have deflationary effects on the economy. An economy undergoing deflation
produces less tax revenues, forcing further expenditure cuts if government
borrowing, and thence money supply, is not to increase yet further. Never-
theless, since the near complete conversion of Western governments to quasi-
monetarist policies from the late 1970s, attempts to control the money supply
have been widespread.
Monroe Doctrine
The Monroe Doctrine is to some extent the major juridical basis for US policy
in Latin America, and after decades of irrelevance has become important again
in recent years, though it is essentially a unilateral declaration of what America
intends to do, rather than a multilateral agreement about how nations on the
American continent should collectively act. Announced by President Monroe
in his State of the Union message to Congress in 1823, it states effectively that
the USA will not allow interference in any country of the American continent
by any European power, and that any such involvement will be regarded as a
danger to the peace and security of the USA itself.
Originally intended to warn off the Holy Alliance powers (principally
Austria, Prussia and Russia) from any attempt to help Spain regain control
of its disintegrating South American empire, it was also directed against Tsarist
Russia itself, which appeared to have colonial ambitions towards the Pacific
coast of America. The doctrine was invoked on several occasions during the
19th century, and indeed expanded to mean that any vital interest of the USA
anywhere on the continent could and would be protected. As US relations
with most Latin American powers grew increasingly cordial during the 20th
century the doctrine came to seem both less unilateral and more legalistic, with
much of its meaning enshrined in inter-American treaties such as the Bogota ́
Pact which set up theOrganization of American Statesin 1948.
However, the increase in radical opposition to the right-wing and often
corrupt governments of Latin America led, after the Second World War, to a
situation in which the Soviet Union directly or otherwise came to confront the
USA as they supported different sides in the civil wars. The doctrine was used
to justify the 1962 American action in blockading Cuba to force Soviet
withdrawal of missiles (seeCuban missile crisis), and to justify the inter-
vention by US Marines in the Dominican Republic in 1965 to prevent the
election of a communist government. As the guerrilla campaigns against the
traditional ruling classes, especially in Central America, grew, with increasing
support from a Cuba more and more firmly in the Soviet camp, the importance
of the Doctrine, and its clear nature as a declaration by the USA of what it
would not tolerate, became more vital. Although there is no doubt that Cuban
Monroe Doctrine