Mexican+Revolution+Group+3


 * What were the economic problems which caused the Mexican Revolution and to what extent were they solved by the constitution on 1917?**

==** Contents  **==

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 The Beginning of Mexico's Economic Downfall  ======

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 Mexico's Economy Under Díaz  ======

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 Limantour  ======

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 Land Policies of the Díaz Administration  ======

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 Tariffs, the Gold Standard, and a Balanced Budget  ======

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 Economic Conditions that Helped Spark the Revolution  ======

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 Economic Changes in Constitution of 1917  ======

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<span style="DISPLAY: block; FONT-SIZE: 70%; FONT-FAMILY: Arial,Helvetica,sans-serif; TEXT-ALIGN: left"> <span style="DISPLAY: block; FONT-FAMILY: Arial,Helvetica,sans-serif; TEXT-ALIGN: left">Major Articles of the Constitution that Affected the Economy  ======

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<span style="DISPLAY: block; FONT-SIZE: 70%; FONT-FAMILY: Arial,Helvetica,sans-serif; TEXT-ALIGN: left"> <span style="DISPLAY: block; FONT-FAMILY: Arial,Helvetica,sans-serif; TEXT-ALIGN: left">Post Constitutional Economy  ======

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<span style="DISPLAY: block; FONT-SIZE: 70%; FONT-FAMILY: Arial,Helvetica,sans-serif; TEXT-ALIGN: left"> <span style="DISPLAY: block; FONT-FAMILY: Arial,Helvetica,sans-serif; TEXT-ALIGN: left">Actual Change Made by Constitution of 1917  ======

---**Beginning of Mexican Economy Downfall ** Starting in 1810, beginning with the Hidalgo revolt against Spanish rule in Mexico, the economy of Mexico became stagnate. It wasn’t until 1876 that the Mexican presidency of Porfirio Diaz woke up the economy. There were two main factors that contributed to this economic problem. One of them was the destruction caused by the eleven years of fighting, which eventually led to Mexican independence (1810-1821). Much of the economy revolved around the mining industry; this was destroyed by the armies, guerillas, and bandits. The other main factor was prolonged political instability (Hansen, 11).

**Mexico's Economy Under Porfirio Diaz**
While under the dictatorship of Porfirio Diaz, Mexico experienced an unprecedented  level of stability and expansion. Diaz governed with a policy that he termed "pan o palo" which translated into English means "bread or club". This policy presented two options to the population. The first was that the people who stayed in line received food, and the second was that those who complained and interrupted the order of things would be forcibly suppressed. Diaz's club was the Mexican military whose primary task was to maintain internal order (Mabry, "Porfiriato"). The military forcibly ended strikes and protests and also assassinated influential people who posed a threat to Diaz's power. With the support and approval of Diaz a group of intellectual technocrats who were known as the Cientificos controlled the economic policy of the nation.

**José Yves Limantour**
"Let us be scientific and let us be realistic." Don José Yves Limantour

José Yves Limantour was the mastermind behind Diaz's economic policies. Limantour served as Financial Minister of Diaz's administration and was the head of the Cientificos. Prior to his employment as Financial Minister, Limantour earned a law degree and was a professor of international law and political economy at Escuela Nacional de Jurisprudencia and Escuela Superior de Comercio respectively (Mabry, "Limantour").


 * Land Policies of the Diaz Administration**

As Financial Minister, Limantour accomplished a tremendous amount for the national budget and attracted a large amount of foriegn business. Limantour did this by changing many of the economic policies of Mexico in order to cater to foreign business interests. The Mexican elite had an unusual favoritism towards foreigners conjoined with the belief that indigenous Mexicans were incapable of modernizing. This prejudice resulted in tax concessions to foreigners (Mabry, “Beginning of the End”). Another significant area where Limantour and Diaz assisted foreign business was in mining. The laws of Mexico during this time reserved the subsoil rights of the country for the state. However, when foreigners wanted to extract the mineral wealth of Mexico Limantour and Diaz changed the laws to allow foreign ownership of the subsurface. One result of foreign mining during this time period was a great expansion of the Mexican railway system. When Diaz became president in 1876 there were only 400 miles of railway in Mexico, but after the importation of foreign mining a system was needed to transport minerals abroad resulting in 12,000 miles of track by 1910 (Mabry, “Diaz”). Limantour and Diaz also helped foreigners and Mexican hacendados take land from the indigenous people. The Cientificos viewed the hacienda as the necessary and preferred agricultural system and as a result they were taxed very little. Also it was the unofficial policy of the Diaz administration to always side with the hacendados whenever there was a dispute between the haciendas and small scale native farming (Mabry, “Beginning of the End”). Due to the favoritism received by the hacendados the hacienda system dominated Mexican agriculture.
 * Tariffs, the Gold Standard, and a Balanced Budget**

In addition to aiding foreigners in acquiring Mexican land, Limantour shifted tariffs to make the Mexican market attractive to outside investors. Limantour lowered and eliminated import duties on goods to encourage foreign companies to bring their products into Mexico (Reinschmiedt). Production taxes, sales taxes, as well as state tariffs were also abolished by Limantour to encourage economic growth (Mabry, “Great War”). Even though Mexico was the worlds largest producer of silver at the time, Limantour decided to switch the Mexican peso to the gold standard, the international norm at the time (Reinschmiedt). Limantour switched from the silver to the gold standard in order to make the Mexican peso more creditable on the international level. Due to the switch to the gold standard and the newfound economic stability of Mexico, the Mexican peso went from being an unreliable monetary unit to become one of the most trusted currencies in the world (Mabry, “Diaz”). Shortly after the turn of the century. Limantour was also responsible for creating a reliable banking and tax collection system that brought in and kept track of the nations budget. As a result of these economic policies, Limantour was able to refinance Mexico's foriegn debt and negotiate new foriegn loans with much better rates of interest than previous arrangements. These conditions made it possible for Mexico to pay off its last installment of debt to the United States in 1890. This was the first time in the history of Mexico that the national budget was balanced and debt free.

**Economic Conditions That Helped Spark The Revolution**
The policies that brought about a flourishing and stable national economy only benefited a small elite group and ignored the vast majority of the population, leaving them to suffer in poverty. While Diaz’s policy of “pan o palo” was a sufficient discouragement against open revolt for some time, tensions and resentment ran high in Mexican society. Rural Mexico is a particularly good example of the disparity of wealth between the elite and the common man. In 1910 there was a total of 900 large land owners and roughly 9 million landless peasants, out of a total population of 15 million (Mabry, “Diaz”). Including those peasants with small plots of land as well as hacienda owners, only three percent of the rural inhabitants of Mexico owned their own land (Smitha). An institution that perpetuated the problem of landlessness was the hacienda store. At hacienda stores workers were forced to buy the products they needed at inflated prices, keeping them in perpetual debt. The hacienda store as well as the clear favoritism of the government towards large landholders angered the rural population of Mexico. Another economic and social policy that caused hatred of the Mexican government by the indigenous peoples was the sanctioned persecution and enslavement of native groups. The Mayan people who originally inhabited the Yucatan Peninsula were sold to Cuba to act as slave labor. This left the tropical plantations of the Yucatan without a work force. To remedy this the government forcefully shipped the rebellious Yaqui natives from their homeland to the Yucatan to fill the void left by the deported Mayans (Mabry, “Beginning of the end”). Labor was forcibly kept in line by Diaz’s “pan o palo” policy and was not allowed to strike for any circumstance. Despite these policies, workers did strike, often to disastrous effect. In 1906 there was a strike at the Cananea copper mines in Sonora. To quell the strike Diaz gave permission to the Arizona State Rangers to cross the border and bring an end to the strike. The Arizona Rangers were unleashed upon the striking workers and they killed several in the process of stopping the strike (Mabry, “Beginning of the End”). Another famous strike occurred in January 1909 at the Rio Blanco textile mill. In this strike the National Army was brought in and they proceeded to gun down dozens of workers (Kreitlow). This open massacre of workers created a more rebellious environment on the eve of the Mexican Revolution. The Mexican elite’s favoritism to foreign workers was so great that it became common practice for unqualified foreign workers to receive jobs rather than qualified Mexicans. The endorsed support of foreigners over Mexicans, haciendas over small plots, the persecution of the indigenous peoples, as well as Diaz’s “pan o palo” policy, created a standard of living for ordinary Mexicans in 1900 that was lower than the century before (Mabry, "The Beginning of the End"). This pushed the general population to a point where they were willing to accept the coming Mexican Revolution as an outlet to implement economic change that would benefit the majority of Mexicans.

**Economic Changes In Constitution of 1917**

The new Constitution was officially created on February 5th, 1917 (elbarero.) The Constitution of 1917 incorporated and expanded upon the 1915 decree. The decree of 1915 issued by Venustiano Carranza was an effort to strengthen his position. The decree declared that all communal lands alienated since 1856 should be returned to their former owners and also that villages without formal titles, but in need of lands, should also receive them. These lands were expropriated from private owners (Hansen, 31).

By today's standards the Constitution of 1917 doesn't look like much, but in 1917 it was considered quite a radical outlook on liberal democracy (Hansen, 88). The Constitution includes the ideas of revolutionary groups. It not only includes the liberties and rights of citizens but also recognizes the social rights (right of workers to strike), the right to a proper education and the right to private property (elbarero  .)


 * Major Articles of the Constitution that Affected the Economy**
 * Article 2 - "**Slavery is ######### in the United Mexican States. Slaves who enter national territory from abroad shall, by this act alone, recover their freedom and enjoy the protection afforded by the laws."
 * Article 3** - "The education imparted by the Federal State shall be designed to develop harmoniously all the faculties of the human being and shall foster in him at the same time a love of country and a consciousness of international solidarity, in independence and justice (The 1917 Constitution).

This article gaurenteed "freedom of religious beliefs." It also says that any religious teaching shall be kept away from the schools. No one is forced to beleive anything they don't want to and no one is harassed for having the beliefs they have. The article also says that idea of this law is to "achieve the understanding of our problems" and to "contribute to better human relationships." People also had the right to go to school for free.

<span style="COLOR: rgb(236,19,19)">**<span style="COLOR: rgb(255,80,0)">Article 27 - Was mostly written by Molina Enriquez. "It's theory is: All land and other productive resources belong to the commonwealth, but may be held as private property except when public interest requires otherwise." (Brenner, 55)

"Ownership of the lands and waters within the boundaries of the national territory is vested originally in the Nation, which has had, and has, the right to transmit title thereof to private persons, thereby constituting private property." The only time land shall ever be expropriated is for public use and "subject to payment of indemnity" (The 1917 Constitution).

The wealth in the soil, and waters and seas of Mexico "belongs to the Nation." People have the right to exploit the land that they own. This article made it possible to control the activities of mining and oil companies and to distribute the land of the larger estates among the poor(elbarero).

Another specification of this article inlcuded that "Only Mexicans by birth or naturalization and Mexican companies have the right to acquire ownerships of lands, waters, and their appurtenances, or to obtain concessions for the exploitation of mines or of waters."

Also that "religious institutions known as churches, regardless of creed, may in no case acquire, hold, or administer real property or hold mortgages thereon:" (The 1917 Constitution).

In article 3 people were given freedom from the church such that people didn't have to believe anything they didn't want to believe, and they couldn't be forced to. The fact that article 27 has a specific section dedicated to making it clear that the church has no right over private land enforces this idea that the people are free from church control. Freedom from church domination wasn't just assumed when the article said "Ownership of the lands and waters within the boundaries of the national territory is vested originally in the Nation, which has had, and has, the right to transmit title thereof to private persons, thereby constituting private property" (The 1917 Constitution). The anti-clerical provision was so important it had to be specifically spelled out. **


 * Article 123** - protects the workers. "The maximum duration for one day shall be eight hours" and for the night seven hours. This article also declares that unhealthy or dangerous work done by women and by minors sixteen years of age may not take place after ten o'clock.

<span style="FONT-FAMILY: Arial,Helvetica,sans-serif">Wages were another major development. Article 123 declares that minimum wage must be sufficient in order for the head of families to satisfy social and cultural needs for their families. The minimum wage must also consider the “conditions of different and commercial activities.” Wages could also not be determined by gender or race. <span style="FONT-SIZE: 10pt; FONT-FAMILY: Arial,Helvetica,sans-serif">Employees that worked for major industries like agricultural or mining were guaranteed hygienic living quarters with reasonable rent. The article also promised that necessary services such as schools and hospitals must be available and situated within the town those employess work in. (The 1917 Constitution). By giving employees better working conditions and the right to work, the constitution was intended to make it possible for more people to work than before. More people would make more money and that meant that they were going to spend, and the economy would grow. This was appealing to the leaders of Mexico because they wanted to get rid of the image that Mexico needs to rely on other countries to survive.

Link to the 1917 Constitution : http://www.ilstu.edu/class/hist263/docs/1917const.html

**Post Constitutional Economy**
The Constitution of 1917 tried to decrease Mexico's heavy dependence on foreign economies, and claim "Mexico for Mexicans." Despite criticism that Caranza's constitution would be retroactive, he made steps to nationalize Mexican industries, starting with petroleum fields. This was met with much diplomatic protest from the United States, who had large investments in Mexican oil. Carranza then proceded to seize the railroads that cris-crossed the country, including the Mexican Railway, the Interoceanic Railway,the Railways of Yucatan, the Mexican Navigation Company, and the Wells-Fargo express company. Most of these railways were owned by foreign companies. High taxes were put on foreign companies, especially on petroleum. In 1918, there was a 23 cent tax for every barrel of oil, that only sold for 43 cents after being transported. Mexico had been too dependent on foreign industry for far too long, and the transition to nationalization proved difficult. (Page, 499)

A large part of the reason such high taxes were placed on foreign oil production was that the Mexican government was in enormous debt. Years of revolution does not make for a booming economy, and Caranza had to find a way to decrease the national debt. He refused to pay interest on the American bonds that had been taken out by his government, and seized properties with bonds and stocks overwhelmingly owned by Americans, then British, and then the French.

It is likely more than a coincidence that the seized properties were owned by the Allied powers. The main reason that Carranza had not been held accountable for all of the money Mexico owed was because Europe was distracted by the First World War. But if Germany won, Mexico would not have to worry about paying back the Allied nationals. The German Minister in Mexico city, von Eckardt, likely put this idea in the heads of Carranza's administration, and so as WWI continued, Mexico made no effort to pay off debts to the Allies. (Page, 499)

**So What Really Changed?**
After the Constitution of 1917 was drafted, old ideas from the charter of 1857 were finally realized. Though the subsoil had technically belonged to Mexico all along, and lay education was provided for in the 1857 charter, the old regimes chose to ignore them and legislation from Díaz's time prevented their implementation. (Brenner, 54)

Of course, the ideals put forth by the new constitution took years to make any sort of noticeable difference, but they opened the door for social and economic change. CROM is a good example of this. Carranza was not a fan of labor, and when workers protested low wages, he ordered military intervention, but article 123 still existed. In 1918, a labor leader named Luis Morones organized the Confederación Regional de Oberos Mexicaons, or CROM. This was Mexico's first labor union. CROM backed Obregón for the presidency and with the support of the labor union he was able to rebel against Carranza and claim the presidency. ( Suchlicki, 119)

The economic problems that led to the Mexican Revolution were solved by the constitution of 1917 to the extent that Mexican land and resources now belonged to Mexico and the lower classes had a slightly greater amount of upward mobility due to the new labor and education laws. The constitution was the first step in paficying the masses, which is the first step in building a viable economy.

**Sources**
Brenner, Anita. __The Wind That Swept Mexico__. Austin, Texas: University of Texas P, 1943.

Page, Walter H., and Arthur W. Page. __The World's Work: A History of Our Time.__ Vol. XXXVI. Garden City, New York: Doubleday, Page and Company, 1918. 498-500. Google. Stanford University, Stanford. 12 Sept. 2008. __Mexican Revolution and the Great War Revolution and Reaction in the 20th Century__. 1992. International World History Project. 11 September 2008 < [|http://history-world.org/mexican_revolution_and_the_great.htm]>

Mabry, Donald J. __Porfirio Diaz (1830-1915).__ Mississippi State University. 11September 2008 < [|http://www.latinamericanstudies.org/mexican-revolution/porfirio-diaz.htm]> Published version: "Porfirio Diaz," //Historic World Leaders//, 4: North & South America, A-L. Detroit and London, Gale Research, Inc, 1994, 212-216.

Mabry, Donald J. __The Porfiato.__ Historical Text Archive. 12 September 2008 < [|http://historicaltextarchive.com/sections.php?op=viewarticle&artid=334]>

Mabry, Donald J. __The Beginning of the End.__ 2002. Historical Text Archive. 12 September 2008 < [|http://historicaltextarchive.com/sections.php?op=viewarticle&artid=375]>

Reinschmiedt, Jordan __Limantour, Jose Yves.__ Historical Text Archive. 12 September 2008 < [|http://historicaltextarchive.com/sections.php?op=viewarticle&artid=557]>

Suchlicki, Jaime. __Mexico : From Montezuma to the Fall of the PRI.__ New York: Potomac Books, Incorporated, 2001. 119.

Smitha, Frank E. __The Mexican Revolution Overthrowing Dictatorship.__ 2004. Macrohistory and World Report. 12 September 2008 < [|http://www.fsmitha.com/h2/ch03mex.htm]>

Kreitlow, S. Bert. __The Political Economy of Preserving the Past: The Rio Blanco Mill In Mexico__. March 1999. American Historical Association. 11 September 2008 <http://www.historians.org/perspectives/issues/1999/9903/9903INT2.CFM><span style="FONT-SIZE: 10pt; FONT-FAMILY: Arial; mso-ansi-language: EN-US; mso-fareast-font-family: 'Times New Roman'; mso-fareast-language: EN-US; mso-bidi-language: AR-SA">

Hansen, Roger D. __The Politics of Mexican Development__. Baltimore, Maryland: Johns Hopkins P, 1971. "The Constitutionof 1917." 14 Sept. 2008 http://www.elbalero.gob.mx/kids/history/html/rev/constitu.html.

"1917 Constitution of Mexico." 14 Sept. 2008 http://www.ilstu.edu/class/hist263/docs/1917const.html.

//1 -Grito de Dolores: mural by O’Gorman//. [Photograph]. Retrieved September 14, 2008, from Encyclopædia Britannica Online: http://original.britannica.com/eb/art-100800 2- __Index of /mexican-revolution__. 26 May 2007. 14 Sept. 2008 <http://latinamericanstudies.org/mexican-revolution/?S=A>

3 - "The Constitution of 1917." __Mexico and its Culture__. 14 Sept. 2008 http://zedillo.presidencia.gob.mx/welcome/pages/culture/note_5feb.html.

<span style="FONT-SIZE: 10pt; FONT-FAMILY: Arial; mso-ansi-language: EN-US; mso-fareast-font-family: 'Times New Roman'; mso-fareast-language: EN-US; mso-bidi-language: AR-SA">4-http://www.nevadaobserver.com/Mexican%20Revolution%201/Mexican%20Railroad.jpg

5- http://www.amphilsoc.org/library/mole/m/tepecano.jpg