Papers presented by David Shorten since 2019

2025 Atlanta, Georgia

"Baby Octopuses: Sovereign Debt Monopolies in the Circum-Caribbean, 1890-1910"

Abstract:

This paper explores the history of foreign-controlled sovereign debt and infrastructure projects in the circum-Caribbean during the late nineteenth and early twentieth centuries, centering on American entrepreneur Minor C. Keith, who utilized sovereign debt to develop Costa Rica's Atlantic Railway and later created the United Fruit Company—a powerful monopoly in the region’s fruit trade. The story of Keith's sovereign debt negotiations and the contract terms secured by financiers in Costa Rica, Honduras, the Dominican Republic, and Nicaragua, demonstrates how railroads funded by foreign debt fueled monopolies, debt crises, and revolutions that defined the region’s development. Keith’s successes in using sovereign debt to build his business spurred imitators, though many other financiers failed to deliver functioning railways, hindering local development. While United Fruit became known as “the Caribbean Octopus,” these smaller entities—“baby octopuses”—remained influential, wielding monopoly power and protected by contract rights but likely to imperil their hosts. Sources include historical bondholder reports, bond and concession contracts, and accounts from Keith's ventures, particularly materials gathered from the Corporation of Foreign Bondholders papers at the London Metropolitan Archives. These sources show not only the international but also the local impacts, particularly on labor, as migrant workers bore the costs of foreign-driven infrastructure projects. This research contributes to business history literature by demonstrating how the mechanics of sovereign debt facilitated monopolization by US financiers and firms in the circum-Caribbean. The paper also analyzes how these developments realigned U.S. foreign policy goals and international capital flows, setting the stage for conflicts over debt and sovereignty in the Caribbean and highlighting U.S. financiers as central drivers of diplomacy, both for the protection they demanded and the crises they created, spurring antimonopoly reforms.

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2024 Providence, Rhode Island

"International Bankers, Postwar Settlement, and the Progressive Party of 1924 "

Abstract:

This paper examines the demobilization of public credit institutions in the United States after World War I in the context of the reconstruction of international finance. It focuses on the War Finance Corporation, Federal Reserve policy, war debt cancelation, and the McNary-Haugen Farm Relief Bill. Based on the archival records of J.P. Morgan partner Thomas Lamont, as well as the papers of various senators, including Gerald P. Nye and Robert La Follette, it explains the emergence of dueling political programs of international bankers and farm-bloc progressives to shape the postwar settlement. Wisconsin Senator Robert La Follette, Sr.’s 1924 Progressive campaign for President sought to relieve postwar anxieties about bankers’ influence over federal governance and the international economy. One of the most successful independent campaigns in United States history, La Follette championed an antimonopoly agenda for postwar reconstruction. Bankers like Lamont, on the other hand, who greatly influenced postwar trade and loan policies, believed peace required powerful and intimate forms of international cooperation and advocated the free flow of goods and fixed exchangeability of currencies for the sake of stabilizing global commerce, rather than to benefit any one nation. This essay explores how these competing programs shaped politics and policy in the 1920s.

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2023 Detroit, MI, United States

"International Financiers and the Reinvention of U.S. Neutrality in the circum-Caribbean, 1900-1914"

Abstract:

During the early twentieth century, the dramatic growth of United States citizens’ economic power abroad, and the nation’s increased involvement in international affairs, exposed cracks in the foundations of U.S. neutrality. Neutrality, a principle in international law characterizing relations among nations, could be defined as a nation’s promise not to disproportionately influence the course of foreign conflicts. In the United States, federal neutrality statutes deterred citizens (and resident aliens) from violating the United States’ duties to remain neutral. However, the nation’s venture into international investments—or, more precisely, U.S. investors’ increased holdings of foreign securities and foreign direct investments, concentrated in Latin America—placed new kinds of pressure on neutrality. Between 1897 and 1910, U.S. international investments increased rapidly from less than $700 million to more than $3.5 billion. On one hand, the structures of international investing entwined the long-term interests of investors and foreign states, which gave investors incentives to support embattled regimes or oppose them, depending on how it affected their investments (and those of their competitors). On the other hand, international financiers easily evaded the law’s grasp. Financiers supported belligerent causes outside of U.S. jurisdiction without violating the law. What’s more, the narrowly tailored neutrality statutes did not inhibit them from doing so even from within U.S. borders. These problems led to calls for revisions to U.S. neutrality laws. This paper recovers international financiers’ perspectives, especially how and why they invested in the circum-Caribbean and became entangled in revolutionary activities, by examining archival and printed records of bankers, bondholders, and financiers, particularly those of the British Corporation of Foreign Bondholders. Tracing the reinvention of U.S. neutrality back to the changing structures of international finance in the circum-Caribbean before World War I, it will offer groundwork for reconsidering a multi-generational movement to maintain peace through neutrality.

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