Memorandum of Conversation, by the Secretary of State

The Mexican Ambassador came in at my request. After some preliminaries, I said that I had asked him to come in in order that we might add a little more to some of the oral conversations we have been conducting from time to time in connection with the American-Mexican problems now pending. I proceeded first to speak of the chaotic condition in international relations in many parts of the world [Page 708] and how deeply disappointed I feel not to have entirely satisfactory relations among the American Republics as an example to other nations.

I said I had in mind at present three outstanding points: that one relates to the question of whether our two governments shall continue the hammer and tongs discussions through exchange of notes, or, whether they shall be terminated so far as the present issue is concerned and efforts made through oral conversations to make some real progress with our problems; that I had prepared elaborate data in connection with a note of considerable length, with a view to continuing the hammer and tongs discussions but also with the strong conviction that they would soon estrange our two countries in every important way. I said that my Government would be glad to discontinue these long drawn out notes, for the reason that they hurt both countries, but, in my opinion, hurt Mexico most; that I would hope then for oral conversations to begin looking towards progress in dealing with the problems involved.

I then said that the Government of Mexico had introduced two new points in its last reply to the American note, and I have considered a brief note, of probably less than two pages, acknowledging this last Mexican note, stating that the single outstanding issue is the principle of just compensation versus the policy of confiscation and then making not an argument but a simple statement in rebuttal. I then referred to the other brief recitals in the proposed note relating to arbitration and a commission for valuation purposes. After doing so I said, “You could inquire of your Government whether it prefers that the long argumentative notes, such as I am referring to, shall be continued further, or, whether the Mexican Government would be willing for the matter to end with this brief simple acknowledgement of two pages or less.” I said that I felt this would determine more or less the interest of the Mexican Government in moving directly towards some settlement through oral conversations.

I then said I would like to know definitely just what the Mexican Government would do about discontinuing further seizures. The Ambassador replied that, while the Government could not make any public statement or go on record about the matter, it would agree not to make any more seizures (nothing was said about whether land or otherwise), but that it would be necessary to make about four exceptions which would comprise three small tracts and one large tract; that these could be valued and arrangements about payment made along with the other valuations and arrangements for payment. I said that his statement was somewhat vague as to when and in what amounts the Mexican Government would be prepared to make payment on the lands which the proposed commission would value, and before sending a man to Mexico to discuss valuations and payments [Page 709] I would like to know something a little more definite as to the certainty of real plans to make payment; that I would not want to send a man to Mexico to sit with a commission to value these properties for six months and then ascertain that there were no real possibilities of payment. The Ambassador said that President Cárdenas was willing to agree to a limitation of six months in which the valuations should be made, and then the Ambassador added himself that the commissioners could within the first thirty days discuss and decide and dispose of the entire question of time, amount, and method of payment, so that if their efforts should fail in this respect my representative on the commission would not be detained six months but only one month. The Ambassador spoke about calling President Cárdenas for further elaboration of some of these matters. I then suggested that he might care to call him tomorrow on the two points relating to more information as to time, amounts, and method of payment, and also give him the substance of the proposed short note which I would be disposed to put out now instead of a long argumentative note in the event it is agreeable to close the exchange of notes. The Ambassador said he would be quite glad to take this step and communicate with me further.

C[ordell] H[ull]