Engaging Neighbors: Protecting Business Interests

Cultivation of bananas, a Latin American industry where companies from the United States have strong positions.
Jacobo Árbenz, left-leaning president of Guatemala, overthrown in a U.S.-backed coup in 1954.
The Panama Canal, a shortcut for ships travelling between the Atlantic Ocean and the Pacific Ocean. The canal, completed in 1914, was built by the United States.
Flames engulfing a building in Panama following the U.S. invasion of Panama in 1989.
Central America, the Caribbean and Mexico are shown in color.

As explained in a previous chapter, the United States became strong enough to exert influence over its Latin American neighbors in the 19th century. Since then, the country’s power position has been further consolidated, and the U.S. has continued to engage its neighbors.

Military interventions

During the 20th century, the United States militarily meddled in the affairs of nearly all of the largest countries of Central America and the Caribbean. In countries like the Dominican Republic and Panama, Washington imposed its will through direct military intervention, while in places like Guatemala and Nicaragua, Uncle Sam relied heavily on arming, training and funding domestic paramilitary groups in order to try to steer developments in what was argued to be the right direction.

In some of the countries where the United States took sides, its actions can be argued to have had stabilizing effects or have contributed to ending dictatorial rule. A number of U.S. interventions, furthermore, contributed to fomenting civil war and human rights abuses, leading many to lash out against the giant country’s foreign policy decisions. The United States, in other words, are heroes to some and villains to others, a dual reputation earned by interventions that practically always, at least partially, have been motivated by American political and business self-interests.

A business perspective

Expounding on the business self-interest as it relates to armed conflict, American corporations have invested large sums of money in business projects all over Latin America. These investments have been made continually throughout the 20th and early 21st centuries, and key people in numerous U.S. governments, for whatever reason, have been eager to protect the economic and political upside that the investments have generated. This, going back to the United States’ military interventions, partly explains why the U.S. has sent armed forces, advisors and money in support of certain Latin American politicians, since these politicians, in turn, have allowed the Americans to successfully do business in their respective countries.

For Latin America, U.S. business projects have often led to important economic and technological improvements. The Panama Canal and electrical grids, for example, are two types of projects that American companies have built or helped bring to parts of Latin America. Still though, many American business projects have disproportionately benefited well-connected in-groups, while at the same time exploiting Latin American workers and destroying valuable land and natural resources.