Curious customs—The abuse of concessions—Flagrant examples—Prospects for
foreigners in Mexico—President Diaz—Mr. Denny’s Life-story.
One of the curious customs in Mexico is the blessing of animals on the
17th of January, the feast of Saint Anthony. On this day at the Merced
(Mercy) Church of this city, from four o’clock in the afternoon till
dark, the people bring all their animals to be sprinkled with holy water
and blessed by the priest. All the animals are highly decorated (I have
seen dogs painted all the colours of the rainbow and covered with
ribbons for this occasion), and every kind, horses, chickens, goats,
pigs, cats, cows, all are brought to the street in front of the church,
when the priest comes out and walks down the line, sprinkling them. In
some matters Mexico keeps abreast of the times, and possibly is ahead of
India and even England. For instance, a dirigible balloon was brought
here from the States and run by an American, who could handle it
perfectly, going wherever he wished and sailing or swooping at will. It
was brought by a Mexican tobacco firm to advertise their cigarettes! I
doubt if India or England has yet begun to advertise with dirigibles. It
was also, incidentally, a godsend to the _rateros_, pickpockets and
thieves, who reaped a harvest while every one was gaping at the heavens.
One of the things which militate against the growth and prosperity of
the country is the custom of granting concessions for every imaginable
purpose. When these concessions are asked for by people who intend to
invest money in the country and develop a new industry it is bad enough,
but the trouble is that many of these concessions are obtained by
concession hunters who have barely enough money to put up as the
necessary guarantee. These people, hearing of the possibility of some
company starting a new industry here, immediately ask for a concession
covering the industry, put up the few hundreds or thousands necessary to
secure the concession, and then sell out at an enormous profit to the
prospective manufacturer. These holdup methods do not always succeed,
however, as in the following case. The men at the head of our concern
contemplated putting up gas plants in most of the big cities of the
republic to supply light and power and heat, and to consume part of the
immense production of oil from their field—gas here and in California
being now made from oil instead of coal. A lawyer here, hearing of this,
asked for the gas concession for this city, put up the $1500 asked as a
guarantee, and was granted the concession. With this in his pocket he
went to Los Angeles and tried to sell it to our company, who, however,
only laughed at him, told him to go ahead and put up his plant, and that
they would sell him oil when he was ready. In the meantime they had
secured the concession for Mexico City. After this rebuff he tried to
get other people to take up the concession, and only after much expense
and two years’ time succeeded in getting people who would buy his
concession and build the plant which is now in operation in Guadalajara.
Some of these concessions are a robbery of the community at large. One
granted to a dynamite concern gives them the sole right to manufacture
this article, so vital to the mining industry of the country. To protect
them, a duty of $90 per ton was placed on the import of the foreign
dynamite, but the concession states that, if the company cannot
manufacture sufficient to meet the demand, they may import free of duty
the balance necessary. The outcome of this is that the company
manufactures enough to protect their concession and import all they
need, and the entire industry is in their hands. Another concession
granted to a young Mexican of this city was ostensibly for irrigation of
waste lands, and it reads in part as follows: He is allowed to take all
the water he needs from Lake Chapala to irrigate these federal lands
(some 400,000 acres), and is paid by the government $5 for each acre so
irrigated. He is allowed to build hydro-electric works on the canal, and
transmit and sell power wherever he likes; it is estimated that he can
generate 50,000 horse-power on the works he has installed, and was first
a competitor, and later, combined with the light and power company of
the city. Then comes this small, innocent-looking clause: the land round
the borders of Lake Chapala, between the present high-water mark and
whatever point he succeeds in lowering the lake to, is given to him.
Just imagine a strip from 10 to 50, possibly 100, feet wide round the
border of a lake that has about 130 miles, more or less, of border!
Besides, he cut every landholder off from a water-front. One wealthy
_hacendado_, realising what it meant to his ranch, paid him $500,000 not
to touch his borders. A German company offered him $2,500,000 in cash
for the bare concession.
Foreigners, as a rule, are fairly welcome in this country, as they bring
in money and start new industries. The upper class and the labourers
appreciate this, but the middle class and the skilled mechanics do not,
as the latter are crowded out. The Mexican railroad men some time ago
agitated for a law which would practically prohibit Americans working at
this business, as at that time there were very few Mexicans holding
responsible positions on the railroads of the country—few indeed got to
be engineers or conductors. When they could not get their law passed
they started anti-foreign agitations all over the country, and were
backed by all who were “agin the government,” till finally, five years
ago last September, the word went round that all foreigners would either
be killed or run out of the country. Notices were posted in this and
other towns (and immediately torn down by the police) warning us what
was to happen if we did not leave, and things began to look serious. Of
course few of us looked for any general rising, but for isolated attacks
on individuals. Lots of people found it necessary to leave for the
States on business (?), and I think most that remained went armed.
However, the government was not idle. On the 14th September they ordered
all the saloons to be closed and stay closed till the 17th. On the 15th
they started making arrests of persons known to be disaffected, and some
five hundred from this city and about seven hundred from surrounding
towns found themselves in the penitentiary that night. On the nights of
the 15th and 16th (the great national holiday) soldiers in small squads
patrolled the city till morning, and any one who even shouted “_Abajo
los Gringoes_” (down with the foreigners) was immediately carried off to
the Quartel. It was the quietest 16th of September we have had since I
have been in the country; on the 17th the prisoners were all released,
and the crisis was over, without a single case of assault in the entire
republic. This is the way Diaz handled revolutionary talk. Now, since
Madero’s successful revolution, all this is changed, and the country is
trying to become a real democracy, and may succeed unless some other
Diaz arises. The railroads have been taken over by the government, they
buying a controlling interest, and Americans are gradually being
eliminated and Mexicans pushed to the front as fast as they can find
suitable men for the higher positions.
I have not till now described the vice-president and real head of our
company, Mr. E. L. Denny, and yet he is worth mentioning as well as some
of the incidents of his life. A handsome man, well read, with a low,
soft voice, and as well dressed a man as I have ever met; all of which
sounds incongruous with his early life. He was, till a few years ago, a
“prospector,” who did not have much luck in his prospecting. His
partners at different times were Harry Carter, who at the time was our
yard foreman, Tom Grand, who is here on a prospecting trip for Denny,
and Charles Canrod, who is his partner now in all his big undertakings.
Twenty years ago Mr. Denny joined forces with Charlie Canrod, who had
also been a prospector, and who had once made a strike and invested his
money in a livery stable and hotel, which cost him $35,000, and which he
later lost; for these men are rich one day and poor the next. Eighteen
years ago they were both broke and came to Los Angeles to find work in
order to earn enough money to go back prospecting. This a miner calls
earning “a grub-stake.” Denny had been working for the city, but took
contracts to paint some houses, and while working on the outskirts of
the town, near what is now “Westlake Park,” found some oil exudes. He
asked some one what it was (for he had taken a sample as a prospector
does), and was told it was “Brea.” He remembered that when he was in
Mexico that was the Spanish name for asphalt, and also having heard that
where there was an asphalt deposit there was or had been oil. He got his
partner Canrod, and they clubbed together what money they had and what
they could beg or borrow, and took options on all the land in the
Westlake district that they could get their hands on. The two began to
sink a shaft, 6 feet by 4 feet, down to find the oil. This shows how
much either of them knew at that time about oil; for if they had found a
gusher they would certainly have been killed. As it was, they were both
overcome once or twice by gas fumes, but did not know what it was.
Luckily, they only found a very little “seep” of oil, but sufficient to
peddle round for painting and other purposes, and to convince the
capitalists (whom they later interested) that they really had something.
Thus, getting a start with the aid of borrowed capital, they interested
a well-driller, who knew his business, to go in with them and sink
proper wells, and they soon had a paying proposition. From Los Angeles
they went to Bakersfield, where they got hold of oil properties, and
when they cleaned up there they had about one million dollars each. Then
they came to Mexico, bought up a tract of land, which they had
personally investigated, some 500,000 acres, which showed oil
indications, and invested over $1,000,000 in works, tanks, drilling
rigs, &c. This field and others later purchased, of which only a small
portion has so far been developed, is producing 57,000 barrels of oil
per day; and this production can be doubled by opening wells already
drilled and capped, as soon as the market is enlarged. Mr. Denny is now
worth probably over $30,000,000, and Charlie Canrod not much, if any,
less. They started the asphalt company to use up some of the by-product,
and have installed a gas company in Mexico City for the same purpose,
and will probably instal them in other cities as conditions warrant.
They also own oil fields at Sherman and other places in California, and
are interested in a dozen different ventures. Such are the men who have
made the Western States what they are to-day—men not afraid to take a
chance and with the brains and ability to carry their schemes through.