MEXICO 1080 



several prominent Americans were forcibly deported from Mexico for having again been 

 found supplying the rebels with arms. The situation became more and more acute, 

 and Pres. Taft was said to have threatened to resort to intervention unless some 

 amelioration were manifested. Pres. Madero sent a notification to the United 

 States that "if a single foreign trooper crossed the border there would be war between 

 the two countries." Pres. Taft, however, denied any intention of active intervention. 

 Two Americans were found hanged at Cananea, in the state of Sonora, July 3ist. 



Great Britain, Germany and France meanwhile addressed enquiries to the United 

 States asking what steps were contemplated in regard to protecting foreign interests 

 in Mexico; and in June, Mr. Philander Knox, the United States' Secretary of State, sub- 

 mitted a plan to create a neutral zone for 15 miles on each side of the Rio Grande, where 

 any troops of either the Mexican or United States armies, during times of revolution 

 and riot, might enter to protect the lives and property of their countrymen. 



Early in August 1912, serious damage was done to the property of the Tominil Mining 

 Co., a British concern, and the intercession of the British foreign office was necessary. 

 A battle between the federal troops and the revolutionaries, lasting several days, was 

 fought some 45 miles from the capital, the losses being very heavy upon both sides. On 

 September 8th permission was given by the United States government for 1200 Mexican 

 federal troops to pass through part of Texas into Mexico to attack fleeing rebels. 



The opposition to the government, although crushed in some parts of the country, 

 broke out afresh in others, and in July 1912 the president found it necessary to request 

 the United States, Great Britain, France, Germany and Spain to accord formal per- 

 mission to suspend the constitutional guarantees, a request which was declined by all 

 the Powers. Outrages were perpetrated by roving bands of revolutionists; a passenger 

 train was stopped at Tucuman (Aug. n, 1912), when 30 of the travellers were murdered 

 and mutilated; on the previous day the town of Ixtapan, in the state of Mexico, was 

 captured by a body of 1000 rebels, who put 300 of the inhabitants to death. American 

 residents at Cananea, the border mining-town, were armed with rifles and ammunition 

 by the United States government. Other mining camps were similarly provided. A 

 further revolution, having for its object the reinstatement of ex-president Diaz, broke 

 out October iyth, the port and town of Vera Cruz being seized and held by the reaction- 

 aries, at whose head Colonel Felix Diaz, a nephew of the ex-president, placed himself. 

 After a single encounter between the federal troops and the revolutionaries, the latter 

 were defeated and Colonel Felix Diaz was captured (Oct. 24th). 



Notwithstanding the turmoil in political circles and the large amount of wanton 

 damage occasioned to property, such as the destruction of railway bridges and trains, 

 the burning of plantations and the pillaging of business houses, the economic condition 

 of the country suffered less than might have been supposed, as was evidenced by the 

 promptitude with which all foreign obligations were met. The house of Speyer Brothers 

 notified the Mexican Government that it was prepared " to offer financial assistance to 

 any moderate amount," a statement which created a favourable effect upon the stock 

 markets of London and Paris. A serious financial condition, however, was revealed in 

 September 1912, when President Madero admitted in his message to Congress (Sept. 

 25th) that only a small amount ($2,000,000) remained out of the last loan for $20,- 

 000,000, which had been raised in June (1912). It was decided to borrow a further 

 $20,000,000 (gold). Messrs. Speyer Bros, were not, however, applied to, the government 

 deciding to place the issue in Europe, a proposal which, owing to the Diaz revolution of 

 October i7th-24th, temporarily at least, proved impossible of realisation. 



The receipts for 1911 fell far short of those of the previous year, the revenue showing 

 a decline of $1,884,901, while the expenditure increased by $8,332,020. It was found 

 necessary to draw liberally upon the treasury reserves, which by June 1911 had already 

 shown a reduction to $9,414,119. A paper surplus of $10,228,478 for 1911-12 was more 

 apparent than real. In August 1911 the government had borrowed from the banking 

 house of Speyer 2,000,000, the proceeds being used by the monetary commission in 

 connection with the currency and exchange operations. 



