The Charlotte News

Thursday, July 7, 1938


Site Ed. Note: We include the following piece by Hugh Johnson on the oil deal between Mexico and Italy and Germany, mainly Germany, as arranged by the very oily William Rhodes Davis, to supply a market for the expropriated American and British oil after both the American and British companies boycotted the oil. This appears one of the earlier editorial pieces recognizing that Mexico was trading this most valuable military materiel to belligerents, certainly before Cash had mentioned it in the News columns.

Egging on the Spigs

By Hugh S. Johnson

BETHANY BEACH, Del.--Mexico hasn't done a thing about paying for the foreign oil property she seized. She is selling oil on a barter basis to Germany and Italy, which is to say she is not getting much money for it--mostly merchandise and machinery which this country used to sell to Mexico.

The oil was taken because of her refusal by the companies to adopt fantastic labor conditions as to wages, hours and union management of the properties. They were cynically impossible, and since the seizure no such idyllic terms have been given the workers. The government simply hasn't got any money to pay workers or for any other purpose. A recent attempt to float an internal loan was almost a complete failure. With the wholesale seizure of private foreign property, nobody outside her borders will either lend or invest a cent in Mexico.


There is a somewhat similar leftist movement in nearly all of the other Latin-American countries. Legislation similar to that under which Mexico seized these oil properties is being proposed in more than one. Why shouldn't such property be taken if the government whose nationals suffer makes no complaint?

That is a purely rhetorical question with an obvious answer. These are nearly all countries of tremendous but undeveloped natural resources. They simply cannot progress without foreign trade, loans and investment--any more than this country could have developed without such assistance. Such seizure of properties without paying for them is a swift and certain way to dry up international intercourse, whether commercial or financial.

If there is anything realistic about the good neighbor policy, it will lean across the back fence and give Senor Cardenas some friendly advice. No, we're not going to send any ships or soldiers to save anybody's oily dollars, but there are plenty of other things we could and should in good conscience do to prevent a paralysis of economic relations. Among the least of these is to stop seeming by silence to encourage and approve this Red adventure as an item of a counterpart of our own Third New Deal.


Our Ambassador to Mexico, the good Josephus Daniels, is a loved and lovable gentleman, but he is an ardent Third New Dealer and his advanced age is taking its toll. His public utterances have approved the general course of Cardenas. Nothing that our State Department has uttered has been more robust than a tap so gentle and tentative that Mr. Cardenas probably considered it an encouraging slap on the shoulder rather than a disapproving kick in the pants.

His attitude or ours is no service to world peace and prosperity to Mexico herself, and certainly none to this country. It seems to be inspired in part by the administration's domestic labor policy and its general hostility to business. That is not excuse enough for this unwise excess of timidity.

Lehman Tidies Up*

For the first time since 1931 New York State has finished up a fiscal year in the black. The $100,000,000 deficit inherited from Governor Roosevelt has been wiped out at last, and Governor Lehman is exceedingly proud of the feat, as well he may be.

For Governor Roosevelt not only left the State with a whopping deficit but with a dizzy funded debt: and debts require servicing. Lookee:

1929....................... $255,986,000

1930........................ 276,865,000

1931........................ 307,302,000

1932........................ 461,068,000

This man Roosevelt is full of the highest ideals, and a lot of them we admire. But, alas! they come high, too.

Zoological Marvel

One of our 448 editorial writers and one of our brigade of reporters think they have unearthed a new marvel in natural history, about which both are hopping mad. On July 4 they succumbed to immemorial American folkways and went on a picnic in the country. Sat themselves down beside the ruins of an ancient mill in a bosky dell and consumed vast quantities of fried chicken and tomato sandwiches and hard-boiled eggs, while the huge trees sighed overhead, and peace descended upon the little editorial and reportorial souls, and they talked huskily of retiring to a little farm when their exertions should be over.

But on July 6 those gentlemen are busily engaged in doubling for contortionists or Cousin Jocko in pursuit of his fleas. One claims to have counted 7,482 chiggers who are presently enjoying his un-proffered hospitality. And the other reports only 16 less. Which brings us to the zoological marvel. They took along two dames on the picnic. Indeed, it was the dames who thought up the idea of the picnic in the first place. But--according to the dames themselves (naturally unsupported by clinical findings) nary a chigger has either one got.

What they want to know, and what we want to know, is: don't chiggers ever snuggle up to dames? And furthermore, if they don't, what these two want to know, and what we want to know, is: is that fair in a woman's world where dames think up picnics in the first place?

Notes on Two Showmen

Signor Mussolini went out from Rome to Aprilia this week and played Cotton Ed Smith in a fashion to make Cotton Ed blush with envy. Cotton Ed once got himself up at election time in overalls and a rush hat and rode whooping into town on a spring wagon. Signor Mussolini, who hadn't the excuse of running for anything, stripped himself to his favorite paunch and helped the peasants harvest the wheat.

That got him a lot of cheers, but the crowd went wild only when the Signor stood up very tall and told them with the flashing eye and proud voice that Cotton Ed uses with his constituents when he tells them that he'd walk out of Heaven if they had set a black parson to praying for him there--when the Signor told them that he wouldn't have bought a bushel of wheat from the "so-called democracies" even if Italy's crop had failed completely and everybody had to go hungry.

The Signor overspeaks himself, but he might have had some difficulty in supplying all of Italy's wheat needs, at that. The balance of trade runs strongly against him. He has no gold that he doesn't need for war. His credit is NO anywhere save in England, and Chamberlain is still holding out on his promised loan. But the Signor turned that hard necessity into a splendid, heroic boast, and got away with it.

Cotton Ed is pretty good at turning necessity into virtues, too, but he never pulled one quite so fancy as that. He better look to his laurels.


In the lingo of insurance agents, 5 & 10 refers not to 10-cent stores but to the usual protection of motorists against public liability. Five means $5,000 maximum insurance for injury to one person, and ten means $10,000 maximum insurance for injury to more than one person in the same accident. This is considered essential coverage for each vehicle.

In the dime-taxi ordinance that the City Council passed on two readings yesterday, however, this basic insurance principle of extra coverage for multiple liability was reversed. The more vehicles that are operated by any one individual or company, the less their bonded liability. If a man puts one car on the streets, he posts a bond of $5,500. If he operates two cars his bond goes up to $5,600, or $100 additional for the second car. And if he operates ten cars, his bond increases to only $8,400, which is an average of $640 per car, or virtually no protection at all.

We have maintained that the dime-taxis offer a transportation service for which there was a demonstrated need. We still think so, but with no such flimsy guarantee as this of their liability to passengers and pedestrians and other motorists. Indeed, the Council must have been day-dreaming about vacations yesterday when the ordinance got by.

A Greek With Gifts

Alf Landon came out as a liberal in the course of giving Mr. Roosevelt down the country last night. Which somehow seems about as convincing as John D. M. Hamilton's proposition that it was really old Tom Jefferson who fathered the GOP, or the other proposition that elephants actually do have wings.

According to Alf, he is heart and soul for Mr. Roosevelt aims, but dead agin his methods, which are completely responsible for the current slump in business. Now, as for that, it is immensely probable that some of Mr. Roosevelt's schemes and acts have played a big part of bringing on the slump. The capital gains tax, the frightening of the utilities, the perennially unbalanced budget--all these look like very grave mistakes. Yet when all is said and done, the evidence that Mr. Roosevelt and his policies are responsible for the slump is considerably less than the evidence that Herbert Hoover and Republican policies were responsible for the great Daddy Rabbit of depressions which began in 1929--as Alf neglected to say.

Ourselves, we approve the President's general aims and often disapprove his methods. But between laying down aims and putting them into practice there is a very big difference. And granting that Mr. Roosevelt ought to have made fewer blunders and to have been more honorable about them when made, we still have our doubts. We still aren't going to plop for the proposition inherent in Alf's speech--that the Republicans can do it better--until he tells us concretely what methods they propose to use, and gives us some surety that they are not going to repeat and make an even bigger mess of things than Mr. Roosevelt has.

Taxes on Temperance

The lead of a newspaper story is supposed both to contain the essential facts and present them in a striking way. Thus the story under a Columbia date line of about tax receipts from alcoholic beverages in 1937-38 begins in this orthodox fashion:

South Carolinians drank less beer and wine but more whisky in the year which ended June 30 than in the preceding 12 months...

Closer examinations, however, will show that the remarkable feature of the consumption and taxation of alcoholic beverages in South Carolina is not the prevailing taste for liquor but the importance of wine and beer as a revenue producer. With liquor stores occupying most of the corner locations not preempted by filling stations, and with the huge North Carolina border trade confined exclusively, we should guess, to the whisky that can't be purchased legally at home, beer and wine still brought half as much money into the treasury as the harder, headachy stuff.

Despite the lamentations of the Prohibitionists, by no means does the cause of true temperance seem to have been lost in South Carolina. Any state that will pay half as much in tax for the privilege of drinking beer and wine as for the privilege of drinking hard liquor shows promise of getting its drinking habits under control. Either that or the State itself discourages temperance by taxing wine and beer too heavily.


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