CHAPTER I

THE INTERNATIONAL IMPORTANCE OF THE

CARIBBEAN

THE rapid growth of the international trade of the world in the last generation has emphasized the importance of the economic factor in diplomacy. In 1890, foreign exchanges are estimated to have reached a total of $17,519,000,000; in 1900, the total was $20,105,000,000 but the next decade and a half brought its most rapid increase, the total now exceeding $40,000,000,000.1 All great commercial countries have been reaching out for wider politica' control of territory into which their commerce may expand and for wider control of the commerce of all lands under whatever flags. With the growth of surplus capital, too, foreign investments have been sought on an unprecedented scale, with the result that the interests of the peoples of all countries have become intimately interlaced.

The imperialistic development of our own day, sometimes preceding, sometimes following national economic interests, has brought a gradual crowding out of weaker peoples, and an integration of political and commercial

1 In 1913 the total was $40,420,000,000. Statistical Abstract of the United States, 1914, Washington, 1915, p. 685.

control under few great empires. Since the middle eighties, Africa has been partitioned in such a manner that today there remain outside the control of the great European powers but two small and tottering states, Liberia on the west coast and Abyssinia in the northeast. Asia, too, especially in the last two decades, has been subjected to pressure by governments seeking to mark out for themselves fields for future commercial expansion. The partition of China, which seemed about to occur in the late nineties to parallel that of Africa a decade before, was given a temporary check by the diplomacy of Secretary Hay, who inaugurated what was called the "Open-Door Policy" in 1901. Recent developments have brought renewed attacks upon her territorial integrity, by Japan on the northeast; by England on the southwest in Tibet, and by Russia on the north in Inner and Outer Mongolia and Turkestan.

If South America, Central America, and the Caribbean had been geographically isolated, it is at least doubtful whether conditions would not there have been developed which would have changed the map in startling ways. But political developments in the New World have brought the American states into a position in which de facto the interests of none are isolated. In the past this has been due not to coöperation, but to the declared national policy of the most powerful of American nations. The Monroe Doctrine, championed at various times under various forms by the United States, has served as a barrier to the propaganda by which European political control could be further extended

in the New World. This doctrine, in its announcement and through most of its history only political, we are beginning to realize has a decided economic phase. This is true not because the United States has used it to its own advantage and to the disadvantage of Europe, but because, political control of the American countries by European powers being cut off, any struggle for economic advantage in regions not already under European flags has had to be carried on under substantially equal terms for all powers. No European nation has been allowed to mark out a sphere of political influence in the New World in which tariff barriers could be erected to shut out the competition of its rivals.

By the closing years of the nineteenth century a new element was beginning to make this principle an even better established feature of American policy. A group of South American states had developed stability of government and national strength to a degree which differentiated them from the other independent states of the continent. Though there has been no formal announcement by these South American states, there is no longer any doubt that they would feel that any attempt to extend European control over additional territory in America would be opposed to their interests, and it is entirely probable that at least certain among them might aid in resisting such aggression by force of arms. Entirely aside from any joint formal diplomatic announcement by American states, it is almost beyond doubt that the principle of the Monroe Doctrine, if questioned, would now find zealous support not

only in the United States, but in the more stable governments of the southern continent.

The states of the extreme south, Argentina, Uruguay and Chile, are now little likely to be drawn into positions which will involve danger of successful European attack upon their territories. With them Brazil ought also to be classed, though there is reason to believe that at least a part of the rich and unexploited resources of that great state might before now have passed into the control of other hands but for the opposition which such action would have met on the part of the other American powers. The entry of this group of states into the ranks of those whose foreign policy will be influenced by continental, and not merely by national, considerations points to the expansion of the Monroe Doctrine from a principle which is supported by the United States to one supported by the chief powers of the New World.

European control of commerce may develop now as in the past, but the political character of loans in these countries will become less prominent. Money from abroad invested in the development of their national resources will come to have a position more nearly akin to that which foreign investments have in the United States, or any other of the world's stable nations. In those countries where stable governments have been established the occasions for interference for the protection of the investments of nationals have probably come to an end; at the same time, these powers have now to be considered in the maintenance of the political policy of America for Americans. The possibility that the

pressure of foreign economic interests may destroy their governments is remote.

The northern part of South America, the island republics of the Caribbean and the weak states of Central America are still in a less favorable position. However much they may sympathize with the policy of resisting extension of European control, not one independently could offer effective resistance. Had they been left unaided to defend themselves by their own diplomacy and military strength, it is not improbable that before our day they would have passed under European control. If they were at the present time left to their own resources it is unlikely that they would long be able to maintain their independence.

If we go no farther back than the closing years of the nineteenth century we find a number of incidents which contain the elements that might have brought about the annihilation of some of these states. The Venezuelan boundary controversy with Great Britain, which came to a climax in 1896, but for the interference of the United States, would almost certainly have resulted in serious dismemberment of that republic. Five years later Venezuela was again in complications which pointed to the possibility of a control of customs houses by a number of the European powers. Such a temporary occupation of territory might develop a situation in which the relinquishment of control would be postponed for long periods, as China has learned to her sorrow in similar situations. Again in 1905, another weak state, the Dominican Republic, faced the possibility of a similar national disintegration. The reported demand by