The Dollar Diplomacy in Latin America Essay

As the United States continued to expand their interests beyond their own frontiers, their involvement in Latin America significantly increased. During his term as President, Theodore Roosevelt adopted a much more interventionist strategy in regard to U.S. relations with Latin America. Although the Monroe Doctrine had existed for nearly a century it was regarded with little importance until President Roosevelt added his own corollary in 1904, now known as the Roosevelt Corollary. The fear that the independent nations of Latin America could not properly govern themselves is largely what led Roosevelt to add his own corollary to the Monroe Doctrine. While President Roosevelt maintained the belief that that the U.S. government should no longer tolerate European interventions in Latin America, he also felt that the young nations of Latin America were not capable of properly governing themselves. Keith Kilty and Elizabeth Siegel demonstrate this belief in their work, Poverty and Inequality in the Latin American - U.S. borderlands when they write, "While the United States saw itself as a protector of Latin America from the colonial powers of Europe, it also came to see itself in the role of protector of Latin America from themselvesHe [President Roosevelt] believed, incompetent Latin American governments would occasionally need correction 'by some civilized nation'" (Kilty, Segal 2). That "civilized nation" of course being the United States *** also provides a similar viewpoint in Born in Blood and Fire, "U.S. explanations for the regions problems always began and ended with Latin America itself" (*****) These paternalistic attitudes of superiority are largely what led the United States to intervene in numerous Latin American nations throughout the nineteenth century.
The first decades of the nineteenth century saw tremendous American intervention in the nations of Latin America. Shortly after President Theodore Roosevelt added his corollary to the Monroe Doctrine, Washington developed a new interventionist policy called Dollar Diplomacy. As the nations of Latin America began to develop, they often borrowed money from European powers to finance their advancement. The American fear was that these 'incompetent' Latin American governments would eventually default on their debts, causing European powers to come as debt collectors but remain as occupying powers. (FL Lecture) Dollar diplomacy was developed to address this American fear and provide a solution to the potential debt defaults may they arise in Latin America. Dollar Diplomacy offers American debt guarantees in exchange for concessions and reforms that serve American interests. One example of how it was employed can be seen in Nicaragua in 1914 the Nicaraguan and American governments agreed that Washington would send money to Nicaragua on a regular basis, and in exchange the United States would control their economic policy and situate naval bases within Nicaragua's borders. Similar agreements were reached with various other nations, including the Dominican Republic and Haiti. While Dollar diplomacy appears to benefit the receiving nation, it was largely self-serving to the United States the concession and reforms that the American government received in the negotiations made under Dollar diplomacy greatly served American interests.