The term “Dollar Diplomacy" was applied by critics to the activist foreign policy of William Howard Taft. Late in his administration, the president described his actions as “substituting dollars for bullets." He went to great lengths — even resorting to bullets — to help develop American business interests in foreign areas. Philander C. Knox, a wealthy corporation lawyer, served as secretary of state and authored much of the Taft policy.
The Taft administration attempted to address two vital concerns:
However, the greatest diplomatic success that Taft enjoyed was settling several nettlesome North American issues .
In Latin America, Taft sought to protect the approaches to the Panama Canal
In the Far East, he attempted to safeguard the territorial integrity of China and promote the Open Door policy.
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Quotes regarding Foreign Affairs under Taft: Dollar Diplomacy.
By William Howard Taft
The diplomacy of the present administration has sought to respond to modern ideas of commercial intercourse. This policy has been characterized as substituting dollars for bullets. It is one that appeals alike to idealistic humanitarian sentiments, to the dictates of sound policy and strategy, and to legitimate commercial aims.
1912 State of the Union address