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78 country that it will help so to shape conditions that the stipulations of the contract may be fulfilled.

Thirdly, the declarations on the part of certain Mexican statesmen that any sort of special guarantee for the payment of debts is without precedent, a reflection on the national honor and not to be considered, are declarations that lack straightforwardness. The financial record of the republic shows numerous cases of hypothecation of special revenues for the service of the foreign loans. In fact the republic, except for the first quarter century of its existence, the record shows, has never been without special claims on the national income in favor of certain of its foreign creditors.

The direct external loans now in force are all, with the exception of the gold loan of 1904, nominally under the protection of special guarantees. The loans of 1899 and 1910 are secured on 62 per cent of the national import and export duties and the bonds of 1913 issued during the revolution are a lien upon the rest.

Governments avoid such agreements if they can, but Mexico has not been able to do so. She seemed to be approaching that condition in 1904 and doubtless the loan of 1910 might have been negotiated without special guarantee but for the fact that it was a refunding measure and the creditors were in a position to demand the continuance of their former security. It seems hardly to be expected that any project for financing the reconstruction of the country will lack features of this sort.

What guarantees of this sort actually mean is not clear. In times of peace, with a responsible government