Revisiting U.S. Financial Colonialism in the Caribbean

Revisiting U.S. Financial Colonialism in the Caribbean From the 1890s to the 1930s, the United States established military, political, and economic domination over the Caribbean Basin. It displaced European and Canadian powers with troops, officials, and bankers. This major book by Peter James Hudson mainly confirms older interpretations that rapacious U.S. formal and informal colonialism produced more poverty and dictatorship than the promised prosperity and democracy. By employing massive research and eloquent prose, he has produced a landmark in the field. Hudson augments extensive existing knowledge by examining the financial side of U.S. occupation in unparalleled depth. He provides a superb narrative study of individual banks and bankers, as well as the processes and practices of their internationalization. By taking us inside the board rooms, the author makes a significant contribution to the business and economic history of the origins of U.S. imperialism among our southern neighbors. Hudson also places an unusual emphasis on “racial capitalism.” He uses this term to argue that the Jim Crow prejudices of the North American banks and bankers shaped their takeover of these tiny countries. Hudson discusses how the major U.S. banks—centered in New York—evolved from primarily merchant operations to commercial and industrial finances from the nineteenth to the twentieth century. Beginning in Latin America and Asia, they became an integral part of U.S. imperial interventions. As this book reveals, these financial houses brought to these subordinate countries not only their dollars but also their loans, procedures, laws, regulations, culture, ethnocentrism, sexism, and racism. Hudson appropriately concentrates on the principal U.S. invasions in Haiti and especially Cuba, without ignoring Nicaragua, Panama, or other victims in the Caribbean and Central America. He analyzes with exquisite details and pithy anecdotes and quotes the legal, quasi-legal, and illegal methods and patterns that characterized the bankers’ behavior in the paternalistic “backyard” of the Colossus of the North. Hudson also skillfully dissects the complex interactions among myriad conflicting and cooperating interest groups in both the center and the periphery. Indeed, he might have pursued these interactions at greater length. For example, he could have investigated further the calculated reluctance of the U.S. government to stand behind some of its investors in Latin America, as the hegemon shifted from gunboat to dollar diplomacy. In response to the U.S. offensive, Latin Americans eagerly sought modernization by amplifying their trade and investment from the new leader of the Western Hemisphere, while trying to preserve their own sovereignty. Washington maneuvered to allay those fears of imperialism by transitioning from mainly military to economic instruments. In the name of laissez-faire capitalism, the U.S. government quietly encouraged its bankers to get involved abroad but seldom openly defended them in their disputes with their hosts or each other. Hudson explains how the Great Depression halted this era of North American penetration and proliferation in much of Latin America. Many of those countries then denounced U.S. imperialism, intrusions, banks, loans, investments, and support for dictators behind a façade of democracy. Some also balked at U.S. cultural and racial arrogance. In turn, Washington assumed a lower profile under the “Good Neighbor Policy” of Franklin Roosevelt. Hudson arduously builds his case from a vast array of primary and secondary materials. His abundant original sources include newspapers, magazines, bank documents, company records, government archives, congressional reports, private papers, and memoirs. His voluminous research focuses mainly on U.S. information, institutions, and actors, leavened with lesser attention to internal Latin American or Spanish language coverage. Along with many praise-worthy achievements, there are a few areas where Hudson could have strengthened his study. Perhaps because he is not a traditional historian of Latin America, his secondary research neglects most of the numerous standard books on the U.S. role in the West Indies. Maybe because he wants to stress the economic side of the story, he particularly slights the classic works on the political, diplomatic, strategic, and military aspects of these events. Although the author’s account of monetary machinations fares well without these distinguished earlier scholars, consulting a broader range of expert historians and other social scientists could have helped contextualize these financial operations. It also could have further illuminated their connections with the political and military interventions. As Hudson suggests a couple of times, the financiers could have been treated in a broader historical and theoretical framework. In another missed opportunity, the author does not develop any clearly elaborated theoretical concepts for the U.S. appropriation of the Caribbean. In tune with most observers, Hudson justifiably views it as an example of imperialism, but he does not define that term or distinguish it from dependency, hegemony, or modernization. Readers are left to wonder to what degree these episodes resembled imperialism elsewhere. Hudson’s other key theoretical claim could also have been developed more fully. He is absolutely correct that racism, sexism, and anti-semitism heavily tainted the behavior of U.S. agents in the Caribbean. However, he does not tell us how that situation differed from the expression of their biases and prejudices at home and in other regions, such as South America. Since historians have long pointed out that North Americans often typecast Latin Americans as inferior on the grounds of race, religion, and gender, this book should unpack what is especially innovative or revelatory about this insight for the particular exploitation of the Caribbean. As the author himself remarks, “… in the context of Haiti, to imagine a history of capitalism scrubbed clean of the stain of racism is impossible” (83). Hudson’s focus on racial issues leads him to conclude too briefly that Latin Americans’ nationalistic reaction against the United States during the Great Depression sometimes included their rejection of racial capitalism and racism. Although this consciousness emerged in some instances, it did not spread very far, last very long, or produce profound changes. Hudson alludes to these limitations when he observes, “These evocations of blackness were ambivalent and often contradictory …” (256). Unfortunately, the lighter-skinned Latin Americans continued to hold sway over their darker compatriots in most countries onto the present day, little different from the U.S. imperial model. Nevertheless, this excellent book’s underscoring of this continuing problem may remind people of its salience and encourage some improvement. Although some themes and issues could have been explored further, Hudson’s book still stands out as a highly valuable publication. It displays the work of a talented historian. Without question, it deserves the attention of many scholars specializing on the United States as well as Latin America. It also speaks to students of international relations, imperialism, capitalism, banking, and racism. © The Author 2017. Published by Oxford University Press on behalf of the Society for Historians of American Foreign Relations. All rights reserved. For permissions, please e-mail: journals.permissions@oup.com. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Diplomatic History Oxford University Press

Revisiting U.S. Financial Colonialism in the Caribbean

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Publisher
Oxford University Press
Copyright
© The Author 2017. Published by Oxford University Press on behalf of the Society for Historians of American Foreign Relations. All rights reserved. For permissions, please e-mail: journals.permissions@oup.com.
ISSN
0145-2096
eISSN
1467-7709
D.O.I.
10.1093/dh/dhx101
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Abstract

From the 1890s to the 1930s, the United States established military, political, and economic domination over the Caribbean Basin. It displaced European and Canadian powers with troops, officials, and bankers. This major book by Peter James Hudson mainly confirms older interpretations that rapacious U.S. formal and informal colonialism produced more poverty and dictatorship than the promised prosperity and democracy. By employing massive research and eloquent prose, he has produced a landmark in the field. Hudson augments extensive existing knowledge by examining the financial side of U.S. occupation in unparalleled depth. He provides a superb narrative study of individual banks and bankers, as well as the processes and practices of their internationalization. By taking us inside the board rooms, the author makes a significant contribution to the business and economic history of the origins of U.S. imperialism among our southern neighbors. Hudson also places an unusual emphasis on “racial capitalism.” He uses this term to argue that the Jim Crow prejudices of the North American banks and bankers shaped their takeover of these tiny countries. Hudson discusses how the major U.S. banks—centered in New York—evolved from primarily merchant operations to commercial and industrial finances from the nineteenth to the twentieth century. Beginning in Latin America and Asia, they became an integral part of U.S. imperial interventions. As this book reveals, these financial houses brought to these subordinate countries not only their dollars but also their loans, procedures, laws, regulations, culture, ethnocentrism, sexism, and racism. Hudson appropriately concentrates on the principal U.S. invasions in Haiti and especially Cuba, without ignoring Nicaragua, Panama, or other victims in the Caribbean and Central America. He analyzes with exquisite details and pithy anecdotes and quotes the legal, quasi-legal, and illegal methods and patterns that characterized the bankers’ behavior in the paternalistic “backyard” of the Colossus of the North. Hudson also skillfully dissects the complex interactions among myriad conflicting and cooperating interest groups in both the center and the periphery. Indeed, he might have pursued these interactions at greater length. For example, he could have investigated further the calculated reluctance of the U.S. government to stand behind some of its investors in Latin America, as the hegemon shifted from gunboat to dollar diplomacy. In response to the U.S. offensive, Latin Americans eagerly sought modernization by amplifying their trade and investment from the new leader of the Western Hemisphere, while trying to preserve their own sovereignty. Washington maneuvered to allay those fears of imperialism by transitioning from mainly military to economic instruments. In the name of laissez-faire capitalism, the U.S. government quietly encouraged its bankers to get involved abroad but seldom openly defended them in their disputes with their hosts or each other. Hudson explains how the Great Depression halted this era of North American penetration and proliferation in much of Latin America. Many of those countries then denounced U.S. imperialism, intrusions, banks, loans, investments, and support for dictators behind a façade of democracy. Some also balked at U.S. cultural and racial arrogance. In turn, Washington assumed a lower profile under the “Good Neighbor Policy” of Franklin Roosevelt. Hudson arduously builds his case from a vast array of primary and secondary materials. His abundant original sources include newspapers, magazines, bank documents, company records, government archives, congressional reports, private papers, and memoirs. His voluminous research focuses mainly on U.S. information, institutions, and actors, leavened with lesser attention to internal Latin American or Spanish language coverage. Along with many praise-worthy achievements, there are a few areas where Hudson could have strengthened his study. Perhaps because he is not a traditional historian of Latin America, his secondary research neglects most of the numerous standard books on the U.S. role in the West Indies. Maybe because he wants to stress the economic side of the story, he particularly slights the classic works on the political, diplomatic, strategic, and military aspects of these events. Although the author’s account of monetary machinations fares well without these distinguished earlier scholars, consulting a broader range of expert historians and other social scientists could have helped contextualize these financial operations. It also could have further illuminated their connections with the political and military interventions. As Hudson suggests a couple of times, the financiers could have been treated in a broader historical and theoretical framework. In another missed opportunity, the author does not develop any clearly elaborated theoretical concepts for the U.S. appropriation of the Caribbean. In tune with most observers, Hudson justifiably views it as an example of imperialism, but he does not define that term or distinguish it from dependency, hegemony, or modernization. Readers are left to wonder to what degree these episodes resembled imperialism elsewhere. Hudson’s other key theoretical claim could also have been developed more fully. He is absolutely correct that racism, sexism, and anti-semitism heavily tainted the behavior of U.S. agents in the Caribbean. However, he does not tell us how that situation differed from the expression of their biases and prejudices at home and in other regions, such as South America. Since historians have long pointed out that North Americans often typecast Latin Americans as inferior on the grounds of race, religion, and gender, this book should unpack what is especially innovative or revelatory about this insight for the particular exploitation of the Caribbean. As the author himself remarks, “… in the context of Haiti, to imagine a history of capitalism scrubbed clean of the stain of racism is impossible” (83). Hudson’s focus on racial issues leads him to conclude too briefly that Latin Americans’ nationalistic reaction against the United States during the Great Depression sometimes included their rejection of racial capitalism and racism. Although this consciousness emerged in some instances, it did not spread very far, last very long, or produce profound changes. Hudson alludes to these limitations when he observes, “These evocations of blackness were ambivalent and often contradictory …” (256). Unfortunately, the lighter-skinned Latin Americans continued to hold sway over their darker compatriots in most countries onto the present day, little different from the U.S. imperial model. Nevertheless, this excellent book’s underscoring of this continuing problem may remind people of its salience and encourage some improvement. Although some themes and issues could have been explored further, Hudson’s book still stands out as a highly valuable publication. It displays the work of a talented historian. Without question, it deserves the attention of many scholars specializing on the United States as well as Latin America. It also speaks to students of international relations, imperialism, capitalism, banking, and racism. © The Author 2017. Published by Oxford University Press on behalf of the Society for Historians of American Foreign Relations. All rights reserved. For permissions, please e-mail: journals.permissions@oup.com.

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Diplomatic HistoryOxford University Press

Published: Apr 1, 2018

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