It is better to be born lucky than rich. Unfortunately for the Dominican Republic, they were neither rich nor lucky. As America became a popular asset among Latin America, the Santo Domingo Improvement Company would unintentionally cause them to become an asset to the Dominican Republic and leave behind a trail of questions yearning to be answered.

With Britain, France, Germany and Russia playing a greater and more influential role in the world, including Latin American countries in the Caribbean, the United Sates seemed to be lost somewhere in the background. Lo and behold, during the 1890’s to 1905, the United States would take the position from Great Britain as the leading country in the world, economically.

In 1898, Puerto Rico became a U.S colony when they defeated Spain, also, the United States assumed superior authority over an independent Cuba in 1902 and one year later in 1903, a newly independent Panama gave the United States permission to build an isthmian canal in the country. Even before their involvement in these countries, their economic presence was felt during the nineteenth century where they would invest in railroads, plantations and public utilities.

The United States became more interested in the Dominican Republic after the Santo Domingo Improvement Company left a trail of broken glass and deeper pockets that the United Stated would have to pick up after and clean up, a job that Theodore Roosevelt was at first reluctant to do.

Smith M. Weed, president of a newly formed corporation in New York, the Santo Domingo Improvement Company (SDIC), was looking to make a big and prosperous investment when he bought from Westerndorp, a Dutch firm, the foreign debts of Santo Domingo. In exchange for the purchase of the Dominican debts, the Improvement Company would gain control of their customs houses. Their confidence also stemmed from the fact that they would be supported by Washington whom, without thinking of the consequences of having a private company control international finances, thought that the Dominican Republic would become a virtual protectorate of the U.S. Moreover, the Santo Domingo Improvement Company President was a close friend to then President, Grover Cleveland.

The main purpose of the Santo Domingo Improvement Company was to do exactly what its name implied, to improve Santo Domingo. To do this, the company would have to get involved with the president of the country, Ulysses Heureaux, who was welcoming to the company as opposed to his fellow government officials who were, by no means, enthused at the invasion of their country by the SDIC. Inevitably, the Santo Domingo Improvement Company and Heureaux would work together until the president’s death in 1899.

One change that the Improvement Company deemed necessary for the country was trade. The main type of agriculture practiced by the Dominicans was subsistence farming, only producing an adequate amount of food for the farmer and his family with an insignificant amount left to be sold. There was also an abundance of land and the Santo Domingo Improvement Company saw the opportunity to combine the two, farmers and land, and have them begin producing cash crops for export which would include coffee tobacco and cacao. To begin exporting for a substantial amount of profit, the route of travel between the farming areas and the ports would have to be updated. By allowing the construction of railroads, a national bank, steamships and wharfs and the implementation of telegraph and telephone systems, the Dominican Republic was becoming more civilized and could now function.

Even before the presence of the Santo Domingo Improvement Company, the country was exporting sugar and tobacco, the only cash crops produced at the time, to the United States and Germany, respectively. As farmers switched to cash crop production, producing mainly sugar, its price fell due to reciprocity and many would cower and return to subsistence. As a result, Dominicans were at first reluctant to return to the scene, but as it developed more and more peasants were flocking to work on sugar plantations, leaving behind their only means of food for consumption. The importation of these types of food in the country was on the rise.

The SDIC would sell 30 million dollars worth of bonds to Europe in order to help with improvements. A new currency of gold would begin to circulate.

In 1894, the president toured the northern-most parts of the Dominican Republic and was greeted kindly by the citizens. It seemed as if they were praising him for his method of running the country especially with exports on the rise. He must have been doing something right in order to have received such adulation. But, with the Dominican Republic already knee-deep in debt and unable to make payments, Heureaux made conditions even worst because of his selfish nature and his need to be in control. This was the reason the Santo Domingo Improvement Company was able to purchase the country’s foreign debts. The dictator would take out loans in order to bribe his opponents in order to keep his position, and the citizens, in order to maintain discipline. In 1899 Heureaux would be assassinated.

After Ulysses Heureaux’s death, the Dominican government took control of the customs houses once again and the Santo Domingo Improvement Company became concerned. In 1901 the Dominican government no longer accepted the presence of the Improvement Company and they were forced to leave. Europe would now able to enter the country and try, in whichever way, to collect its payments. With the help and support of the State and the U.S Navy from 1901 to 1905, the Santo Domingo Improvement Company eventually got the Dominicans to agree to pay a total of 4.5 million dollars and to ignore the previous debts owed to them. The presence of the warships instilled fear in the Dominican government.

The persistence of the Improvement Company at the Republic to repay them and only them caused the United States to look down on the company.

The Dominican Republic still had debts outstanding and with the European countries right on its tail, they were hoping for some divine intervention and in 1905, President Theodore Roosevelt took over the Dominican Republic as well as all their customs houses. The Improvement Company whimpered and whined in the background in fear of not receiving their payment. The President introduced his Corollary to the Monroe Doctrine, a new policy, to stabilize the Republic. The Corollary states that:

Chronic wrongdoing, or an impotence which results in a general loosening of the ties of civilized society, may in America, as elsewhere, ultimately require intervention by some civilized nation, and in the Western Hemisphere the adherence of the United States to the Monroe Doctrine may force the United States, however reluctantly, in flagrant cases of such wrongdoing or impotence, to the exercise of an international police power (La Salle).

The words of the Roosevelt Corollary kept the ferocious European countries at bay and the receipts from the customs houses would be used as payments to them. To make things even better, the President loaned the country 20 million dollars in hopes of rejuvenating the country

Toward the end of it all, the Dominican Republic would become better off. The Santo Domingo Improvement Company entered the Republic with good intentions, working around their greed to help a country in need, which they did to an extent. With the help of the Republic’s avaricious President, Ulysses Heureaux, the Improvement Company would manage to put the country deeper in debt and in the midst of it, turn the country against their President and eventually killing him. Thankfully, the United Stated heard the cries of the Dominicans and put into place a policy that would become beneficial, not only to the Republic, but the entire Latin America. A new Dollar Diplomacy was formed.

Work Cited

Veeser, Cyrus. A World Safe for Capitalism. New York: Columbia University Press, 

1893. 

The Bentley College. www.ecampus.bentley.edu. March 24th, 2004

Merrriam-Webster Dictionary. www.m-w.com. March 23rd, 2004

La Salle High School. www.cincinnatilasalle.net. March 24th, 2004