Taft’s “Dollar Diplomacy”

Section Summary

All around the globe, Taft sought to use U.S. economic might as a lever in foreign policy. He relied less on military action, or the threat of such action, than McKinley or Roosevelt before him; however, he both threatened and used military force when economic coercion proved unsuccessful, as it did in his bid to pay off Central America’s debts with U.S. dollars. In Asia, Taft tried to continue to support the balance of power, but his efforts backfired and alienated Japan. Increasing tensions between the United States and Japan would finally explode nearly thirty years later, with the outbreak of World War II.