The New Internationalism.

By 1910 the traditional American policies of isolationism and noninterference in foreign affairs had clearly ended. The United States protected the Philippines and warded off Japanese aggressions in China, tried to mediate old-world rivalries in Europe, and asserted military and economic dominance in the Caribbean. William Howard Taft and Woodrow Wilson each placed his individual stamp on world affairs, but both operated within the broad policy outlines established by Theodore Roosevelt.

Dollar Diplomacy.

President Taft and his secretary of state, Philander C. Knox, tried to overturn many of Roosevelt's diplomatic policies. They abandoned Europe and did not actively pursue goodwill with Japan, but the administration could not reverse Roosevelt's most lasting policy — protecting American interests in the Caribbean. Taft and Knox went beyond the former president's intervention and devised their own strategy called "dollar diplomacy." Dollar diplomacy involved using private...