

Upon the wheat crop of the world depends the life of the world, and upon the mechanical harvester depends, literally, the life of the modern wheat industry. In its turn, the operation of the harvester is dependent upon the millions of miles of binder twine which alone make possible the handling of the wheat on its way from the standing fields to the thresher which converts it to golden grain. Since Cyrus McCormick first offered his “reaper” to the American farmer, more than fifty years ago, invention has sought far and wide for freedom from the need of twine for the binding of the sheaves, but neither “header” nor mechanical flail has been able to achieve it; to-day the wheat farmer must have twine, and that by the hundreds and millions of pounds, to harvest his crop.

Thus, because the sisal hemp or henequen of Yucatan is the only fiber which can be produced in sufficient quantities at a low price to meet the farmer’s need for binder twine, the wheat for the world’s food supply depends vitally on the product of this one distant state of Mexico. Without its humble aid, the American farmer might, conceivably, hark back to the binding of wheat sheaves by hand--it is certain that we could anticipate the scrapping of billions of dollars’ worth of mechanical harvesters in the substitution of some other method than theirs. The only other fiber that will serve for the making of binder twine is true Manila hemp, whose total crop would not fill a tenth of the needs of the world’s annual harvest, and whose finer quality and greater cost have caused it to be devoted almost exclusively to the making of high-class cordage. Cotton and jute and silk and all other known or promised vegetable or animal fibers from which binder twine might conceivably be made have proven useless for the purpose. One of them is too stout, one too soft, one too short of fiber, one not brittle enough, another too brittle. Sisal, the Yucatan henequen, is to-day the only hemp which meets all demands of the world’s annual wheat harvest, a demand which has reached the colossal total of 400,000,000 pounds a year.

Upon this need has been built the one great creative industry of Mexico, the one business, agricultural or manufacturing, which in Mexico produces wealth through human energy. Its source is the long-leaved henequen plant, to whose necessarily slow growth for fiber the sandy, desert soil of the Yucatan coastland is peculiarly adapted. The henequen is a species of the great agave, that strange, cactus-like “Century plant,” which is found in one form or another in almost all desert countries. As the maguey, it grows in the great Central Mexican plateau, furnishing the heavy drink called _pulque_, and giving up a hand-extracted fiber which has been woven into the raiment of the Indians of the Valley of Mexico for centuries. Still other varieties, in the warmer sections of Mexico, furnish food for cattle and, distilled, the fiery _mescal_ or _tequila_ which is an even more terrible curse of Mexico than the much-berated _pulque_.

It is the henequen, however, which is the most commercially useful of all the agaves, for its narrow leaves, three to four feet long, are peculiarly adapted to the mechanical extraction of their fiber (which most of the agaves are not). The coarse, rasping, yellow strands have the thickness and the strength of horsehair, so that they survive the vigorous de-pulping process of the great gin-like machines. After drying, they furnish a stout fiber which, when woven into thick cord, ties the wheat sheaves in the harvester, and breaks easily as each sheaf is thrown back into the thresher in the gorgeous pageant of the harvest.

This henequen, the sisal hemp of commerce, was first exported in 1864, and by 1880 was one of the well-known but minor fibers in the American market. In 1898, when the Spanish-American war cut off the exports of Manila hemp, henequen sprang into immediate and great importance, its price rose from 2¹⁄₂ cents to 10 cents a pound in New York, and an immediate increase in the industry and in the economic importance of the state of Yucatan took place. There was a lively boom in henequen lands, and incidentally an improvement in social and political conditions in Yucatan, followed by something of a slump with a few mild panics around 1907.

But henequen fiber had been definitely established in the market and selling as it did at an average price of 5¹⁄₄ cents a pound, became the great staple for the manufacture of binder twine. This new and virtually inexhaustible supply of cheap fiber for twine-making played its part in the broadening use of the mechanical harvester, until by 1915 Yucatan henequen binder twine was being shipped to every wheat producing area in the world, from the Siberian steppes to the pampas of the Argentine.

In 1914 the exports from Mexico were more than a million bales or approximately 400,000,000 pounds, which was a doubling of production in fourteen years. The current price of about 6 cents a pound had enabled the Yucatan growers to build up immense fortunes and made it possible for the manufacturers of the thousands of tons of binder twine to furnish it to the American farmer at less than 10 cents a pound.

The chief manufacturers of binder twine and, therefore, the chief buyers of Yucatan henequen, are the International Harvester Company, which makes about half the binder twine used in the world, the Plymouth Cordage Company, which makes about a quarter of the entire supply, and various state penitentiaries in the wheat belt of the United States. All of these manufacturers work on close margins for the Harvester Company’s business is selling harvester machines and it seems interested materially in keeping the price of such accessories as twine as low as possible. The effect of this, combined with Yankee shrewdness, has been a continuous effort to keep the price of Yucatan henequen down to rock bottom, and to this end its buyers have been cheerful arbiters of the price of the sisal in the Mexican market.

They were never, however, quite the grasping, grinding capitalistic despots they were described as being by the Yucatecans, for those of us who can remember back into the philosophic days before 1914 will recollect that it was not customary for even American capital to kill the geese that laid the golden eggs. The Yucatan hacendados were encouraged to demand, and get, comfortable prices for their product, and incidentally to plant large new acreages of the henequen plants.

It was this large planting, which went on from 1900 to 1914, which caused the first glimmering of the idea of “direct action” on the part of the hacendados, the growers of the sisal. It takes seven years for henequen plants to come into bearing, and the prospect of immensely increased production and probably lowered prices inspired the first idea of a pool which would maintain the old price levels. In 1912 a scheme for regulating the price of henequen was first presented to his fellows by a Yucatan hacendado. His idea was not so much to create an artificial shortage by storing the hemp, as to form some sort of organization which would have first chance to buy the henequen crop and thus make the hacendados participants in the profits made by the jobbers or middlemen.

The organization which resulted, in 1914, was called the “_Comisión Reguladora del Mercado de Henequén_” (Commission for Regulating the Henequen Market), or, for short, the “Reguladora.” It was not, however, a great success, for the Reguladora was only an organization buying in competition with the old established agents, and the growers still pursued their own immediate interests in seeking their markets. Coöperation has never been one of the outstanding virtues of the Mexicans, and in the selling of their crops the Yucatecan hacendados have never shown any sign of a break away from the national individualism. The hacendados have always done their business in Merida, the capital and business center of Yucatan. They pass from one sunlit office to another, wailing dismally over the terrible prices the comfortably ensconced buyers offered them and their unfortunate fellows, but seeking and ready at a momentary hint to drive a bargain which would cut their neighbors’ throats on the possible chance of a temporary personal profit. The gentlemanly agreement of the Reguladora was not, under these circumstances, a controlling factor in the henequen market.

This was the situation when, in March, 1915, General Salvador Alvarado, a doughty retainer of President Carranza, “captured” the state of Yucatan with an army of 8,000 men which he had brought from Vera Cruz. Although Mexico has been in revolution since 1911, Yucatan had, till this time, taken little part, accepting new governors with mild surprise but no opposition as one administration succeeded another in Mexico City. Yucatan is a great peninsula far to the east of the Mexican mainland, unconnected by railways, and thirty-six hours’ journey by fast steamer across the Gulf of Mexico from Vera Cruz. The Yucatecans have always considered themselves as a people somewhat apart from other Mexicans, and during many of the revolutions previous to Diaz, the peninsula remained aloof and politically independent, re-entering the Mexican confederation only toward the close of the pre-Diaz era.

General Alvarado is a product of northern Mexico. He belongs with the true Carrancista group in Mexican politics, has been a candidate for president of Mexico and has made many trips to the United States as a financier, most recently as an envoy of the de la Huerta government in search of a rehabilitating loan. All this, however, has come since his spectacular experience in Yucatan. In that state he gained the experience, and political record, which made him aspire to the presidency of Mexico, and earned his diploma as revolutionary financier. There, also, he probably first acquired those radical ideas which enabled him to assert, as he did in the Mexican Chamber of Deputies in November of 1920:

“I am a bolshevist, I have always been a bolshevist, and I shall always be a bolshevist.”

General Alvarado’s first government work was as a custom-house employee, but he joined the Carranza movement early and early rose to the rank of general through the manifestation of a thoroughly forceful personality and a ruthless preoccupation with his own advancement.

Yucatan, in its isolation, in its great wealth, and its easy-going manners, presented General Alvarado with the opportunity of his career. Here were ungathered riches for revolutionary spoils, here was noble opportunity for the uplift of the “submerged 85 per cent,” here was waiting easy military glory of conquest with no one to oppose. In going to Yucatan, General Alvarado was, moreover, encumbered by none of the political and business experience which delays the prompt execution of inspired ideas. Nor was he inhibited by any preconception of the needs of the commonwealth or its chief industry, for this was his first visit to his future principality. All he knew or heard was that Yucatan was rich and that its proletariat was “oppressed,” largely by wicked foreigners of shocking and predatory manners.

When he arrived in Yucatan, General Alvarado noted with interest the beauty of that gem of Mexican state capitals, Merida, with its sun-clear streets and its beautiful parks and public buildings. He saw the luxurious equipages and homes and visited the great haciendas of henequen. In the meantime, he looked over the documents in the governor’s office and the stock of gold in the state treasury. He scowled his disapproval, as was the Carrancista habit, at the foreigners engaged in the henequen business. Then his attention was called to the charter of the Reguladora, the harmless agreement of the hacendados to keep the price of the fiber as high as they could and still not soil their hands with trade.

This charter had courteously made the governor of the state ex-officio head of the Reguladora. Promptly, and without more authority, General Alvarado took charge of the organization. His first act was to force upon the unhappy hacendados, through the authority of their own instrument, a corporation which took their own business utterly out of their own hands and forced them to the acceptance of official dictation without dissent or question.

To the end of organizing his Reguladora in line with modern thought and to thorough efficiency for his own ends, he invited in from Mexico City the one set of brains in the Carranza administration, those of Luis Cabrera, and called in the motley company of self-styled “socialists” who had been drawn to Yucatan by the lurid tales of revolutionary propagandists who had predicted the inevitable uprising of the oppressed proletariat when opportunity should be given them.

This cabinet laid out the Reguladora plan, and two American bankers of New Orleans, Saul Wechsler and Lynn H. Dinkins, organized a syndicate which agreed to finance the cornering of the henequen market up to $10,000,000. There was no socialism in this phase of the plan, for the bankers were to receive a commission of $4 per bale on all henequen marketed, plus the current banking rate of interest for all moneys needed, the loans to be fully secured by mortgages against hemp in storage or in transit.

So far all was well, but here Alvarado met his first difficulty. The henequen growers were not socialistically inclined, nor were they as trusting of his good faith, or so well secured as the American bankers, nor had they so much to gain or so little to lose as the “socialist” advisers of the governor. Many of them refused to be bound by the new rules of the Reguladora, which included, amongst others, a provision that no hemp should be sold to any agent or interest save the Reguladora.

But Alvarado’s government called on the hacendados to subscribe to his rules for the Reguladora, and to those who refused it threatened (and gave evidence of the fullness of its intentions to carry out its threats) to fire the fields and throw the offending hacendados and their families into the flames. It organized the Red Guard of Yucatan (called the “Leagues of Resistance”), and spread terrorism throughout the peninsula. It drove out the tiny group of foreigners who for twenty-five years had been engaged in “exploiting” the unfortunate Yucatan proletariat by keeping the capitalistic hacendados from getting too much money out of American farmers. Along with them went hundreds of the hacendados and their families, and also priests and nuns, while the simple Indians who could not take steamers for foreign ports emigrated quietly back into the forests of interior Yucatan.

For Alvarado’s henchmen closed the churches, burned their priceless historical records, and outraged nuns and priests. They turned the church buildings into “labor temples” and barracks and storehouses from which later was sold, over the counter, the liquor which had been confiscated in enforcement of “prohibition” in Yucatan. They turned the schools of towns and plantations into centers of propaganda and espionage under imported “teachers” who knew none of the Indian language, and many of whom could not write their own names. They confiscated great haciendas under the elaborately “socialistic” agrarian law, and for those upon whom the iron hand did not fall directly, established a reign of terror in the raids of the “Leagues of Resistance,” whose crimes, from night-riding and burglary to rape and murder, the Legislature declared to be “political offenses” in the name of “socialism,” and thus outside the jurisdiction of the common courts.

His henchmen, foreigners, Mexicans and Yucatecans, raised up the previously contented “industrial workers,” railway men, porters and longshoremen (numbering in all less than 9,000 out of a state population of 300,000), forming them into unions whose increasing wages were overlapped more rapidly than they were raised by the rising costs of the handling of the imported commodities upon which they, like every one else, must live in desert Yucatan. Their wages, and the cost of living, multiplied eight times in the four years, while the wages of the farm workers little more than doubled, and a grievously added burden was placed upon the hacendados who from time immemorial have taken up the loss in increased food prices so that their farm workers may live.

By such means, and with such control, General Alvarado acquired the domination of the industrial life of Yucatan and of henequen production upon which he built up his market corner. In the selling of the product so controlled, he raised the price of raw henequen from 7 cents a pound in New York to more than 19 cents a pound in the same market. So firm was his grip on production and on distribution that he could, and did, withhold stock which was sorely needed in the harvest fields, bringing about, in 1916 (through this means and through the soaring prices which had to be asked for the binder twine which was sold), an investigation by a committee of the United States Senate. This committee, after months of investigation, completely exonerated the American manufacturers from the charge of profiteering, and perhaps for the first time in the history of that august body, placed itself on record as asserting that a foreign government had acted the rôle of an iniquitous trust in creating an artificial shortage and artificially inflated prices for a product vital to the business of America’s farms.

In the four years that the Reguladora corner lasted, more than $200,000,000 in advanced prices were taken from American buyers, an average advance of more than 200 per cent. Thus, granting a legitimate doubling of the price of the fiber in keeping with the doubling of the costs of other commodities in this period (1915-1919), the accepted figure of $112,000,000 of direct loot through the Alvarado henequen corner may be taken as literally true. And this was loot that never reached either the cruel hacendados who owned the farms or the workers who furnished the labor for the creation of the product. All this and more went into the bottomless pit of Mexican revolutionary graft.

This henequen corner was, it must be remembered, created in the name of socialism and the salvation of the downtrodden peon. Along with it went a mass of other activities, wherein the funds derived from the sale of henequen at the advancing prices were turned to schemes of ostensible government ownership, socialization and coöperation. Before even the hacendados were given the 4 cents a pound guaranteed them as first payment against the great profits to come from the “corner,” the Reguladora funds were invested in the purchase of the state railways, at prices to this day unknown. These funds also financed the organization of the _Compañia de Fomento del Sur-Est_ (Development Company of the South-East) and bought nine old Mexican coasting steamers at a cost of $4,000,000 so that the socialists of Yucatan might not be dependent on capitalistic steamship lines. The Reguladora also financed the drilling of oil wells, and built a flock of tanks to contain the oil--which never came out of the ground. It also built a railway, confiscating therefor, “for the common good,” one-tenth of all the rails and equipment of the private plantation railways on the henequen farms; in a few months it sold this railway to a favorite for $150,000, a tenth of its cash cost, payable in ten years.

The _Cia. de Fomento del Sur-Est_ entered upon the business of relieving the oppressed proletariat from the wicked prices for the necessities of life fixed by capitalistic grocerymen. It bought its own supplies in the United States, transported them in its own steamers, and sold them--for more than the current retail rates! The proletariat did not benefit from any of these schemes, but the government henchmen who bought in the United States, and those who sold in Yucatan, waxed fat and comfortable, although remaining firm and loyal socialists to the end.

All these things were done in the name of socialism, and in that name, also, the power of Reguladora gold was felt even in the heart of the United States, in a heart made sensitive to such machinations by the nervous strain of the war which was already at our throats. Not a little of the money derived from the sale of henequen at prices four and five times normal was used in the conducting of a campaign of propaganda. Mexican and foreign “socialists” were kept in the United States lecturing and writing and publishing magazines and books. These activities were radical and, in part at least, I. W. W., in general character but they were devoted also to spreading the fame of the Alvarado brand of socialization of industry in Yucatan and to the dissemination of anti-American ideas under the guise of socialism.

It was glory and it was madness to strike thus at the heart of the “Colossus of the North” as the anti-foreign Mexican orators like to call the United States, and at the very same time at the “Colossus of Mammon,” as the wilder socialists referred to us in Yucatan. Carranza had tried the former form of baiting, but the combination of the two was an orgy of glory reserved for the satellites of Alvarado. Never was anything quite so daring and quite so magnificent ever done by a Mexican revolutionist before, and not even Carranza dared do more.

So glory and madness traveled together, but meanwhile, out in the henequen fields and in the Indian villages, Yucatan toiled on. The simple natives could not quite appreciate the “socialists” and literally fled in terror before some of their manifestations, so that in that day, and in this as well, they tell you with eager friendship to “beware of these terrible socialists.” To them, “socialist” is a name associated with things that are, to their simple minds, quite unsocial.

Alvarado, in his “conquest” of Yucatan, had frankly spread terror throughout the peninsula. Opposed, on his triumphal march to Merida, by a small “home guard” of upper and middle class youths, he had captured and shot scores of them in cold blood, as “traitors,” and pursued his way. He had, as I have noted, closed and sacked the churches, remarking that “As the revolution advances, God recedes.” Then, on one of the main boulevards of Merida, he had allowed the dead bodies of two who had offended him to swing from sunrise to sunset from a limb of an oak tree, so that thereafter the simple words, “Remember the oak tree,” were sufficient to bring the stoutest-hearted conservative to terms.

But for all that, General Alvarado protested unfailing friendship for the peons and the Indians, grieved somewhat by their distrust of him, but pronouncing his devotion to their welfare in no measured terms. In his carrying out of his “socialistic” policies, he did not, however, consult their wishes or even their possibilities of development. His one panacea for the ills of the Indians was “land,” and land he and his imported advisers were determined to give them, no matter whether they wanted it or not. Never did the ideals of socialism, beautiful in themselves, have an uglier distortion.

“Land distribution” is, as I have said, the crux of the protestations of all Mexican revolutionists. Upon the alleged land hunger of the Indians the revolutionists have based most of their appeals for foreign sympathy. The actual facts of the labor situation, in Mexico and especially in Yucatan, are therefore worth brief description in this connection. The so-called “peonage system” of Mexico goes back historically to pre-Spanish times. It is based on the psychological difficulty of obtaining continuous labor. Continuous labor being vital to such an industry as henequen growing, there flourished in Yucatan, previous to 1914, a system of indebtedness which was practically slavery. Laborers on the plantations were allowed to get into debt in order that they might be held on the plantations on the pretext of working out the advances which were made from time to time by the hacendados. These debts averaged about 200 pesos ($100) a man, and it is undoubtedly true that the system was the origin of wicked abuses, a plantation store credit system being devised to keep the peons always in debt, and workers being sold by the head for their debts. Confinement in barbed wire enclosures was common in some sections, and altogether the picture of the Yucatan situation especially was a very unlovely one.

But the system of debt advances was really effectively abolished under Madero, two full years before Carranza and Alvarado entered upon the scene, and it is worth noting that the hacendados, many of whom had fortunes tied up in peon debts, found themselves far happier to be free from the system than were the peons. It is indeed questionable whether the peonage system, as such (and where it was not abused), was entirely distasteful to the Indians who were its victims. Lacking any ability to save, the abolition of the system of debt advances wrenched from their grasp the only possible form of enjoying the fruits of their labor outside their usual hand-to-mouth existence. Under the old systems they were able to have some of the good things of life by getting an advance in money, which they spent gayly, careless of the future, and then proceeded to work out the debt in the months or years which followed. Basically, the system had its redeeming features, when considered from the viewpoint of Indian psychology, even though the abuses were such that its abolition was inevitable.

Linked up with the peonage system was the land distribution question, far too complicated for its origins to be gone into here.[6] In Yucatan, the most heavily populated section is not the most fertile. Henequen is not grown in the forests back from the sandy seacoast where prehistoric civilization left the great ruins of a rich and glorious empire, but on the seacoast itself. This virtual desert, extending in some places twenty-five miles back from the coast, is the land which is adapted to the growing of henequen, for a slow maturing of the plant is vital to the creation of those long, strong fibers which constitute the valuable portion of the leaves.

This so-called desert land is sometimes capable, when first cleared of brush, of one or even two croppings of corn. Then it must lie fallow for many years before another food crop can be raised. The native Indian, therefore, has little or no use for a small plot, or indeed for the ownership of any plot of ground, unless he can crop it once or twice and then sell it to a henequen planter, while the Indian seeks other corn-lands elsewhere. If the government hampers him in moving about, he prefers not to try to live as an independent farmer, but to work on a plantation where he can get regular pay for cutting henequen leaves, and also can cultivate a little corn-plot lent him by the hacendado and renewed each year.

Now the Indian, despite the fortunes which have been made by the hacendados in the henequen business, has no interest at all in becoming a henequen grower. He knows from experience that the value of the leaves he himself produces are little more than what he would be paid on an hacienda for cutting the hacendado’s own leaves, and he knows that he has not the capital or the initiative to go into hemp production himself. The result was that some years ago, when the communal land was first distributed to the Indians, it was cropped once or twice and then sold to the nearest hacendado to become henequen plots.

Sometimes indeed, the communal land was so worthless for corn that the hacendados were allowed to take it over without payment or protest and to plant it to henequen. This loss, from the Indian viewpoint, was far from an unmixed evil, for the natives of the commune profited in the gaining of an opportunity for assured livelihood close by their homes--difficult enough except on the henequen farms, in the desert sections of Yucatan.

Henequen production is far more of an industry than it is a farming project. Primarily, it requires from the planting of the shoots until the first leaves are ready for cutting, eight years of continual and expensive care, for the fields must be kept clear of brush and weeds, the plants tended and those which die replaced with regularity. After eight years of continuous outlay, the leaves are cut, brought into a great industrial plant where machinery and many workers are required to remove the pulp, to dry the hemp fiber on racks under the sun, to pack it into 400-pound bales in hydraulic presses, and to ship it to the distant American market. The agricultural end of the henequen business is but a small item in its process, and no individual farmer, even if he has moderate capital, can prosper on it.

The land distribution planned by Alvarado was to be made from the great henequen haciendas, and some of the oratory defending the confiscation of those haciendas pointed out the fact that this very land had been stolen from the Indian communes in years gone by and was now being returned to the original Indian owners. That was interesting to the pitying audiences of the Alvarado propagandists in the United States, but it was of not the slightest interest to the Indians of Yucatan. They had once owned that land, and had or had not cropped it in corn once or twice. They knew quite well it was hardly worth the trouble and the expense in taxes it would be for them to own it again, especially as they saw the hacendados being skillfully put out of business and knew that with their disappearance went the only market in which Indians could sell the land after they got it, or the henequen leaves if they raised them.

Thus it came about that despite the apparent incongruity of the fact, the Indians of Yucatan paid almost no attention to Alvarado’s land distribution plans, listening to the alluring official announcements with stolid indifference. They attended the festivals which accompanied the distribution, but they took up no land grants.

There were indeed, many Indians who actually took flight into the interior of the state as a result of the efforts to force land upon them. The Mexican Indian, of whatever tribe, in reality desires deeply but one thing--to be left alone to pursue his half-savage life in his own way, an aboriginal ambition which should not be difficult to understand by those who know anything of the North American Indian of the United States. Socialism, like the responsibilities of land ownership, is beyond his ken and he literally ran away from the offers of either in Yucatan.

Some Indians, of course, remained, along with a great number of the mixed-blood “slaves” who had been imported from the Mexican mainland into the state during the boom period of the henequen business. These were thoroughly “unionized” in the Mexican sense. That is, they were forced to pay their poor little three pesos for a big red card which proclaimed their membership in some union or other, were promised all that the human heart could desire--and were allowed to subsist as long as possible upon the promises. The unions were used to the double end of ruining the capitalistic landlords and reducing the output of henequen so that the price would go higher.

On the plantations where these “unionized” workmen remained, the old task system, by which each man cut from 2,500 to 3,000 leaves a day, was abandoned for a regular “eight-hour day” in which the workmen did as little as they cared to do, and worked, not under instructions, but wherever they chose to work. As a result the cutting of leaves was reduced fully one-half, and the plants near the roads were overcut while those deep in the fields were allowed to blossom and go to seed. Both processes killed the henequen, which has to be cut regularly and skillfully in order to prolong its life of usefulness. For miles the great pole-like blossoms marked the henequen fields like a forest, and thousands of productive acres went to ruin. Thus Nature’s inevitable process of flowering and decay marked, itself, man’s crass flinging back of her riches into the dust from which those riches had come in the long slow years of his care of her.

Meanwhile, other forces had been at work, some building the pyramid of mad ideas and madder methods, others undermining the pyramid’s foundations upon the rocks of the conservative past or disintegrating its mortar of imitation socialistic idealism. Of these forces, the greatest was the financial cycle of paper money, “short” drafts and towering mortgages against increasing stocks of unsold henequen.

By 1915, when Alvarado arrived in Yucatan, the system of paper money which Carranza used to finance his revolution had already engulfed Mexico. Carranza had recently issued his famous dictum that if Gresham’s law (one of the fundamental laws of economics, which holds that bad money, in any quantity, inevitably drives out good money) was interfering with the circulation of the Carranza paper, Gresham’s law should forthwith be repealed by executive decree. Billions of Carranza paper had been printed, and it was already the circulating medium in Yucatan; gold and bank bills were in hiding. Alvarado decided that the time was ripe for a currency of his own, and issued, before he had been long in the state, the Reguladora paper money, ostensibly guaranteed by hemp in storage in Yucatan and in the United States. By decree, this money had to be received at the old value of the silver peso, two for one American dollar.

It was a beautiful idea, except for economic law. The bayonets of Alvarado’s soldiers helped keep up values for a while, but slowly the theory that power can achieve anything the “proletariat” wants was blasted by fact. Alvarado had promised to redeem his Reguladora paper in gold or in New York exchange, but he did not bother to back up his promises by a limitation of the currency to the amount he could redeem, so that at one time he had $34,000,000 in paper in circulation, against henequen stores of half the value, stores which he could not liquidate. The currency’s value dropped, cent by cent, then by groups of cents, and finally it was almost waste paper, like that of Carranza. There was not enough henequen in New York, nor enough gold in Yucatan, to redeem the paper, and the political nostrum for the economic ill of bad paper currency failed.

The failure was colossal enough, in any case, without the financial complication of the currency. Alvarado had closed the ports to all hemp from the interior that was not consigned to the Reguladora. That beneficent monopoly allowed no shipments by rail, and before he got through Alvarado had to close the roads with soldiers, so that no carts could reach the port. Meanwhile, he had been boosting the price, deliberately and virtually by decree, until, as I have said, it reached more than 19 cents, as against less than 7 cents a pound which had been its price before the Reguladora took charge of the market.

This raising of the price cut off a large portion of the market,--and that had not been anticipated. Virtually all consumption of henequen except for binder twine ceased. At 19 cents Manila hemp could compete--and it is far better hemp. At 19 cents jute cord can compete, and jute cord is soft and pleasant to handle, and where previously henequen cord had been used for big bundles of newspapers and magazines and mail, jute was substituted--and now the men who handle the bundles of newspapers and magazines and mail refuse to go back to the rasping henequen cord which cuts their hands so uncomfortably.

The consumption of henequen was actually reduced to half by this deliberate destruction of its market. In spite of the new low prices to-day, this condition in the general fiber market combines with the cutting off of the Russian and some of the other European demand to reduce the world consumption of the Yucatan fiber to about 70 per cent of what it was prior to 1914. All this loss the Reguladora had to take up, in addition to the stores which it laid aside to push up the price. Economic law was at work, and all the contentious statements that the price was going up only in proportion to the rising costs the world over was answered by the fact that henequen was driven out of the general fiber market by other hemps which had increased in price, to be sure, but had never approached the geometrical progression which henequen assumed under the lordly sway of Alvarado’s corner.

When all is said and done, however, it was Mother Nature and Gresham’s law which finally broke the corner. Corners in the products of Nature have a way of piling up unexpected responsibilities and finally loosing unexpected forces which swamp the unwary juggler. So it was in Yucatan. With about a year’s supply of fiber in storage in the United States and Mexico, more than half of it mortgaged to American bankers, and with about $10,000,000 in Reguladora currency in circulation with nothing but photographs of gold stores to guarantee it, Alvarado’s henequen corner went the way of all the corners of history. That was in the spring of 1920 when, after a year of price fluctuation, Nature and the eternal laws of economics began gently wafting the prices downward until they reached the lowest level in fifteen years. Then it was that the banking syndicate, which had loaned money against henequen shipments, foreclosed on 250,000 bales in storage in New York, marking the final chapter in the story of Alvarado’s Reguladora experiment.

When the smash came, there was an Association of Henequen Growers which had been begging in Yucatan and in the Supreme Court of Mexico for a chance to take back their business. As the financial difficulties and the financial needs of Alvarado’s henchmen increased, the Reguladora had all but given up paying any money to the haciendas where the henequen was produced. The mule that lived on sawdust up to the day he died is a fable of ancient times, but even under such loudly acclaimed “socialism” as that of Yucatan something has to be paid for a product which is produced and exported. The growers had all but reached the end of their resources, and Alvarado offered them only paper money, which he would or could not change into gold drafts. So just before the crash, to satisfy the clamor, Alvarado took his way to Mexico City and royally presented the Reguladora to the Association of the Producers of Henequen.

The hacendados had hardly had time to look over the ruins when those financial interests which had loaned money on hemp that was to sell around 20 cents a pound foreclosed on those 250,000 bales in New York and New Orleans, placing thereon a value of 5 cents a pound. Alvarado was safe in Mexico City preparing to visit New York in an effort to get a loan of a few hundred millions for the government of Carranza. The hacendados held the sack, and watching the sack was a group of financiers, including the Equitable Trust Company of New York, the Royal Bank of Canada and the Interstate Trust Company of New Orleans, the latter the Dinkins concern through which most of the loans on the henequen had been placed.

Down in Yucatan the hacendados had their farms back, the Indians were returning at night to look things over and see whether the “socialists” had retired far enough for them to return in safety to their comfortable “slavery”--but nobody had any money. When Alvarado left, the hacendados had inherited the Reguladora offices, and had opened its money vaults. These vaults, photographs of whose gold stocks had been circulated by Alvarado to sustain his paper currency, were quite empty. The haciendas were in terrible condition, and there was no way of getting funds with which to rebuild and replant them. The only hope was for capital from outside--Alvarado’s “socialism” had passed on its way. Of the possible sources of rescue, the chief was in the group of unhappy banks in New York, New Orleans and Montreal, which were already in the henequen business with their 250,000 bales of foreclosed stock. The second hope was the International Harvester Company, which needs henequen in its business. The hacendados chose the banks, and the Equitable Trust Company, the Royal Bank of Canada, the Interstate Trust Co., and the Comisión Reguladora (which still existed in name if not in spirit) formed a company, and taking the four initials, called themselves the Eric Corporation.

There was much rejoicing in Yucatan, for the Eric was going to lend a few more paltry American and Canadian millions and reëstablish the great state industry. The Reguladora (now consisting of the hacendados) turned in some 300,000 more bales of hemp that were stored at Progreso, the Yucatan port, as their part of the capital stock of the Eric, and the hacendados went back to work.

Now one of the peculiar things about “economic ruin” is that it seldom ruins a business--individuals are the only victims. Yucatan was devastated, many thousands of acres put on the non-productive list. There was no money to pay labor or to finance the crops, but the henequen business went on. To all intents and purposes about all that had happened was the elimination of most of the surplus planting which there would have been if all had gone along properly and there had been no Alvarado to corner and destroy the market. Henequen kept on growing on the haciendas and, despite increased costs of handling, it continued to move to market.

Don Avelino Montes, a Spaniard who had been the chief buyer of the International Harvester Company, returned from his exile in Cuba and resumed buying. Don Arturo Pierce, the honorary British vice-consul who did the buying for the Plymouth Cordage Company, abandoned consuling and returned to the henequen trade. The price of Yucatan hemp kept slumping, but to the surprise of the Eric people, the demand was supplied with new hemp, and the Eric’s stocks of old hemp diminished but slightly. The money to rehabilitate the Yucatan haciendas was not forthcoming. The old hemp stock had to be sold first, and the wretched hacendados refused to coöperate and let the Eric unload.

Henequen deteriorates, and also it requires insurance, as the many fires in Progreso and New Orleans at the time testified. The cost of holding the half million bales of henequen of the Eric is about $2,500,000 a year, and the price at which it was bought in, plus insurance, represents a cost of about 8 cents a pound. The price of hemp had been stabilized at that very figure by Señores Montes and Pierce, with some outside assistance from New York brokers, but the sales were made in Yucatan, of new hemp. So the Eric, in righteous anger, cut the price from 8 cents to 7, and then to 6. The price of new hemp also fell, and the hacendados, partners in the Eric, wailed at the evil which was being done them. However, they continued to sell the new crop at the new price, to the Harvester and the Plymouth and Henry Peabody & Co., and Hanson and Orth, while the gradually deteriorating stocks of the Eric went begging. The price was finally cut to 5 cents, by the Eric. Yucatan has met this price, too, with new hemp, and because it is still possible to make money out of henequen with the price at 4 cents in New York, it seems likely that Yucatan will continue to grow henequen, and to sell it. Meanwhile, however, the business doctors of the Obregon administration in Mexico City at one time succumbed to the pressure of the unhappy hacendados and even agreed to try the “Reguladora” experiment all over again, with the central government buying 60 per cent of the henequen crop at 6 cents a pound, and again “controlling” the market, a step in the spiral of destruction which had but a brief life and little significance. For the story of Yucatan is written and the state and its great industry are to-day being ground between the wheels of the “capitalism” which the beautiful theories of Yucatan’s “socialistic” autocrats sought to destroy.

This is the outcome of Yucatan’s experiments in Alvarado’s brand of so-called socialism. The price of the fiber is back to less than it was before the inflation began, the production has been cut from 1,000,000 bales in 1914 to less than 700,000 in 1919, a decline of 30 per cent, while, taking the potential production from the plantings up to 1914, the present production is about half of what it would have been if Alvarado had never come to Yucatan. The haciendas are back in the hands of their original owners, the market is in the hands of foreign capital, and foreign capital is fighting over the spoils with what seems to the Yucatecans utter and cruel disregard of the amenities of gentlemen. The $112,000,000 squeezed from American farmers and the other untold millions taken from Yucatan by loot, by false prices in “coöperative stores,” by freight rates on the graft-owned railways, and all the other means used by Alvarado’s retainers, have gone to the enrichment of his group and to the upkeeping of the Carranza government. No noticeable part of it has remained in Yucatan, and save for increased wages all around (and the world has surely learned that this is not prosperity) no possible profit has remained. The spiral cycle is complete, and none has gained, not even the predatory capitalists, who are unhappily cutting each other’s throats in an effort to solve the problems into which they were swept by the machinations of Alvarado and his henchmen.

To-day Yucatan is not free from the domination of the “socialists,” but that domination is political, marked by those outrages which have come to be merely a part of politics in Mexico. Elections are held from time to time, elections wherein two parties of socialists alone confronted each other. The battle is bitter, as battles are when brothers are the contestants. There is still killing and loot, and women and children suffer death and worse in the solution of such glowing political questions as whether, we might say, the flag of Yucatan should be all red or merely red with a black bar across it--its problems are daily forgotten, for the real issue is only to find out who should have the next hand at the graft. Socialistic, to be sure, because all Mexican manifestations to-day are masquerading under the name of socialism, but quite as little in tune with true socialistic ideals as a battle between two factions in Tammany Hall over the control of New York politics would be socialism.

FOOTNOTES:

[6] Both peonage and the Mexican systems of land distribution are discussed at some length in _The People of Mexico_.