Roosevelt’s “Big Stick” Foreign Policy and Taft’s “Dollar Diplomacy”

Roosevelt’s “Big Stick” Foreign Policy

While President McKinley ushered in the era of the American empire through military strength and economic coercion, his successor, Theodore Roosevelt, established a new foreign policy approach, allegedly based on a favorite African proverb, “speak softly, and carry a big stick, and you will go far”. At the crux of his foreign policy was a thinly veiled threat. Roosevelt believed that in light of the country’s recent military successes, it was unnecessary to use force to achieve foreign policy goals, so long as the military could threaten force. This rationale also rested on the young president’s philosophy, which he termed the “strenuous life,” and that prized challenges overseas as opportunities to instill American men with the resolve and vigor they allegedly had once acquired in the Trans-Mississippi West.

Roosevelt believed that while the coercive power wielded by the United States could be harmful in the wrong hands, the Western Hemisphere’s best interests were also the best interests of the United States. He felt, in short, that the United States had the right and the obligation to be the policeman of the hemisphere. This belief, and his strategy of “speaking softly and carrying a big stick,” shaped much of Roosevelt’s foreign policy. (2)

The Construction of the Panama Canal

As early as the mid-sixteenth century, interest in a canal across the Central American isthmus began to take root, primarily out of trade interests. The subsequent discovery of gold in California in 1848 further spurred interest in connecting the Atlantic and Pacific Oceans, and led to the construction of the Panama Railway, which began operations in 1855. Several attempts by France to construct a canal between 1881 and 1894 failed due to a combination of financial crises and health hazards, including malaria and yellow fever, which led to the deaths of thousands of French workers.

Upon becoming president in 1901, Roosevelt was determined to succeed where others had failed. Following the advice that Mahan set forth in his book The Influence of Seapower upon History, he sought to achieve the construction of a canal across Central America, primarily for military reasons associated with empire, but also for international trade considerations. The most strategic point for the construction was across the fifty-mile isthmus of Panama, which, at the turn of the century, was part of the nation of Colombia. Roosevelt negotiated with the government of Colombia, sometimes threatening to take the project away and build through Nicaragua, until Colombia agreed to a treaty that would grant the United States a lease on the land across Panama in exchange for a payment of $10 million and an additional $250,000 annual rental fee. The matter was far from settled, however. The Colombian people were outraged over the loss of their land to the United States, and saw the payment as far too low. Influenced by the public outcry, the Colombian Senate rejected the treaty and informed Roosevelt there would be no canal.

Undaunted, Roosevelt chose to now wield the “big stick.” In comments to journalists, he made it clear that the United States would strongly support the Panamanian people should they choose to revolt against Colombia and form their own nation. In November 1903, he even sent American battleships to the coast of Colombia, ostensibly for practice maneuvers, as the Panamanian revolution unfolded. The warships effectively blocked Colombia from moving additional troops into the region to quell the growing Panamanian uprising. Within a week, Roosevelt immediately recognized the new country of Panama, welcoming them to the world community and offering them the same terms—$10 million plus the annual $250,000 rental fee—he had previously offered Colombia. Following the successful revolution, Panama became an American protectorate, and remained so until 1939.

Once the Panamanian victory was secured, with American support, construction on the canal began in May 1904. For the first year of operations, the United States worked primarily to build adequate housing, cafeterias, warehouses, machine shops, and other elements of infrastructure that previous French efforts had failed to consider.

Most importantly, the introduction of fumigation systems and mosquito nets following Dr. Walter Reed’s discovery of the role of mosquitoes in the spread of malaria and yellow fever reduced the death rate and restored the fledgling morale among workers and American-born supervisors. At the same time, a new wave of American engineers planned for the construction of the canal. Even though they decided to build a lock-system rather than a sea-level canal, workers still had to excavate over 170 million cubic yards of earth with the use of over one hundred new rail-mounted steam shovels. Excited by the work, Roosevelt became the first sitting U.S. president to conduct an official international trip. He traveled to Panama where he visited the construction site, taking a turn at the steam shovel and removing dirt. The canal opened in 1914, permanently changing world trade and military defense patterns. (2)

Arial photo of the Panama Canal as described above.
Figure 5-13: Panama canal image by NASA is in the Public Domain .The Panama Canal can be seen from space, as this picture taken from the International Space Station demonstrates. The picture, taken in September, 2004 as part of Expedition 9, shows the south-eastern — Pacific — end of the canal. The approach from the Pacific is on the right (the south); this leads to the Miraflores Locks, and then to Miraflores Lake. On the left (north) end of the lake, in the centre of the picture, is the Pedro Miguel lock, which then leads to the Gaillard Cut, which runs left (north) under the Centennial Bridge towards the Río Chagres and Lake Gatú n.

The Roosevelt Corollary

With the construction of the canal now underway, Roosevelt next wanted to send a clear message to the rest of the world—and in particular to his European counterparts—that the colonization of the Western Hemisphere had now ended, and their interference in the countries there would no longer be tolerated. At the same time, he sent a message to his counterparts in Central and South America, should the United States see problems erupt in the region, that it would intervene in order to maintain peace and stability throughout the hemisphere

Roosevelt articulated this seeming double standard in a 1904 address before Congress, in a speech that became known as the Roosevelt Corollary. The Roosevelt Corollary was based on the original Monroe Doctrine of the early nineteenth century, which warned European nations of the consequences of their interference in the Caribbean. In this addition, Roosevelt states that the United States would use military force “as an international police power” to correct any “chronic wrongdoing” by any Latin American nation that might threaten stability in the region. Unlike the Monroe Doctrine, which proclaimed an American policy of noninterference with its neighbors’ affairs, the Roosevelt Corollary loudly proclaimed the right and obligation of the United States to involve itself whenever necessary.

Roosevelt immediately began to put the new corollary to work. He used it to establish protectorates over Cuba and Panama, as well as to direct the United States to manage the Dominican Republic’s custom service revenues. Despite growing resentment from neighboring countries over American intervention in their internal affairs, as well as European concerns from afar, knowledge of Roosevelt’s previous actions in Colombia concerning acquisition of land upon which to build the Panama Canal left many fearful of American reprisals should they resist.

Eventually, Presidents Herbert Hoover and Franklin Roosevelt softened American rhetoric regarding U.S. domination of the Western Hemisphere, with the latter proclaiming a new “Good Neighbor Policy” that renounced American intervention in other nations’ affairs. However, subsequent presidents would continue to reference aspects of the Roosevelt Corollary to justify American involvement in Haiti, Nicaragua, and other nations throughout the twentieth century. (2)

Map of Latin American listing US involvements in the region. These include: in Cuba, Platt Amendment (1901) and Cuban-American Treaty (1903); in the Dominican Republic, Financial crisis prompts first use of Roosevelt Corollary (1904-1905); Puerto Rico, Foraker Act (1900); Panama, Panama Canal zone created (1903).Figure 5-14: U.S. Involvement in Latin America under Roosevelt by OpenStax is licensed under CC-BY 4.0 From underwriting a revolution in Panama with the goal of building a canal to putting troops in Cuba, Roosevelt vastly increased the U.S. impact in Latin America.

The Roosevelt Corollary and Its Impact

In 1904, Roosevelt put the United States in the role of the “police power” of the Western Hemisphere and set a course for the U.S. relationship with Central and Latin America that played out over the next several decades. He did so with the Roosevelt Corollary, in which he stated:

It is not true that the United States feels any land hunger or entertains any projects as regards the other nations of the Western Hemisphere save as such are for their welfare. All that this country desires is to see the neighboring countries stable, orderly, and prosperous. Any country whose people conduct themselves well can count upon our hearty friendship… Chronic wrongdoing, or an impotence which results in a general loosening of the ties of civilized society, may in America, as elsewhere, require intervention by some civilized nation, and in the Western Hemisphere the adherence of the United States to the Monroe Doctrine may force the United States, however, reluctantly, in flagrant cases of such wrongdoing or impotence, to the exercise of an international police power.

In the twenty years after he made this statement, the United States would use military force in Latin America over a dozen times. The Roosevelt Corollary was used as a rationale for American involvement in the Dominican Republic, Nicaragua, Haiti, and other Latin American countries, straining relations between Central America and its dominant neighbor to the north throughout the twentieth century. (2)

American Intervention in The Russo-Japanese War

Although he supported the Open Door notes as an excellent economic policy in China, Roosevelt lamented the fact that the United States had no strong military presence in the region to enforce it. Clearly, without a military presence there, he could not as easily use his “big stick” threat credibly to achieve his foreign policy goals. As a result, when conflicts did arise on the other side of the Pacific, Roosevelt adopted a policy of maintaining a balance of power among the nations there. This was particularly evident when the Russo-Japanese War erupted in 1904.

In 1904, angered by the massing of Russian troops along the Manchurian border, and the threat it represented to the region, Japan launched a surprise naval attack upon the Russian fleet. Initially, Roosevelt supported the Japanese position. However, when the Japanese fleet quickly achieved victory after victory, Roosevelt grew concerned over the growth of Japanese influence in the region and the continued threat that it represented to China and American access to those markets (Figure). Wishing to maintain the aforementioned balance of power, in 1905, Roosevelt arranged for diplomats from both nations to attend a secret peace conference in Portsmouth, New Hampshire. The resultant negotiations secured peace in the region, with Japan gaining control over Korea, several former Russian bases in Manchuria, and the southern half of Sakhalin Island. These negotiations also garnered the Nobel Peace Prize for Roosevelt, the first American to receive the award.

When Japan later exercised its authority over its gains by forcing American business interests out of Manchuria in 1906–1907, Roosevelt felt he needed to invoke his “big stick” foreign policy, even though the distance was great. He did so by sending the U.S. Great White Fleet on maneuvers in the western Pacific Ocean as a show of force from December 1907 through February 1909. Publicly described as a goodwill tour, the message to the Japanese government regarding American interests was equally clear. Subsequent negotiations reinforced the Open Door policy throughout China and the rest of Asia. Roosevelt had, by both the judicious use of the “big stick” and his strategy of maintaining a balance of power, kept U.S. interests in Asia well protected. (2)

Taft’s “Dollar Diplomacy”

When William Howard Taft became president in 1909, he chose to adapt Roosevelt’s foreign policy philosophy to one that reflected American economic power at the time. In what became known as “dollar diplomacy,” Taft announced his decision to “substitute dollars for bullets” in an effort to use foreign policy to secure markets and opportunities for American businessmen. Not unlike Roosevelt’s threat of force, Taft used the threat of American economic clout to coerce countries into agreements to benefit the United States.

Of key interest to Taft was the debt that several Central American nations still owed to various countries in Europe. Fearing that the debt holders might use the monies owed as leverage to use military intervention in the Western Hemisphere, Taft moved quickly to pay off these debts with U.S. dollars. Of course, this move made the Central American countries indebted to the United States, a situation that not all nations wanted. When a Central American nation resisted this arrangement, however, Taft responded with military force to achieve the objective. This occurred in Nicaragua when the country refused to accept American loans to pay off its debt to Great Britain. Taft sent a warship with marines to the region to pressure the government to agree. Similarly, when Mexico considered the idea of allowing a Japanese corporation to gain significant land and economic advantages in its country, Taft urged Congress to pass the Lodge Corollary, an addendum to the Roosevelt Corollary, stating that no foreign corporation—other than American ones—could obtain strategic lands in the Western Hemisphere.

In Asia, Taft’s policies also followed those of Theodore Roosevelt. He attempted to bolster China’s ability to withstand Japanese interference and thereby maintain a balance of power in the region. Initially, he experienced tremendous success in working with the Chinese government to further develop the railroad industry in that country through arranging international financing. However, efforts to expand the Open Door policy deeper into Manchuria met with resistance from Russia and Japan, exposing the limits of the American government’s influence and knowledge about the intricacies of diplomacy.

As a result, he reorganized the U.S. State Department to create geographical divisions (such as the Far East Division, the Latin American Division, etc.) in order to develop greater foreign policy expertise in each area.

Taft’s policies, although not as based on military aggression as his predecessors, did create difficulties for the United States, both at the time and in the future. Central America’s indebtedness would create economic concerns for decades to come, as well as foster nationalist movements in countries resentful of American’s interference. In Asia, Taft’s efforts to mediate between China and Japan served only to heighten tensions between Japan and the United States. Furthermore, it did not succeed in creating a balance of power, as Japan’s reaction was to further consolidate its power and reach throughout the region.

As Taft’s presidency came to a close in early 1913, the United States was firmly entrenched on its path towards empire. The world perceived the United States as the predominant power of the Western Hemisphere—a perception that few nations would challenge until the Soviet Union during the Cold War era. Likewise, the United States had clearly marked its interests in Asia, although it was still searching for an adequate approach to guard and foster them. The development of an American empire had introduced with it several new approaches to American foreign policy, from military intervention to economic coercion to the mere threat of force.

The playing field would change one year later in 1914 when the United States witnessed the unfolding of World War I, or “the Great War.” A new president would attempt to adopt a new approach to diplomacy—one that was well-intentioned but at times impractical. Despite Woodrow Wilson’s best efforts to the contrary, the United States would be drawn into the conflict and subsequently attempt to reshape the world order as a result. (2)