The Weekly Quill — Coronacrisis in Mexico

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Coronacrisis in Mexico — The Supply Chain Disruption Closer to Home

The year was 1925, not 2019, when a more welcome Corona made its debut. That fortuitous year marked Grupo Modelo, Mexico’s largest brewery, introducing the world to the famous cerveza. And, for nearly 100 years, bottling has continued, quenching thirsts on both sides of the Rio Grande. That is, until the very unpopular Corona of 2019 reared its ugly head and the Mexican government declared its production nonessential, essentially turning off the taps. Fear not, there was still plenty to be had to celebrate that most Mexican of celebrations, Cinco de Mayo. It is the Fiesta of all Fiestas, no? Well maybe not. Maybe it’s more of an American celebration. Truth be told, Cinco de Mayo, which celebrates the victory at the Battle of Puebla against the French, is mostly contained to the Mexican state of Puebla…Oh, and all across the United States.

In fact, this now festive excuse to down a cold one and smash a piñata originated in the 1862 streets of Los Angeles among Mexicans drawn to the Gold Rush a decade earlier. But those gatherings had nothing to do with food and drink but were rather meant to galvanize the masses to stand against the scourge of slavery. By way of background, it was in July 1861 that Mexican President Benito Juarez imposed a two-year moratorium on loan-interest payments to French, British and Spanish creditors. With the backing of England and Spain, the French invaded Mexico (for the second time) at Veracruz. The Battle of Puebla was but an early chapter in the Franco-Mexican War that raged through 1867. As for the Mexican expats in Los Angeles and neighboring states, they gathered in a united fear that the French would prevail in forming a monarchy in Mexico which in turn would establish an alliance with the Confederate States of America aimed at reestablishing slavery in Mexico.

Call it the lesser of two oppressors given there was no love lost for the United States after that little event known as the Mexican American War of 1846-1848 ended with Mexico losing half its territory to the United States. Tensions continued to run high with further damaged in 1914 when the U.S. returned to France’s scene of the crime, the Port of Veracruz. General John J. Pershing and 10,000 of his troops carried on as usual with the nasty habit of interfering via invasions throughout the Mexican Revolution from 1910 to 1920. It would not be until FDR’s 1933 “Good Neighbor Policy” aimed at respecting “the sanctity of agreements in and with a world of neighbors” was put to the test that the border finally found a sense of calm.

By 1938, Mexican President Lázaro Cárdenas retaliated against U.S. and British oil companies’ refusal to comply with Mexican laws governing wages and working conditions by nationalizing their holdings, creating the state-owned petroleum company Pemex. Britain severed diplomatic relations. FDR increased its cooperation with Mexico which in turn agreed to sell much-needed crude to its northern neighbor as World War II loomed. In time, Mexico grew to be the world’s seventh largest oil exporter.

 

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Danielle DiMartino Booth is founder and Chief Strategist at Quill Intelligence

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