812.5045/512: Telegram
The Chargé in Mexico (Boal) to the Secretary of State
[Received 8:15 p.m.]
241. In an informal conversation today Ambassador Castillo Najera told me that in accordance with a conversation he had with Mr. Welles in Washington before he left he had discussed the outlook on the petroleum labor difficulties with President Cardenas yesterday. The President told him that he expected to receive the representatives of the petroleum companies to discuss the situation with them, that he expected to take the entire petroleum situation into his own hands with a view to arriving at an early solution, that he would deal with it in his message to Congress on September 1 and would see Ambassador Castillo Najera again on September 2 to give him a further explanation of the subject which he could give to Mr. Welles upon his arrival in Washington.
The Ambassador said that he was under the impression that an adjustment would be reached with the petroleum companies which would settle the matter, that he thought the companies this time were in fact faced with demands which were economically impossible, and that he appreciated that it would be no advantage to anyone to force a rupture which would result in their withdrawal from Mexico and unfortunate repercussions in the United States. He said that he felt sure the President would find a way to extricate the experts from the difficult position into which they had gotten themselves in their report to the Labor Board so that an adjustment could be reached.
[Page 670]The Ambassador said that four representatives of the petroleum companies had called upon him this morning at the Foreign Office that he had seen them only briefly as he did not feel that he had any direct connection with the matter and had asked them to reiterate their telegraphic request for an early interview with the President. He said that he would get in touch with me again as soon as he had further information on the progress of the question.
While I am sure that he will exercise his influence with the President to bring about an acceptable adjustment, I anticipate that for political reasons the President may have to deal unsympathetically with the petroleum companies in his message to Congress on September 1. I anticipate that if an adjustment is reached between the companies and the Government which will dispose of their labor troubles and tend to establish their progress for the future, the Government will seek to accomplish it on a basis of some early payments by the companies to the Government on account of taxes or on some other score which will help the Government meet its present large commitments.
Ambassador Castillo Najera spoke with some emphasis of the importance which he and Licenciado Suarez attach to the reestablishment of Mexican credit in the United States.