AMCHAM CUBA NEWSLETTER  for  DECEMBER 2000

 

 

(3) To maximize the constructive role of Cuba’s military in any transition, the US should develop military-to-military contacts; continue counter-narcotic contacts benefiting the US; and explore cooperation with neighboring nations to help Columbia negotiate conflict settlement.

(4) The US should expand on prior CFR proposals to promote trade, investment, and relief of suffering, labor rights and the legacy of property nationalizations.  Specifically the US should:

•   accept payment in cash or 90-day commercial paper (no US subsidies) for food and medicines, while Cuba should let all “end-users” purchase American products;

• authorize US investment in new informational materials for Cuba;

• resolve US-certified uncompensated claims, let claim- holders negotiate exchange value, license equity in joint ventures conforming to Helms-Burton law  [consensus was not reached on follow-on investment or expansion of equity, pending further study];

• license business activities now allowed (news, support for travel, distribution of humanitarian aid/sales, cultural program support), and approve further investment “contingent upon demonstrated progress [on]…workers’ core labor rights” defined by the International Labor Organization;

• support independent study of labor rights in Cuba, including conditions for free, independent trade unions, right to strike/organize, and direct worker employment;

• license US universities and firms to offer management training and labor rights institutes;
  support Cuba’s observer status in the World Bank and Inter-American Development Bank to expand Cuba’s understanding of market economies and international finance;

  but

  oppose Cuba’s readmission to the Organization of American States (OAS) until Cuba accepts regular, free elections, lest admission undermine OAS commitment to democracy. 

 2. But, is a non-threatening Cuba now possible?   A very different viewpoint is offered by Dr. Brian Latell, Georgetown U’s School of Foreign Service professor and until 1998 a Latin American specialist at the Central Intelligence Agency.  He cites five potential security threats to examine the question.  In the recent rush by so many influential commentators, business people, and members of Congress to curtail or abandon the economic embargo against Cuba, several issues of significant concern for US security interests are receiving scant attention.  They deserve to be better appreciated by those on all sides of the sanctions debate.

More than 11 years since the fall of the Berlin Wall, and nearly a decade since the Soviet Union itself dissolved, Cuba’s ability to threaten US interests is widely believed to have evaporated along with Soviet strategic and ideological threats.  A Defense Department study of Cuban military capabilities prepared in 1998 for Congress has frequently been cited by those who assert that Fidel Castro’s Cuba no longer poses any threat the US or Latin America.  In fact, the report’s language was more qualified.  Further-more, in his transmittal letter…, Secretary of Defense William Cohen highlighted one particularly ominous issue of military concern.

Observers increasingly also conclude that Cuba’s ability and desire to support violent revolutionaries abroad have expired.  Some correctly recall that the Cuban government agency that for decades had primary responsibility for sponsoring revolutionary groups in the hemisphere was disbanded in 1990.  In any event, it is commonly argued, the Marxist revolutionary movements most dependent on the Castro regime negotiated themselves out of existence a decade ago.  But in fact two large and powerful Colombian insurgencies long associated with Cuba continue to pose a grave threat in a region of critical importance.

The perception that Cuba has ceased to be a military, ideological, or subversive threat is rooted in the geo-political and economic shocks that Havana experienced at the end of the Cold War.  The annual community subsidy of about $6 billion was gone and Castro’s ability to preach the inevitability of communist victories around the world was shattered.  Instead, during the first half ot the 1990s, survival became the regime’s overwhelming preoccupation as social unrest and economic calamity reached unprecedented dimensions on the island.  But even then, in its lonely destitution, the Castro regime continued to post serious security threats. 

* Boat People.  Notably, in the summer of 1994, with Castro’s tacit encouragement, about 40,000 Cubans fled on small craft, demonstrating that even a weakened and disoriented Cuban government could inflict substantial pain on the US.  Moreover, the “balsero” exodus was the third time that Castro enabled disaffected Cubans by the tens of thousands to flee across the Florida Straits, each cynically manipulated to relieve acute pressures of popular disaffection.  A fourth sea lift impelled by Castro is not inevitable, of course, but will remain a distinct possibility as long as he is in power.

In addition, Castro in all likelihood will remain intransigent in his determination to undermine US interests with little regard even to any unilateral reductions of the embargo that might occur.  Cuba can be expected to pursue sophisticated overt and covert policies intended to reduce US influence, to promote anti-democratic “guardian” type regimes in Latin America, and to revive and advance the fortunes of violent Latin American revolutionaries.

* Latin American Guerrillas.  Leaders of the Marxist guerrillas in Colombia have looked to Cuba for inspiration and guidance for decades.  And although the FARC and the ELN no longer acquire material support from abroad, they probably depend on Cuba as their principal intermediary and covert ally in international relations.  For his part, Castro no doubt is working clandestinely to under-mine the US Plan Colombia and to promote the long term fortunes of the guerrillas.

* International Terrorism.  The State Department’s 1999 report on global terrorism (released April 2000) includes Cuba, with six other nations, as a sponsor of terrorism.  It indicates that Cuba harbors past terrorists and maintains links to foreign terrorist organizations.  Recently Castro appeared to confirm Cuba’s ties to the Spanish ETA Basque terrorists when he angrily refused to endorse a resolution condemning them at the November Ibero-American summit in Panama.

* Complicity in the Narcotics Trade.  Since the late 1980s, credible charges of Cuban complicity in narcotics trafficking have been lacking, but respected economists have concluded nonetheless that Cuban government hard currency earnings are probably augmented covertly by receipts from narcotics traffickers.

* Possible Biological Warfare Program.  In his transmittal to Congress of the 1998 Defense Department report on the Cuban military, Secretary Cohen said “the intelligence community also looked into the potential for Cuban development of chemical and biological weapons.”  And added that he “remains concerned about Cuba’s potential to develop and produce biological agents, given its biotechnological infrastructure.”

In this regard, I wrote in May 1999 that “the Secretary’s reassuring words seem to indicate that defense and intelligence specialists place a high priority on collecting and analyzing information about biological and nuclear programs in Cuba.  Certainly it will be essential for US military and intelligence officials to continue necessary efforts to assess any weapons or proliferation issues that could be associated with Cuba’s ambitious biological and biotechnology programs that in the past enjoyed the enthusiastic blessing and support of Castro. 

Real and potential Cuban threats to US interests have increased since the mid-1990s as the dire economic crisis at the end of the Cold War has been ameliorated.  Cuba now has somewhat greater resources to pursue more energetic policies to continue confronting US interests as it has for more than 40 years.

3. Economic hopes remain dim.  External pressures will weigh on the economy through 2001, writes Patricia Grogg, but Cuba “hopes to maintain growth at approxi-mately 5%”.  Marta Roque (Internal Dissidents economist) challenged claims by Carlos Lage, Council of State Vice President, that Cuba had attained annual growth of 7.7% the first half year.  She called for “less official meddling” to promote new foreign investment and deal with debt delinquencies, blamed centralization for inefficiency, corruption, consolidating the dictatorship, and unwilling-ness to accommodate investor requests for reforms.  

Claudia Marquez Linares of the Grupo Decoro says official fees (taxes, licenses) which bite into profits are squeezing self-employed workers out.  A December resolution by the Ministries of Agriculture and Internal Commerce says only three types of cooperatives and small farmers may make direct sales of produce left after State quotas are met; the measure would eliminate middlemen.    

Fuel scarcity has cut transport, and fewer than 50% of Havana buses are operating.  Reports mid-December are that several industries have closed for lack of fuel, despite the new Venezuela oil commitment.  David E. Lewis’ Cuba Economy Update reports Economy Minister Jose Luis Rodriguez’ claims sugar production rose by 7.3% to reach 4.59 million tons this year, still low despite land reforms and market-based incentives offered.  Sugar and nickel remain among Cuba’s top income sources, but tourism remains the most dynamic sector with average growth of 18.6% over five years.  Cigar production remains below announced goals. 

Cuban Legislature President Ricardo Alarcon recently asked for more investment from Japan, claiming Cuba’s economic environment is “ripe”.  Foreign Minister Kono recently announced a Japan-Cuba economic dialogue for in January in Tokyo – the first such meeting in 14 years, and, to improve Japan’s US relations, asked Alarcon to improve its human rights stance. 

And Cuba hopes to new agreements will expand trade with MERCOSUR members Brazil, Paraguay, and Uruguay to include Argentina, within the Assn. of Latin American Integration (ALADI).

  4. Human rights violations continue.  Amnesty International says over 200 Cuban citizens were arrested shortly before International Human Rights Day Dec. 12.  Pablo Alfonso, writing in the Nuevo Herald December 27, upped the number to 250 detainees, “curiously coinciding with the telephone cut-off”. (Telephone communications will probably worsen following a US Treasury ruling that phone companies may not pay the additional Cuba tax.)

CubaNet says a new Cuba law suspends diplomas of professionals who join a religious order, denying them the right to practice their professions, like medicine.  CubaNet called for protests to Fidel (www.cubaseccion!igc.apc.org), copied to the library union (eliades@jm.lib.cult.cu and ascubi@fcom.uh.cu).  The crackdown on religion allegedly includes destruction of a school child’s religious images by school authorities.  On December 22, Cuba’s independent libraries appealed arrest of several leaders, presumably to disrupt a provincial meeting scheduled for Santiago (held anyway).  And Canada’s Cuba Cruise Corporation cited bomb treats as it canceled plans to take US citizens to Cuba.  Critics called the plan illegal as US citizens would be on board.

5.  Visits to Cuba.   Staff of the National Geographic will lead an 11-day trip this spring to historic sites in Cuba including Hemingway’s home. Information is available at 888-966-8687.  Trips by the Center for Cuban Studies will explore visual arts, architecture, women's issues, educa-tion and literacy for US students, religious observance, plus the Center's "Update" trips (tel. 212-242-0559),   

 

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OPINION CORNER. 

Alfredo Blanco, Jr., Vice President of the Sugar Producers of Cuba, Inc., an association of former mill owners, offers his perspective on Cuba and the embargo.  As a mill owner until 1960, he witnessed Fidel Castro's revolution.  Then, as an exile active in a large New York sugar-trading house, he closely followed Cuba's politics and economy.  Blanco deals with the complex rogue behavior of the sole communist country of the Americas, and with controversial economic issues including the US trade embargo.

The always contentious Issues surrounding Cuba elicit emotional responses from various sectors seeking to advance their own viewpoints, ideological (human rights, democracy) and economic (the embargo).  Key to this rabid communist country’s anomalies is its ruler, Fidel Castro, charismatic and ruthless, a leader whose heinous totalitarian dictatorship has kept him in power for 42 years. 

 

Castro's obsession is to stay at the helm regardless of hardships imposed on his people and destruction to Cuba’s patrimony.  He seeks universal acclaim as the world's greatest political reformer.  He has been clever at brinksmanship (the missile crisis, 1962) and blackmailing (immigration agreement with the US relating to rafters, 1994).  He is a master of deceit, and popular worldwide with communists and leftists envious of US success.  He is an unpatriotic criminal, a genius of evil to the Cuban exile community and conservatives - an extraordinary leader, grossly underestimated by most.  If these premises prove to be true - as we believe - no peaceful transition is possible, and friendly overtures from the US will be futile, as we explain below:

 

(1) The primary characteristic of Castro's regime, absolute control over the population and its economy, relies on its infrastructure.  Upon seizing power (1959), the government started squandering wealth accumulated by a prosperous Cuba (then second in GDP in Latin America), nationalizing health care, and confiscating properties in the name of independence from US trade which it claimed represented exploitation.  The consequent totalitarian dictatorship, embracing communist ideology and methods, took complete control by means of massive executions, suppression of every democratic freedom and human right, and erasure of all vestiges of property and private business activity.  Building on its international victories (Bay of Pigs invasion, missile crisis), the government crushed all opposition, embraced communism, and gained Soviet Union support against invasion by the US or Cuban exiles.  Typical components of communist repression were quickly put in place:  Committees for the Defense of the Revolution, Rapid Response political parties, Marxist indoctrination at the schools, government-appointed judges, compulsory military service, and a huge army to be used for internal repression, international wars, and subversion in Latin America and Africa.

 

(2) It is useful to predict the behavior of this totalitarian dictator-ship in light of similar systems elsewhere.  Renowned sociologists (Przeworakl, Linz, Lopez) assert that totalitarian dictatorships are haunted by a need to maintain power and to forcefully respond to policies challenging their grip.  The essence of Castro's rule is unrestrained personal power.  All individuals, groups, and institutions are permanently subject to his unpredictable and despotic Intervention.  Influential persons derive importance from association with him.  His radical policy has no room for "soft-liners" who are eliminated, and only "hard-liners" survive in authoritative positions.  A negotiated, amicable transition is not feasible.  The sole reason for government to relinquish power would be an exogenous shock, like war, death of the supreme leader, or a revolutionary uprising by the people or the military.  [Note:  Negotiated transitions are possible in other types of authoritarian regimes, e.g., former dictatorships in South America, Spain and Eastern European nations, where some dissidents and soft-liners were tolerated, and later rose to powerful positions.

 

(3) Currently the most contentious issue for the US business community concerning Cuba is the Helms-Burton trade embargo (1996): 

 

Theory and evidence indicate that totalitarian dictatorships take liberalization steps when the country's economy is dismal.  They reluctantly yield to pressures brought about by shortages of food and services, which cause the people to become dissatisfied, unruly, and the regime to fear an escalation of unrest that could topple it.  The customary remedy is to relax somewhat the rigid controls on the economy and allow a semblance of individual freedom.  When the economy has recuperated, the regime feels secure enough to buy tranquillity with the additional revenues, taking care of close allies and appeasing influential members of society, while simultaneously tightening oppression of the people and disregarding human rights.  History confirms that these principles apply to Cuba, as illustrated below: 

 

A. In 1980 the Cuban government faced a major crisis caused by the stifling of private economic activities, especially agriculture, to such an extent that food shortages developed, discontent spread, people pushed their way into embassies, and 125,000 refugees fled to the US.  Sensing a weakening of control, the regime let farmers sell part of their produce in farmers' markets, permitted small businesses (family restaurants) and self-employment, and authorized joint ventures with foreign partners.  Soon, however, Fidel Castro’s dislike of the emergence of uncontrolled persons and groups led him to denounce them, and in 1982 he virtually retracted the liberalized regulations on grounds that intermediaries and the self-employed were getting rich and exploiting the public by raising prices. 

 

B. A new crisis emerged in 1986 when Cuba defaulted on debt payments to European nations and Japan as Cuba’s economy declined and its peso exchange rate against the US dollar soared to CP 30/US$1.  The breakup of the Soviet Union and discontinuance of subsidization sent the Cuban economy into a tail-spin.  To prevent the fall of the regime, in 1994 Castro took desperate steps towards economic liberalization, among them legalizing holdings and transactions in US$, reviving farmers markets, facilitating tourism and remittances by exiles to their relatives in Cuba, and encouraging foreign investment.  After the Pope's visit (1998), the regime turned back the clock, increasing repression, jailing dissidents, and fleecing the impoverished population by exchanging payments in US$ to Cuban pesos at par.  Since the regime froze wages in 1959 (and the exchange rate today is CP 20 per US$), the result is that today's average wage of CP150=CP150/20=US$7.50 monthly, or $.25 daily -below subsistence level.  Cuba’s s GDP per capita is US$ 1,540, and only Haiti has a lower figure in the Americas.  It is a sad epilogue to unfulfilled promises by a diabolical system headed by a perverse tyrant.  

 

If the embargo is lifted, the additional revenues would not flow to the people.  The government would devise mechanisms for sucking up the additional income to use to increase repression, dispense favors to hard-liners, and consolidate its grip.  The government cannot tolerate persons and groups gaining independence from official controls because its survival would be threatened.

                                                [END OF OPINION CORNER]

 

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AmCham Cuba wishes you and yours a wonderful year, and peace in the new millenium!

Sincerely,

 

 

Phoebe Lansdale  Executive Director                             

 

December 31, 2000

Editorial review: Robert Weekley