The "revolution" which had unseated Díaz had found its principal sponsors and beneficiaries among the upper and middle classes, for although they had pressed the lower classes into the fray to do the fighting and the dying, the latter had little to show for their efforts when the Constitution of 1917 was drafted. Just as in the struggle for independence, when it had been the criollos that had wrested power from the peninsulares, in the "revolution" it had been the mestizos and the Indians who had formed the bulk of the fighting force but who had experienced the least improvement in their lives. In neither instance had the fundamental problems of the Mexican nation been addressed, but only those that most directly impacted that minority of the population who saw the opportunity to enhance their own economic, social, and political position. As in so much of Latin America, the struggle for democracy, for equality, and for human rights still had a long way to go in Mexico before some semblance of victory would be achieved.
Few if any of the problems which had precipitated the conflict had been resolved, for Mexico was seriously in debt, inflation was rampant, wages were down and unemployment was widespread, the railways had largely been destroyed, and food shortages were pushing prices out of reach of the common people. Revenues from oil, most of which was going to the United States, were still relatively stable but when the Great War ended in Europe, the bottom fell out of the henequen market and the Yucatán was plunged into depression.
When Carranza took the reins of government, he continued to rule Mexico in much the same mold as had Díaz, for as an hacendado himself, he had no real intention of enacting any major changes in land ownership. Indeed, Zapata's continuing struggle in Morelos was a source of annoyance to him, and in July 1919, Carranza engineered a plot to have him silenced. An army colonel was given the assignment to pretend that he was secretly joining Zapata's movement and, when he got within range of the charismatic leader, he murdered him, in return for a promotion to a generalship. With Zapata out of the way, Carranza next addressed his own future. Knowing that he could not succeed himself in office when his term ended in 1920, he attempted to install a flunky who he could manipulate, but Obregón, who wanted the Presidency himself, had other ideas. Acting swiftly, he forced Carranza to flee to the mountains of Veracruz where his soldiers soon found and killed him. To fill Carranza's un-expired term, he had a Sonoran friend from Guaymas, Adolfo de la Huerta, named as president. However, when Obregón's cousin, General Benjamin Hill, announced that he, too, planned to run for president, this momentarily upset Obregón's own plans, but not for long. General Hill abruptly sickened and died, and only when autopsied could a cause of death be firmly established: arsenic poisoning.
Obregón also acted quickly to remove Francisco Villa as a potential source of irritation, offering him a pardon and a ranch in Parral, Chihuahua in return for his promise to withdraw from politics -- terms to which the now-aging fugitive readily agreed. So, as Obregón moved into the presidency in 1920, he was already a powerful hacendado but, being a pragmatist, he managed to greatly enhance his fortunes while in office by avoiding any conflict of interest with the all-powerful Yankee investors. Fundamental to this cozy working relationship with the Americans was his support for the so-called Bucareli Agreements of 1923, which essentially negated the provisions of Article 27 of the Constitution that would have restored mineral rights to the Mexican nation. As his own term of office neared its end, however, Obregón resorted to the same tactic used by Carranza before him, namely to choose a weak successor who could be controlled from behind the scenes. When he announced his choice of Plutarco Calles, another close friend from Guaymas, Sonora, a number of military generals rose in revolt against him, several of them likewise former associates from his home state. Secure in the backing of the Yankees, Obregón proceeded to have every one of the captured rebel leaders shot and even took the thoughtful precaution of sending a "hit-man" to Pancho Villa's ranch to kill him, lest the latter entertain any notion of joining the revolt against him. Altogether, at least seven thousand persons are known to have died in this abortive attempt to unseat Obregón.
Once Calles was suitably ensconced in the National Palace, Obregón retired to his hacienda back in Cajeme, Sonora, although it was clear to everyone that the country's center of power had accompanied him. Unfortunately, Calles' term in office was not only marked by a collapse in silver prices in 1926, but a decline in oil revenues as well, so when his government reiterated Mexico's claim to ownership of the sub-soil and restricted the concessions of foreign oil producers to fifty years, the United States once more threatened military intervention. Calles also made the "mistake" of trying to enforce the anti-clerical provisions of the 1917 Constitution, causing a religious uprising to break out in the solidly Catholic states of Jalisco, Colima, Michoacán, and portions of adjacent Zacatecas and Nayarit. Beginning in January 1926, armed peasants, rallying to the cry of "Viva Cristo Rey" (Long Live Christ the King) and subsequently known as the 'Cristeros', attacked government troops and dynamited railroad trains, while the army in turn shot priests, raped nuns, and pillaged churches. During the three years that this bloody sectarian war raged, over eighty thousand Mexicans were killed. By 1929, with drought ravaging much of northern and central Mexico and depression spreading from Wall Street throughout the world, both the impoverished Calles government and the unemployed clergy called a truce in the fighting, leaving the bewildered peasants in a state of limbo. As with so many contests of strength in Mexico, the Cristero uprising, too, ended without a clear-cut victory for either side.
Nudged by his mentor back in the chickpea fields of Sonora, Calles did manage to get the Congress to rewrite the Constitution to permit the re-election of presidents and to extend their term by two years, but otherwise he had such poor relations with the Senate that he had to govern by executive decree. However, such tampering with the Constitution did not sit well with politicians having aspirations of their own for the Presidency, and when a couple of his Sonoran military "buddies" ventured to announce their own plans for moving into the National Palace, Obregón did not hesitate to order them murdered. As a result, Obregón easily "won re-election" in 1928, but, with the Cristero revolt at its peak at the time, Obregón himself became the target of a pair of Catholic partisans on the street in Mexico City. He luckily escaped unscathed and his assailants were quickly put before a firing squad that savagely riddled them with bullets. Shortly thereafter, however, another Catholic fanatic gunned down Obregón at a banquet honoring him in a posh restaurant. At this juncture, Calles, fearing that he might be accused of having been a party to this scenario, promptly dismissed one of his cabinet officers known to be hostile to Obregón and proclaimed that he would step down at the end of his term, never to seek the presidency again. He further announced that, in the future, Mexico would be governed by "institutions" rather than by "caudillos", and essentially abdicated the power of the presidency to the Partido Nacional Revolucionario (the National Revolutionary Party).
The latter was a coalition of disparate political constituencies that recognized more could be accomplished through behind-the-scenes discussion and compromise than through half-hearted military coups. To be sure, the coalition represented the existing power structure of military men and regional chieftains whose grasp on power was ensured by exercising careful oversight over what might otherwise become unruly groups of industrial workers and land-hungry peasants. Thus, it was an arrangement that promised something to everyone -- protection to foreign capitalists as well as social justice to the downtrodden masses. To succeed in its program, the only prerequisite was to win elections, and with a network of political control extending downward from the national committee in Mexico City to the state and municipal delegations, this was a task for which it was admirably equipped. By making membership in the PNR a matter of personal choice, the Calles government also effectively preempted the "need" for opposition parties, although anyone with political ambitions certainly was quick to realize that they could only be achieved through "playing ball" with the party in power.
With Obregón removed from the scene, Calles now became the Jefe Máximo (the "Maximum Chief") of Mexican politics. In consultation with the PNR, he gave the nod to Emilio Portes Gil, an agrarian organizer from Tamaulipas, to serve as interim president until a new election could be held. Calles and the PNR chose Pascual Ortiz Rubio, an engineer from Michoacán as their candidate, but when José Vasconcelos, the secretary of education under Obregón, entered his name as an opposition candidate, it suddenly became necessary for the PNR to harass voters and stuff the ballot boxes to guarantee Ortiz Rubio's election.
On his inauguration day, an assailant with a rifle shot the hapless Ortiz Rubio in the face, and, although he survived, he seldom appeared in public following this attempt on his life. Calles continued to direct the affairs of govenment, and, two years into his job, when Ortiz Rubio sought to exercise his own authority, he was quickly forced to resign. As his replacement, Calles chose another old friend from Guaymas, Abelardo Rodríguez, on whom he could count for complete subservience.
The first decade of Mexico's post-revolutionary history had seen the country become the second largest oil-producer in the world -- dwarfed only by the United States, to which most of its own production went into export. President Wilson had warned Carranza not to try to enforce the Constitution of 1917 because it was "an anti-capitalist doctrine", and while there had been much muttering on the part of the Mexicans, they had not dared to challenge their powerful northern neighbor. Indeed, by 1930 Americans had more money invested in Mexico than they did at the end of the Díaz era, so the "revolution" had done nothing to reduce foreign influence in the country. Similarly, land reform had gone essentially nowhere, because the haciendas had been virtually untouched; nearly five-sixths of the country's best farmland was still in the possession of about two percent of the nation's landlords. Of the country's three and a half million agricultural workers, over 70 percent had no land at all and another 15 percent tilled such minute and scrubby parcels that they could scarcely support themselves and their families. For their part, the industrial workers found wages and working conditions only minimally improved, though by the end of the "revolution" they could at least air their grievances through the Regional Confederation of Mexican Workers (CROM), a government-controlled union. However, the Great Depression all but wiped out the small gains labor had made in the first post-revolutionary decade as massive unemployment again spread through the country. Even the modest advances made by the feminist cause, especially in Yucatán during the progressive administration of Governor Felipe Carrillo Puerto, came to an end in 1923 following his assassination. Sadly, Mexico's "revolution" had not been a change with "a capital R": despite over a decade of bloodshed and the loss of more than one million lives, most of the country's most pressing problems still remained un-addressed.
The collapse of the world economy in 1929 merely increased the suffering of the Mexican people. The bottom dropped out of the market for all of the major export commodities -- oil, minerals, cotton, and henequen -- causing mines, factories, and plantations to close, and thousands of farm workers were sent home from the United States to further swell the masses of unemployed in Mexico. Drought ravaged much of the central and northern regions of the country, curtailing the already meager harvests of corn and beans, and pushing food prices out of reach of the impoverished masses.
Clearly, in this dire hour of global distress, Mexico, like most of the other countries of the world, looked to a "messiah", to a "miracle worker" to lead it out of its deepening quagmire of misery. Fortunately, the man of the hour was already being groomed for his task in the heart of the western state of Michoacán. He was Lázaro Cárdenas, born of chiefly Indian ancestry in the village of Jiquilpán in 1895. His father was a field hand and a weaver of shawls, but being able to read, had worked himself up to becoming a small shopkeeper. Appreciating the value of education, he made sure that his son Lázaro was enrolled in a private school at the age of six. A couple of years later Lázaro transferred to a public school whose teacher instilled in him a deep admiration for Morelos and Juárez as well as a strong antipathy toward the church and foreign intervention in Mexico's affairs. Cárdenas also had ample opportunity to acquaint himself with the plight of the Indian masses and to develop empathy for their struggle for land reform. In his mid-teens he managed to obtain a position in the local tax collector's office, a job that required him to outfit himself in both a coat and a tie, and at 16 he became an assistant to the secretary of the municipal mayor. As a youth of eighteen he joined the army to fight in the Revolution against Huerta, and by the end of the war he had advanced to the rank of General. His rapid promotion was no doubt due, in part at least, to the fact that he had come to attention of Plutarco Calles, who valued the taciturn and laconic young man as one of his most faithful lieutenants. In 1928, at the age of 33, he was elected governor of the state of Michoacán, but the timing of his debut into politics had to be one of the least auspicious that can be imagined.
Facing the united opposition of large landowners, clergy, and Cristeros, Cárdenas immediately set about building his own power base among the campesinos of Michoacán, because the state lacked a significant industrial sector. Calling his movement the Michoacán Regional Confederation of Labor (CRMDT), Cárdenas drew together a following of agricultural workers, public servants, university students and teachers whose numbers swelled to more than 100,000, divided into something over 4,000 rural cadres. Through his land reform program, he organized a number of ejidos and saw to it that they were likewise organized into well-armed rural defense units. He also was the godfather of the Feminist Federation of Michoacán that launched a campaign against both alcoholism and religious fanaticism and trained the women to assist in the defense of their ejidos if their husbands were incapacitated in any way. His political program further called for agrarian reform, an 8-hour work-day, a minimum wage, and close cooperation with the Mexican Regional Labor Confederation (CROM) headquartered in Mexico City.
An adroit politician, Cárdenas managed to keep all real political power in his own hands by making sure that the hierarchy of the CRMDT was systematically shuffled out of office as their elective terms came to an end. Usually this meant that a federation member 'graduated' to some political office, such as becoming a state legislator, a delegate to the National Congress, a municipal presidency, or a judgeship. With allies in such strategic positions, Cárdenas soon found himself climbing the national political ladder, first becoming the head of the PRN, then Secretary of War, and in 1932 being named to the inner sanctum of Calles' closest advisors.
With the blessing of the national power structure, Cárdenas relinquished the governorship of Michoacán to a conservative who quickly set about trying to undo much of what he had accomplished during his four years in office. Now, with national political ambitions foremost in his mind, Cárdenas shifted his support to a successor who represented the Confederation of Mexican Workers (CTM), thereby dealing a deathblow to the CRMDT that had outlived its usefulness as a stepping-stone to power.
In 1934, when Calles and the PRN threw their support behind Cárdenas rather than to one of the three generals also seeking the 'nod', he was assured of election as Mexico's next president. But, dissatisfied with the rubber-stamp approval of the party rather than a vote of confidence from the populace at large, Cárdenas immediately set off on a nation-wide "campaign tour", in which he visited every state in the union to meet with the people, to listen to their grievances and hear them express their hopes for the future. Returning to Mexico City following the election, he ended his acceptance speech with the words, "I have been elected President and I intend to be President", a clear message to his patron and mentor, Calles, that he had every intention of being 'his own man'.
When Cárdenas took office, the Mexican economy, like that of most of the Western world, was in deep distress, so he and his advisors devised a Six Year Plan for development, no doubt patterned to some degree on similar programs which had been set in motion in the post-revolutionary Soviet Union. It was a strongly nationalistic document which called for agrarian reform, the recognition of the ejido as a fundamental building block of landownership in Mexico, the establishment of a bank to extend credits to farmers, the expansion of irrigation systems in the arid central and northern regions of the country, and the extension to peasants living on large haciendas of the right to petition for small plots of their own. The plan also called for compliance with Article 123 of the Constitution that granted workers the right to organize and strike and also for enforcement of the Constitution's provisions dealing with the ownership of the country's sub-soil resources of petroleum and metallic minerals. In addition, rural education was to be expanded through the construction of some 12,000 new schools, and the curriculum itself was to emphasize scientific, rational, and socialist goals, including sex education, while at the same time banning all religious teaching. The uprising of the Cristeros against Calles' earlier anti-clerical measures was, of course, fresh in everyone's memory and one of the most notorious opponents of the Church, the caudillo of Tabasco state who had won the sobriquet of "executioner of priests", still occupied the post of agricultural secretary in Cárdenas' cabinet. Naturally, the Catholic devout of the country, concentrated largely in the central states of Puebla, Morelos, Jalisco, Zacatecas, and Cárdenas' home state of Michoacán, were infuriated by such ideas and some 8000 middle-class urban dwellers took up arms to contest them. So divisive an issue was the matter of sex education that this part of the new school reform had to be shelved, at least temporarily. Even so, anti-clerical feeling was running so high that by 1935 over half of Mexico's states had no priests at all. When the governor of Veracruz arbitrarily set a quota of one priest for every 1000 inhabitants in his state, it seemed a most generous "compromise", because in the country as a whole their numbers totaled scarcely more than 300 -- or less than 1 per 40,000 inhabitants.
Calles, now in retirement in Cuernavaca, still saw himself as the "power behind the Presidency" and believed that Cárdenas would have no chance of implementing his far-reaching plans for reform without his support, which he had no intention of giving. Indeed, by this time Calles was so thoroughly subservient to his Yankee patrons that he founded himself championing the cause of foreign capital and the sanctity of private property to garner their continued favor. When the country was paralyzed by a wave of strikes in 1935 and Cárdenas did not step in to crush them, Calles and his coterie of businessmen were appalled by his inaction. For his part, Cárdenas argued that the strikes were but a manifestation of the unjust balance between profits and wages, and turned the disputes over to his newly formed Department of Labor. When the latter ruled repeatedly in favor of the striking workers, Calles warned Cárdenas that he had better be careful lest he be forced to "abdicate" as had his earlier "front-man", Rodriguez, when he took too independent a line. However, by continuing to support the cause of the workers, Cárdenas increasingly won the backing of the labor movement, which, together with the solid base he had already established amongst agricultural workers, steadily strengthened his hand as the inevitable showdown between him and Calles gradually came to a head.
Feeling himself bolstered by broad popular support, Cárdenas proceeded to "dump" all but three of the country's governors and military zone commanders -- all appointees of Calles -- as well as the cabinet that the latter had likewise bequeathed to him. When a delegation of these unemployed bureaucrats arrived on Calles' doorstep to complain to the Jefe Máximo and demand reinstatement, the head of the largest labor movement in Mexico, Lombardo Toledano, threatened to call a general strike. Realizing that he was no longer in control of the situation, Calles abruptly announced his "retirement" from politics and departed for exile in the United States. However, no doubt encouraged by his Yankee patrons, he was back within six months trying to foment more trouble for the Cárdenas regime, so Toledano brought out his workers -- 80,000 strong -- to march in the streets of the capital, while Cárdenas arranged to have Calles and his cohorts "read out" of the party and once more shipped off into exile in the United States.
The next challenge to the reform government came from a strike in the glass industry in Monterrey in February 1936. In response to a directive from the Department of Labor, again favoring the workers, the factory owners chose to lock out the workers instead, so Cárdenas boarded a special train to confront the company directors face to face. He candidly told them that if they were "tired of the social struggle" implicit in such labor disputes, they could either turn their factories over to the workers or to the government! He assured them that either of these moves would be a far more "patriotic" solution than a lockout. Once again Cárdenas carried the day, and out of this confrontation developed an enlarged labor movement that eventually crystallized into the Confederation of Mexican Laborers (CTM) under Toledano's leadership.
With Calles out of the picture and labor unrest temporarily quieted, Cárdenas next turned his attention to mollifying the Catholic church. He reaffirmed his belief in the freedom of religion and promised that his government would not carry out any anti-religious activities nor promote any "propaganda" or sex education in the schools. Even so, fanatical Catholics felt that these concessions did not go far enough, and in 1937 they organized the Unión Nacional de Sinarquistas (UNS) to combat what they considered to be the continued secularization of Mexico.
Although often being accused of being a "socialist" or "Marxist", Cárdenas was not an ideologue but a pragmatist. Like the leader of many another country at this time of world depression, he felt that the private sector of the economy has shown neither its willingness nor its ability to cope with the magnitude of the disaster and that only government could intervene to help put things back on track once again. He had not disavowed "capitalism", but he insisted on giving it a social conscience, and in this regard he mirrored the policies adopted by FDR in the United States and by many another government in the countries of Western Europe.
One of the issues of top priority and closest to his heart was agrarian reform. In the autumn of 1936, he took personal control of the division and redistribution of lands held by the large haciendas into ejidos, or communal farms. Geographically, the first area to be targeted was the Laguna district of Coahuila state, the fertile irrigated cotton lands that had been the home of Madero. Cárdenas took deep pride in being able to expropriate the most productive areas of these large commercial estates and turn them over to the poorest of the landless peasants. The following year, he targeted the large henequen plantations of the Yucatán for subdivision among the small farmers, and then moved on to Sonora where he made sure than much of the best irrigated land went back to the Yaqui Indians. In Baja California the expropriated cotton plantations surrounding Mexicali were turned into ejidos, and in Tamaulipas he reallocated the sugar cane plantations among the field hands. In Sinaloa, too, the premium-irrigated valleys were converted into ejidos. The fact that most of these expropriations took place in the more commercialized farming areas of the north simply reflected the predominant presence of foreign investment in those regions. In any event, within the six years that Cárdenas was in office, he tripled the amount of land held by the country's small farmers, having expropriated more than 45 million acres and distributed it among a million peasants. By 1940, nearly 47% of the country's arable land had been redistributed to about 42% of the agricultural population. Nevertheless, well intentioned as such measures were, there remained much left to do. Half of the country's large landowners remained "unscathed" by the land reforms, yet more than two million peasants still had no land of their own. Indeed, in many parts of the country, the hacendados had largely defeated the purposes of the land reform by sub-dividing their properties among their heirs and relatives, so that no individual parcel would exceed the 300 ha (750 acres) size-limit set for expropriation. Complicating the situation further was the fact that the ejido investment bank had run out of funds, many of the plots already distributed were of such small size or of such poor quality that the farmers still could not make a living, and insufficient rain in the late 1930's was causing increasing hardship in many of the areas lacking irrigation. Moreover, many of the farmers still could not get their products to market because of inadequate or non-existent farm-to-market roads.
In the haste to push through land reform, many administrative blunders also occurred. Little thought was given to the geographic distribution of the individual plots carved out of the large estates, resulting in weird patterns of land ownership and problems of access. Particularly in the Yucatán, where the principal cash crop was henequen, some farmers obtained title to land about to be harvested while others would have to wait for several years to realize any return. Still others had no access to a desfibrador, or mill where the plant was processed into cordage, so had no way to market their crop whenever it was ready. Although for many ejidatarios, the old local hacendado was gone, his new "landlord" was an impersonal bank located somewhere in the capital city, but just as demanding in its schedule of payments.
Ever mindful that the success of their reform programs depended on an educated populace, the Cardenista planners also set about expanding the construction of rural schools. Yet, if these were to succeed in their mission, it was realized that they had to be accompanied by programs for providing potable water, roads, medical services, and electricity to the same remote areas of the country. Moreover, technical assistance was required to build irrigation dams and canals, to teach scientific methods of cultivation and animal husbandry, and to establish producer and consumer cooperatives in outlying areas that lacked a viable commercial infrastructure. Cárdenas likewise re-established an activist Department of Indian Affairs, realizing that a sizable proportion of the Mexican population would forever remain outside the orbit of national life without a material improvement in their economic and social condition. So dedicated was he to the cause of the Indian that Cárdenas personally attended each of the eight national congresses held to discuss the concerns of the indigenous people, and was instrumental in seeing to it that vocational schools were started to help integrate them into the country's economy. Indeed, whether he was aware of it or not, Cárdenas had instituted in many areas of Mexico the same kind of comprehensive regional planning that was being carried out at that time in the United States by the federal government to assist in the economic and social development of one of its most backward regions, the Tennessee Valley.
The Cardenista Six-Year Plan was not only a blueprint for putting Mexico on a new course for economic and social development but it was also a vigorous manifestation of a new political independence as well. Washington, ever wary of its neighbor becoming too independent in foreign affairs, was clearly upset when Mexico offered political asylum to Leon Trotsky, the Soviet dissident. And, when Mexico chastised the western democracies for their failure to assist Republican Spain against Franco and the Fascists and began sending supplies and munitions to their embattled "brothers", U.S. pretensions of neutrality seemed strangely hollow indeed. Domestically, Cárdenas bought out the foreign investors who controlled Mexico's railway system and nationalized it. He also shut down the gambling casinos and houses of prostitution located in the northern border towns, despite the hue and cry raised by their American owners and patrons. And when he expropriated the rich farmlands surrounding Ciudad Obregón and returned them to the Yaqui Indians, the Yankee cries of protest became even more impassioned and bitter.
Cárdenas' boldest move was yet to come: in March 1938, only six days after Hitler's troops marched into Austria following the Anschluss, he expropriated the properties of the foreign oil companies and nationalized them. Although President Roosevelt had promised in his inaugural address in 1932 that the United States would hereafter refrain from intervening in the internal affairs of the Latin American countries, Cárdenas no doubt had questioned for some time how seriously such a commitment could be taken. With Europe moving inexorably toward another major war as the result of German rearmament and expansionism, the U. S. was now so much more clearly preoccupied with developments in that sphere that he felt it would not likely respond to nationalization of the Mexican oil industry in any belligerent manner. Nevertheless, Cárdenas accompanied his move with a declaration that, if Washington did dispatch any Marines to Mexico, he would not hesitate to blow up the oil fields. Although the United States was convinced that Communists were behind this hostile action, in view of Cárdenas' threat, it decided against launching a military incursion into Mexico.
Mexico's experience with the foreign oil companies had been exploitive in the extreme. Against an investment of some $100 million dollars made over the course of thirty years, they had reaped profits that totaled in the neighborhood of $5 billion dollars. Yet, wages for Mexican workers had been kept minimal, and when strikes broke out seeking higher pay, the oil companies argued that they could not afford to meet more than one-fifth of demands the workers submitted. A government commission found that the workers' demands were valid and asked the companies to at least double their offer. When the companies refused, the Mexican Supreme Court ruled against them, and only after many threats and much vituperative rhetoric did the companies begrudgingly "manage" to come up with the amount specified. By then, however, Cárdenas' patience had run out. Despite his promise to pay compensation within ten years, the companies rejected Cárdenas’ offer, and the British and Dutch governments immediately severed diplomatic relations with Mexico.
The United States was every bit as hostile as were Britain and the Netherlands, so it immediately set about trying to prevent the sale of Mexican oil on the international market and also terminated all purchases of silver from the country. American entrepreneurs were prevented from selling Mexican oil in Europe and the inflow of all capital to Mexico was cut off. Pemex (Petroleos Mexicanos), the nationalized Mexican oil company, was unable to purchase new machinery and replacement parts, and oil production gradually fell to little more than half of what it had been when the expropriation took place. Hostile anti-Mexican propaganda, financed in part by American oil companies, sharply cut into the country's tourist earnings, and an abortive coup against the Cárdenas government also traced its financial backing to the same sources. By 1942, these economic pressures had succeeded in obliging Mexico to sell its oil to Germany, Italy, and Japan -- so counter-productive a policy that Washington finally decided to give up its embargo in that year. Nevertheless, by the outbreak of the war, the flight of capital out of Mexico as a result of the expropriation of the oil industry had reduced foreign investment in the country by two-thirds -- a clear indication to the Cardenistas that their move toward independence was succeeding. Only in retrospect do we realize how apropos the words of an unknown Mexican soldier following the battle of the Alamo would have been to this situation: "Another victory like this and we will surely lose the war!" Perhaps the greatest personal tragedy was that Lázaro Cárdenas himself lived long enough to see most of his life's work expunged by the actions of the lesser men that followed him.
On the domestic political front, another major change was in the offing. The PNR, or National Revolutionary Party, believed that it had in effect accomplished what it had set out to do. It had given a voice to labor and land to the peasants. Now, a new agenda and a new format were needed to meet the challenges of a new Mexico. Hence, a new party -- the Partido Revolucionario Mexicano, or PRM -- came into being, a fusion of workers and farmers that also reached out to include the growing urban middle class, students, women, bureaucrats, the military, and the professionals. For Mexico, 1938 not only marked the high-water mark for economic and social reform but also the charting of a new direction in the country's internal political movement as well.
Of course, most of the Mexican elite was quite unhappy about the nationalization of the oil industry. Industrialists, bankers, and merchants all thought that Cárdenas had gone too far in trying to stand up to the Yankees. Many of the military brass believed that the move was Communist inspired, and technicians felt it had been too precipitate a move because Mexico had neither the managerial expertise nor the requisite fleet of tankers to operate the industry efficiently. Of course, the depressed state of the world economy only deepened their gloom, causing markets for Mexican products to contract, oil revenues to fall off, and inflation to set in as wages dropped and prices rose. Small wonder, then that in the political arena the conservatives rallied around a new coalition which called itself the Party of National Action (PAN), among whose most ardent supporters were Catholic activists and middle-class urban women. To be sure, Cárdenas and his cohorts, including the once-mighty Toledano, saw the backlash coming and realized that the reform movement had run its course. When the PRM met to choose its candidate for President, a reform candidate favored by Cárdenas was pushed aside and the nod went instead to a conservative general by the name of Manuel Ávila Camacho. Even so, when the ballots were counted and Camacho was proclaimed the winner, it was generally agreed that the ruling party had only managed to hold on to the Presidency through fraud. Violence on election day resulted in the death of some 47 Mexicans, the bulk of them in the capital. Whether they realized it or not, for most of Mexico's people, the era of hope and promise was already drawing to a close and it was back to "business as usual".