"...few had much, if any, sympathy for Cipriano Castro's position; his harassment of the Dutch merchant marine for years had already eroded his position at the 1901 Panamerican Conference, and Venezuela's ensuing financial crisis and refusal to honor debt agreements affected a great many American firms as well, even if Foraker was reluctant to dispatch the US Navy through the Windward to join the small flotilla of British, German, and Italian warships anchored off the Venezuelan coast to settle the conflict. Castro had snubbed his nose at larger powers, both Great and middle-tier alike, and had only himself to blame, the thinking went, and the State Department, in Allison's last weeks at the helm, had received assurances from both Britain and Germany that territorial acquisitions were off the table. Besides, the United States was keen on keeping their German-Dutch partners in the Nicaragua Canal happy, and so the Navy built up a small squadron at Tortuga but took no more action than that.
This, in the end, wound up being a remarkable tactical blunder in the short term and a major strategic mistake in the long-term. While the Monroe Doctrine had always relied upon the British to enforce it, American naval expansionism had at least threatened to suggest that the US would flex her naval muscles. The "limpness" of Washington's reaction to the Venezuelan blockade was taken both in Europe and in capitals south of the Ohio as a sign of American weakness and indecisiveness, a lesson that would not soon be forgotten and created a permission structure for other states to begin to behave more aggressively in the Caribbean Basin and South America. Germany, meanwhile, deduced - not incorrectly - that the United States cared more about Nicaragua than Venezuela and responded by landing their marines in three Venezuelan mainland ports (most prominently Maracaibo, which they took after a ferocious shelling that killed two hundred persons) while also occupying the Isla Margarita near the Dutch West Indies. Britain withdrew from the flotilla as Germany exercised military force, thus opening the door for further bloodshed; the German expatriate community in Venezuela, prominent in its business elite, escalated the ongoing civil war there and invited German military intervention via the cities of Maracaibo and Barcelona, and an expeditionary corps full of grizzled veterans of the Boxer Intervention took Caracas by late spring, driving Castro and his men deep inland. The German occupation of Venezuela in support of a new, pro-foreign capital junta and its attempts to kill or capture Castro would last until its final withdrawal in 1911, and Venezuela's civil war would see the death of nearly half a million people and close to twenty thousand Germans, a preview of the ugliness of warfare in the 20th century (though, it must be said, a great many of those German deaths were from yellow fever and malaria in the tropical climes of the Caribbean coast, rather than from combat).
The German invasion of Venezuela made the Foraker administration look utterly impotent to both domestic and international observers. It soured relations between Washington and Berlin for the rest of a very crucial decade and had a definitive impact on delaying the completion of the Nicaragua Canal by many years as the financing and construction became the site of a bureaucratic turf war (partially by Costa Rica taking a German line and Nicaragua, of course, near-fanatically attaching to the American position). The incident had a number of knock-on effects in Washington as a result; Allison, already mulling retirement, was quietly encouraged to exit before the 58th Congress, with large and ambitious Democratic majorities imminent, was seated in March, and Elihu Root was slid over into the role to complete his sweep of the Core Four Cabinet offices within a ten year period. To replace Root, Naval Secretary Chauncey Depew was tapped to head the Treasury and recently-defeated Indiana Senator Albert Beveridge appointed as his replacement in turn. Root's time at State under Foraker would be brief and uneventful, for it would be his return ten years later to the same job that would truly define his career; Beveridge, however, had a major impact at the Navy Department, where he formalized the 1:2:4 standard and set about implementing the famed 1904 Naval Act that accelerated and doubled-down on the global naval arms race..."
- Bound for Bloodshed: The Road to the Great American War