The United States's motivations to break the declaration of neutrality and enter World War I were rooted in economic and strategic motivations. The United States had given several Allied countries huge financial loans, and as events progressed, the United States became more concerned with ensuring the success of the Allied countries and their abilities to pay back the loans. The United States also had a vested interest in the ending of the war, as Britain and France had enacted a trade blockade against several Baltic and mid- or Eastern European neutral countries. This move by the Allied countries angered US merchants, but US public sentiment was generally much more sympathetic to the British and French than to Germany, Austria-Hungary, or Turkey.
In 1915, a merchant ship that left from New York, the Lusitania, was sunk by German submarines. Public opinion in the United States became even more hostile toward the Central Powers and more drawn to the idea of US military involvement. In 1917, as German submarines and naval warships revamped their attacks on any and all non–Central Power ships in their tactic of unrestricted naval warfare, the president of the United States at the time, Woodrow Wilson, decided to formally ask congress to declare war against the Central Powers and join the Allied forces.
The entry of the United States into World War I was in some respects motivated by idealism. There can certainly be doubt as to the commitment of Woodrow Wilson to high-minded principles of democracy and national self-determination. That said, there were also pragmatic concerns to be taken into consideration. For one thing, most of the Allied powers were heavily indebted to American banks and other financial institutions. If they lost the war, then they would default on those debts. So it was certainly in the interests of Wall Street for the United States to intervene.
We should also bear in mind that the increasingly aggressive campaign of submarine warfare by the Germans was seriously disrupting America's lucrative trade with Europe. Not only that, but civilian vessels were also at serious risk. The sinking of the Lusitania, torpedoed by a German U-boat, turned American public opinion even further against the Germans. The loss of so many innocent lives, including a number of American citizens, led to a growing clamor for some kind of military response.
There were several reasons why the United States gave up the policy of neutrality to enter World War I. Two of the primary reasons had to do with threats due to the offensive tactics from the Germans.
Under President Woodrow Wilson, the United States remained committed to neutrality during the early years of World War I. The Germans began using U-Boats in the Atlantic Ocean. The Atlantic was frequently used to transport passengers and cargo on British and American ships. The Germans bombed several ships and Americans were killed. Despite this, the United States remained neutral and sought to negotiate with the Germans. In 1915, the Lusitania was bombed and sank. Over 1,000 passengers perished, including over 100 Americans. The US government continued their policy of remaining neutral and negotiating with the Germans. This pattern of negotiations following bombed ships continued despite public outrage in the United States. More and more ships were bombed in 1916 and early 1917.
The final turning point came when the Zimmerman telegram was intercepted. The information in the telegram revealed that the Germans were seeking to form an alliance with Mexico. If Mexico accepted the invitation to form an alliance, they would be able to reclaim the US states of Arizona, Texas, and New Mexico with help from the Germans. This information caused Wilson to change his mind about neutrality, and the United States entered World War I in April of 1917.
There were several reasons that the U.S. abandoned "splendid isolation" and entered the first World War.
One reason was moralistic. The U.S. saw itself as a beacon of freedom and democracy, two characterisitcs they felt Germany and its allies were at odds with. The attacks on Belgium, France and other nations stood in stark contrast to American ideals, so Wilson demanded that American enter the war and, "make the world safe for democracy"
Another reason which was more pragmatic was war loans. The U.S. had loaned Britain, France and their allies lots of money which, if they lost, might not be recouped. For this reason, the banking industry pressured the Wilson administration to enter the war in order to protect U.S. loans.
Still another compelling reason was the recent attacks by U-Boats on U.S. shipping. When Germany began using submarines to sink Atlantic shipping, the Americans were outraged since their ships were being targeted as well. The sinking of the Lusitania in 1917 was the final straw and probably the most compelling reason that the U.S. entered the war.
Finally, there was the issue of the Zimmerman Note. This was a diplomatic offer between Mexico and Germany where the Germans offered to help Mexico in a war with the U.S. which they hoped would detract from intervention by the U.S.