Fraud in Cuban Foreign Medical Mission

Cuban medical professionals who have served in Cuba’s medical mission to Venezuela (Barrio Adentro) have reported fraudulent overstatement of the mission’s statistics.[1]

Venezuela pays Cuba on the basis of the number of patients the medical professionals treat or the educational workshops they teach. As a result, the Cuban authorities do not want low numbers of such patients to affect their income and, therefore, set daily quotas for the number of patients that are seen and treated.

According to some Cuban dentists and ophthalmologists in particular, they were unable to meet their quotas and, therefore, regularly submitted reports that falsely overstated the number of patients they had seen.

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[1] Wyss, Bario Adentro Mission in Venezuela: Lying White Lace, el Nuevo Herald (Jan. 28, 2017).

Cuban Entrepreneurs Express Frustration and Confidence

A recent study based on interviews of 80 Cuban entrepreneurs found seemingly contradictory results.[1]

There was frustration. As expressed by the Miami Herald, “Like entrepreneurs in any country, Cuban entrepreneurs want more access to resources and fewer bureaucratic obstacles to expand and reinvest in their businesses.”

There also was optimism. Said the author of the study, Cuban-born economist Carmelo Mesa Lago, there was a “very high level of reinvestment that the self-employed engage in. Most, including those renting apartments and houses, reinvest.” The study also found a “high degree of satisfaction expressed by those who have decided to start a private business in Cuba, which has allowed them to gain autonomy and live better than those who depend on state wages.”

With virtual unanimity, the entrepreneurs complained about “the level of state interference” or over-regulations plus high prices for supplies, the absence of a wholesale market and high taxes.

The study looked at four segments of the so-called “non-state sector” of the Cuban economy: (1) the self-employed; (2) farmers who use state-owned parcels; (3) corredores   (brokers) of home sales as well as buyers and sellers of private homes; and (4) workers of non-farm production and service cooperatives. Another sector–owners of private restaurants known as paladares—was not included because, says Lago, they do not want to attract attention to their business.

The study– oces del cambio en el sector no estatal cubano (Voices of Change in the Cuban Non-State Sector)—is published by the Ibero-American publishing house.

Conclusion

This study confirms the existence of a thriving non-state sector of the Cuban economy, contrary to the Senate testimony of the new U.S. Ambassador to the U.N., Nikki Haley, as mentioned in a recent post.

The study also confirms the unsurprising difficulties and challenges the Cuban government faces in creating a mixed economy. Indeed, as covered in an earlier post, Raúl Castro in his role as the leader of the Communist Party of Cuba at its Party Congress last year stressed those difficulties and challenges while also acknowledging the essential and important contributions of the non-state sector for the Cuban economy.

Finally the study confirms the need for the U.S. to support the further development and success of this sector by continuing and enhancing the U.S. normalizing of relations with Cuba, especially the enabling of U.S. remittances to those on the island and thereby constituting a major source of capital for this sector. This very point has been emphasized by Engage Cuba, a U.S. coalition, in its lobbying of the new Trump Administration.[2]

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[1] Gámez-Torres, Cuban entrepreneurs dream big, but the government gets in their way, Miami Herald (Jan. 26, 2017).

[2] U.S. and Cuba’s Efforts To Continue Normalization, dwkcommentaries.com (Dec. 9, 2016); Lobbying the Incoming Trump Administration To Continue Normalization with Cuba, dwkcommentaries.com (Jan. 18, 2017); Engage Cuba.

President Raúl Castro Says Cuba Can Work with the Trump Administration

 

On January 25 Cuba’s President, Raúl Castro, expressed “Cuba’s willingness to continue negotiating pending bilateral issues with the [U.S.], on the basis of equality, reciprocity and respect for the sovereignty and independence of our country, and to continue the respectful dialogue and cooperation on issues of common interest with the new government of President Donald Trump.”[1]

Castro continued, “Cuba and the [U.S.] can cooperate and coexist in a civilized manner, respecting differences and promoting all that benefits both countries and peoples, but it should not be expected that to do so Cuba will make concessions inherent to its sovereignty and independence.”

On the other hand, he said, “The [U.S.] economic, commercial and financial blockade persists, which causes considerable hardships and human damages that severely harm our economy and hamper development. Despite this, we continue immersed in the updating of our economic and social model and we will continue to fight to build a sovereign, independent, socialist, democratic, prosperous and sustainable nation.”

These comments were in the larger context of Castro’s speech at the summit of the Community of Latin American and Caribbean States (CELAC)[2] held in Bavaro, the Dominican Republic, when he said, “Never has it been more necessary to effectively advance along the path of unity, recognizing that we have many common interests. Working for ‘unity within diversity’ is an urgent need.”

“To achieve this, strict adherence to [the group’s previous proclamation] is required, in which we commit ourselves ‘to strict compliance with their obligation not to intervene, directly or indirectly, in the internal affairs of any other State,’ and to resolve differences in a peaceful manner, as well as to ‘fully respect the inalienable right of every State to choose its political, economic, social and cultural system.’”

“It would be desirable for the new [U.S.] government to opt for respect for the region, although it is a matter of concern that intentions have been declared that endanger our interests in the areas of trade, employment, migration and the environment, among others.”

Subsequently the Summit passed resolutions applauding the U.S. termination of its “dry foot/wet foot” immigration policy for Cuban migrants while also urging the U.S. Congress to repeal the Cuban Adjustment Act; condemning the U.S. embargo (blockade); and calling for the U.S. to return Guantanamo Bay to Cuba.[3]

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[1] Castro, Never has it been more necessary to effectively advance along the path of unity, Granma (Jan. 25, 2017); Reuters, Cuba’s Castro Warns Trump to Respect Country’s Sovereignty, N.Y. Times (Jan. 25, 2017); Assoc. Press, Castro: Cuba Can Work With Trump if Sovereignty Respected, N.Y. Times (Jan. 26, 2017).

[2] CELAC consists of 33 sovereign countries in the Americas representing roughly 600 million people and is seen as an alternative to the Organization of American States and U.S. influence in the region.

[3] Morales, Dialogue and political agreement on the basis of mutual trust, Granma (Jan. 26, 2017); Special Declaration on the need to end the economic, commercial and financial blockade of the United States of America against Cuba, Granma (Jan. 26, 2017); Special Declaration: Return to the Republic of Cuba of the territory that occupies the naval base of the United States of America in Guantánamo, Granma (Jan. 26, 2017).

Rex Tillerson, Secretary of State Nominee, Provides Written Responses Regarding Cuba to Senate Foreign Relations Committee

On or before January 20 Rex Tillerson provided written responses to questions from the Senate Foreign Relations Committee that is considering his nomination to be Secretary of State.[1] Here we will look at those responses regarding U.S. policies regarding Cuba.

Tillerson’s Responses Regarding Cuba

Many of his responses were “Yes, if I am confirmed” and are not understandable without the question. The following are his responses regarding U.S. policies regarding Cuba [with portions of the questions inserted in brackets to make the answers more understandable]:

  • “If confirmed, I will engage with Cuba but continue to press for reform of its oppressive regime. I will support human rights defenders and democracy activists in Cuba, empower civil society, defend freedom of expression, and promote improved Internet access and I will ask our allies to do the same.”
  • “Yes, if I am confirmed, [I will continue to support programs that promote democratic voices and initiatives in Cuba like Radio and TV Marti].”
  • “If confirmed, I will engage bilaterally and multilaterally to bring these fugitives [like New Jersey cop-killer Joanne Chesimard] to justice.”
  • “Yes, if I am confirmed, [I work with the Treasury Department to ensure that no revenue from American businesses goes directly toward supporting the Cuban military and the regime].”
  • “If confirmed, I will press Cuba to meet its pledge to become more democratic and consider placing conditions on trade or travel policies to motivate the release of political prisoners.”
  • “I will work bilaterally and multilaterally to identify training and technical assistance opportunities to assist with judicial reform, if I am confirmed.”
  • “Yes, [I will stand by President-elect Trump’s commitment to reverse the Obama Administration’s Cuba regulations until freedoms are restored on the island]. There will be a comprehensive review of current policies and executive orders regarding Cuba to determine how best to pressure Cuba to respect human rights and promote democratic changes.”
  • “Yes, [I will stand by Vice President-Elect Pence’s commitment to reverse the Obama Administration’s Cuba regulations].”

Conclusion

Perhaps not too surprisingly, these responses do not add much clarity on the new administration’s policies regarding Cuba. As he said in his live testimony to the Committee and in these written responses, there are hints that the new administration will change at least some aspects of the Obama Administration’s policies to normalize relations with Cuba. But first there will be “a comprehensive review of current policies and executive orders regarding Cuba to determine how best to pressure Cuba to respect human rights and promote democratic changes.”

Those of us who support normalization need to be on guard and register our objections to any proposed retreat from that important, positive development for the U.S. and Cuba and indeed all of Latin America.

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[1] Secretary-of-State-designate Rex Tillerson’s confirmation answers on Latin America, Latin America Goes Global (Jan. 20, 2017)

Lobbying the Incoming Trump Administration To Continue Normalization with Cuba  

Major supporters of U.S. normalization of relations with Cuba have been lobbying the incoming Trump administration to continue that policy. This includes Cuban entrepreneurs, as discussed in a prior post, and most recently U.S. agricultural and business groups.

Agricultural Groups[1]

On January 12 over 100 U.S. agricultural trade groups, including the American Farm Bureau and the American Feed Industry Association, sent a letter to President-Elect Trump. It said, ” we urge you to continue to show your support for American agriculture by advancing the relationship between the U.S. and Cuba and building on the progress that has already been made.”

The letter cited a recent deep dip in farm income to bolster their argument that U.S. farmers needed more trade. “Net farm income is down 46 percent from just three years ago, constituting the largest three-year drop since the start of the Great Depression.”

They also mentioned that under an exception to the U.S. trade embargo from the year 2000, Cuba may import agricultural products for cash, but this cash limitation limits the ability of U.S. agriculture to export to Cuba. Therefore, the letter calls on Trump to allow normal trade financing and credit so the sector can better compete for the Cuban market.

The letter concluded with these words: “As a broad cross-section of rural America, we urge you not to take steps to reverse progress made in normalizing relations with Cuba, and also solicit your support for the agricultural business sector to expand trade with Cuba to help American farmers and our associated industries. It’s time to put the 17 million American jobs associated with agriculture ahead of a few hardline politicians in Washington.”

Business Groups[2]

On January 17 the Cuban Study Group, an organization of Cuban-American business leaders, led a group of advocates for U.S.-Cuba normalization, in submitting to the President-elect a memorandum entitled “U.S. Policy Toward Cuba: the Case for Engagement.”

It argued that continued engagement with Cuba will create U.S. jobs and facilitate more positive change on the island. It states “constructive engagement — including the reduction of travel and commercial barriers — is the best strategy for supporting the Cuban people and boosting U.S. jobs and exports.” Indeed, further progress toward normalization stands the best chance of improving security just off U.S. shores, reducing irregular migration, enhancing the management of U.S. borders, and encouraging continued, positive evolution inside the island.” More specifically, continued engagement with Cuba should produce the following benefits to the U.S.:”

  • “U.S. Job Creation. Further engagement would allow the United States to regain lost market share in emerging Cuban markets from economic competitors such as China, Vietnam, and Brazil and employ thousands of U.S. workers in agribusiness, infrastructure, tech, and tourism.
  • Cuban-American support. Lifting restrictions on remittances and travel allows Cuban-Americans to support their families in Cuba and provide critical seed funding for the island’s nascent private sector.
  • Cuba’s burgeoning entrepreneurial sector. In just a few years, Cuba’s private sector has grown to account for 30% of the country’s workforce. U.S. travelers to Cuba have become the principal source of revenue for many small businesses.
  • Greater access to information. Internet access is growing, and continued engagement can further contribute to connectivity and the development of civil society in Cuba.”

Moreover, they say, “to reflexively reverse course could have pernicious consequences for U.S. economic and foreign policy interests and the prospects of evolutionary change in Cuba.”

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[1] Engage Cuba, Over 100 U.S. Agriculture Groups Urge Trump to Strengthen U.S.-Cuba Trade Relationship (Jan. 13, 2017); Reuters, U.S. Farmers Ask Trump to Stay the Course on Cuba, N.Y. Times (Jan. 12, 2017).

[2] Engage Cuba, Cuba Groups to Trump: Reversing Course Could Harm Cuban People and U.S. Interests (Jan. 17, 2017); Reuters, U.S.-Cuba Detente Supporters Make Last-ditch Effort to Sway Trump, N.Y. Times (Jan. 17, 2017).

The other signers of the memorandum are the American Society/Council of the Americas; the U.S.-Cuba Business Council; the Center for Democracy in the Americas; Ted Piccone, Senior Fellow, Brookings Institution; Richard E. Feinberg, Professor, UC San Diego and Senior Fellow (non-resident), Brookings Institution; William M. LeoGrande, Professor of Government, American University; Engage Cuba; Washington Office on Latin America (WOLA); Latin America Working Group; National Foreign Trade Council (NFTC); Christopher Sabatini, Executive Director, Global Americans and Lecturer, Columbia University’s School of International and Public Affairs; The National Cooperative Business Association CLUSA International (NCBA CLUSA) National Tour Association (NTA) United States Tour Operators Association (USTOA) TechFreedom The American Society of Travel Agents NAFSA: The Association of International Educators; the National Foreign Trade Council, the American Society of Travel Agents and the Association of International Educators; Christopher Sabatini, Executive Director, Global Americans and Lecturer, Columbia University’s School of International and Public Affairs; The National Cooperative Business Association CLUSA International (NCBA CLUSA); National Tour Association (NTA) United States Tour Operators Association (USTOA); TechFreedom; The American Society of Travel Agents; NAFSA: The Association of International Educators.

 

Representatives Emmer and Castor Introduce Bill To End Embargo of Cuba

Rep. Tom Emmer
Rep. Tom Emmer
Rep. Kathy Castor
Rep. Kathy Castor

On January 12, U.S. Representatives (Tom Emmer (Rep., MN), who is the Chair of the House’s Cuba Working Group, and Kathy Castor (Dem., FL) introduced a bill (H.R. 442)– the Cuba Trade Act—“to lift the Cuba embargo. This . . . [bill] would allow businesses in the private sector to trade freely with Cuba, while prohibiting taxpayer funds to be used on promotion or development of this new market.” (This bill was first introduced in the prior Congress.)[1]

Representative Emmer said, “Over the past two years, the [U.S.] has taken steps away from a failed policy of isolation and towards normalizing relations with our neighbor just 90 miles off our Florida coast. In the 115th Congress we have a real opportunity to continue these efforts to strengthen our national security, open new markets, and empower the Cuban people with human rights and real economic reforms. It is time for the halls of Congress to reflect the views of more than 70% of the American people who favor ending the trade embargo, and we look forward to doing just that.”

Representative Castor issued a similar statement. She said, “The Cuba Trade Act would lift the outdated economic embargo, continue the normalization process and open new business opportunities to benefit the people of the United States and Cuba. My neighbors, business leaders, faith leaders and others in the Tampa community have been at the forefront of positive change in America’s relationship with the Cuban people. We must turn the page on the Cold War policies of the past and build new bridges for jobs and economic opportunities for both nations and continued improvements in human rights for the Cuban people.”

The bill has four Republican cosponsors (Mark Sanford (SC), Justin Amash (MI), “Rick” Crawford (AR) and Ted Poe (TX)) and four Democrat cosponsors (Donald Beaver (VA), Barbara Lee (CA), Mark Pocan (WI) and Jim McGovern (MA)).

Last month, Emmer, Castor and their colleagues of the bipartisan Cuba Working Group sent a letter to President-elect Trump to encourage continued U.S. engagement efforts with Cuba.

Thanks to these two representatives. Give them thanks and encourage their colleagues to join the fight to repeal.

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[1] Press Release, Emmer, Castor Re-introduce Cuba Trade Act (Jan. 12, 2017).

Secretary of State-Nominee Rex Tillerson Addresses U.S. Policies Regarding Cuba     

Rex Tillerson
Rex Tillerson

In his opening statement at the January 11 Senate Foreign Relations Committee hearing on his nomination, Secretary of State Nominee Rex Tillerson made the following comments about U.S. policies regarding Cuba:[1]

  • “And we must adhere to standards of accountability. Our recent engagement with the government of Cuba was not accompanied by any significant concessions on human rights. We have not held them accountable for their conduct. Their leaders received much, while their people received little. That serves neither the interest of Cubans or Americans.”

Later in response to questions by Senator Marco Rubio (Rep., FL), a Cuban-American and a noted opponent of normalization, Tillerson said he would advise the president to veto any legislation codifying President Obama’s thaw with Cuba, at least until the Trump administration can conduct its own review of that policy. In addition, Tillerson said the current U.S. normalization policy has not benefited most Cubans.

Tillerson specifically added that he would also advise Trump to veto any measures to lift the Cuban embargo, and “examine carefully the criteria” under which Cuba was taken off the list of state sponsors of terrorism, to determine “whether or not that de-listing was appropriate.”

Tillerson did not commit to indefinitely maintaining the above positions, instead deferring to the results of the new administration’s forthcoming review to determine its long-term Cuba policy.

Tillerson underscored that the United States “cannot ignore the law” and must comply with measures such as the Helms-Burton Act, which codified the embargo in 1996, and stated that economic restrictions must remain in force until the Cuban government complies with certain conditions, among them that the Castro family leaves power. Any modification of that legal basis on the policy toward Cuba “should be done by Congress,” according to Tillerson, who committed to strictly enforcing the law.[2]

The obvious follow-up question that I believe was not asked is whether one of the objectives of the promised review of U.S. policies regarding the island will be recommending changes to relevant statutes.

Responding to a question by Senator Robert Menendez (Dem., NJ), a Cuban-American opposed to normalization, Tillerson said that advancing human rights and democracy in Cuba and returning to justice U.S. fugitives like Joanne Chesimard, convicted of aiding and abetting the murder of a New Jersey State Trooper, would be a condition of any further engagement with Cuba.

Conclusion

This hearing was bad news and good news for advocates of normalization like this blogger.

The good news is Tillerson’s prediction that the new administration will conduct a review of existing U.S. policies regarding Cuba before making any changes in them.As previoulsy stated, this review should include recommendations to Congress for changes in existing statutes on the subject.

The bad news is the series of suggestions that many of the normalization policies will be cancelled.

Although I agree that so far Cuba has not made significant concessions on human rights, I disagree with the implicit conclusion from this statement: the U.S. needs to demand Cuban concessions on human rights as a condition for the U.S. making any further economic “concessions” to the island. This is the policy that was followed for over 50 years before December 17, 2014, without the desired result.

I also disagree with his prospective recommendation of a veto of any legislation ending the U.S. embargo of Cuba. In addition, I reject his implication that the U.S. May 2015 rescission of its designation of Cuba as a “state sponsor of terrorism” was not justified. As explained in earlier posts, the embargo is unjustified and counterproductive for the U.S. while  previous “terrorism” designations were ridiculous and unjustified and the rescission was fully consistent with the law and the facts and was implicitly endorsed by Congress’ failure to approve a joint resolution countermanding the rescission. [3]

Finally I disagree with Tillerson’s testimony that the Cuban “people have received little” from U.S.-Cuba engagement or normalization. As previously stated in various posts, the increased remittances from families and friends in the U.S. to others in Cuba, all made possible by the Obama Administration’s loosening of U.S. restrictions, have been a major source of funding for the expansion of family-owned businesses on the island. That expansion has helped to reduce the portion of the Cuban economy controlled by state-owned enterprises and has increased the income and well being of Cuban entrepreneurs and their employees, who are and will be a significant force for further modification of the Cuban economic and political system.[4]

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[1] Secretary of State Designate Rex Tillerson: Senate Confirmation Hearing Opening Statement (Jan. 11, 2017); Rex Tillerson Confirmation Hearing: Live Coverage, W.S.J. (Jan. 11, 2017); U.S. Senate For. Rel. Comm., Nomination Hearing for Secretary of State Nominee Rex Tillerson (Jan. 11, 2017) (video); Demirjian, Tillerson says Trump is prepping to review Obama’s Cuba policy, Wash, Post (Jan. 11, 2017); Menendez, Secretary of State Nom Rex Tillerson gives commitment to justice during Senate confirmation hearing (Jan. 11, 2017); Kasperowicz, Tillerson would recommend veto of bill ending Cuba embargo, Wash. Examiner (Jan. 11, 2017).

[2] Of greater interest to most of the media about this hearing was Rubio’s challenging questions to Tillerson about whether he favored sanctions against Russia and whether he thought Putin was a war criminal. (E.g., Sanger & Flegenheimer, In Rocky Hearing, Rex Tillerson Tries to Separate From Trump, N.Y. Times (Jan, 11, 2017).)  Were such questions about Russia merely a Rubio ploy to solidify Tillerson’s opposition to Cuba normalization?

[3] See posts listed in the “U.S. Embargo of Cuba” and “Cuba State Sponsor of Terrorism?” sections of List of posts to dwkcommentaries–Topical: CUBA.

[4] See posts listed in the “Cuban Economy” section of List of posts to dwkcommentaries–Topical: CUBA.