A Site for a Free Cuba
Un Sitio para Liborio
A Site for a Free CubaUn Sitio para Liborio |
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The embargo on Cuba is a tool
"The embargo on Cuba is a tool. At present it is used - successfully - to restrict the flow of resources to a recalcitrant regime. It can also be used as a bargaining chip to extract economic and political reform. If given away unilaterally, it has no value. The embargo is, by definition, defensive in nature. It is a way to contain the worst excesses of a regime. It is incomplete, however, without a parallel effort to support democracy proponents, human rights activists, independent journalists and economists, and budding entrepreneurs. It is not enough to contain a failed regime, we must help those citizens of a captive nation that share our belief in the dignity of the individual to find their way out from under the heavy hand of totalitarianism. We now have an opportunity to do this. It is in our national interest, and in our common stake in humanity to do so." See full text below Senate Committee on Commerce, Science and Transportation Sub-Committee on Consumer Affairs, Foreign Commerce, and Tourism Hearing on U.S. Trade Policy with Cuba Testimony of Ambassador Dennis K. Hays Thank you Mr. Chairman, I appreciate this opportunity to appear before you and the committee to discuss U.S. trade policy with Cuba. There are times in foreign affairs when the right thing and the smart thing are the same thing. Through successive Administrations, Republican and Democratic alike, America has stood with the people of Cuba and against a repressive regime that provides neither food nor hope. Where other nations have chosen to compromise their principles and the tenants of good business, we as a people have been steadfast both to our ideals and to common sense. Our trade policy toward Cuba serves to foster reform, to protect our national interests, and to protect the American taxpayer. In the forty-three years of its existence, the regime of Fidel Castro has gone to extraordinary lengths to crush the human spirit and individual initiative. Even now, in the 21st century, Cuban farmers are told what to plant, Cuban workers in foreign companies have over 95% of their wages stolen by the state, and Cuban homeowners are forbidden to buy or sell property. And this, of course, concerns only the economic arena. The political record of the Castro regime is far worse, with the legacy of the revolution a tragic montage of thousands of deaths by firing squad, the denial of medical care to political prisoners, and brutal actions against civilians. Added to this, of course, is the regime's culpability in the execution and premeditated murder of numerous American citizens. It is for these reasons that we stand with the people of Cuba and agree with President Bush that before our sanctions are lifted, prisoners of conscience must be freed, free speech, a free press and the right of association must be restored, and Cuba must commit to a path that leads to free and fair multiple party elections. The specific purpose of this hearing, as I understand it, is to assess U.S. trade policy from an economic perspective. I would thus like to discuss our trade embargo and its impact on both Cuba and the United States, why Cuba under Castro is not an attractive trading partner and what the Cubans hope to accomplish with their current charm offensive. Finally, I would like to briefly discuss what we can do to hasten the day when Cuba is again a full economic partner of the United States. The US Embargo Against Cuba Economic sanctions, when applied appropriately and conscientiously, remain an effective tool of foreign policy. Economic sanctions, by their very nature, afford us the ability to fine-tune our response to the provocations of terrorist, criminal, and outlaw states in a firm, but non-military, manner. Sanctions do suffer from one major weakness, however, a persistent expectation that they, by themselves, can solve every problem - be it too high tariffs or the rampages of a bloodthirsty dictator. Such excessive expectations mask the very real successes sanctions have had over the years in denying resources to rogue states and forcing dictators to amend, adapt, or reform their ways. Like any Marxist economy, Cuba requires unearned inputs to avoid a constant downward spiral. Unable to generate real economic growth, the regime desperately seeks foreign sources of funds to subsidize its inefficient system. For many years, the Cubans had the Soviets, who pumped money into Cuba at a rate of seven hundred thousand dollars ($700,000) an hour, twenty-four hours a day for almost two decades. When in the early 90's the Soviets were no longer willing or able to continue with this, Castro rejected Gorbachov's advice to adopt market reforms and instead inflicted a 35-60% reduction in the average Cuban's (not his own, of course) standard of living. This failure to reform had important results with respect to our national security. Cuba's military has shrunk from the largest (per capita??) in Latin America, over 300,000 troops, to fewer than 50,000. More strikingly, Cuba's Navy and Air Force have all but ceased to be effective units except, of course, against tugboats full of children (Marzo 13) or unarmed Cessnas (Brothers to the Rescue). Cuba's ability to expand it's biotech laboratories has been diminished, although the distress sale of advanced technology to other terrorist states is equally troubling. At the same time, Castro's ability to finance and support subversive groups throughout the hemisphere has been greatly restricted and the region has enjoyed an unprecedented decade of democratic reform. The embargo does more -it creates pressure for democratic and economic reform. In 1993 Castro legalized the use of dollars and permitted direct remittances from relatives in the US in an attempt to capitalize on the concern of Cuban Americans for their starving relatives. In 1994 he authorized "farmers markets" that for the first time gave at least a limited amount of freedom to farmers to grow and sell crops. That same year he slashed the military budget, permitted "self-employment" in a restricted number of fields, relaxed the criteria for family visits, and even restored some selected religious freedoms. For an explanation as to why Castro did these things, you need only listen to his remarks. Castro told his rubber stamp National Assembly, "We are forced to do things we would never otherwise do because of the economic necessities of the times" The record over the past forty years is clear. Castro reforms when he must, represses when he can. A unilateral lifting of our embargo would give him an undeserved respite, and lead - as it always has in the past - to more rather than fewer restrictions on the Cuban people. Cuba as a Business Partner: As a place to do business, Cuba consistently ranks at the very bottom of the list. Chad, Haiti, and Turkmenistan are all more attractive places to invest. In fact Cuba ranks 151st out of 154 countries, somehow edging out Libya, Iraq and North Korea. There are reasons for this -in Cuba private property, the sanctity of contracts, free labor unions, and an independent judiciary are all alien concepts. When you do business with Cuba you enter into a twilight zone of arcane laws and regulations. You are required to be complicit in a full range of unsavory practices. Foreign investors are expected to not only comply with rules that deny Cuban workers their rights, but to inform on any worker who expresses opinions critical of the regime. Moreover, Cuba is in default on practically every loan it has ever taken. Cuba is in default to Russia, to the European Union, to its Latin American neighbors, to South Africa, to the nations of Asia, and to two-thirds of the members of NAFTA. In fact, about the only country in the world without uncollectable debt is the United States. As the International Trade Commission reported last year, "Cuba stopped payment of all its foreign commercial and bilateral official debt with non-socialist countries in 1986. Because US financial institutions were prohibited from financial dealing with Cuba, there was no US exposure to Cuba's foreign debt moratorium." Thanks to our embargo, the American taxpayer has not had to bail out any American business or bank shortsighted or incompetent enough to ignore the record and trust Castro. Castro's Charm Offensive Castro is desperate for new sources of funding. Having run out of credit in Europe, Asia, Africa, Latin America and Canada, Castro has only the United States and Antartica left as possible sources of new credit. Realizing that no penguin would be so gullible as to loan anything to a deadbeat of his magnitude, Castro has focused on his only remaining hope - us. Thus, we have seen what has come to be known as the "charm offensive." This offensive has three parts. First, Castro did not formally oppose the placement of terrorists in Guantanamo -although Castro's Attorney General, Juan Escalona, did manage to publicly state that he "hoped the Taliban would escape and kill Americans" before he got the new Party line. Second, Cuba has purchased American agricultural products. It is important to note that the money for these purchases reportedly comes for funds that were supposed to go to the Europeans and others for debt repayment. This is especially ironic, as to my knowledge, all agricultural trade other than ours involves heavy subsidies, below market barter arrangements, concessionary financing, and debt forgiveness. Now, the pittance these nations expected in payment from Castro is denied them and being used to finance their replacement. So much for loyalty. Third, Castro has invited everyone he can think of to visit Cuba to take the usual guided tour of the regime's Potemkin Village facilities. Current Policy and the Proposal for Financing We initially opposed the revision of the law a year and a half ago that permitted the sale of US agricultural products to Cuba on a cash basis. We took this position because Castro has always used food as a means of control. The ration card, it is important to remember, came into mandatory use prior to the imposition of US sanctions. When informed of this change in US policy, Castro at first vowed he would not purchase "a single grain of rice." Some months ago, however, he reversed himself and purchased a significant amount of US products. And, because the law requires it, he paid cash for his purchases. It is now proposed that the compromise that has resulted in sales for farmers and protection for the taxpayer be amended to permit short term financing of sales. To move, in effect, from getting paid to accepting Castro's promise to pay. This is the arrangement other countries have tried and come to regret. Humanitarian Assistance I would like to take a moment to discuss humanitarian assistance. The largest source of humanitarian aid to Cuba is the United States. Dade County alone probably provides more humanitarian assistance than the rest of the world put together. This is Cubans in America helping Cubans in Cuba. This occurs because there is confidence the recipient of such assistance is an individual or family, not the Cuban regime. The U.S. government has also offered humanitarian assistance on an official level, most recently in response to Hurricane Michelle. The only requirement was that the aid get to its intended recipients through the Churches and non-governmental organizations. The Road Ahead The embargo on Cuba is a tool. At present it is used - successfully - to restrict the flow of resources to a recalcitrant regime. It can also be used as a bargaining chip to extract economic and political reform. If given away unilaterally, it has no value. The embargo is, by definition, defensive in nature. It is a way to contain the worst excesses of a regime. It is incomplete, however, without a parallel effort to support democracy proponents, human rights activists, independent journalists and economists, and budding entrepreneurs. It is not enough to contain a failed regime, we must help those citizens of a captive nation that share our belief in the dignity of the individual to find their way out from under the heavy hand of totalitarianism. We now have an opportunity to do this. It is in our national interest, and in our common stake in humanity to do so. Thank you. ----------------------------------------------
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