US Foreign Policy, 1920s (AQA A-Level History): Revision Notes
US Foreign Policy, 1920s
The debate over isolationism
In 1920, the United States Senate refused to ratify American membership of the League of Nations. This decision has prompted historical debate about whether the USA pursued an isolationist foreign policy during the 1920s. Isolationism refers to a deliberate policy of avoiding international commitments and remaining detached from foreign affairs, particularly those of Europe.
Some historians argue that the Senate's rejection of the League demonstrated a commitment to isolationism throughout the decade. However, others contend that the USA was too powerful and economically influential to adopt complete isolation from world affairs. Instead, America became selectively involved in international matters, particularly through European financial arrangements (such as the Dawes and Young Plans) and disarmament initiatives (notably the Washington Naval Disarmament Conference). The USA also maintained active involvement in Latin America and pursued policies to protect its interests in the Far East.
The historical evidence suggests that whilst the USA avoided formal political and military alliances, it remained deeply engaged in international economic and diplomatic affairs where American interests were at stake. This selective engagement challenges the traditional view of 1920s American isolationism.
Aims of US foreign policy
American foreign policy in the 1920s was shaped by several distinct objectives:
Avoiding European conflicts: The USA was convinced that the First World War had resulted from the selfish rivalries and entangling alliances of European powers. American policymakers were determined to avoid involvement in future European conflicts, preferring to maintain freedom of action rather than binding commitments.
Containing communism: Following the Bolshevik Revolution in Russia in October 1917, American leaders increasingly feared the spread of communist ideology. This was perceived as a threat to both the economic system and political stability of the USA. Containment of communism became a driving concern in foreign policy decisions.
The fear of communism spreading to the United States influenced many policy decisions throughout the 1920s, from European financial support to interventions in Latin America. This anti-communist stance would become even more pronounced in later decades.
Maintaining naval supremacy: The USA possessed the world's most powerful navy and sought to preserve this status. A particular concern was preventing further naval arms races, especially the expanding strength of the Japanese navy. American policymakers wanted to halt the growth of rival naval powers without bearing the financial burden of an unlimited arms race.
Protecting Far East interests: American economic and strategic interests in the Far East required careful management. The USA aimed to maintain the Open Door policy in China - a principle that guaranteed equal trading access for all nations in Chinese markets - which was increasingly threatened by Japanese expansionist policies. Maintaining the status quo in the region was essential to protecting American commercial interests.
Upholding the Monroe Doctrine: The USA remained committed to maintaining its economic and political interests in Latin America. The Monroe Doctrine, which asserted American opposition to European interference in the Western Hemisphere, continued to guide policy. However, the emergence of the Good Neighbor Policy suggested a shift towards cultivating better relations with Latin American nations whilst still protecting American interests.
President Warren Harding articulated this overall approach in his 1920 election campaign, stating that America's need was "not heroics but normalcy; not revolution but restoration; not internationality but nationality". He emphasised the importance of avoiding world domination by military force whilst maintaining steady, careful progress.
International conferences and agreements
The USA took the initiative in promoting international disarmament during the 1920s, organising two major diplomatic efforts: the Washington Disarmament Conference of November 1921 and the Kellogg-Briand Pact of 1928.
The Washington Conference, 1921-22
The Washington Conference brought together the United States, Great Britain, Japan, France and Italy. The USA was particularly eager to convene this conference for several interconnected reasons:
Preventing the Anglo-Japanese Alliance: Britain intended to renew its alliance with Japan in 1922, which would have secured Japanese support for British interests in the Far East. However, American policymakers feared this would strengthen Japanese influence in the region, particularly in China, and wanted to prevent Britain from providing diplomatic cover for Japanese expansion.
Maintaining the Open Door policy in China: The USA wished to preserve equal trading access in China, which benefited American commercial interests. Japanese expansion threatened to establish exclusive spheres of influence that would disadvantage US trade.
Securing support for disarmament: President Harding placed foreign affairs under the control of Secretary of State Charles Evans Hughes, who was a strong advocate of disarmament. Hughes saw the conference as an opportunity to reduce the burden of naval competition whilst maintaining American security.
Countering Japanese expansion: The most pressing concern was growing Japanese influence in the Far East. Japan had acquired German colonies in the Pacific following the First World War and posed a potential threat to communication links between Hawaii and other US possessions such as Guam and the Philippines. Moreover, Japan threatened China, which was increasingly vulnerable due to internal civil conflict.
Achievements of the Washington Conference
The Naval Disarmament Agreement
The conference produced the first international agreement on arms limitation, bringing stability to the Pacific region. The disarmament agreement involved four powers - the USA, Britain, Japan and France, with Italy signing in 1922.
Each nation agreed to reduce battleship tonnage over ten years. The final ratios were:
- USA and Britain: 5
- Japan: 3
- Italy and France: 1.75
This meant Japan accepted less tonnage than Britain and the USA.
Additionally, the Four Power Treaty required each country to respect the others' interests in the Far East and maintain the Open Door policy in China. Japan promised to withdraw its troops from the Chinese province of Shantung, and the USA agreed not to strengthen its military presence in Guam.
Limitations of the Washington Conference
Despite these achievements, the conference had several weaknesses. It imposed no limits on the size of armies or air forces. The naval limitations applied only to battleships and aircraft carriers, leaving other vessel types unrestricted.
Crucially, the agreement was 'toothless' - it contained no enforcement mechanism. No sanctions would be imposed on nations that violated the limitation agreement. Although Japan abided by the treaty for several years, it began expanding its influence during the 1930s, ultimately rendering the agreement ineffective.
The Kellogg-Briand Pact, 1928
The Kellogg-Briand Pact was an international agreement established by Frank B. Kellogg, the US Secretary of State, and Aristide Briand, the French Foreign Minister. This pact was signed for two main reasons:
The French sought a formal alliance with the USA for security purposes. However, America wished to avoid commitments in Europe and used the pact as a means of appeasing the French without accepting binding obligations. Moreover, there was growing support for peace movements in the USA during the 1920s, with various peace societies established to encourage public support for peaceful conflict resolution. One example was the World Peace Association.
Fifteen countries signed the pact, agreeing not to wage war except in self-defence and to seek peaceful means of resolving disputes. The Senate ratified the pact by an overwhelming majority of 85 votes to one, demonstrating broad political support for the principle of peaceful conflict resolution.
However, like the Washington agreements, it was another toothless accord with no sanctions for countries that violated its terms. The Senate Foreign Relations Committee insisted that the pact would not actually prevent the USA from using military force if attacked, nor would it commit America to helping any threatened country.
In practice, the agreement had little real effect on preventing the outbreak of war. The lack of enforcement mechanisms meant that nations could violate the pact without consequences, highlighting a recurring weakness in international agreements during this period.
The USA and Europe
Despite its reluctance to join the League of Nations, the USA found it impossible to avoid all involvement in European affairs, particularly due to the consequences of the Versailles peace settlement and the issue of reparations.
Loans and debt repayment
The USA was prepared to lend money to countries after the war to restore prosperity and prevent the spread of communism. However, these loans were not extended to the USSR and China. The Americans insisted that all war debts had to be repaid, using debt repayments as leverage over European powers.
Using Debt as Economic Leverage
When Britain attempted to force up the price of rubber by restricting supplies in the British Empire, the USA retaliated by threatening harsher repayment terms for war debts. This demonstrates how America used its position as a creditor to protect its economic interests and influence European policy decisions.
The Dawes Plan, 1924
The USA was concerned about maintaining a stable Germany to prevent a communist revolution. America became directly involved through the Dawes Plan of 1924. Charles G. Dawes, an American banker, was asked by the Allied Reparations Committee to investigate Germany's inability to afford the original reparations instalments, which had led to default in 1923.
Dawes' report, published in April 1924, proposed a restructured payment schedule. He recommended:
- Instituting annual reparations payments on a fixed scale
- Reorganising the German State Bank
- Increasing foreign loans to Germany
Key Financial Details of the Dawes Plan
The plan reduced German payments to $250 million annually, with these payments increasing over the next five years as the German economy improved. Germany was also given an immediate loan of 800 million marks, with US bankers providing half and the remainder coming from foreign bankers.
The Young Plan, 1929
The Young Plan of 1929 was drawn up by Owen Young, head of the General Electric Company. This plan further scaled down reparation payments to $26 billion, to be paid over a period of 59 years.
The Circular Flow of Money
The result was a complex circular flow of money that revealed the interconnected nature of post-war finances:
- The USA was lending money to Germany
- Germany was using these loans to pay reparations to the Allies
- The Allies were using these payments to repay loans to the USA
In other words, the USA was effectively paying itself back with its own money. The situation became even more confused with the Dawes and Young Plans scaling down German reparation payments, meaning Germany was paying less to the Allies who, in turn, paid less to the USA.
Involvement in Latin America
Although the USA largely avoided political commitments to European affairs during the 1920s, it continued to pursue and protect its interests in Latin America. There was increased American involvement in Latin American affairs during this period, partly due to the Monroe Doctrine as well as the emergence of the Good Neighbor Policy, which cultivated better relations with Latin America. Much of this increased involvement was economic, which in turn often encouraged greater political and military intervention to safeguard these economic interests.
Economic involvement
US investment in Latin America doubled during the years 1924-29, rising from $1.5 billion to $3 billion. This included automobile firms such as General Motors, which manufactured vehicles in Argentina, Brazil and Uruguay. In 1923, General Electric established the American and Foreign Power Company and controlled the provision of electricity in eight Latin American countries. In addition, US companies dominated the media, including the film industry and radio broadcasting.
The State Department actively supported this economic expansion by hiring economists such as Edwin Kemmerer to develop plans for countries that requested US investment. The Kemmerer Plans helped to stabilise and develop the economies of such countries by offering advice on sound currency and central banks.
However, such investment brought problems and increased US involvement in order to protect these investments. For example, America would intervene to prevent US loans being spent by corrupt officials on luxuries. However, the USA was reluctant to sanction military intervention because it was expensive and unpopular with taxpayers.
Settling disputes
During the 1920s, where possible, the US settled disputes with troops or financial compensation rather than through prolonged military intervention. These were often replaced by what were termed 'loyal local militia':
US Interventions in Latin America
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Colombia (1920s): The USA gave Colombia $25 million in compensation for its support for the independence of Panama in 1903.
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Mexico (1922-23): There was an ongoing dispute with Mexico after the latter defaulted on its international debts, much of which were owed to the USA, in 1914. In 1922, the Mexican government agreed to repay $500,000 and, in the following year, the Bucareli Accords provided compensation for damage caused to foreign property during the Mexican Revolution.
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Nicaragua (1925-28): In 1925, US troops were withdrawn from Nicaragua in order to improve relations between the two countries. However, the following year 5,000 troops were sent back due to the outbreak of civil war. A US diplomat, Henry Stimson, organised the Peace Treaty of Tipitapa which led to the election of Juan Bautista Sacasa in 1928.
These examples demonstrate that whilst America sought to reduce direct military intervention, it remained actively involved in protecting its economic and political interests throughout Latin America.
Key Points to Remember:
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The USA was not truly isolationist in the 1920s but pursued selective engagement, avoiding European political alliances whilst remaining active in economic and diplomatic affairs globally.
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American foreign policy aimed to avoid European conflicts, contain communism, maintain naval supremacy, protect Far East trading interests, and uphold the Monroe Doctrine in Latin America.
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The Washington Conference (1921) achieved the first international arms limitation agreement and prevented renewal of the Anglo-Japanese Alliance, but it lacked enforcement mechanisms and ultimately failed to prevent Japanese expansion in the 1930s.
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Through the Dawes Plan (1924) and Young Plan (1929), the USA became deeply involved in European economic affairs, lending money to Germany to enable reparations payments, which were then used to repay American loans - creating a circular flow of payments.
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US investment in Latin America doubled between 1924 and 1929 (from $1.5 billion to $3 billion), leading to increased political and military intervention to protect American economic interests, though the USA increasingly preferred financial settlements to prolonged military occupations.