Student Name

AP US History
Period 2
October 23, 2007
Chapter 22: The Battle for National Reform
Section 4: The “Big Stick”: America and the World, 1901-1917
DQ #8: Examine how U.S. foreign policy towards Caribbean/Latin America under presidencies of Taft
and Wilson became more assertive and interventionist.
I. “Dollar Diplomacy”- Foreign Policies under William Howard Taft (picture left)
A. Purpose of Policy
• A move from Roosevelt’s “big stick” policy to “dollar diplomacy” “This policy has been characterized as
substituting dollars for bullets.”-William Howard Taft
• American financial investments would aid in establishing economic, social &political stability in Latin Amer.
countries
• promotion of commercial interest: trade, marketing, farming, industries; guaranteed loans to foreign countries
attempt to open up foreign markets
• keep foreign European countries at bayinvest and control economy first
• protect regions around the Panama Canal
• Under Taft, Sec. of State Philander C. Knox created the Latin American Division of the State Department to help
form better relations with the countries
B. Nicaragua
• USA sided w/ the insurgents (sparked by an American mining co.); sent American troops into country to seize custom
houses
• Knox (also one to coin “Dollar Diplomacy”)- allowed American bankers to offer loans to new government in
Nicaraguaincrease US financial leverage in country; establish a firm pro-American gov’t in Nic.
• 1912-Two years after 1909 revolt- pro-Amer. gov’t in Nic. faced insurrectionTaft ordered troops to protect the gov’t
remained there until 1933
C. Caribbean Interventions
• American military presence in Haiti and Hondurasgov’t urged American bankers to invest in both countries to keep
out foreign funds
• four U.S. banks, swayed by the State Dep., refinanced Haiti’s national debts allowing future intervention
• Same done in Dominican Republicreliance on Amer. imports and commerce
II. “Moral Diplomacy”-Foreign Policies under Woodrow Wilson (picture bottom left)
A. Latin America- Approach similar to that of Roosevelt and Taft
• established a military gov’t in Dominican Republic-1916- when it had refused to accept a treaty that would have made
D.R. a U.S. protectorate
• Haiti- Wilson spent marines to settle a revolution-Amer. officers drafted a Haitian constitution in 1918
• Wilson brought Danish West Indies and renamed them Virgin Islands afraid that the islands would fall into
Germany’s (foreign) hands
• Nicaragua- Brian-Chamorro Treaty of 1914- treaty with Nic. gov’t, ensuring that no Euro. country could build a
canal there & gave rights to America to interfere with Nic.’s internal affairs
B. Change of Policy
• Wilson brought with his inauguration an attempt to apply high moral standards to foreign relations
• main motive was to demonstrate that U.S. respected other nations’ rights & supported the spread of democracy
• Wilson repudiated imperialist policies hope to protect democracy and free people in countries rather than use force
did not work out and Wilson often had to resort to using the military to settle outrisings
C. Mexico
• Example of Wilson’s handling of moral diplomacy
¤ Taft administration quietly encouraged Victoriano Huetra to revolt against Francisco Madero (overthrew
dictatorship in Mex.) b/c Madero was against Amer. business presence in Mex.
¤ murder of Madero by Huetra Wilson refused to recognize “government of butchers”
• Contradiction to Moral Diplomacysupported revolts against gov’ts that were against Amer. interest
¤ Tampico incident (the arrest and release of Amer. sailors on U.S.S. Dolphin in Vera Cruz) Wilson previously
sent naval fleet to aid Venustiano Carranza, leader of Constitutionalists who were against Huetra, to blockade
port of Vera Cruz; retaliate by sending U.S. Navy to Vera Cruzhelped Carranza overthrow Huetraled to
creation of more democratic gov’t in Mexico
CONCLUSION: The United States continued throughout William Howard Taft’s presidency to intervene in neighboring
countries’ affairs as the nation had before, attempting to control their governments through business investments. This policy
provided America with tremendous power in Latin America, but staged a long-term political instability within these countries.
Woodrow Wilson resented the failure of the dollar diplomacy to establish peace in Latin American and Caribbean and adapted
an anti-imperialist stand and high moral approach in foreign affairs. Nevertheless, he was forced by his own incapability to
negotiate peace within the militant countries to use military force to appease foreign rebellions.