FDR’s Good Neighbor Policy

IB History of the Americas

Background: Big Stick Diplomacy, Dollar Diplomacy, Moral

Diplomacy

The U.S. Becomes a World Power• At the turn of the 20th century, the U.S.

emerged as a world power:– The U.S. asserted its dominance in Spanish-

American War (1898)– America built the 3rd largest navy in the world – Annexed Hawaii, the Philippines, Puerto Rico,

many Pacific islands– Asserted economic control over almost all of

Latin America

The U.S. Becomes a World Power

• The U.S. developed a new, aggressive foreign policy under T. Roosevelt, Taft, & Wilson:

• Their policies differed, but all revealed a desire to increase American wealth, military power, & stature in the world, especially Latin America

“Big Stick Diplomacy”

“Dollar Diplomacy”

“Moral Diplomacy”

American Foreign Acquisitions, 1917

Theodore Roosevelt’s “Big Stick Diplomacy”

TR’s “Big Stick Diplomacy”• Roosevelt hoped to expand upon

America’s new, world stature after the Spanish-American War:– TR believed in the superiority of American

Protestant culture & hoped to spread these values

– To increase American economic & political stature in the world, the U.S. needed to be militarily strong & ready to fight if needed

TR & Sec of State Elihu Root applied “big stick” diplomacy

most effectively in Latin America

“Speak softly & carry a big stick, you will go far”

—TR’s favorite African proverb

TR’s “Big Stick Diplomacy”• TR’s top foreign policy objective was to

build the Panama Canal & he used his “big stick” to get it:– When the Colombians rejected an offer to

lease land in Panama to build a canal, TR supported a revolt for Panama independence

– In 1903, Panama (with the U.S. navy) became a nation & signed a lease agreement for a canal

A Panama Canal would facilitate world trade & allow the U.S. to quickly merge its Atlantic

& Pacific naval fleets in an emergency

The U.S. paid $10 million for the canal & leased it for $250,000 per year

The Panama Canal was an engineering marvel, but one of the most important reasons

for its completion was the scientific elimination of malaria-causing mosquitoes

When opened in 1914, the canal gave the USA a huge economic advantage in

the Western Hemisphere

“The inevitable effect of our building the Canal must be to require us to police the

surrounding premises”—Sec of State, Elihu Root

The Roosevelt Corollary• One of the greatest concerns was the intervention of European nations in Latin America:– In 1903, Germany & England threatened to

invade Venezuela to recoup unpaid debts – TR issued Roosevelt Corollary to the Monroe

Doctrine in 1904 claiming special “police powers” in the Western Hemisphere

TR warned European nations to stay out AND warned Latin American nations to be

more responsible or the U.S. would intervene

The Roosevelt Corollary to the Monroe Doctrine, 1904

Additionally, the Lodge Corollary in 1912 refused to allow foreign companies to buy ports

or establish military sites in Latin America

The Roosevelt Corollary was used to justify American armed intervention in the Dominican Republic, Cuba, Haiti,

Nicaragua, & Mexico

Attempts to maintain order in Latin America led to pro-American regimes that relied on

dictatorial rule over its citizens

Big Stick Diplomacy• Foreign policy under TR extended to Asia

as well as Latin America:– TR negotiated an end to the Russo-Japanese

War in 1905 from Portsmouth, NH– Gentlemen’s Agreement in 1907 limited

Japanese immigration– The Root-Takahira Agreement in 1908

protected America’s Open Door Policy in China

“Constable of the World”

William Howard Taft’s “Dollar Diplomacy”

Taft and Dollar Diplomacy• President Taft took over after TR &

continued an aggressive foreign policy, called “Dollar Diplomacy”– Use U.S. wealth rather than military strength

in foreign policy – In Latin America, U.S. banks assumed debts

to Europe– Taft’s attempts to build railroads in China

alienated Japan & ended the Open Door Policy

Woodrow Wilson’s “Moral Diplomacy”

Moral Diplomacy• Wilson was well-versed in domestic policy before becoming president, but not foreign policy

• He believed that Moral Diplomacy could bring peace & democracy to the world without militarism & war

• Wilson talked of “human rights” in Latin America, but defended the Monroe Doctrine & intervened more than Roosevelt or Taft

“It would be the irony of fate if my administration had to deal chiefly with

foreign affairs”—Wilson in 1912

Wilson appointed pacifist William Jennings Bryan as his Secretary of State

Wilson apologized to Colombia for

U.S. support of the Panamanian revolt

Moral Diplomacy in MexicoIn 1913, Mexican president Madero was overthrown by dictator Victoriano Huerta

Wilson refused to recognize Huerta & demanded that he step down so legitimate elections could

be held for a new president

When Huerta refused, Wilson used minor incidents (arrest of some U.S. sailors in Tampico) to send the military to occupy Veracruz & force

Huerta to flee to Europe

Mexican rebel Pancho Villa tried to provoke war with the U.S. by raiding across the border for

supporting his rival Carranza

Wilson responded by sending the military to find Villa (who were unable to do so)

Moral diplomacy seemed to fail in Mexico as war seemed eminent but WW I forced

Americans to change their focus to Europe

Conclusions• After the Spanish-American War, the USA

assumed an aggressive foreign policy:– In order to maintain order, forestall foreign

intervention, & protect U.S. economic interests– By the outbreak of WW I, the USA had seen

its foreign policy evolve from strict neutrality, to imperialist, to police officer

Washington’s Proclamation of Neutrality (1793) & Farewell Address (1796)

Annexation of Alaska, Hawaii, & Philippines; Open Door Policy in China

“Big Stick,” “Dollar,” & “Moral” diplomacies

Our “Sphere of Influence”Our “Sphere of Influence”

Moral Diplomacy• Involvement in Haiti• Mexican Revolution• Involvement in Dominican Republic• Virgin Islands• Reasons US entered WWI

– Make world safe for democracy– War to end all wars

• Jones Act, 1917 in Puerto Rico• Jones Act, 1916 conditions for Philippines independence • Repeal Panama Canal Tolls Act of 1912• No longer offered support to American investors

overseas

FDR’s “Good Neighbor” Policy

Important to have all nations in the Western Hemisphere united in lieu of foreign aggressions.

FDR The good neighbor respects himself and the rights of others.

Policy of non-intervention and cooperation.

The Good Neighbor Policy

U.S.-Latin America Relations During the War Years

The Good Neighbor Policy– "In the field of world policy, I dedicate this nation to

the policy of the good neighbor, the neighbor who resolutely respects himself and, because he does so, respects the rights of others." ~FDR, Second Inaugural Address

– The Good Neighbor Policy began with Pres. Hoover in 1928 in attempt to repair the damaged relations with L.A. during the Coolidge administration

– FDR promised to end direct US military intervention in the Western Hemisphere, and promised Latin American states that they would enjoy a high level of autonomy.

– What where the goals of the GNP? Did it succeed?

Case Study: Brazil

Case Study: Brazil• Brazil was one of Germany’s major trade partners – a

recipient of massive investment in returns for exports of coffee and beef.

• From 1939, the USA sought to divert Brazil away from its relationship with Germany. One way in which it could achieve this was through offers of massive investment, aid and loans to support President Vargas in his plans to diversify the Brazilian economy

• In March 1939 Roosevelt extended a package of credit and loans totalling $115 million to fund the Volta Redonda steel mill.

• In the spring of 1940, Brazilian foreign minister Oswaldo Aranha spent two months in Washington, soon after Brazil received a $19 million loan and $50 million in gold from the U.S.

Case Study: Brazil• One of the main aims of the U.S. economic

policy was to turn the Brazilian foreign ministry away from Germany and towards alliance with the USA.

• Vargas maintained neutrality until 1941, when an agreement was formed between Brazil and US. The U.S. would finance Brazilian iron and steel extraction, in exchange for military bases in Natal, in the northeast.

• Vargas signed the Washington Accords in 1942 to supply natural rubber from the Amazon to the Allies,

Case Study: Brazil

• In 1944 the USA gave Brazil $154 million of Lend-Lease funding to modernise its armed forces, especially its navy.

• 1944 the Brazilian Expeditionary Force (BEF) was sent to Italy to fight with the US army.

Case Study: Brazil

• Summary: The USA used its wealth, and its willingness to invest in the diversification of the Brazilian economy, to turn Getulio Vargas away from the alliance with Germany.

Case Study: Mexico

Case Study: Mexico• Mexico had received substantial US investment in the

development of its oil industry, there was increasing resentment at the low wages paid by American oil companies. Generally, US was unpopular and resented in Mexico.

• In March 1938 the Mexican government under Lazaro Cárdenas threatened to confiscate (expropriate) the assets and equipment of the US oil companies.

• Standard Oil demanded massive compensation, not just for the value of the plant but also for the loss of future profits.

Case Study: Mexico• Roosevelt sent his long-time assistant Josephus Daniels

to negotiate with the Mexicans. Daniels went against the wishes of the oil companies by accepting a much lower offer of compensation.

• By 1938, FDR was aware of the prospects of war, and he was determined to maintain good relations with the Mexican government, which was a major supplier of oil and silver. (let us not forget an 1,800 mile border)

• In 1941 FDR urges Standard Oil to accept $24 million in compensation from the Cárdenas government – only 5% of what Standard Oil had demanded.

• FDR conceded to Mexico because he feared that Mexico might declare open support for Germany.

Case Study: Mexico• US envoy, Henry Wallace, visited Mexico in 1940 to

persuade Mexico to allow the US to build naval and air bases on its coastline for operations against U-Boats, Mexico refused to surrender its neutrality.

• Mexico received $40 million in loans and credits of $300 million, as well as low-cost lend-lease equipment.

• The policy of neutrality was very popular in Mexico, and it was only the sinking of two Mexican tankers by u-boats that prompted Mexico to declare war on Germany in May 1942.

• The declaration was very unpopular in Mexico, and many Mexicans believed that their government had sold out to the US. The Mexicans sent one squadron of aircraft to fight the Japanese in the Pacific Theater

Case Study: Mexico• Summary: The US

managed to maintain “neighbourly” relations with Mexico by not using its clout to pressure the Mexican government to meet the demands of Standard Oil Co.

• Mexico was not an enthusiastic ally but it also didn’t side with Germany

Case Study: Argentina

Case Study: Argentina• Argentina was the second most populous

state in Latin America and FDR recognised its importance. Also its close ties to Germany.

• Relations with Argentina had been difficult because of US restrictions on beef imports due to “sanitary regulations.” (This was really a form of protectionism.) In 1935 Roosevelt introduced a Bill to Congress that would allow beef imports from Argentina, but this was blocked due to opposition from the US Senate.

Case Study: Argentina• In 1941 relations between

Argentina and the USA deteriorated. Argentina expressed support for Germany, which resulted in a breakdown of trade with the US.

• President Ramirez considered declaring war against Germany, and was overthrown by Gen. Edelmiro Farrell and his defence minister Gen. Juan Peron.

Case Study: Argentina

• In 1943, as a punitive measure, the US did not invite Argentina to attend an economic and agricultural conference in the US.

• In 1944 the US broke all diplomatic relations with Argentina in an attempt to pressure a declaration of war on Germany.

• On 9 April 1945 Argentina finally agreed to declare war on Germany (29 days before the end of the war in Europe) in return for US recognition of the government of Gen. Farrell.

Case Study: Summation• The USA’s attempt to build up a coalition of Latin

American states in support of the war against Germany was mostly a failure. This was due to two main factors

1) Latin American distrust of the USA’s economic imperialism2) The strong cultural links between many Latin American states

and Germany. – Vargas used the US to develop the Brazilian economy.

Strengthening itself against powerful South America states like Argentina.

– Cárdenas rallied the Mexican people by standing up to US business and government over its oil resources

– Farrell maintained a pro-Germany policy until the last days of the war

U.S. Political Criticism of Good Neighbor Policy

• “We are not winning the friendly collaboration of the peoples of Latin America. We are trying to buy it … We are hated… for upsetting their economy.” ~Senator Hugh Butler, 1943 (R. Nebraska)

• The main criticism of FDR’s strategy was that it cost hundreds of millions of dollars that could have been spent in the US, or on developing the support of neutral states in Europe, such as Sweden and Turkey.

• Also, as the US controlled the Western Atlantic (from Autumn 1943), some argued that the support from Latin American states was irrelevant.

• Finally, politicians argued that the loans and credits to Latin America supported corrupt and un-democratic governments and that this price was too high for diplomatic support in the war that would not make any real difference. (ex. Raphael Trujillo, Dominican Rep.)

Latin American Reaction to the Good Neighbor Policy

• The ruling elites of Latin America were able to prosper from US loans, there is little evidence to show that the Good Neighbor Policy did anything to improve popular opinion of America.

• In fact, many politicians and people in Latin America regarded US aid and investment as nothing more than neo-colonialism.

Hemispheric Diplomacy • Solving regional disputes

– Compared to the New Deal and to the politics of isolationism, leadership of the Western Hemisphere was not a major priority for the Roosevelt administration.

Hemispheric conferences 1933-1942– Most ended with disagreements over whether the League

should be involved in hemispheric disputes. The US wanted to use neutrality as a means of solving disputes in Latin America. Most did not trust US motives.

– Havana Conference (1940): Discussed resisting imperialism from states outside the Americas. It was agreed (without formal treaty) that the states of the Americas would assist any state that was threatened by an external aggressor

– Rio Conference (1942): FDR looked for the American states to break off diplomatic relations with Japan. Argentina and Chile refused.

European Reaction to the Good Neighbor Policy

• Many European leaders (ex. French Prime Minister Edouard Daladier) regarded the Good Neighbor Policy as an extension of the Monroe Doctrine that sought to reduce Latin America to an economic colony of the US.

• Others criticised his support of dictators such as Rafael Trujillo of the Dominican Republic

Analysis Good Neighbor Policy

• Overall, the Good Neighbor Policy was both a continuation of earlier hemispheric policies, but with certain significant additions – – (1) the injection of massive US funds and loans; – (2) attempts to manage trade through

not always reciprocal agreements; – (3) attempts to build up Latin American support and

assistance for the US war effort – with very mixed results.

• One major and unintended consequence of the Good Neighbor Policy was a growth of Anti-Americanism due to the belief that America was trying to dominate and control hemispheric trade, and prop-up dictators who agreed with its policies. Notably the states most eager to work with US were those with totalitarian regimes.