Congressional Reactions to New U.S. Regulations on Cuban Private Sector

Differing opinions on the new U.S. regulations regarding the Cuban private business sector have come from Congress.[1]

U.S. Senator Marco Rubio (Rep, FL) apparently said the new regulations are U.S. “concessions” reflecting Biden “desperation” and are “deeply worrying. Cuba’s ‘private sector’ is a façade that enriches the Castro and Díaz-Canel regime,  as demonstrated by the failed commitments during the . . [Obama] administration.”

Several analysts reportedly agree that such enterprises are a mechanism of Cuban power  to use such enterprises to evade U.S. embargo regulations. According to Rubio, “Any financial aid to this vile regime only encourages further repression and anti-American attacks.”

Democratic Representative Barbara Lee (California) disagrees. She thanked President Biden “for the steps to support Cuban entrepreneurs,” who “deserve the opportunity to grow their businesses and provide for their families.” According to Congresswoman Lee, these businessmen would suffer “harassment” from the governments of both Cuba and the United States.

She also said, “After more than six decades, the [U.S.] embargo is causing immense suffering without bringing any positive change in Cuba” and it is long past time to leave the “failed embargo” behind and to completely” normalize relations with (the Government) of Cuba.

Concurring opinions were expressed by Representative James McGovern (Dem. Mass) who said he has “met many small and medium-sized business owners and I know that these changes will help them carry out basic financial transactions.” He added, the Biden Administration “must continue taking these positive steps—particularly removing the Cuban (regime) from the list of state sponsors of terrorism and working toward the normalization of diplomatic relations between both countries.”

========================

[1] ‘Concessions to the regime’ or ‘support for entrepreneurs’: U.S. politicians in the face of Biden’s new measures, Diario de Cuba (May 30, 2024).

 

Cuban Government’s Reactions to New U.S. Regulations for Cuban Private Enterprise   

On May 28, the Cuban Ministry of Foreign Affairs released a formal Statement about the new U.S. regulations and then held a separate press conference on that topic. Later Cuban President Miguel Diaz-Canel made a statement on that subject.

Cuba Ministry of Foreign Affairs Statement[1]

  • “On May 28, the Government of the United States finally announced a group of measures aimed at implementing the policy announced on May 16, 2022. The purpose of this step, according to the text published by the Office of Foreign Assets Control (OFAC), is to support the private sector in Cuba.”
  • “These measures are limited in scope and do not target the essence of the blockade against Cuba nor the additional sanctions that make up the maximum pressure policy. Once again, this US government decision relies on its own distorted view of the Cuban reality, for it intends to artificially separate the private sector from the public sector, when they are both part of Cuba’s entrepreneurial system and the Cuban society as a whole.”
  • “With this announcement, the US government intends to address only one sector of our population. The coercive measure that most affect Cuba’s economy and public services and severely harm the wellbeing of our population are neither eradicated nor modified.”
  • “If these measures are implemented, the United States would seek to give advantage to the Cuban private sector, which was lawfully established and has been able to develop thanks to the measures taken, as a sovereign act, by the Cuban government in consultation with the Cuban people.”
  • “So has occurred with the access to the Internet, which was established and expanded by Cuba, despite the obstacles resulting from the blockade and the restrictions imposed to prevent free access to hundreds of tools and websites.”
  • “The Government of the United States has been explicit in its intention to use this sector for political purposes against the Revolution, in the interest of its change of regime policy.”
  • “Even if these measures were about a whimsical selectivity, both the private and the public sector will continue to suffer from the consequences of the blockade and the absurd inclusion of Cuba in the list of States that allegedly sponsor terrorism.”
  • “The coercive measures that are part of the economic blockade will remain in force, with their cruel impact on the entire Cuban population.”
  • “Obviously, the United States is ratifying its willingness to punish Cuba’s state sector, knowing that this is the one that offers essential services such as education, health, culture, sports and others to all Cubans, including the private sector; and that it is the guarantee of social justice and equity among all citizens. That is the reason why the US government recently adopted measures aimed at persecuting Cuba’s international medical cooperation. Several published documents have revealed that the US remains determined to depriving us from our revenues and destabilizing the country with the political purpose of dominating our nation.”
  • “The Cuban government will analyze these measures, and if they do not infringe upon our national legislation, and they are in fact an openness that would benefit the Cuban people, even if only one sector, it will not impede its implementation.”

Cuban Press Conference About New Regulations[2]

On May 28, Johana Tablada, the deputy director general of the United States at the Cuban Ministry of Foreign Affairs, held a press conference regarding the new U.S. regulations about the Cuban private enterprise sector.

She said they “do not touch the body of the [U.S. embargo] blockade nor do they modify the extreme measures and regulations applied by the Trump and Biden governments in recent years. “once again, the United States Government tries to adapt its actions not to the reality of Cuba, but to a fiction that has been built on the reality of Cuba. ”

She stressed that the US Administration tries to separate the Cuban private sector from the public sector through its announcements and strategies and ignores that both sectors make up the fabric of the Cuban business system and society as a whole. This U.S. effort is about privileging a private sector that does not owe anything to the United States.

She also said Cuba will study these measures and, if they mean a real opening and are not just a political announcement, the [Cuban] Government will not put brakes on their implementation. But since Cuba is included in the list of countries that supposedly sponsor terrorism, it is very difficult for the measures announced this Tuesday to be applied in their full scope.

President Diaz-Canel’s Statement[3]

On May 29, Diaz-Canel said, the US measures are “limited, restrictive and do not touch the fundamental body of the blockade against our country, nor the other sanctions of its maximum pressure policy.”

“The intention to direct them only to a segment of our people shows their historical intention to fracture unity among Cubans.”

The concern for the development of the non-state sector of our economy is not genuine.”

“They do not eliminate or change the coercive measures that most affect the Cuban economy and public services, thereby severely damaging the well-being of our entire population today.”

” We will continue to promote the increasing integration of all our economic actors, which today are, together, a cornerstone for our development and progrss towards the well-being of all our people.”

Comments

Both the U.S. and Cuba agree that the new Treasury Department regulations leave unchanged the U.S. embargo (blockade) of the island and the U.S. designation of Cuba as a state sponsor of terrorism. Cuba, of course, wants those measures eliminated while the U.S. merely assumed that they would continue. As a U.S. citizen, this blogger wants to see them eliminated and suggests that the U.S. use this opportunity to engage Cuba in discussions about doing just that while remembering that  President Obama had discontinued the terrorism designation.[4]

The U.S. and Cuba also could have discussions about how to encourage the best operations of the latter’s new private enterprise sector. Given the horrendous current status of the Cuban economy, Cuba should welcome such discussions and be open to significant changes on those issues.

========================

[1] Statement of the Cuban Ministry of Foreign Affairs, There is only one Cuba (May 29, 2024); Cuban Foreign Minister affirms that measures announced by the US are limited, Granma (May 29, 2024).

[2] Minrex: The new US regulations continue to be limited and do not touch the body of the blockade, CubaDebate (May 28, 2024).

[3] Diaz-Canel, The integration of all economic actors will be increasingly greater, Granma (May 30, 2024); US measures for MSMEs ‘respond to a subversive design’, says Diaz-Canel, Diario de Cuba (Mau 29, 2024).

[4 ]President Obama Rescinds U.S. Designation of Cuba as a “State Sponsor of Terrorism,” dwkcommentaries.com (April 15, 2015); U.S. Rescinds Designation of Cuba as a “State Sponsor of Terrorism,” dwkcommentaries.com (May 29. 2015),

U.S. and Cuba Dispute Existence of Legitimate Cuban Private Business Sector

At a January 18, congressional hearing, U.S. Rep. María Elvira Salazar (Rep., FL), who chairs the House Foreign Affairs Subcommittee on Western Hemisphere Affairs, said that claims that a private sector exists on the island were likely “a new scheme from the regime which is desperate for millions of dollars to violate the American market.” Later at that hearing, she voiced some scepticism about such a claim.[1]

The next day, Cuba’s vice minister for the economy, Johana Odriozola, disputed that contention. She said, “Nobody in their right mind can talk about something that really exists being a myth. We are not talking about something small; we are talking about more than 10,000 micro, small, and medium-sized companies.”

In addition, Johana Tablada, currently number two at Cuba’s foreign ministry’s department handling U.S. affairs, also questioned the premise of the congressional hearing in a lengthy tirade against U.S. policies toward the island and personal attacks against Salazar. . . . Tablada said the Cuban government would not allow the U.S. government to use the private sector to meddle in Cuba’s internal affairs but said the government is “serious when it says it supports this sector’s development.”

Although the Cuban government has imposed various restrictions on these enterprises, [2]“the private sector, which also comprises self-employed workers and some cooperatives, now employs 35% of all Cuban workers — more than those employed in state-owned companies.”

====================

[1] Torres, Cuba pushes back against claims in Congress that its private sector is a myth,’ Miami Herald (Jan. 25, 2024);  U.S. House Hearing on Cuban Private Enterprise, dwkcommentaries.com (Jan. 20, 2024).

[2] Torres, Resisting reforms, Cuba announces price hikes and new restrictions on the private sector, Miami Herald (Jan. 10, 2024); Torres, As the economy craters, the Cuban government hits private-sector workers with tax hike, Miami Herald (Jan. 18, 2024)

U.S. House Hearing on Cuban Private Enterprise  

On January 18, the U.S. House Foreign Affairs Subcommittee on Western Hemisphere Affairs held a hearing that opened with its chair, Rep. Maria Elvira Salazar (Rep., FL), delivering a speech entitled “The Myth of the New Cuban Entrepreneurs: An Analysis of the Biden Administration’s Cuba Policy.”[1]

Salazar said, “according to information she has, the growth of private enterprises in Cuba is a ‘scheme’ by the Cuban government to violate the U.S. embargo and that only the children of Cuban leaders have an easy path to own these businesses.” That comment was echoed by Rep. Mark Green, a Tennessee Republican, saying, “the Cuban military is embedded in every single business, so the concept of a private sector is almost non-existent in the country.”

At the end of the hearing, however, after hearing about the Biden Administration’s position discussed below, Salazar “seemed to have softened her initial stance, telling the State Department officials that Republicans are ‘on the same page.’ Apparently contradicting her early views, she asked, “How can we help this administration really help those small business owners in Cuba that have no contact or connection with the regime to open up a good store if they want or to own a privately owned business? What can we do together?”

The Biden Administration’s Position on Cuban Private Enterprise

Eric Jacobstein, deputy assistant secretary of state for Western Hemisphere Affairs, testified at the hearing, “In an acute twist of irony, the island’s communist government must now rely on private enterprise to provide food and basic services for its people. We believe the organic expansion of the private sector on the island – led by the Cuban people themselves and not by any foreign government – is an opportunity that should not be wasted. Above all, we must encourage the freedom of Cuban citizens to define their economic future. Failing to engage and support Cuba’s private sector would leave space for Russia and the [People’s Republic of China] to shape the direction of the Cuban economy. We must not allow this to happen.”

Jacobstein added, “We believe the organic expansion of the private sector on the island – led by the Cuban people themselves and not by any foreign government – is an opportunity that should not be wasted. Above all, we must encourage the freedom of Cuban citizens to define their economic future. Failing to engage and support Cuba’s private sector would leave space for Russia and the [People’s Republic of China] to shape the direction of the Cuban economy. We must not allow this to happen.” Moreover, “the private businesses give some young Cubans reasons to stay on the island despite the challenges. . . . In an acute twist of irony, the island’s communist government must now rely on private enterprise to provide food and basic services for its people,”

Enrique Roig, the deputy assistant secretary in the State Department’s Bureau of Democracy, Human Rights and Labor, said that “the Biden administration is not solely focused on supporting independent private entrepreneurs but also on improving the human-rights situation on the island. In particular, the administration has pushed for the release of about 1,000 political prisoners.”

Rep. Joaquin Castro (Dem, TX), the Ranking Member of the Subcommittee, said, the U.S. should support Cuban entrepreneurial efforts, not stifle them.” He added, “Our policies of the last 60 years have not resulted in the changes we would like to see; in some cases, they have even emboldened the Cuban government and strengthened their relationship with key adversaries like China and Russia. The United States can both recognize the threat that the Cuban regime poses to regional and national security while also engaging on key priorities and supporting the Cuban people’s efforts to further their own democratic aspirations.” This includes embracing “former President Barack Obama’s engagement policies, including removing Cuba from the list of countries that sponsor terrorism,” calling it ‘a baseless, extremely harmful designation.’

California Democrat Sydney Kamlager-Dove said that the denial that the Cuban private sector truly exists was a “conspiracy theory.”

Other Comments on Cuban Private Enterprises

Before the hearing, John Kavulich, the president of the U.S.-Cuba Trade and Economic Council, a Washington-based organization tracking business with Cuba, wrote in the Cubatrade blog, “The hearing premise is established on a falsehood” and that it is “wrong” to define those who have created and manage the private enterprises “as participants in a myth, as dupes of the government … rather than instruments of change. [The Cuban government] “does not embrace the re-emerging private sector. It’s tolerated. That should not mean the United States Congress should dismiss it. Or worse, work against it. “

======================

[1] Torres, Republicans and Democrats in Congress clash over the existence of the private sector in Cuba, Miami Herald (Jan. 18, 2024),

 

U.S. Reactions to New U.S. Anti-Cuba Policies 

U.S. objections to the new U.S. policies regarding Cuba (and Venezuela and Nicaragua) have been registered by a Bloomberg News editorial; by the U.S. Chamber of Commerce; by Representative Eliot Engel, the Chair of the House Committee on Foreign Affairs and other representatives and by groups and individuals outside the government. They will be discussed first.[1]

Then we will look at support for the policies from three Cuban-American legislators (Sen. Marco Rubio (Rep., FL), Sen. Robert Menendez (Dem., NJ) and Rep.Mario Diaz-Balart (Rep., FL); from Sen. Rick Scott (Rep., FL); and from Walter Russell Mead of the Wall Street Journal.

Given the legitimate current U.S.  preoccupation with the Mueller Report and its implications, there have been no editorials (to date) on these Cuba policy changes in other leading newspapers (New York Times, Washington Post and Wall Street Journal) or by the sponsors of the pending Senate bill to end the U.S. embargo of Cuba (Senators Amy Klobuchar (Dem., MN), Patrick Leahy (Dem., VT) and Mike Enzi (Rep., WY)) or by the Chair of the House ‘s Cuba Working Group Steering Committee (Tom Emmer (Rep., MN).

Critics of the New Policies[2]

  1. The Bloomberg Editorial.

Although it was worthy for the U.S. to seek to persuade Cuba to stop helping Venezuela’s Maduro, Bloomberg says the new policies are “the wrong way to get results.”

In fact, says Bloomberg, the new U.S. policies and actions will “inflict real damage on Cuba,” and  “that’s unlikely to make the country’s rulers budge. Instead, opening the [U.S.] floodgates for litigation against Canadian and European companies doing business in Cuba will fracture the international front against Maduro — not to mention swamping U.S. courts with troublesome lawsuits.” In fact, such litigation is “more an attack on America’s friends than on Cuba or Venezuela.”

Moreover, according to Bloomberg, “Aside from dividing what could have been a U.S.-led coalition [against Venezuela’s Maduro], the new escalation will play into the hands of aging hardliners, encouraging Cuba to seek help from Russia and China, and weaken potent internal forces for change.”

  1. Engage Cuba

Engage Cuba, the leading bipartisan coalition of businesses and others who support U.S.-Cuba normalization, issued the following critical comments:

(Statement by James Williams, President of Engage Cuba)

  • “President Trump is doing this for one reason, and one reason only: to appease fringe hardliners in South Florida ahead of the 2020 election. The only way to get property claimants what they deserve is through diplomatic negotiations, which President Trump just threw off the table. . . This lets the Cuban government off the hook and shifts the burden to American, European and Canadian companies. American companies and our closest allies will now be paying instead of the Cuban government.”
  • “The hypocrisy of the Trump administration cozying up to the most brutal dictatorships in the world in Saudi Arabia, Russia and North Korea, but claiming to care about democracy and human rights in Cuba, is like living in a parallel universe. President Trump himself tried for years to open up a Trump Hotel and golf resort in Cuba.”
  • “U.S. travel and remittances are the lifeblood of the private sector entrepreneurs in Cuba. These restrictions are a cruel betrayal and a knife in the back of Cuban civil society and the prospects for a growing independent private sector in Cuba. The Cuban people are already struggling under tremendous difficulties, and these actions only make it worse. We need a policy that focuses on empowering the Cuban people and advancing American interests, not continuing a 60-year failed policy that only serves fringe domestic politics in South Florida.”

(Property Claim Lawsuits)

  • “The Trump administration has chosen to break precedent with every administration since President Clinton by failing to waive Titles III and IV of the the LIBERTAD Act, commonly referred to as the Helms-Burton Act after its sponsors. When Title III takes effect on May 2, American companies and foreign firms will be subject to lawsuits in U.S. courts over the use of properties that were nationalized by the Cuban government following the 1959 revolution. Title IV will also take effect, requiring the denial of U.S. visas for anyone “trafficking” in confiscated Cuban properties, as well as their relatives.”
  • “In opposition to international law, Title III affords claimant rights to Cuban Americans who were Cuban citizens at the time their property was confiscated. Currently, there are 5,913 certified claims of seized American property in Cuba, but the State Department has estimated there could be a flood of up to 200,000 claims with the full activation of Title III.”
  • “Due to Title III’s potential to jeopardize U.S. trade interests, every U.S. administration since the law’s enactment in 1996 has suspended its implementation, typically for a period of six months. Today’s announcement marks the first time Title III has been fully activated and U.S. firms will be subject to lawsuits.”
  • “Companies from the biggest U.S. trade partners, including the European Union, Canada, and Mexico, will also be subject to property claim lawsuits under Title III, though most countries will protect their companies from having to pay damages to U.S. property claimants. The EU and Canada have threatened retaliation in the World Trade Organization.”
  • “Meanwhile, U.S. adversaries like Russia and China are unlikely to comply with Title III lawsuits and will instead align themselves with Cuba against this extraterritorial U.S. policy. By maintaining a trade embargo, the U.S. has already left a vacuum in Cuba for adversarial influence. As Cuba continues to be isolated by the Trump administration, it will increasingly turn to Russia and China, who offer them favorable credit terms and invest in high-profile projects.”

(New Restrictions on Remittances,Travel, and Financial Transactions)

  • “Bolton also announced there will be new limits on non-family travel to Cuba and U.S. remittances to the island, a heavy blow to Cuba’s nascent private sector (roughly one-third of the workforce) which greatly depends on remittances and U.S. travelers to keep their small businesses alive. Remittances will now be capped at $1,000 per quarter, a dramatic departure from the $4 billion that flowed to the Cuban people after the Obama administration lifted all limits on remittances in 2015.”
  • “Five Cuban government-run businesses will be added to the list of entities with which direct financial transactions are barred. New Department of Treasury regulations will prohibit U.S. banks from processing “U-Turn transactions,” Cuba-related funds transfers from a bank outside the U.S. that pass through U.S. financial institutions before being transferred to banks abroad where neither the originator nor the beneficiary is a U.S. national.”
  1. U.S. Chamber of Commerce

“Six decades of trying to isolate Cuba has failed to bring change to the island, and today’s move only doubles down on this strategy. The U.S. Chamber’s support for a new approach to Cuba is founded in our profound conviction that more engagement with the Cuban people — on the basis of free enterprise and free markets — is essential to democratic change and improvements in the Cuban people’s lives.”

“We strongly support U.S. government efforts to protect the property rights of U.S. citizens abroad, but full implementation of Title III is unlikely to achieve those aims and is instead more likely to result in a protracted legal and diplomatic morass that ensnares U.S. courts, companies and partners. . . . Furthermore, it is difficult to see how this action squares with the administration’s earlier commitment to hold harmless U.S. companies legally authorized and previously encouraged to do business in Cuba.”

“Many American companies will now be subjected to countersuits in Europe, Canada, Latin America, and elsewhere. Today’s announcement threatens to disrupt our trade ties to these countries, which are among our closest allies and best customers. Instead, we should be working with them to make the case for democratic change in Cuba.”

  1. Center for Democracy in the Americas

Another U.S. group that supports U.S.-Cuba normalization, the Center for Democracy in the Americas, said through its executive director (and former Obama National Security Advisor) Emily Mendrala, “Capping remittances is mean-spirited, and can only be understood as the U.S. government’s attempt to create economic hardship among the Cuban people. Ambassador Bolton’s speech conflated Cuba with Venezuela, and he announced a policy approach that does the same. The two countries are different, living through very different moments, and to exploit events in Venezuela to settle Cold War scores with Cuba is a distraction from real needs in Venezuela.”

  1. Cuba Educational Travel

Collin Laverty, president of Cuba Educational Travel, added other critical comments. First, “the measures on remittances and travel threaten the economic survival of Cuban families and the viability of thousands of independent small businesses allowed to operate since 2010 under reforms implemented by former President Raúl Castro.” Second, “The only winners here are a handful of members of Congress and those stuck in the past that support them. The losers are millions of Cubans on and off the island and the overwhelming majority of Americans that support engagement with Cuba.”

  1. Current and Former Federal Government Officials

Representative Eliot Engel (Dem., NY), the Chair of the House Committee on Foreign Affairs, stated, ““President Trump’s rejection of over two decades of bipartisan consensus on a key piece of U.S. policy toward Cuba will further isolate the United States from our Latin American and European allies and diminish our ability to promote democracy in Cuba and Venezuela. Sadly, this decision will do nothing to resolve U.S. property claims in Cuba—an important goal toward which we must continue to strive.”

Similar statements were issued by Representatives Kathy Castor (Dem., FL), James McGovern (Dem., MA), Barbara Lee (Dem., CA) and Donna Shalala (Dem., FL).

Benjamin Rhodes, a former Obama adviser who helped negotiate the December 2014 U.S.-Cuba normalization agreement, said, “Restricting remittances that can be sent to Cubans will directly hurt the Cuban people. This is a shameful and mean-spirited policy.”

Mark Feierstein, a former National Security Council’s Director for the Western Hemisphere, tweeted: “As Bolton delivers speech in Miami today on Cuba, it’s useful to keep in mind that according to public opinion polls, most Cuban-Americans approve the measures taken by the Obama Administration to support the Cuban people. The [National Security Council]. . . is out of step with majority opinion in Miami.” In another tweet  he stated, “What we’re leading the Cuban people toward is a darker day, where there will be less economic opportunity.”

  1. Other Americans

Tim Fernholz, who covers space, the economy and geopolitics for Quartz, has addressed the new policies’ adverse effects on the emrging Cuban private sector. He says, “The Trump administration is setting out to crush free markets in Cuba.” These policies “will damage Cuba’s nascent private sector far more than a ruling regime that has out-lasted six decades of US embargo. Trump is pulling the rug out from Cuba’s cuentrapropistas—literally, self-employed—eliminating their sources of capital and revenue and reducing their influence during the all-important transition to a post-Castro Cuban government. . . . US policy toward Cuba, meanwhile, is defined by a near-theological belief that isolating the Cuban people will lead them to abandon national self-determination.”

Supporters of the New Policies[3]

The two Cuban-American Senators and one of the Cuban-American U.S. Representatives, as expected, endorsed at least some of the new U.S. policies. So did Senator Rick Scott. So did Walter Russell Mead, who is the James Clarke Chace Professor of Foreign Affairs and the Humanities at Bard College, a Distinguished Fellow in American Strategy and Statesmanship at the Hudson Institute, and The Wall Street Journal’s Global View columnist.

Senator Marco Rubio (Rep., FL) said, “”By no longer suspending Title III of the Freedom Act, the Trump administration is the sixth of impunity by the Castro regime. The United States is opening the door to justice and enabling victims of the Cuban dictatorship to rightfully sue their perpetrators. Today, as we commemorate the value of the fallen heroes in the Bay of Pigs invasion, history is once again being written. ”

Senator Robert Menendez (Dem., NJ) offered a similar statement: “By fully implementing Title III of the LIBERTAD Act, the United States is rightly providing U.S. citizens with the means to hold the Cuban regime accountable through the U.S. justice system.”

Representative Mario Diaz-Balart (Rep., FL) issued a lengthier statement, which is extracted below:

  • “At long last, victims of confiscated properties will finally have the chance to pursue claims to recoup losses suffered at the hands of the Castro regime.”
  • “President Trump and his administration have demonstrated remarkable solidarity with the Cuban people and the regime’s other victims in tightening sanctions by prohibiting financial transactions with the Cuban military.
  • “Cutting off resources and investment to the regime in Cuba will benefit both U.S. national security interests and regional security interests for neighbors in our hemisphere.”

Senator Scott stated, “Americans can finally sue for property stolen by the Cuban regime. We must continue to do everything we can to cut off the money supply to the Castro Regime, which continues to prop up dangerous dictators like Nicolas Maduro in Venezuela and Daniel Ortega in Nicaragua.”

Walter Russell Mead. He starts with the proposition that Venezuela presents the key challenge of Latin America. “Left to accelerate, the breakdown of governance and civilized life in Venezuela can only create more refugees, enrich arms smugglers and drug cartels, allow forces like Hezbollah to insinuate themselves more deeply in the region. On the other hand, a return to some kind of stability under a pro-business government would initiate an economic recovery that would help the people of Venezuela and their neighbors alike, and deprive the terror cartels of much of their arms and funding. Crucially, if Venezuelan oil production recovers, it would help stabilize world energy markets and significantly increase American leverage with both Russia and Iran.”

“The continued collapse of Venezuela’s economy means the Cuban regime is also facing disaster. From the Trump administration’s point of view, this is a historic opportunity. If Cuba . . . abandons socialism on Mr. Trump’s watch, the president’s prestige at home and abroad would soar.”

Therefore, says Mead, the Trump Administration hopes for “historic victories in Cuba and Venezuela.” That plus  “the fear of a costly defeat have combined to persuade the Trump administration to adopt some of the most far-reaching economic sanctions ever imposed.” In short, no previous U.S. president “has been willing to impose sanctions that alienate powerful allies to this degree over Caribbean policy. That Washington is pressing ahead suggests how high a priority Venezuela has become for the administration.”

Conclusion

There are so many reasons to oppose the new U.S. policies towards Cuba, as this blogger does. Just refer to the above section regarding such opposition and to the similar discussion in the previous posts cited in footnote 1.

As always, this blog invites reasoned comments, pro or con, or corrections from all readers of this post.

===================================

[1] Prior posts have discussed (a) the April 17 announcement of the U.S. allowance of litigation over alleged trafficking in American-owned Cuba property that was expropriated by the Cuban government, circa 1959-60; (b) National Security Advisor John Bolton’s April 17 announcement of additional Cuba sanctions; (c) Cuban reactions to these changes; and (d) European and other countries’ reactions to these changes. These changes take effect in the midst of Cuba’s current dire economic situation, which was the subject of another post.

[2] Editorial, Cuba Is a Problem That Trump Is Making Worse, Bloomberg (April 22, 2019); Press Release, Engage Cuba Statement on New Cuba Sanctions (April 17, 2019); Engage Cuba, Memorandum: New Sanctions on Cuba Announced April 17, 2019 (April 2019); U.S. Chamber of Commerce, Statement on Cuba and Title III of the LIBERTAD Act (April 17, 2019); Center for Democracy in the Americas, CDA STATEMENT:Cuba Sanctions announcement (April 17, 2019); Cuba Educational Travel, CET Statement on President Trump’s Cuba Policy Changes (April 17, 2019); Engel on Implementation of Article III of the Helms-Burton Act (April  17, 2019); U.S. Rep. Castor: The Trump Administration’s Announcement of New, Hardline Restrictions on Cuba Brings Pain to Families, Hurts Growing Cuban Private Sector (April 17, 2019); McGovern Statement on Trump Administration;’s Reckless Policy Change Toward Cuba (April 17, 2019); Congresswoman Barbara Lee Slams President Trump’s Backwards Policy Towards Cuba (April 17, 2019); Caputo, Trump crackdown on “3 stooges of socialism’ has 2020 thrust, Politico (April 17, 2019) (Rep. Shalala quotation); Reuters, Trump’s Cuba Hawks Try to Squeeze Havana Over Venezuela Role, N.Y Times  (April 18, 2019) (Rhodes quotation); Feierstein Twitter Account; Fernholz, Cuba’s entrepreneurs are under attack by Donald Trump, Quartz  (April 22, 2019).

[3] Press Release, Rubio Commends Trump Administration’s Move to Hold Cuba Accountable (April 17, 2019); Press Release, Rubio Highlights Importance of Trump Administration’s Commitment to Democracy in Latin America (April 17, 2019); Press Release, Menendez Statement on Announcement to Let Cuban Americans File Suit over Property Confiscated by Cuban Regime (April 17, 2019); Diaz-Balart: Trump Administration’s Full Implementation of Title III Is a Monumental Decision   (April 17, 2019); Press Release, Sen. Rick Scott Applauds President Trump For Fully Implementing Title III of the Libertad Act (April 17, 2019); Mead, Trump Takes Aim at Caracas and Havana, W.S.J. (April 22, 2019).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Senator Leahy’s Senate Floor Speech To End Embargo of Cuba

As mentioned in a prior post, on February 7, Senator Amy Klobuchar (Dem., MN) introduced the Freedom To Export to Cuba Act (S.428) with cosponsors Patrick Leahy (Dem., VT) and Michael Enzi (Rep., WY)./

On February 15, Senator Leahy delivered a lengthy and persuasive speech on the Senate floor supporting this bill and ending the embargo. Here is the text of that speech.

After commending Senator Amy Klobuchar (Dem., MN) for introducing this bill and urging other Senators to support the bill,, Senator Leahy said, “This bill is about ending the anachronistic prohibitions in U.S. law that for decades have limited U.S. engagement with Cuba, including preventing American companies from exporting their products to Cuba.  The fact that legislation to do so is even necessary is illustrative of the absurdity of the situation in which we find ourselves.  Companies from Europe, Russia, China, Mexico, and every other country can sell their products to Cuba, which is just 90 miles from our coast, but American manufacturers and retailers are largely shut out of the Cuban market. . . . This bill would enable American companies to compete, which every believer in a free market should support.”

“It is also important for Senators to know that punitive actions by the Trump Administration last year to further restrict the right of Americans to travel to Cuba have had devastating consequences for Cuba’s fledgling private sector – the very people the White House and supporters of the restrictions profess to want to help.  The fact that they have said nothing about the harm they are causing Cuba’s struggling entrepreneurs demonstrates that they care more about continuing their failed policy of sanctions, regardless of who they hurt, than about helping the Cuban people or about protecting the right of Americans to travel freely.” 

“The latest ill-conceived attempt by the White House to punish Cuba would permit Title III of the Helms-Burton Act to go into effect.  This would allow, among others, individuals who were Cuban citizens when their property in Cuba was expropriated half a century ago to sue in U.S. courts any Cuban, foreign, and even American company whose business in Cuba today uses that property.  That could be an airport, port, warehouse, hotel, restaurant, you name it.  Virtually every American and foreign company investing in Cuba would suddenly be liable for treble damages.”

“The purpose, as the law’s authors made clear when it was enacted 23 years ago, is to harm Cuba’s economy by making it completely inhospitable for foreign investment.”

“As my friend in the House, Representative Jim McGovern (Dem., MA), has pointed out –

  • ‘It’s no mystery why Presidents Clinton, Bush, Obama, and Trump blocked Title III from going into effect every six months for the past 23 years.’
  • ‘It is hypocritical – it penalizes companies for doing what American companies do all over the world.’
  • It is contrary to international law, which recognizes the right of expropriation and requires compensation.’
  • ‘It is an extraterritorial sanction that guarantees a response from our trading partners, like Canada, Spain and the EU, including complaints at the World Trade Organization.’
  • ‘And if you care about agriculture, be warned: It will open a new front in the trade war, with all the repercussions that can bring.’
  • ‘It will allow Cuba to claim victim status and rally international support.’
  • ‘It will clog our courts with lawsuits.’
  • ‘It will make it impossible to negotiate compensation for U.S. claims in Cuba, and, in the end, hurt the very Americans who seek compensation for the property they lost.’
  • ‘It will divide us from friends and allies who are now working for a peaceful solution in Venezuela.’
  • ‘And it will guarantee that new investment in Cuba will come from the Russians, Chinese and others who are hostile to the United States, and whose state-owned companies can’t be sued in U.S. courts.’

“I agree with my friend in the other body [Rep. McGovern].  What the White House is considering would trigger an avalanche of unintended consequences that would bring U.S. commerce with Cuba to a halt, harm relations with our allies in this hemisphere and beyond, and make resolving property claims more difficult.  I ask unanimous consent that a piece by William LeoGrande on Title III of the Helms-Burton Act published in the February 13, 2019 issue of OnCubaNews be printed in the Record following my remarks.” [This article will be published in a separate post to this blog.]

Like “many issues, Members of Congress have strong feelings pro and con about U.S. relations with Cuba.  It is no secret that, after more than half a century of a policy of isolation that has achieved none of its objectives and primarily hurt the Cuban people, I, like Senators Klobuchar and Enzi and many others in this body, favor closer relations.”

“Conversely, there are those in Congress and the Trump Administration who believe strongly that we should ratchet up the pressure on the Cuban government in an attempt to achieve those elusive goals.”

“I have often spoken publicly about the lack of political freedom and civil liberties in Cuba.  But I also think it is important to try to be objective:  to criticize when called for and to acknowledge positive changes when they occur.”

“I recognize that those who favor maintaining the failed economic embargo have a longstanding, visceral antagonism and resentment toward the Cuban government.  While they rarely, if ever, mention the corrupt and brutal Batista regime that enjoyed unqualified U.S. support until it was overthrown in 1959, they have legitimate reasons to criticize the mistreatment of the Cuban people by the current government and its support for the corrupt and repressive Maduro regime in Venezuela.”

“But they too should acknowledge that threatening and bullying Cuba has not worked.  In fact it has made the situation worse, and provided an excuse for the Cuban government to blame its own failures on us.  They should also acknowledge positive changes in Cuba, but they never do.  Not ever.  It is almost as if they are psychologically, ideologically, or emotionally incapable of saying one positive thing about the Cuban government, no matter what positive things it does.”   

“Perhaps they are afraid that if they did, they would alienate their donors in the Cuban-American community.  Of course, we know that Cuban-Americans are divided about the U.S. embargo.  Some are hardcore believers in the embargo, and they always will be.  But at least as many – and increasing numbers – oppose the embargo, especially those who were born after the Cuban revolution.” 

“I wonder what the pro-embargo isolationists would say if the Cuban government were to stop harassing and abusing dissidents who favor a more democratic system.  Would those who oppose the embargo say anything positive?” 

“What if the Cuban government decided to embrace a free market economy and let private businesses flourish?  Would those who oppose the embargo say anything positive?”

“I doubt it.  I doubt it because no matter what positive reforms occur in Cuba, they will continue to defend the embargo until Cuba is a full-fledged democracy and those who currently hold power either die or are voted out of office.” 

“We all want Cuba to become a democracy, where civil and political rights are respected, and the sooner the better.  But those same defenders of the embargo support billions of dollars in U.S. aid – and weapons sales – to countries that are led by authoritarian, brutal, and corrupt dictatorships and monarchies, some of which have held power for decades or generations.”    

“How do the pro-embargo diehards reconcile that?  They don’t and they can’t.”

“The fact is, Cuba is changing.  Not nearly as fast as we and the Cuban people would like, but it is changing in ways that few would have predicted not very long ago.”

“Last year, Raul Castro’s hand-picked successor, Miguel Diaz-Canel, became President and he promised a government more accessible and responsive to the people’s needs.  How he delivers on that promise remains to be seen.”   

“Since 2010, after the Cuban government recognized that the Internet is essential if Cuba wants to be part of the modern world, Internet access has exploded.  The government has opened hundreds of public Wi-Fi hot spots and cyber cafes in the past five years, and home Internet access became legal and available in 2017.  Today, almost half of the Cuban people have personal cell phones that were illegal just a decade ago.”

“As others have pointed out, these changes have encouraged new forms of communication, networking and organizing via social media.”

“But change does not come easily in Cuba, as it does not in many countries.  Last July, the government announced onerous new regulations on the private sector, covering a wide range of issues:  food safety, labor contracts, procurement, taxation, limits on the size of private businesses.  The new rules were an attempt by hardliners to crack down on the private sector, which was criticized for black marketeering.”

“But private entrepreneurs resisted, and they challenged the regulations as contradictory to the government’s own plans that recognizes the private sector as important to economic growth and employment. They appealed to government officials and spoke publicly about the harm the new rules would have on their businesses.”

“When the final regulations were issued, several that had caused the most resentment were dropped.  According to the Minister of Labor and Social Security, the decision to revise the rules was due to ‘the opinion and experiences of those directly involved.’”

“The government also retreated on a new law – Decree 349 – requiring artists, musicians and performers to register with the state and pay a large commission on their earnings from private engagements, and it banned work with objectionable content and empowered inspectors to shut down any offensive exhibition or performance.  Clearly, an attempt to further limit free expression.”

“Since the 1980s, Cuban artists have had more freedom to be critical of the government than other social sectors, and so it was not surprising that Decree 349 ignited widespread protests.  After social media was used to mobilize opposition within the Cuban arts community and among artists abroad, the government agreed not to enforce the law until implementing regulations are drafted in consultation with the arts community.”

“According to one observer, ‘during [the latter half of last year], nearly 8.9 million Cubans debated the draft of a new constitution in their workplaces, neighborhoods and schools.  Communist Party members were told not to argue with even the most radical proposals for amendments, and the ensuing debates were freewheeling, often lasting past their scheduled time.  Among the main topics: whether the president and state governors should be directly elected by voters; whether the concentration of wealth and property should be allowed; whether term limits and age limits for leaders were a good idea; and whether the Communist Party should be subordinated to the constitution and hence the law.”  Not long ago it would have been unthinkable to openly debate these issues, especially as part of a constitutional reform process.”

“One article that attracted intense debate recognized same-sex marriage, and was promoted by Raul Castro’s daughter, a long-time activist for LGBTQ rights. The proposal sparked strong opposition from evangelical churches supported by the Catholic Church.  Gay rights advocates countered with campaigns of their own.  The chance of a significant ‘no’ vote on the entire constitutional reform led the government to drop the provision from the final draft of the constitution with a pledge to consider it later.”

“This surge in mobilization by well-organized constituencies utilizing social media to resist government policy, from burdensome private sector regulations to gay marriage, is unprecedented in Cuba.  The government’s willingness to not only tolerate these organized challenges but to change policies in response to them, is significant. “   

“As has been noted, none of these issues dealt with the rigid structure of the Cuban system.  Cuba remains a one party state, in which those who challenge the system are treated as criminals.  But the precedent of organized interest groups mounting successful campaigns to challenge and change government policy is now established, which is positive.” 

“None of the longstanding critics of the Cuban government in the U.S. Congress or the Cuban-American community [has] acknowledged any of this, nor are they likely too.  For them, anything less than a wholesale change of government in Cuba is unworthy of mention, even though they apply a very different standard – a double standard – to other authoritarian governments.  In fact, they would ridicule anyone who regards such changes as positive or worthy of recognition.”

“As we know from our own experience, political reform is difficult.  Our own Electoral College, an anachronism designed to protect a slave-holding minority, remains in effect more than two centuries later.  Five times, in the world’s oldest democracy, it has prevented the winner of the most popular votes from being elected president.”  

“The Cuban people want to live better and they want a lot less government control over their lives.  Armed with cell phones and the Internet they are going to make increasing demands of their government.  This is happening at a time when Venezuela’s economy is collapsing and the survival of the Maduro regime, Cuba’s closest ally in the hemisphere, is in question.  Not surprisingly, the Cuban government is trying to limit the pace of change and to secure other benefactors.  It is turning increasingly to Russia, Algeria, Iran and other countries that welcome the chance to challenge U.S. influence in this hemisphere.” 

“This is a time for the United States to be actively and visibly engaged in Cuba, for Americans to be traveling to Cuba, for expanding educational, cultural, and professional exchanges between the U.S. and Cuba, and for American companies to be competing in Cuba.  It is not a time to return to a failed policy of threats and ultimatums, driven by domestic politics rather than by what is in our national interests.”

“That is why I am cosponsoring the Freedom to Export to Cuba Act.  And it is why I intend to support other bipartisan legislation to replace our failed Cuba policy with one that serves America’s interests, not the interests of a shrinking minority, and not the interests of Russia and other countries that are reaping the economic benefits of our self-defeating policy of isolation.”

Reaction

I concur in the rationale and conclusion of this speech: end the U.S. embargo of Cuba.

While I believe there is valid documentation of the Senator’s assertion that Cuba has limits on free speech and assembly, he views this in isolation from Cuba’s situation. Cuba is a small country facing the vastly larger and more powerful  U.S., which for many years has had various hostile policies and actions against Cuba, including secret and undercover so-called “democracy promotion” programs on the island. In that context, it should be easy to understand why Cuba is concerned about dissidents and free speech and assembly.  Accordingly reliable U.S. assertions about the abolition of so called “democracy promotion” programs on the island should be a precondition to improving Cuban freedoms of speech and assembly.

============================================== 

Senator Leahy,  Statement of Senator Leahy On the Freedom To Export to Cuba Act (Feb. 15, 2019).