Great Depression

1900-1945: The Caribbean experiences two World Wars and a Great Depression from a distance

Caribbean islands were riding an economic high as they entered the 20th century. And as during any wartime, sugar prices soared. But the Great Depression after the first World War took the world by storm, and many precarious island governments were toppled by the economic stress.

U.S. Territories

When the U.S. won the Spanish-American war, Puerto Rico became the first U.S. territory in the Caribbean. At first, the U.S. was unsure how to deal with this territorial holding. Officials did not want to grant the island statehood for two reasons: Puerto Ricans were 40% non-white according to census data, and they spoke Spanish.

Instead, the U.S. enacted the Foraker Act in 1900. It copied the British Crown Colonies' government, and included the following elements:

  • The U.S. President appoints the island's Supreme Court and Governor.

  • The Governor names 11 members to an Executive Council.

  • The popular vote chooses the 35-member House of Delegates.

  • The U.S. Congress retained veto power over any Puerto Rican laws.

  • In 1902 there would be no tariffs for goods between Puerto Rico and the U.S.

  • People would be citizens of Puerto Rico - not the U.S.

This bill was not well-liked by any of the parties involved, but political troubles made it difficult to change. However, President Woodrow Wilson created the Jones Act to govern Puerto Rico in 1917, the same year that the U.S. purchased the Virgin Islands from the Danes. The purchase went through to stop the Germans from taking territory in the Americas.

The Jones Act, however, provided the following only for Puerto Rico:

  • Puerto Ricans would be protected by the Constitution as U.S. citizens.

  • Puerto Ricans could travel freely to the mainland.

  • The islanders were exempt from federal voting or taxes, but could be drafted.

Puerto Rico's Senate and House were elected via universal male suffrage, until 1929 when women gained the right to vote. The President continued to appoint the Governor and Supreme Court.

After World War I the U.S. all but forgot about its Virgin Islands territories, leaving them under naval control until 1931, when control was transferred to the Department of the Interior. Nonetheless, the islanders gained U.S. citizenship in 1927.

At first the islands retained their Danish-style government. The Organic Act of 1936 guaranteed their Constitutional rights, but gave local governments the rights to use all local taxes. Voting rights on the Virgin Islands were also relaxed, giving the right to vote to any U.S. citizens who could read English.

U.S. Intervention

Puerto Rico and the Virgin Islands weren't the only interests the U.S. had in the Caribbean. The war that gave the U.S. control of Puerto Rico also freed Cuba, and the U.S. government helped Cuba to form its own government. Haiti and the Dominican Republic also had a close association with the U.S. throughout modern history.


In 1902 Tomás Estrada Palma became Cuba's first President. However, in 1906 both Palma and his Vice President resigned after an uprising by José Miguel Gómez, and U.S. troops were sent to help control the island. Palma had won re-election in 1905 while the country experienced an economic boom. He was also one of the few presidents who did not line his pockets with Cuban funds. Still, the election campaign had involved dirty politics on the sides of both Palma and Gómez.

U.S. troops again returned in 1917 to help establish Mario García Menocal's presidency after his re-election in 1916. Several other presidents reigned until 1924 when General Gerardo Machado y Morales was elected and turned the presidency into a dictatorship.

The U.S. again intervened in 1933, forcing Machado to resign and hoping to find a peaceful solution to the troubles on Cuba before protests could turn into civil war. The president installed by President Franklin Roosevelt's Ambassador was soon overthrown. In 1934 the U.S. recognized Sergeant Fulgencio Batista y Zalvidar as the Cuban leader, but Batista named Carlos Mendieta as President.

By 1940 Batista was so well-liked that he was elected as President in an honest election. The U.S. relinquished much of the control it had gained over Cuba through the Platt Amendment, but retained its naval base in Guantánamo Bay. Hispaniola

At this time, both Haiti and the Dominican Republic were struggling as nations. Although they had earned their independence in the first half of the 17th century, their political structures were still unstable and subject to many changes of power. For example, Ramón Cáceres was elected as president of the Dominican Republic in 1906, but was assassinated in 1911.

Concerns of German occupation during the first World War caused the U.S. to occupy Haiti in 1915 and the Dominican Republic in 1916, which subsequently improved conditions on the island. In 1927, the young Rafael Trujillo was given control of the Dominican National Guard. By 1928 the Guard became the country's army.

The U.S. trained these soldiers in an effort to reduce the number of bandits in the countryside. However, Trujillo had his eyes on leadership, and in 1930 he took control of the Dominican Republic. This same year a hurricane devastated the country, and economic turmoil reigned as the Great Depression took its toll on the island.

In 1931 Trujillo became the country's dictator and rebuilt Santo Domingo, naming it Trujillo City in his own honor. Although he was a dictator, Trujillo was extremely popular during the beginning of his reign as he rebuilt the island and improved roads, public buildings, railways, and even hotels for tourism.

In 1933, the U.S. left Haiti and the island's political struggles began as leaders fought for power. These political struggles and power changes lasted for more than 20 years.

Shared Troubles

Though some islands fared better than others during this time, the Great Depression struck all of the Caribbean islands, which often relied on the support of their parent nation. Sugar prices fell drastically, leaving most islands without a source of income following a sugar high that had allowed many of the islands to grow through the introduction of roads and other construction projects.

These economic troubles hit the independent countries of the Caribbean hardest. Cuba, Haiti, and the Dominican Republic were forced to borrow money to stay afloat. Economic troubles almost invariably led to political shake-ups, as unhappy islanders revolted. Power changed hands frequently, often creating worse situations as a series of corrupt politicians came into office.

A second World War provided another economic boom in the Caribbean, but troubled nations continued their fight for leadership. Island conditions improved and worsened a number of times during the beginning of the 20th century, but in the end, a wartime rise in sugar prices could not lift the islands out of the political turmoil they had fallen into.

The two World Wars book-end the Great Depression, and these economic changes led to historic political problems, particularly among the Caribbean's independent nations. Those with colonial ties managed to make it through these tough times.


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