John and Fritz are at it again, Part I: The Venezuelan Crisis
"Germany views our refusal to build up a large navy as a sign of weakness...in a few years they will be in a position to take some step in the West Indies or South America which will make us either put up or shut up on the Monroe Doctrine."
US Vice President Theodore Roosevelt in a letter to Henry Cabot Lodge in 1900.
"If any South American States misbehaves towards any European country, let the European country spank it; but I do not wish the United States or any other country to get additional territory in South America...I told him [the German consul general in New York]...that...I have a hearty and genuine liking for the Germans both individually and as a nation;...that I was delighted to see South America kept open commercially to Germany and to the United States on an equal footing; that if a big German-speaking community in a South American state could not stand misgovernment, and set up for itself, there would be in that fact by itself nothing to which I should object; but that I did not desire to see the United States gain any territory in South America itself, and that...I would do all in my power to have the United States take the attitude that no European nation, Germany or any other, should gain a foot of soil in any shape or way in South America."
US Vice President Theodore Roosevelt commenting his discussion with the German ambassador von Holleben in 1902.
"Castro is an unspeakably villainous little monkey."
Theodore Roosevelt, 1905.
To understand the wider geopolitical context of Great Power relations regarding Scandinavia in autumn 1905, one has to keep in mind the previous instances where the Powers had been able to put aside their differences and act together. While the Boxer War is the most famous example of this development, the Venezuelan Crisis of 1902 was another event that postwar world would look as a sign of things to come. The way Germany and rest of the Concert of Europe interacted during this formative years of the 21st Century had a lot to do with the persons of Kaiser Wilhelm II and his loyal Chancellor, Prince Eulenburg. For Chancellor Eulenburg, the years at the beginning of the new century had been marked with his worries about the deteriorating state of the Anglo-German relations. The Navy Bill of 1900 had gone through after Tirpitz and the German navalists had worked hard to gain enough support at the Reichstag. Meanwhile Holstein at the German Foreign Service still felt confident that there was no need to hurry regarding initiatives towards Britain, since London would ultimately have to align herself with Berlin in any case, and time was on the side of Germany. Eulenburg disagreed, but for the time being could do little to outmaneuver the "monster of the labyrinth" while at the same time keeping Wilhelm II in line without alienating His Majesty.
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Appointed to implement Weltpolitik, he viewed his primary domestic task as patching together workable coalitions from the fractious groups that vied for power and influence in Wilhelmine Germany to cement the personal rule of Wilhelm II. His approach to this goal was based on his own extensive client networks and behind-the-scenes approach. In foreign policy Eulenburg wanted to avoid continental coalitions against Germany at all costs. He maintained Bismarck’s alliance with Austria-Hungary, and sought to improve relations with Russia and France. Yet Russian focus to the Balkans was forcing Eulenburg to wooing Britain as a counterbalance to the rising power of St. Petersburg.
At the northern side of the Channel Joseph Chamberlain thought that some sort entente with the Germans could be useful, at least in order to avert the threat of a wider anti-British Continental coalition. Wilhelm, with his mixed love/hate-relationship with Britain, found the idea quite attractive. The however, the anti-English tone of the German press coverage of the Boer War had outraged the British. The German press magnates kept the Boer War in the headlines since the public outrage was selling well, just like their French and Russian counterparts. The matter culminated when Chamberlain’s October 1901 speech, comparing the conduct of British forces in South Africa to the actions of German soldiers in the war of 1870 was soothed over by Eulenburg, much to the dismay of German nationalists.
It was at this moment that Venezuela came to the fore. Nothing unites like a common foe, and Caracas had managed to raise the ire of London, Berlin, Rome, Paris and Washington - a no mean feat by itself. The handmark of Eulenburg and his attempt to steer a new course to German foreign policy in uneasy, but working cooperation with Holstein is clearly seen in the way the Germans approach the situation of Venezuela, a country that was mired in internal unrest and civil conflicts since 1896. The sinking prices of coffee, the main foreign export, would have been bad enough even without any internal unrest. But with new loans contracted in London in 1881 and Berlin in 1896 being lost to corruption and fiscal mismanagement, the reign of military leader, formel congressional deputy, lawyer, journalist and local strongman Cipriano Castro was on a collision course with the international debtors. Ruling with the support of the military and his urban middle-class client network from Táchira province, Castro was widely loathed for his lavish lifestyle and disregard of the foreign claims and complaints about the internal situation of Venezuela.
From the point of view of Venezuelans and especially Castro himself, the foreign powers were hypocrites of the highest order, and he had every right to defend his position and the national prestige of the people of Venezuela by standing firm. After all, he had done so before.
After the rights to the rich Guanoco Lake asphalt concession had been contested by Warner and Quinlan of New York in 1900, the old monopoly of the Asphalt Trust and their power in Venezuelan economy had suddenly been put a risk. The influential New York and Bermúdez Company reacted by joining forces with the French Cable Company in the clandestine funding for
la Revolución Libertadora, a revolt that the wealthiest man in Venezuela, Manuel Antonio Matos, had set up against Castro after he had paraded Matos through the streets of Caracas when he had refused to loan money to the government. Castro had just crushed this uprising at the cost of twenty thousand deaths in November 1902, when new trouble was already on the horizon. Warner and Quinlan representatives contacted Castro, and provided evidence of the support that their competitor, Bermúdez, had provided to Matos. Castro seized their properties, and began actions against them in the Venezuelan courts.
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What Castro failed to take into account was that the second vice president of Bermúdez, General Avery D. Andrews, was a friend and associate of President William McKinley and his vice president, Theodore Roosevelt. When Warner and Quinlan realized that the U.S. Legation in Caracas would therefore not support their interests in the country, they quickly enlisted the support of a few Congressmen from mainland US. Bringing the matter to Congressional attention made it a point of interest to President McKinley, who would have otherwise preferred to avoid further costly foreign adventures at the region.
Meanwhile matters were moving ahead in Europe.
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The principle at stake is of the first importance", the British Foreign Office stated in a report regarding the behaviour of Venezuela in violating the rights of the British citizens and the negotiations about the $15m debt that Venezuela had defaulted. News of German initiative in the Hague arbitration afford made the Chamberlain more active, namely in order to avoid a situation where Germany - or perish the thought, Italy - defended the rights of their citizens while Whitehall idled. Thus British Foreign Office approached the German ambassador about the possibility of “common action.” Lansdowne was interested in improved relations with Germany, and eagerly told the ambassador in Berlin to sound out the Wilhelmstrasse about German intentions in Venezuela. Thus the joint action was well under way after the end of the Boxer War in January 1902. The German chargé Pilgrim-Baltazzi and British minister Haggard in Caracas acted in concert, and had actually lobbied their governments for cooperation for some time.[
3]
The elephant in the room was the attitude of the United States.
Chamberlain, firmly aware how Willian Lindsay Scruggs had used his political and press connections to lobby the Cleveland Administration to intervene as an arbitrating power in the border crisis of 1895, treaded lightly. Luckily for the European creditor nations, the way Castro had challenged the power of the US-based companies of the Asphalt Trust had made President McKinley nominally supportive to the Europeans. The President urged Castro to make a good-faith effort to repay his foreign loans, while Secretary of State John Hay publicly stated that the Monroe Doctrine was never intended to shield “wrongdoing states from justice.” Vice President Roosevelt took a harder stance, and conveyed his views to the German consul general in no uncertain terms.
Eulenburg reacted with caution. After the issue of Samoa had been put to rest, there were no major disagreements or direct confrontations between Berlin and Washington. Wilhelm II had actively courted US during his whole reign, but the McKinley administration mainly focused on domestic issues, putting little attention to foreign squabbles or the shifting alliance systems, enjoying just the kind of splendid isolation that was becoming increasingly difficult goal for Britain. Several key US politicians, especially vice President Roosevelt, viewed German ambitions in the Western Hemisphere with suspicion. Desperate to find ways to please the whims of his erratic Autocrat while at the same time maintaining working relations with the United States, Eulenburg sought support from London. Luckily for him, it was forthcoming.
1. In OTL Bülow wanted to unify the nation through Anglophobia, while cultivating relations with Russia to gain an offensive alliance directed against Britain, so that Germany could expand her influence in South America as Wilhelm II envisioned! Thus Bülow sabotaged all negotiations with London in 1900-1901 and actively supported anti-British sentiment at the press circles at home as a means towards achieving national solidarity. Meanwhile he wanted to play a waiting game, maintaining “a free hand” between London and St.Petersburg.
2. In OTL they made this move a bit later. Here news from Europe alert them to act earlier.
3. In OTL Disputes between British colony of Trinidad and the disagreement over the sovereignty of the island of Patos were only making matters worse. In OTL Haggard managed to argue that the island, "a little better than a mass of rock" as a hydrographer attached to the Foreign Officer reported, had strategic value. In TTL Chamberlain is more cautious due the different diplomatic position of Britain.