Snarl Cut

The President of Mexico took a pen into his heavy fist and signed, "P. Elias Calles."

The document before him comprised new regulations altering the effect of those Mexican oil laws which the U. S. has branded as "retroactive and confiscatory" (TIME, Feb. 22, 1926).

President Calles, it is safe to say, would not have signed the new regulations, last week, except for the fact that the U. S. now has in Mexico City a new and abler-than-usual Ambassador, Dwight Whitney Morrow, onetime Morgan partner. By large business methods and with a Morgan-sized grasp of essentials, Mr. Morrow has, in four months, cut the oil snarl which has embittered the U. S. and Mexico for a full decade.

One year ago the U. S. State Department thought and stated that a "Bolshevist Hegemony" existed in Mexico. Last week the Department issued an official communique, in part as follows:

"The petroleum regulations just promulgated by President Calles . . . would appear to bring to a practical conclusion the discussions which began ten years ago with reference to the effect of the Mexican Constitution and laws upon foreign oil companies. The Department feels, as does Ambassador Morrow, that such questions, if any, as may hereafter arise can be settled through . . . the Mexican administrative departments and the Mexican courts."

Thus the Department warned U. S. oil men that if they do not choose to abide by the Morrow-Calles status quo, created last week, they can no longer count on State Department aid in bucking the Calles hegemony in Mexico.

The new regulations, boiled down from their several score articles, provide that:

1) The rights held by foreigners in Mexican oil properties prior to the adoption of the Mexican Constitution of 1917 will be confirmed.

2) This confirmation, which will be made to applicants prior to Jan. 11, 1929, will validate their rights in perpetuity, thus supplanting the system of 50-year-confirmatory titles which the U. S. contended was confiscatory.

3) The nature of the "rights" possessed by U. S. holders of Mexican lands in 1917 shall include "oil rights" only in case it can be proved that they performed some "positive act" showing that they were developing or proposed to develop their lands to produce oil.

Commented Ambassador Morrow, last week, on the subject of "rights": "While there may well be honest differences on this point, there is no reason why any such differences cannot be satisfactorily settled through due operations of the Mexican governmental departments and the Mexican courts."

Clearly, Ambassador Morrow takes the large view that it would be futile to try to exact from Mexico the confirmation of "oil rights" to persons whose lands had shown no trace of oil in 1917--when Mexico embarked upon a Constitutional regime definitely conserving future Mexican oil discoveries to Mexicans.

Ambassador Morrow's important gain has been to secure apparent justice for those U. S. citizens who held bonafide Mexican oil lands in 1917.

At Manhattan, last week, oil men awaited the Spanish text of the Calles regulations and prepared to take the advice of highest paid counsel before settling back in the comforting assurance that all is substantially well with oil in Mexico.

Few who read of Ambassador Morrow's achievement, last week, could learn without keen interest that his brother, Colonel Jay Johnson Morrow, is now busy in Manhattan as chairman of a commission which is attempting to reconcile certain special boundary claims between Chile & Peru arising out of the general perennial Tacna-Arica controversy (TIME, Nov. 26, 1923).

Since 1925 Colonel Morrow has been quietly presiding over his commission, having previously been Governor of the Panama Canal Zone. A close lipped Army career man, he would neither affirm nor deny, last week, reports that his commission is on the point of submitting its completed findings to President Coolidge, who acts, by request of Chile & Peru, as a gingerly umpire of the dispute.