28 Chapter 2
Outcome (and Settlement): Compromise (Negotiated)
Fatalities: None
Narrative: This is a multilateral dispute involving the United States and several Cen-
tral American states that occurs against the backdrop of increased policing of the area
in accords with the Roosevelt Corollary (see MID#254, MID#247, and MID#1205).
On January 3, 1909, the United States dispatched the gunboat Dubuque to the coast of
Nicaragua after receiving rumors of revolutionary activity in the country. The rumor
was that John Moisant, a Salvadoran, was in Nicaragua trying to organize activity
against El Salvador. Another US ship, the Tacoma, was sent on February 26 amid
fears that the activity in Nicaragua could degenerate into a three-state conflict involv-
ing Honduras as well.
Honduras, by this time, pleaded for US intervention citing Nicaraguan president
Zelaya’s behavior, though Zelaya responded on March 7 with an assurance to the
United States that Nicaragua was doing nothing nefarious. Another warship, the
Yorktown, was dispatched to the area on March 12. Meanwhile, the United States
and Mexico joined diplomatic forces to try to ease the tensions in Central America.
On this same day, Nicaraguan gunboats, led by the schooner Momotombo, attacked
a Salvadoran gunboat, the Presidente. The Presidente nearly sunk the Momotombo
and fled, but Nicaraguan ships were in pursuit. While this confirmed warlike activity
emanating from Nicaragua, neither the United States nor Mexico knew what Nica-
raguan intentions were. Nevertheless, Mexico declared its intentions to show force
to allay the situation on March 14 while Nicaragua’s ministers refuted that such an
incident between the Momotombo and the Presidente ever occurred. The next day,
Nicaragua amassed 6,000 soldiers at its border for what it claimed was defensive
purposes.
While concerns for regional security were paramount, it is very likely that the
United States used these incidents as cover to press the Emery claims and that these
claims were the source for increasing pressure that the United States placed on Nicara-
gua. The Emery claims originated from American George D. Emery’s timber industry
that had a camp on the Mosquito Coast in Nicaragua. When Zelaya came into power,
he tried to reign in the Mosquito Coast area into the Nicaraguan state. He coerced
Emery’s company into renegotiating a previous contract and rescinded it on August
1906 to the loss of two million dollars for Emery. The United States adopted the
claims for indemnity by its national. The American government demanded Nicaragua
send the issue to arbitration on March 20. Zelaya balked at the terms stipulated by the
Americans in his reply dated March 22, agreeing to submit only the question of due
process to arbitration.
Meanwhile, the security concerns got more complicated on May 6 when a rumor
arrived in Panama suggesting that Zelaya was determined for an invasion of its
neighbors. On May 15, a strike of banana pickers in Nicaragua resulted in martial
law. Upset that the United States meddled in the banana-picker situation, the official
government newspaper of Nicaragua published a plea on May 17 for an alliance
with Japan to counteract the presence of the United States. The consul general for
Nicaragua published a denial of the “official” status of that newspaper the next day.
The matter ended on May 25 when Nicaragua agreed to submit the Emery claim to
arbitration.