"Business and the Mexican Revolution: Rivalries and Co-Creation"

The onset of the Mexican Revolution in 1910 profoundly frightened many U.S. business interests. For more than three decades, President Porfirio Díaz had transformed Mexico into a beacon of foreign investment by offering investors a reliable, hands-on partnership with his regime. By 1912, a U.S. consular report estimated that Mexico held $1.6 billion in foreign capital—$1 billion from the United States, including a significant portfolio investment in the government-owned Ferrocarriles Nacionales de México (National Railways of Mexico). Thus, the revolt against Díaz and the continuation of the Revolution after his fall threatened the nation’s liberal economic order, raising the specter of default and expropriation. At the same time, the Revolution created opportunities for individual investors to stake new positions in Mexico.
This paper examines how US businesses responded to and shaped the Mexican Revolution. It argues that rivalries among large and small investors aggravated the crisis. Drawing on archival records of the Corporation of Foreign Bondholders, J.P. Morgan & Co., the State Department, Congress, and contemporary reports, it shows how ambitions to dislodge entrenched interests—or to curry political favor—led investors to take opposing sides, often in defiance of US policy aims. The analysis focuses on two vitally linked sectors, international bonds and railroads, whose turmoil reflected the broader degradation of business-government relations in Mexico in the 1910s.
Figures such as oilman Henry Clay Pierce, who sought control of the National Railways of Mexico; John Wesley DeKay, whose attempt to trade Mexican bonds for munitions contributed to the 1914 U.S. occupation of Veracruz; and the International Committee of Bankers on Mexico, which imposed financial oversight after 1919, illustrate how investor rivalries reshaped international business and the very terms of Mexican sovereignty. These conflicts were cast as struggles between independent entrepreneurs and powerful trusts, revealing how investors adopted and expanded the boundaries of US antimonopoly politics.