Mexico's Oil Nationalization of 1938

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Arnulfo Manriquez arm2283 05/06/11 Prof. Anthony G. Hopkins HIS350L

Mexico’s Oil Nationalization of 1938

The nationalization of oil companies under the presidency of Lazaro Cárdenas is perhaps one of the most widely discussed instances in Mexican history, along with Independence and Revolution. One can see the common theme in these episodes: the explosion of national revolutionary sentiments causing important upheavals in the structures of society. The promises these movements made were seldom realized, but people still remember and regard them as the pillars of the nation. The expression of Nacionalismo Revolucionario remains an integral ethos across Mexican social movements, unions and even politicians. The monumental event of expropiation and nationalization in the 18th of March in 1938 is always remembered as the culmination of these ideals, the revolution and as a prime example of the nation’s anti-imperialist stance. The expropiation is of great relevance to current events: for the last two decades in Mexico, neoliberal governments have attempted to privatize PEMEX, the state owned oil company, generating staunch opposition from the left and center of the political spectrum. This opposition rejects the foreign ownership of Mexico’s oil, still using the rhetoric of nationalism, the primacy of a nation’s sovereignty and control of its resources for its own benefit. Conservative arguments are that PEMEX is corrupt and inefficient, which are strangely some of the same arguments the left hurled against the oil trusts during the 1930’s. The former are not lying about corruption, which obviously would not disappear with privatization. However this concern does raise some questions. Is this nationalist fervor in defense of an energy resource really a widespread national rallying cause that could exert political pressure, or is it one designed and orchestrated mainly by state elites for their own purposes? In Mexico’s case, did president Lazaro Cardenas deliberately plan the expropiation of the oil industry or was it his sudden response to a rising crisis? Historiography shows an interesting divide concerning the question previously posed. The Mexican oil expropiation is most commonly presented as the unexpected culmination of a labor dispute between the Oil Workers Unions, the STPRM and the CTM, and the foreign oil trusts, most of them American, British and Dutch. However, many British and American historians tend to minimize the extent of popular nationalism and tend to attribute the action as less a response to social pressure and more an attempt to cement an authoritative state. In stark contrast, Mexican historians focus more on the iniquity of the oil companies, labor militancy and strong national support for the cause. This essay will deal with examining these two different lenses and attempt to make clearer the symbiosis and delicate balance of the dichotonomies involved: social justice and authoritarianism, nationalism and international integration. The first part will deal with the context and details of the events, and the second will take the issues historians have discussed and compare the two main currents. Finally I will propose some areas of focus that might help clarify the issue. Oil has brought conflict between Mexico and the U.S. since the early days of its discovery. During the dictatorship of Porfirio Diaz foreign trusts were easily able to acquire property for development and established many refineries along the Poza Rica area of Veracruz. Most of these companies were American: Standard Oil Company, and Sinclair Group. The largest refinery, “el Aguila”, was British owned but came to have Mexican shares. Oil was not the only foreign posession, in 1912 an American consul assessed Mexico at “$2,434,241,422, of which the foreigners had $1,705,054,180 and the Mexicans $729,187,242. Citizens of the United States…possessed about $1,000,000,000...
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