Baltimore crisis The " Baltimore " crisis was a diplomatic incident that took place between Chile and the United States , after the 1891 Chilean Civil War , as result of the growing American influence in Pacific Coast region of Latin America in the 1890s . It remains a nodal event because it marked a dramatic shift in United States – Chile relations . It was triggered by the stabbing of two United States Navy sailors from the USS " Baltimore " in front of the " " True Blue Saloon " " in Valparaíso on October 16 , 1891 . Background . In 1884 Chile emerged from the War of the Pacific as a potential threat to the hegemony of the United States . The Chilean navy , then the strongest fleet in the Pacific , was able to confront American policy . In 1882 Chile refused US mediation in the War of the Pacific . In 1885 , as the United States Navy occupied Colón , then part of Colombia , the Chilean government ordered its navy to occupy Panama City and not to leave until after the American forces evacuated Colon . Finally in 1888 Chile annexed Easter Island , located some 2 , 000 miles west of Valparaíso , and by occupying Easter Island , Chile joined the imperial nations . But by 1891 the equation of power had changed . The United States possessed more naval power and , more significantly , Alfred Thayer Mahan ' s theories were needed to secure the growing influence of the United States in Latin America . During the Chilean Civil War the American government supported the forces of President Jose Manuel Balmaceda and enforced a ban on exports for the insurgents that was supported partially by the United Kingdom . These and another circumstances troubled relations between the United States and the victorious former insurgents , who in 1891 defeated the presidential forces and were then in power in Chile . Just before the end of the Chilean Civil War the United States sent a group of ships including the USS " Charleston " to force the Chilean insurgents ' cargo ship " Itata " , that illegally loaded arms in San Diego for the insurgents , to return to San Diego . The US ships reached Iquique before the " Itata " . The new Chilean government ordered the ship back to San Diego to face outstanding charges . During the war the American owned Central and South American Cable Company , by order of the Balmaceda administration , restored submarine telegraph cable service between Santiago and Lima and sundered the cable connection to the insurgent headquarters . In addition , the United States minister in Santiago gave diplomatic asylum to various insurgent leaders during the war and to Balmaceda ' s supporters after the war . The victorious insurgents called upon the American minister in Santiago , Patrick Egan , to surrender the newest refugees to the authorities but it was refused . From the insurgents ' point of view , the United States had tried to stop them from purchasing weapons , denied the rebels access to international telegraph traffic , spied on the insurgent troops , and refused to surrender war criminals . USS Baltimore incident . On October 16 , 1891 , a mob attacked a group of sailors on shore leave from the cruiser USS " Baltimore " outside of a bar in the Chilean port of Valparaíso . Two sailors were killed and seventeen to eighteen were injured . The new Chilean government rejected American protests , but after United States President Benjamin Harrison sent a strong message to the United States Congress Chile apologized and paid $ 75 , 000 in gold .