Sunday, March 6, 1938

THREE EDITORIALS

Site Ed. Note: The editorial on surplus cotton may not have been by Cash but provides a curious connection with Mexico and oil. In early 1936, William Rhodes Davis worked out a complex deal for trading Mexican oil to Nazi Germany--an altered version of which scheme ultimately supplied oil to Germany's war machine between Mexico's expropriation day, March 18, 1938, and Hitler's invasion of Poland, September 1, 1939. Approximately 70% of Mexico's exported expropriated American and British oil wound up in Germany in exchange for German industrial goods, especially tin and steel. The original scheme in 1936, however, involved the Bank of Boston, which had loaned Davis the money to build his Hamburg refinery, buying surplus Southern cotton from the U.S. Government, trading it to cotton-scarce Germany for railroad equipment, selling the German railroad equipment to Mexico in exchange for oil and then selling the oil to Davis (or more appropriately loaning him the oil in expectation of repayment out of the sale of the refined product); Davis then refined the oil in his German refinery, built with Hitler's personal approval, and sold it on the world market--primarily, of course, to Germany, Italy, and Japan. Thus, Mexico, while supplying the oil which powered the Panzer divisions which invaded Poland and later Norway, Belgium, Holland, and France, was able to circumvent the British and American oil companies' boycott of Mexican oil resulting from the failure of Mexico to pay for the expropriation in 1938.

Davis would seek to revive the cotton barter plan in meetings in the presidential suite at the Reforma Hotel in Mexico City in August, 1939, but failed by this time to win Administration approval for the scheme, having fallen into extreme disfavor with President Roosevelt and U.S. Ambassador to Mexico Josephus Daniels. The start of the war on September 1 then produced a British blockade of oil to Germany and Italy. Davis's ensuing unilateral efforts to broker a peace plan whereby Roosevelt would act as negotiator between Britain and Germany allowing cession of the Danzig Corridor in Poland to Hitler, plebiscite determination of the remainder of Poland, and leave Hitler in power, were met with icy non-response in Washington after Davis obtained approval for the plan from Germany in late September, 1939. Roosevelt would not abide Hitler remaining in power and knew all too well that "plebiscites" in Nazi-occupied lands meant rigged elections and puppet governments. Davis lost his ability to capitalize on Hitler's need for oil from Mexico. The Mexican oil did, however, continue to flow aboard Japanese freighters and some of it then found its way along the Trans-Siberian railway into Germany until Hitler's invasion of Russia on June 22, 1941 ended that route; at the same time, Davis sat in his Hotel Reforma suite plotting his next traitorous oil deal to supply himself millions of dollars from the worst belligerents the world has ever known. He would, however, never realize the product of his next move; he was dead on August 1. (See Mystery Man, by Dale Harrington, 1999, pp. 40, 80, 82)

When Premier Hodza of Czechoslovakia finished a liberty-or-death speech to his Chamber of Deputies last week, the members and galleries rose emotionally and sang the Czech national anthem. All, that is, with the conspicuous exception of Communist and pro-Nazi Deputies, who held their seats and their tongues.

This illustrates a queer thing, a thing we're utterly unable to account for. Communists and fascists seem to be in the toils of a dark and destructive and self-nurturing mood. You'd think that since the Nazis hated Hodza's speech, the Communists would like it because they hate the Nazis so. You'd think that since Hodza had just stood up and told Nazi Germany where to get off, Communists in his audience, with their consuming hatred of Nazis, would have felt compelled to cheer.

But the ideology boys do not respond like ordinary human beings. They not only hate each other, they hate everybody else. Sometimes, when they outrage our conception of sanity and civilization in a worse manner than usual, we think they must even hate themselves.

The House Merchant Marine Committee Friday rejected a recommendation of Joseph P. Kennedy's Maritime Commission "for establishment of training schools for merchant seamen to be supervised by the Coast Guard."

But at the same time it approved the provisions of a report which would "enable ship owners to purchase vessels from the commission with a down payment of 25% of the sale price, instead of 25% of the American construction cost."

The last suggests that Congress means business about building up a strong merchant fleet. For one of the greatest difficulties of American shippers has been that of earning a profit on the high original cost of ships in this country as compared with Europe.

But how shall we reconcile that with the turning down of the idea of the Coast Guard school for the training of merchant seamen? England has had such schools for seamen for a century,--with the result that she has not only had her ships extraordinarily well-manned, but also that she has that great tradition of seamanly loyalty which the Pole, Joseph Conrad, knew so intimately and never tired of celebrating.

With labor conditions what they are in the American Merchant Marine, the only alternative to some such selecting and training school seems to be Madame Perkins' scheme of letting the unions and management "fight it out." But if we are going to have a strong merchant marine, the ships will have to have a lot of passengers to keep the venture from being a dismal financial failure. And is it likely that passengers are going to choose to ride American ships with management and labor "fighting it out," and letting them (the passengers) take the consequences in poor service and in peril to their lives? Joe Kennedy said that he wouldn't do it.

Reminiscent as it may be of the "buy a bale" persuasion in 1914, this attempt to move 8,000,000 bales of the surplus cotton crop into consumptive channels has its possibilities. Special sales campaigns of surplus farm products have been tried before, with surprising success. California peach-growers found themselves with a carry-over of peaches from the 1935 crop that threatened to swamp the price of a big 1936 supply already on the way. In a month's co-operative merchandising with chain stores, sales were increased 171 per cent over the year before, the carry-over brought down almost to normal, and the price sustained.

The same thing, on the plea of distressed cattle-raisers, was done with beef dumped on the market because of the 1936 drought. Sales responded nicely to pressure, and as a result the Government had to buy only 5,000 head to hold up prices, as against the 2,500,000 it took in 1934. It has been tried even with beans, but so recently that we are unable to report on it.

And cotton--so many attractive, useful, necessary articles are made of cotton. It would not be a dreary task like eating one's way through a hill of beans to augment the household's supply of cotton towels or cotton accessories or cotton wearables, especially those new fetching prints for the ladies. What has been done with peaches and beef and beans ought to be as easy to do with cotton. At any rate, it is certainly worth trying to bridge the gap between last year's bumper and this year's curtailed crop.