The 1920s saw a continuation of endemic political instability in Central America and many parts of the Caribbean. Despite the trappings of democracy, dictatorships prevailed in most of these nations and a progression of corrupt regimes continued to oppress the working masses.
In 1922, the United States invited Central American nations to a conference in Washington for the specific purpose of trying to heal a bitter dispute between Honduras and Nicaragua. U.S. delegates failed to ignite interest in the formation of a Central American union, an idea that had been planned a number of times previously, but had never succeeded. However, the conference was able to reach agreement on the following:
the establishment of a Central American Court of Justice
the negotiation of a treaty of neutrality
preliminary planning on an arms limitation agreement.
Over the next few years, a number of Central American nations ratified these agreements, but no effort was made to implement their provisions. The United States was unable to exert effective leadership because it was viewed with suspicion, if not hatred, by many Latin nations. The U.S. had a history of supporting dictatorships that were friendly to American business interests and repeatedly intervened when it was felt that conditions were spiraling out of control. This pattern continued in the 1920s, when Nicaragua, Haiti and Cuba were occupied by American forces to protect lives and investments.
A serious effort to improve relations with Latin America was not made until the implementation of the Good Neighbor Policy of the 1930s.