The administration of Theodore Roosevelt blatantly interfered in Colombian affairs in 1903 in order to secure land for the construction of a canal across Central America. That event had soured relations between the two nations and made others in Latin America suspicious about U.S. activities.
An effort was launched to redress Colombian grievances during the Wilson administration. Thaddeus A. Thomson, an American lawyer and diplomat from Texas, negotiated a treaty in Bogotá that awarded the government $25 million for the loss of Panama and included an apology for the U.S. role in the affair. Senate friends of Roosevelt, who was still alive and actively critical of Wilson, refused to consider the matter, regarding it as an unjust condemnation of the former president. Colombian resentment continued to simmer beneath the surface.
By 1921, conditions had changed. Roosevelt had died two years earlier and his supporters in the Senate seemed less concerned about his memory than responding to the call of American businessmen who had learned about the discovery of vast oil reserves in Colombia. The seven-year old reconciliation treaty was dusted off and an offending passage removed that which expressed the United States sincere regret for the Panamanian adventure. The cash payment, however, was retained.
The Thomson-Urrutia Treaty was a clear reversal of policy by the Republicans, as the Democrats gleefully pointed out during the ratification hearings. In the end, the agreement was easily ratified by the Senate on April 20, 1921 and accepted by Colombia later that year.
See other diplomatic issues during the Harding administration.