FORO CUBANO Vol 3, No. 23 – TEMA: BLOQUEO ECONÓMICO –
U.S.-Cuba policy whiplash only preserves the status-quo
Por: Ricardo Herrero*
*Director Ejecutivo, Grupo de Estudio de Cuba; email@example.com
For nearly four years, the Donald Trump Administration has slowly but methodically reversed its predecessor’s policy of détente with Cuba. Complimented at all times by a steady program of political rallies and high-level public appearances in Miami, the administration’s aim has been consistent: to cancel President Barack Obama’s “failed” and “one-sided deal with Cuba,” and punish the Cuban regime for “its abuses.”
To understand whether the Obama Administration’s policy was indeed a failure, it is first important to understand its guiding theory of change. As Obama articulated in his historic December 17, 2014, speech announcing the restoration of diplomatic relations with Cuba: “I do not expect the changes I am announcing today to bring about a transformation of Cuban society overnight. But I am convinced that through a policy of engagement, we can more effectively stand up for our values and help the Cuban people help themselves as they move into the 21st century.”
The Obama administration understood that a half-century strategy of resource denial –first implemented through trade sanctions under presidents Dwight Eisenhower and John Kennedy, and later codified under Helms-Burton Act of 1996 and other laws– had failed to advance any positive transformations is Cuban society. On the contrary, it had isolated the United States from Western allies in its approach to Cuba and provided the Castro government with an expedient justification for its iron-fisted rule and devastating, centrally planned economy. Further, by conditioning the all-or-nothing lifting of sanctions on the existence of a democratic transition government in Cuba and the exit of the Castro brothers from power, Helms-Burton effectively placed the timetable for US re-engagement in the hands of the Cuban Communist Party.
Instead, the Obama team accepted the fundamental lesson behind 55 years of embargo policy: change in Cuba had to come from within. It could not be micromanaged by bureaucrats in Washington. They recognized that the best ambassadors of democratic values in Cuba were Americans and Cuban-Americans and that opening travel and trade was the most promising way to increase the autonomy of the Cuban people and strengthen their position to demand changes from their own government. A policy that made life easier for Cubans on the island, even if it brought a collateral benefit to the Cuban state, was the more virtuous path and the more likely to incentivize positive change.
Between early 2015 and early 2017, the Obama administration used its discretionary authority over elements of the embargo to make it easier for US citizens and residents to travel to the island, eased restrictions on spending money in and sending money to Cuba, and opened the door for limited forms of US investment that stood to primarily benefit the Cuban people.
On the merits of its own goals—incrementally empowering the Cuban people—engagement was a success. Since 2011, hundreds of thousands of US travelers to Cuba helped fuel a significant expansion of Cuba's nascent private sector, benefitting thousands of livelihoods. By the fall of 2016, there were more than 500,000 licensed cuentapropistas (self-employed workers) operating on the island. When private farmers, employees of joint ventures, and informal sector workers are added in, Cuba’s non-state sector accounted for more than one-third of the Cuban labor force at the time, though still excessively constrained by the state. American travelers, and business partners like Airbnb and commercial banks, helped make private entrepreneurship the most dynamic, jobs-producing sector of the Cuban economy, particularly in 2015 and 2016. By relaxing remittance restrictions, the White House also facilitated the creation of new financial linkages between Cubans at home and abroad. Albeit functioning informally and not recognized as investment under Cuban law, remittances provided key start-up capital for Cuban private sector growth.
Further, as part of the agreement to normalize diplomatic relations in 2014, Cuba committed to expanding Internet access for its citizens. Regulatory changes authorizing US investment, dialogue, and partnerships with Cuba's state telecommunications authorities contributed to an environment that saw the Cuban government follow through on this commitment beginning with the creation of public Wi-Fi hotspots in 2015, and later with expansions into home broadband in 2017 and 3G coverage in 2018. By the time Cuba rolled out 4G in 2019, 1.8 million of the island’s 5.3 million cell phone subscribers were regularly accessing the Internet from their mobile devices, according to independent news site 14ymedio.
Partnerships with US universities, NGOs, and cultural institutions also helped propel unprecedented growth and diversification in Cuba's civil society. From small business training and incubation programs, to artistic exchanges, to journalism training fellowships, Cuban citizens took advantage of opportunities brought by engagement to expand their horizons and skills. Thanks in part to such exchanges, private sector business owners and employees became an important new voice in Cuban civil society advocating for further economic reform.
At the same time, US and Cuban authorities set aside the antagonist rhetoric that long defined bilateral relations and opened direct dialogues on issues of mutual concern. Embassies opened in each nation’s capitals in 2015, facilitating government-to-government communication and issue-specific working groups. Direct talks with Cuban officials resulted in the signing of over 20 bilateral agreements and memoranda of understanding (MOUs) that directly served US policy goals in Cuba and benefitted US national interests and security. These included increased cooperation on matters of law enforcement, public health, drug trafficking, and civil aviation. Collaboration led to extraditions of several US fugitives of justice. Further, the agreement to normalize diplomatic relations lead to the release of 53 Cuban citizens who the United States considered political prisoners, reducing the number of long-term political prisoners in Cuba since the 1960s to an all-time low.
Despite these outcomes, supporters of the old embargo policy judged the Obama policy not on its own terms, but on theirs, which remained singularly focused on regime change. Many backed Donald Trump’s presidential run in 2016, and Trump returned the favor in June 2017, when, in his first speech in Miami delivered as president, he announced: “We will not lift sanctions on the Cuban regime until all political prisoners are freed, freedoms of assembly and expression are respected, all political parties are legalized, and free and internationally supervised elections are scheduled.” This was not novel statement of policy, but an expression of the conditions for lifting embargo sanctions as stipulated in the Helms-Burton Act. Trump also said he would "seek a much better deal for the Cuban people" and help them "form businesses and pursue much better lives” which raised expectations that the private sector-focused elements of his predecessor’s policy might remain intact.
And for the first two years of the Trump administration, despite the resurgence of boisterous rhetoric and a sharp reduction of staff at US Embassy Havana in response to still unsolved health incidents, most of the Obama Executive Orders remained in place. However, a new "restricted entities list" did ban US persons from engaging with a wide array of enterprises linked to the Cuban military.
This changed with the ignition of the Venezuelan crisis in early 2019, when the Trump Administration opted to move forward with the full enforcement of Helms-Burton plus additional travel and commercial sanctions against Cuba. These were meant to punish Havana for its military and intelligence assistance in support of long-time socialist ally, Nicolás Maduro. Under the rubric of “maximum pressure”, the Trump Administration aggressively rolled back Obama-era policies meant to empower Cuban families, entrepreneurs, and civil society. These included the elimination of 5-year multiple entry visas for qualified Cuban visitors to the United States, the announcement of new quarterly limits on family and donative remittances, and a ban on all commercial and charter travel flights to Cuban destinations from the United States, with the exception of Havana. These measures, like the embargo, have been entirely unilateral, and meant to starve the Cuban regime of hard foreign currency. However they have imposed undue and disproportionate hardship on the Cuban people.
To date, the Trump administration’s Cuba policy has yet to produce any demonstrable progress toward advancing its stated objectives of fostering democratic change and forcing Cuba to drop its support for the Maduro regime. In 2018, Cuba's government successfully completed a generational political transition without incident or challenge to authority. While Raúl Castro will remain first secretary of the Cuban Communist Party through early 2021, the new president Miguel Díaz-Canel has already spent two-plus years as head of state. Meanwhile, US efforts to blacklist companies from shipping oil from Venezuela to Cuba have not forced Havana to reconsider its support for Maduro. Cuba continues to find workarounds for Venezuelan oil to reach its ports, and when shortages do occur as in the fall of 2019, they predominantly impact Cuba's citizenry. All evidence suggests that far from generating a rift between authorities in Havana and Caracas, “maximum pressure” has only pushed them into a tighter defensive crouch, held afloat by the support of more powerful allies such as Russia, China and Iran.
The Trump administration went as far as activating Title III of the Helms-Burton Act, an unprecedented step that authorizes lawsuits in US courts against foreign and Cuban entities alleged to be "trafficking" in private property confiscated by the Cuban Revolution in the 1960s. Title III had been waived by every US president, both Democrat and Republican, since the law’s enactment out of concern it would trigger bitter disputes with major US trading partners. Despite warnings that Title III activation would lead to "thousands" of lawsuits in US courts, only 26 cases have been filed, and most so far have either been dropped or dismissed for lack of legal standing or evidence. No doubt the activation of Title III has had a cooling effect on the foreign investment climate in Cuba, but no major investor currently in the country has pulled out as a result.
Perhaps worst of all, Trump’s antagonistic rhetoric and aggressive sanctions policy have prompted the return of a “siege mentality” among Cuban authorities. Conservatives in the Cuban Communist Party have re-gained the upper hand and urgently needed economic reforms have taken a back seat to national security priorities. Sectors of Cuban civil society that had been empowered to demand more of Cuban officials under the climate of normalization, such as independent media outlets, have come under increasing hostility in the last three years.
Ideological purists in the Cuban system also launched a crusade against the evils of so-called "centrism,” just as President Trump was beginning to "cancel" Obama’s normalization. Direct and indirect forms of repression against democracy advocates, journalists, artists, and other independent activists have continued, and in ways intensified. To prevent coverage of politically sensitive events, Cuban security agents have resorted to blocking members of Cuba's independent press from leaving their homes. Cuban authorities have also weaponized Cuban migration laws in new ways, "regulating" dozens of journalists and other civil society activists from traveling abroad. In the cultural sphere, Decree-Law 348, which went into effect in December 2018, hangs as a Damoclean sword over artists who work without the explicit approval of state-run cultural institutions. Meanwhile, though short-term detentions have declined (in part due to a decline in public protest), longer-term arrests and defamation campaigns against well-known political opponents have intensified. For example, against the backdrop of the COVID-19 pandemic this spring, authorities used the vague provisions of Decree-Law 370—issued in July 2019 to regulate the "informatization" of Cuban society—to impose fines on independent journalists who disseminated information on the Internet deemed to be "contrary to the social interest.”
After a promising period in which the Cuban government encouraged significant (if overly regulated) private sector expansion, a period of counter-reform followed as of mid-2017 resulting in new constraints on private sector growth. Agricultural production remained anemic, with the private farm sector hampered by quota requirements, price controls, and inefficient state-run distribution channels. Cuba's dual currency system continues to artificially boost bloated state sector enterprises that operate at a loss. And though a new Cuban constitution approved in 2019 recognized new forms of private property, a much-needed enterprise law expected to legally formalize the private sector has been postponed until 2022.
The downgrade of the US Embassy in Havana has rendered direct US diplomatic and civil society outreach efforts toothless. The US Embassy in Havana still exists but is a shell of its former self. With a reduced diplomatic presence, embassy staff has neither the time nor resources to efficiently advocate for US interests, nor adequately support Cuba's diverse civil society. The downgrade has also left Cuban migrants, refugees, and asylum seekers with few remedies. With the US Consulate closed, thousands of Cuban families in the United States waiting to reunite with loved ones have been stuck in limbo. Worst of all, for an administration that touts its commitment to human rights, Trump officials suspended refugee visas for all Cubans fleeing political persecution.
Finally, undocumented Cuban migration to the United States—chiefly via the U.S.-Mexico border—has once again increased. Following the elimination of the so-called Wet-Foot Dry-Foot policy in the last days of the Obama administration, the number of Cubans seeking entry to the United States sharply declined as expected. However, while roughly seven thousand Cubans were declared inadmissible at US ports of entry in fiscal year 2018, that number jumped to over 20,000 for fiscal year 2019, leaving thousands stranded in the northern towns of Mexico. The more complete closure of the border amid the Coronavirus pandemic has only raised further doubts about the fate of these migrants.
While reasonable observers may differ over whether the policy objectives set by the Obama administration were the most promising way to enable internal change processes in Cuba, the evidence indicates that the policy advanced its goals. On the other hand, US policy under the Trump administration has not tangibly improved the lives of the Cuban people, let alone set the stage for a transition to democracy, weakened Cuban regime officials, or persuaded them to abandon the Maduro regime. On most fronts, conditions on the island today are less conducive to meaningful change than they were when President Trump assumed office in early 2017. This is not to say the Trump administration's actions are entirely responsible for Cuba's declining fortunes, but its embargo redux has disproportionately hurt the Cuban people and undermined agents of change in Cuban society. Judged by the merits of its own first-term objectives—bringing about the downfall of the communist regime in Cuba—the Trump administration had failed roundly.