File No. 812.512/857.
The Mine and Smelter Operators’ Association to the Secretary of State.
In view of proposed recognition by United States Government of Carranza and probability that Carranza forces will be able in a short [Page 947] time to control affairs in northern Mexico, which have lately been under the dominance of the Villa faction, the entire mineral industry of this northern section of the country is alarmed over the various tax decrees which have recently been issued by the Carranza Government at Vera Cruz and Mexico City, covering payment of taxes on mineral lands and taxes on gold, silver, lead, copper and zinc in ores or bullion exported from Mexico. The decrees involve taxation upon the mineral industries so heavy that it will be difficult for many companies to operate under normal prices at a profit. It would appear that Carranza will endeavor to finance his government largely by these excessive demands upon the mineral industry, and thus in reality obtain his finances from American and foreign individuals and companies. Owing to the fact that, particularly in the northern section of Mexico, a large part of the burden of feeding the Mexican laboring class has been assumed during the past two years by American companies, many of whom have operated without any profit, it does not seem just that the excessive taxation proposed by the Carranza Government should become effective.
We respectfully call this to your attention, soliciting your consideration of this matter, hoping that you may see fit to have some satisfactory understanding with the Carranza Government prior to actual recognition.