1. Dollar Diplomacy

2. What is dollar diplomacy?
Dollar diplomacy is the name given to the early 20th-century American foreign policy that sought to use American economic strength rather than military power to guarantee U.S. national security and economic interests.
It is most associated with the administration of William Howard Taft and its policy toward Latin America.

3. Here’s how it worked
American banks would be called upon to finance loans to Latin American governments in need of capital
This would create a dependent relationship with the countries, providing a foothold for American interests
Americans would leverage this dependence to remove European influence, a la the Roosevelt Corollary

4. What was the purpose?
Dollar Diplomacy was Taft’s answer to the question of how to exert influence in foreign countries, particularly Latin America
He preferred economic dependence to military subservience
He figured it would help Latin American countries, while also helping enrich some American businesses

5. Wilson’s Moral Crusades
Woodrow Wilson sought to establish a more high-minded motive for intervention in foreign lands
He saw it a moral imperative to stand up against countries whose leaders did not have the backing of the people, was undemocratic, or was hostile to US interest
Problems with Mexico (p. 569)