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Howard Taft's foreign policy, known as "Dollar Diplomacy," aimed to use economic power to influence and stabilize countries in the Western Hemisphere, particularly in Latin America and the Caribbean. By encouraging American businesses to invest in these regions, Taft hoped to create economic ties that would foster political stability and discourage European intervention. This approach emphasized financial leverage over military action, suggesting that economic investment would lead to stronger diplomatic relations and enhance American influence without resorting to traditional military means.

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