The Velasquez administration shines in Dominican history like a star amid a gathering storm.
After the country's eight years of subjugation, Velasquez took care to respect the political and civil rights of the population. An upswing in the price of export commodities, combined with increased government borrowing, buoyed the economy. Public works projects proliferated. Santo Domingo expanded and modernized. This brief period of progress, however, ended in the resurgent maelstrom of Dominican political instability. The man who would come to occupy the eye of this political cyclone was Rafael Trujillo.
Although a principled man by Dominican standards, Velasquez was also a product of long years of political infighting. In an effort to undercut his primary rival, Federico Velasquez, and to preserve power for his own followers, the president agreed in 1927 to a prolongation of his term from four to six years. There was some debatable legal basis for the move, which was approved by the Congress, but its enactment effectively invalidated the constitution of 1924 that Velasquez had previously sworn to uphold. Once the president had demonstrated his willingness to disregard constitutional procedures in the pursuit of power, some ambitious opponents decided that those procedures were no longer binding. Dominican politics returned to their pre-occupation status; the struggle among competing caudillos resumed.
Trujillo occupied a strong position in this contest. The commander of the National Army (Ejacercito Nacional, the new designation of the armed force created under the occupation), Trujillo came from a humble background. He had enlisted in the National Police in 1918, a time when the upper-class Dominicans, who had formerly filled the officer corps, largely refused to collaborate with the occupying forces. Trujillo harbored no such scruples. He rose quickly in the officer corps, while at the same time he built a network of allies and supporters. Unlike the more idealistic North American sponsors of the constabulary, Trujillo saw the armed force not for what it should have been--an apolitical domestic security force--but for what it was: the main source of concentrated power in the republic.
Having established his power base behind the scenes, Trujillo was ready by 1930 to assume control of the country. Although elections were scheduled for May, Velasquez's extension in office cast doubt on their potential fairness. (Velasquez had also eliminated from the constitution the prohibition against presidential reelection.) This uncertainty prompted Rafael Estrella Ureafata, a political leader from Santiago, to proclaim a revolution in February. Having already struck a deal with Trujillo, Estrella marched on the capital; army forces remained in their barracks as Trujillo declared his "neutrality" in the situation. The ailing Velasquez, a victim of duplicity and betrayal, fled the capital. Estrella assumed the provisional presidency.
Part of the arrangement between Estrella and Trujillo apparently involved the army commander's candidacy for president in the May elections. As events unfolded, it became clear that Trujillo would be the only candidate that the army would permit to participate; army personnel harassed and intimidated electoral officials and eliminated potential opponents. A dazed nation stood by as the new dictator announced his election with 95 percent of the vote. After his inauguration in August, and at his express request, the Congress issued an official proclamation announcing the commencement of "the Era of Trujillo."
The dictator proceeded to rule the country like a feudal lord for thirty-one years. He held the office of president from 1930 to 1938 and from 1942 to 1952. During the interim periods, he exercised absolute power, while leaving the ceremonial affairs of state to puppet presidents such as his brother, Halactor Bienvenido Trujillo Molina, who occupied the National Palace from 1952 to 1960, and Joaquafan Balaguer Ricardo, an intellectual and scholar who served from 1960 to 1961. Although cast in the mold of old- time caudillos such as Santana and Heureaux, Trujillo surpassed them in efficiency, rapacity, and utter ruthlessness. Like Heureaux, he maintained a highly effective secret police force that monitored (and eliminated, in some instances) opponents both at home and abroad. Like Santana, he relied on the military as his primary support. Armed forces personnel received generous pay and perquisites under his rule, and their ranks and equipment inventories expanded. Trujillo maintained control over the officer corps through fear, patronage, and the frequent rotation of assignments, which inhibited the development of strong personal followings. The other leading beneficiaries of the dictatorship--aside from Trujillo himself and his family--were those who associated themselves with the regime both politically and economically. The establishment of state monopolies over all major enterprises in the country brought riches to the Trujillos and their cronies through the manipulation of prices and inventories as well as the outright embezzlement of funds.
Generally speaking, the quality of life improved for the average Dominican under Trujillo. Poverty persisted, but the economy expanded, the foreign debt disappeared, the currency remained stable, and the middle class expanded. Public works projects enhanced the road system and improved port facilities; airports and public buildings were constructed, the public education system grew, and illiteracy declined. These advances might well have been achieved in even greater measure under a responsive democratic government, but to Dominicans, who had no experience with such a government, the results under Trujillo were impressive. Although he never tested his personal popularity in a free election, some observers feel that Trujillo could have won a majority of the popular vote up until the final years of his dictatorship.
Ideologically, Trujillo leaned toward fascism. The trappings of his personality cult (Santo Domingo was renamed Ciudad Trujillo under his rule), the size and architectural mediocrity of his building projects, and the level of repressive control exercised by the state all invited comparison with the style of his contemporaries, Hitler in Germany and Mussolini in Italy. Basically, however, Trujillo was not an ideologue, but a Dominican caudillo expanded to monstrous proportions by his absolute control of the nation's resources. His attitude toward communism tended toward peaceful coexistence until 1947, when the Cold War winds from Washington persuaded him to crack down and to outlaw the Dominican Communist Party (Partido Comunista Dominicano--PCD). As always, self-interest and the need to maintain his personal power guided Trujillo's actions.
Although conspiracies--both real and imagined--against his rule preoccupied Trujillo throughout his reign, it was his adventurous foreign policy that drew the ire of other governments and led directly to his downfall. Paradoxically, his most heinous action in this arena cost him the least in terms of influence and support. In October 1937, Trujillo ordered the massacre of Haitians living in the Dominican Republic in retaliation for the discovery and execution by the Haitian government of his most valued covert agents in that country. The Dominican army slaughtered as many as 20,000 largely unarmed men, women, and children, mostly in border areas, but also in the western Cibao. News of the atrocity filtered out of the country slowly; when it reached the previously supportive administration of President Franklin D. Roosevelt in the United States, Secretary of State Cordell Hull demanded internationally mediated negotiations for a settlement and indemnity. Trujillo finally agreed. The negotiations, however, fixed a ludicrously low indemnity of US,000, which was later reduced to US,000 by agreement between the two governments. Although the affair damaged Trujillo's international image, it did not result in any direct efforts by the United States or by other countries to force him from power.
In later years, the Trujillo regime became increasingly isolated from the governments of other nations. This isolation compounded the dictator's paranoia, prompting him to increase his foreign interventionism. To be sure, Trujillo did have cause to resent the leaders of certain foreign nations, such as Cuba's Fidel Castro Ruz, who aided a small, abortive invasion attempt by dissident Dominicans in 1959. Trujillo, however, expressed greater concern over Venezuela's President Rafamulo Betancourt (1959-64). An established and outspoken opponent of Trujillo, Betancourt had been associated with some individual Dominicans who had plotted against the dictator. Trujillo developed an obsessive personal hatred of Betancourt and supported numerous plots of Venezuelan exiles to overthrow him. This pattern of intervention led the Venezuelan government to take its case against Trujillo to the Organization of American States (OAS). This development infuriated Trujillo, who ordered his foreign agents to assassinate Betancourt. The attempt, on June 24, 1960, injured, but did not kill, the Venezuelan president. The incident inflamed world opinion against Trujillo. The members of the OAS, expressing this outrage, voted unanimously to sever diplomatic relations and to impose economic sanctions on the Dominican Republic.
The firestorm surrounding the Betancourt incident provoked a review of United States policy toward the Dominican Republic by the administration of President Dwight D. Eisenhower. The United States had long tolerated Trujillo as a bulwark of stability in the Caribbean; some in Washington still saw him as a desirable counterforce to the Castro regime. Others, however, saw in Trujillo another Fulgencio Batista--the dictator Castro deposed in 1959--ripe for overthrow by radical, potentially communist, forces. Public opinion in the United States also began to run strongly against the Dominican dictatorship. In August 1960, the United States embassy in Santo Domingo was downgraded to consular level. According to journalist Bernard Diederich, Eisenhower also asked the National Security Council's Special Group (the organization responsible for approving covert operations) to consider the initiation of operations aimed at Trujillo's ouster. On May 30, 1961, Trujillo was assassinated. According to Diederich, the United States Central Intelligence Agency supplied the weapons used by the assassins.

Rafael Trujillo

Present Day Dominican Republic.
Our overall outlook on the Dominican Republic remains positive. As long as some basic fundamentals remain in place, then we feel the long-term outlook remains as before.
It is true the current government in power has raised taxes, some might say far too much too soon, disenfranchising the very same voters that supported them. It is also true that the current government is discussing issuance of US$ 500 Million in government bonds, and is discussing the idea of pegging the local currency to the US dollar. All such initiatives are fine, if there is some real material benefit in doing so, and not for any other reason. The previous government was criticized for borrowing money, however such funds were borrowed internally (much of it from BanInter) and were used for publics works projects in the capital and elsewhere. Any government borrowing is fine, provided it is for hard assets and offers the opportunity for dividends later on. Public works projects, roads, and general infrastructure are examples of such hard assets. Funds borrowed for non-material projects are of course questionable. The same holds true for individuals as well as governments. For example, if you borrow money to purchase estate, you have a hard asset that hopefully will increase in value later on long after the debt is paid off. If you borrow money (such as with credit cards) to take dinner in a restaurant, you are stuck with debt later on and nothing to show for it other than a meal which has come and gone. So, to borrow money for a hard asset, which could increase in value, or offer dividends is certainly a sensible thing to do. To borrow money so you can spend foolishly in the here and now is not.

Some of these ideas are not entirely new, as it is true that the previous government also was examining the idea of pegging the local currency to the Euro or switching over to the Euro altogether. This was an interesting idea considering there is or has been far more European investment in the country than American investment (although the Dominican Republic is located physically much closer to the US than Europe, which perhaps is a bit of irony). Case in point, the first country to react quickly and send aid when the last hurricane past through (which was the first hurricane to hit the Dominican Republic in 50 years) was Spain, and not the United States.

Go figure.

The interesting thing to point out is that there are many local people that do understand the dynamics of political maneuvering by the United States and other foreign nations and voice opinions accordingly.
It is important for the government of any small country to understand how the US operates and to take steps for its own benefit accordingly. That is to say, the US is in crisis regarding the long-term, is scared to death, and is playing its cards accordingly. An example of this is the support for a small country to raise its taxes and local salaries. Why? The US would like nothing better than to see smaller countries loose their competitive advantage, but of course they do not say so directly. That would be too blatant and obvious. Instead they say, it is terrible that local workers in your country earn less than US workers, (and have a lower standard of living or perceived lower standard of living). We, the wonderful people in the US government want to help you improve.

Baloney, they could case less. What they want is to see the income tax and labor cost advantages go away, so American companies will stop relocating factories and jobs away from the US. They also want to stop Americans from leaving the US and stop the flow of money out of the US economy and into other places, where bank account interest is tax-free and perhaps more favorable. Any government official of a smaller country that does not understand this, is naive or is fooling them-selves. The US wants to open a new Army base in your country. Why? So they can dump garbage into the ground and use the place to test missiles, bombs and whatever else. Things they would not dare do on US soil, because it is a violation of US environmental protection laws or simply because it will not be tolerated by the local US citizens. However, the US thinking goes, let's dump our garbage in places like the Dominican Republic. They don't know any better, plus we can damage the environment there and get away it. Not everyone in the local foreign government however is blind to this or naive, which is why you do not see a US Army base in the Dominican Republic.

The truth of the matter is that no country is perfect. However, some countries may offer benefits, which are more important to you personally, than others.
Some clients, will say they do not like the Dominican Republic, because of (or lack of) certain services or issues of importance to them. It really is a question of making a checklist and finding out which country has more positives than negatives if you are considering relocation (expatriation).
With regards to cost of living, real estate, physical location, economy, banking and overall freedom, we still believe the Dominican Republic comes out on top over almost all other Caribbean destinations we have compared it to. But, everyone of course is entitled to investigate them-selves and make up their own mind accordingly. However, if you are going to be ritical or make a comparison, at least get the whole story and not rely solely on a few ambiguous sound-bites you might have read somewhere.