An ‘Aladdin's lamp’ for free enterprise: Eisenhower, fiscal conservatism, and Latin American nationalism, 1953–61

Abstract

This study explores the Eisenhower administration's efforts to promote free trade and investment policies in Latin America. US officials believed that private capital investment, rather than US foreign aid, would best promote Latin American economic development and improve its abiliry to purchase American products. By eliminating the need for foreign aid, Latin American economic autarky complemented Eisenhower's zeal for fiscal conservatism. Although most scholars have focused on the primacy of anti-communism in Eisenhower's inter-American policies, this study contends that economic nationalism posed the greatest threat to Eisenhower's policies. US officials eventually responded by expanding aid to Latin America, but the additional economic aid was always intended to complement private capital, rather than replace it. This article, based upon the papers of influential administration officials and State Department records, sheds considerable light as to why the United States promoted free trade and investment policies in the developing world, as it still does today.