The United States and Latin America

by John Holladay Latané

When the Wilson administration came in, Secretary Bryan took up the negotiations with Colombia where Knox dropped them, and concluded a treaty according to the terms of which the United States was to express "sincere regret that anything should have occurred to interrupt or to mar the relations of cordial friendship that had so long subsisted between the two nations," and to pay Colombia $25,000,000. The treaty further granted Colombia the same preferential rights in the use of the canal which the Taft administration had proposed, and in return Colombia agreed to recognize the independence of Panama and to accept a boundary line laid down in the treaty. This treaty was submitted to the Senate June 16, 1914. As soon as its terms were made public ex-President Roosevelt denounced it as blackmail, and wrote a letter to the chairman of the Senate Committee on Foreign Affairs requesting to be heard before any action was taken on the treaty. During the first session of the Sixty-sixth Congress in 1919 the Colombian treaty was reported from the Committee on Foreign Relations with important amendments. Article I, containing expressions of regret on the part of the United States for the events that had taken place on the isthmus, was entirely stricken out. The clause giving Colombia the right to transport through the canal its troops, materials of war, and ships of war, "even in case of war between Colombia and another country," was amended by the elimination of the words in quotations. The sum of $25,000,000, instead of being paid in cash, was to be paid in five annual installments. The Senate refused, however, to give its consent to the ratification of the treaty even in this form, and it is understood that it was proposed to cut the payment to Colombia down to $15,000,000.

A great nation like the United States, which has always professed to be guided in international questions by high standards of justice and morality, cannot afford to delay indefinitely the settlement of a dispute of this kind with a weak nation like Colombia. President Roosevelt's action in the Panama matter made a bad impression throughout Latin America and caused our policy in the Caribbean to be regarded with grave suspicion. As to Colombia's rights in the matter, Secretary Bryan made the following statement in his argument before the Senate Committee on Foreign Relations in support of the treaty:

It is contended by some that the action taken by the United States was based upon the necessities of the case, and those necessities, as stated by those who take this position are, that Colombia was not able to build the canal herself and was not willing to sell to the United States upon reasonable terms the right to build the canal. Those who take this position put the United States in the attitude of exercising the right of eminent domain in the interest of the world's commerce; but the exercise of the right of eminent domain does not relieve those who exercise it of liability for actual damages suffered. Take, for illustration, the condemning of a block of ground for a public building. Suppose that every lot owner excepting one is willing to sell his land to the government at its market value, but that one of the lot owners, whose lot is necessary to the erection of the building, asks more than the land is worth. The government proceeds to condemn the property, but it does not attempt to escape from paying what the land is actually worth, and the actual value of the property is not reduced one dollar by any effort that the owner may make to obtain for it more than it is worth. If it is contended that the price offered by the United States prior to Panama's separation was a reasonable one, and that Colombia ought to have accepted it, that valuation cannot be reduced merely because Colombia was not willing to accept the offer. This illustration is based upon the theory adopted by those who say that Colombia was entirely in the wrong in refusing to accept the offer made by the United States, but this theory, it will be remembered, is disputed by the people of Colombia, who defend the position their government then took and, as has been said before, they have ever since asked that the controversy be arbitrated by some impartial tribunal.[267]

In 1904 President Roosevelt made a radical departure from the traditional policy of the United States in proposing that we should assume the financial administration of the Dominican Republic in order to prevent certain European powers from resorting to the forcible collection of debts due their subjects. On September 12, 1904, Minister Dawson reported to the State Department that the debt of Santo Domingo was $32,280,000, the estimated revenues from customs receipts $1,850,000, and the proposed budget for current expenses $1,300,000, leaving only $550,000 with which to meet payments of interest, then accruing and in arrears, amounting to $2,600,000. About $22,000,000 of this debt was due to European creditors. Most of this indebtedness had been incurred by revolutionary leaders who had at various times taken forcible possession of the government and hastened to raise all the money they could by the sale of bonds, leaving the responsibility with their successors. The European creditors of Santo Domingo were pressing for the recognition of their claims. Germany seemed especially determined to force a settlement of her demands, and it was well known that Germany had for years regarded the Monroe Doctrine as the main hindrance in the way of her acquiring a foothold in Latin America. The only effective method of collecting the interest on the foreign debt appeared to be the seizure and administration of the Dominican custom-houses by some foreign power or group of foreign powers. President Roosevelt foresaw that such an occupation of the custom-houses would, in view of the large debt, constitute the occupation of American territory by European powers for an indefinite period of time, and would therefore be a violation of the Monroe Doctrine. He had before him also the results of a somewhat similar financial administration of Egypt undertaken jointly by England and France in 1878, and after Arabi's revolt continued by England alone, with the result that Egypt soon became a possession of the British Crown to almost as great a degree as if it had been formally annexed. President Roosevelt concluded, therefore, that where it was necessary to place a bankrupt American republic in the hands of a receiver, the United States must undertake to act as receiver and take over the administration of its finances.

The policy that he was about to adopt was stated as follows in his annual message of December 6, 1904:

Any country whose people conduct themselves well can count upon our hearty friendship. If a nation shows that it knows how to act with reasonable efficiency and decency in social and political matters, if it keeps order and pays its obligations, it need fear no interference from the United States. Chronic wrongdoing, or an impotence which results in a general loosening of the ties of civilized society, may in America, as elsewhere, ultimately 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.

About the same time Minister Dawson was directed by Secretary Hay to suggest to the Dominican government that it request the United States to take charge of its customs. As the Dominican government saw no other way out of its difficulties, it responded to this suggestion, and on February 4, 1905, a protocol was signed by Mr. Dawson and the Dominican foreign minister which provided that the United States should guarantee the territorial integrity of the Dominican Republic, take charge of its custom-houses, administer its finances, and settle its obligations, foreign as well as domestic. In calling the new agreement a "protocol" instead of a "treaty," the President had probably not intended to submit it to the Senate, but the proposal to depart so radically from our past policy created so much criticism that the Senate was finally asked to ratify the protocol in regular form. This they failed to do, but the President did not propose to be thwarted in this way. As the Senate would not sanction his appointment of a receiver of customs for Santo Domingo, he drafted a modus vivendi, under the terms of which the President of the Dominican Republic appointed a receiver of customs named unofficially by President Roosevelt, who proceeded to administer the affairs of the republic under the protection of the United States navy, whose ships the President could as commander-in-chief order wherever he pleased. The President's course met with determined opposition both in and out of Congress, but as he was bent on having his way and continued to carry out his policy without the sanction of the Senate, that body finally decided that it would be best to give the arrangement a definite legal status. On February 25, 1907, the Senate agreed to the ratification of a revised treaty which omitted the territorial-guarantee clause, but provided that the President of the United States should appoint a general receiver of Dominican customs and such assistants as he might deem necessary; that the government of the United States should afford them such protection as might be necessary for the performance of their duties; and that until the bonded debt should be paid in full, the Dominican government would not increase its debt except with the consent of the United States. In the meantime, under the interim arrangement, conditions in Santo Domingo had greatly improved, the customs receipts had nearly doubled, and the creditors had agreed to compromise their claims, so that the total debt at the time the above treaty was ratified amounted to not more than $17,000,000.[268]

In spite of the criticism that President Roosevelt's policy encountered, the Taft administration not only continued it in Santo Domingo, but tried to extend it to Nicaragua and Honduras. The five republics of Central America had been for years in a state of political and economic disorder as the result of wars and revolutions. In 1906 there was a war between Guatemala and Salvador, in which Honduras became involved as the ally of Salvador. President Roosevelt invited President Diaz of Mexico to unite with him in an offer of mediation, which resulted in a peace conference held aboard the U. S. S. Marblehead. At this conference the belligerents agreed to suspend hostilities and to attend another conference for the purpose of drafting a general treaty of peace. The second conference was held at San José, Costa Rica, but President Zelaya of Nicaragua declined to send a representative because he was unwilling to recognize the right of the United States to intervene in Central American affairs. At this time Zelaya was systematically interfering in the internal affairs of the other Central American states, and exercised such complete control over the government of Honduras that Guatemala and Salvador were endeavoring to stir up revolutions against him in that state and in Nicaragua. War was about to break out in the summer of 1907 when President Roosevelt and President Diaz again intervened diplomatically and persuaded the Central American governments to suspend warlike preparations and to attend a conference in the city of Washington. In November the delegates of the five Central American states met in the Bureau of American Republics and were addressed by Secretary Root and the Mexican ambassador. The delegates adopted a general treaty of peace, providing for the settlement of existing differences and for the establishment of a Central American court of justice composed of five judges, one to be elected by the legislature of each state. The five republics agreed to submit to this tribunal all controversies of whatever nature that might arise between them which could not be settled through ordinary diplomatic channels.

But President Zelaya of Nicaragua, who still controlled Honduras, continued his interference in the affairs of the other republics by encouraging revolutionary movements and sending out filibustering expeditions. He was also hostile to the Central American court of justice, and it became evident that there was little chance of permanent peace as long as Zelaya remained in power. When, therefore, in October, 1909, members of the conservative party started a revolution at Bluefields against Zelaya's government, the movement was regarded with sympathy in the other Central American republics and in Washington. Conditions became so intolerable that many people in Nicaragua and Honduras appealed to the United States to intervene for the purpose of restoring order. President Diaz of Mexico was friendly to Zelaya and informed the United States that he did not care to take any further action. This brought to an end the coöperative efforts of the two governments and thereafter the United States had to act alone. Nothing was done, however, until two Americans were executed by Zelaya's order in November, 1909. As a result of these executions, which were without legal excuse and attended by barbarous cruelties, President Taft promptly severed diplomatic relations with Zelaya's government. In a dispatch to the Nicaraguan chargé, December 1, 1909, Secretary Knox said:

Since the Washington conventions of 1907, it is notorious that President Zelaya has almost continuously kept Central America in tension or turmoil; that he has repeatedly and flagrantly violated the provisions of the conventions, and, by a baleful influence upon Honduras, whose neutrality the conventions were to assure, has sought to discredit those sacred international obligations, to the great detriment of Costa Rica, El Salvador, and Guatemala, whose governments meanwhile appear to have been able patiently to strive for the loyal support of the engagements so solemnly undertaken at Washington under the auspices of the United States and Mexico.