Tema: Lift the Cuba Embargo?

Dorgan Seeks Frustrated Creditor Status
http://www.capitolhillcubans.com/2009/07/dorgan-wants-to-become-frustrated.html

Wednesday, July 8, 2009

Last week, the Russian Federation's Audit Chamber revealed that the Cuban regime failed on three occasions to pay installments on the US$355 million credit deal it signed with Russia on Sept. 28, 2006.

This is just the latest episode in a saga that, in 2009 alone, includes:

1. Reports by Mexico's La Jornada and Spain's El Pais newspapers that hundreds of foreign companies that transact business with the Cuban regime's authorities, have had their accounts frozen since January 2009 by the regime-owned bank that is solely empowered to conduct commercial banking operations in convertible currencies, Banco Financiero Internacional, S.A. ("BFI").

2. "Cuba has rolled over 200 million euros in bond issues that were due in May, as the country's central bank asked for another year to repay foreign holders of the debt, financial sources in London and Havana said this week." Reuters, June 9, 2009.

As a reminder, in Castro's Cuba, you can only do business with the government, as private business activity severely restricted.

Yet, the National Journal reports this morning:

Sen. Byron Dorgan, D-N.D., will offer legislation today to change a provision in the 2000 law that allows agriculture trade with Cuba so that the Treasury Department cannot require the government of Cuba to pay for food before it is shipped, Dorgan said Tuesday.

During the Senate Appropriations Committee markup of the FY10 Agriculture appropriations bill, Dorgan said he had considered offering his Cuba amendment to the bill, but that he had been told that some members of the committee "would have an apoplectic seizure" so he will instead offer it today on the Financial Services and General Government appropriations bill.

Dorgan noted that the Treasury Department had initially allowed Cuba to follow the normal commercial pattern of making payment before goods arrive in the country, but that in 2005 the Bush administration decided that "cash in advance" meant payment for the goods before they left the country.

Dorgan said he would introduce the measure because he has failed in his attempts to convince Treasury officials to change their position. "Someone down at Treasury apparently still can't hear," Dorgan said. "We've had meeting after meeting after meeting."

EDITOR'S NOTE: The U.S. can also join this ever-growing club of Castro's frustrated creditors by supporting Senator Dorgan's legislation.

Hasn't anyone learned any lessons about extending easy credit yet? What does it take?

Senator Dorgan intend to stick US taxpayers with the bill, this is not ignorance of Cuba's deadbeat status, it's criminal intent on his part.

These politicians are being influenced and manipulated by those Cuban Investment Experts that want the embargo to end without any real change in Cuba's government. Their job is to make sure that we continue to loosen sanctions of the embargo, so they can continue and secure deals that they currently have and plan for the future. They are very cleaver and are getting away with it. They control the fate of the Cuban claims and also what's going on with the embargo.

Hardships Increase, Not Ease
http://www.cubastudygroup.org/index.cfm?FuseAction=PressReleases.Detail&PressRelease_id=5613&Month=7&Year=2009

Jaime Suchlicki, Miami Herald

July 6th, 2009 - Despite mounting economic difficulties, the Cuban government is not likely to open up Cuba's economy or to offer meaningful concessions for normalization of relations with the United States.

The Castro brothers believe that increasing hardships will not produce an internal rebellion. Gen. Raúl Castro recently reduced the availability of food that Cubans receive through ration cards. If there was concern for popular unrest, this type of measure would have not been introduced.

Political and economic centralization and control, along with ideological rigidity, are the chosen policies to guarantee a successful succession and to prevent Cuba's transformation into a democratic, market economy.

Elites unsure

Major concessions would mean a rejection of one of Fidel Castro's main legacies: anti-Americanism. It may create uncertainty among the elites that govern Cuba leading to friction and factionalism. The Cuban population also could see this as an opportunity for mobilization demanding faster reforms. It could also be seen as a weakening of Cuba's anti-American alliances with radical regimes in Latin America, Iran and Syria and Cuba's defection from the anti-imperialist front.

U.S. recognition may mean a victory for Raúl and the legitimization of his military regime.

Yet it is a small price when compared to the uncertainties that a Cuba-U.S. relationship may produce internally and externally among Cuba's allies.

From Cuba's point of view, the United States has little to offer: American tourists, whom Raúl doesn't need to survive; American investments, which he fears may subvert his highly centralized and controlled economy; and products that he can buy cheaper from other countries. The United States does not have, furthermore, the ability to provide Cuba with the petroleum that Venezuela is sending with little or no payment. Aid from Venezuela, Iran, Russia and China, furthermore, is provided with no conditions. These regimes demand little from Cuba.

Correlation of forces

The periodic public statements that Raúl has made about wanting negotiations with the U.S. government are politically motivated and directed at audiences in this country and Europe. In particular, Raúl believes that the ''correlation of forces'' is such that Congress may lift the travel ban and end the embargo unilaterally, without Cuba having to make any concessions.

Serious overtures for negotiations are usually not issued from the plaza. They are carried out through normal diplomatic avenues open to the Cubans.

These avenues have never been closed, as evidenced by the migration accord and the anti-hijacking agreement between the U.S. and Cuban governments. In the past, both Democratic and Republican administrations have had conversations with Cuban officials and have made serious overtures for normalization, only to be rebuffed.

Real concessions

The issue is not about negotiations or talking. There has to be a willingness on the part of the Cuban leadership to offer real concessions -- in the area of human rights and political and economic openings as well as cooperation on anti-terrorism and drug interdiction -- in exchange for an alteration in U.S. policies. The United States does not drop major policies without a substantial quid pro quo. Only when Raúl is willing to deal -- not only with the United States, but, more important, with the Cuban people -- should he expect a reciprocal change in U.S. policies.

Jaime Suchlicki is director of the University of Miami's Institute for Cuban and Cuban-American studies.

Greed propels the anti-embargo crowd to the detriment of the Cuban people. Stop looking at dollar signs and focus on human rights. The Castro brothers continue to play games with naive U.S. politicians.

Cuba's "bailout", by obtaining US-backed credit lines as well as the external debt of over $60 billion, will guarantee the continuation of the Castros regime, delaying instead of accelerating a transition to democracy.

No ‘Normalization’ Until the Castro Regime is Gone
http://www.familysecuritymatters.org/publications/id.2966/pub_detail.asp

William R. Hawkins

When I was in Ankara, Turkey for a defense trade conference at the end of January, I had lunch with two French delegates. We spent much of the time re-fighting the UN debate over the Iraq War which threatened to sunder U.S.-French relations. At the end of the lunch, one of the Frenchmen turned to Cuba, arguing that if American business was allowed to reach the Cuban people, “the U.S. would own the island in six months.” I told him that America would be happy to help the Cuban people build a new life for themselves, but there would have to be a regime change first. Otherwise, the economic benefits of removing sanctions would be grabbed by the communist elite and never reach the average citizen.

The recent trip to Cuba by a delegation of six U.S. House members of the Congressional Black Caucus (CBC) reinforces my point. The delegation did not meet with the people of Cuba, only with the regime. The entire delegation held a five-hour meeting with President Raul Castro. Then Rep. Barbara Lee (D-CA), the leader of the group, Reps. Bobby Rush (D-IL), and Laura Richardson (D-CA) were personally invited to the Havana home of “retired” despot Fidel Castro for what was more like a pilgrimage that a diplomatic mission. Rep. Rush said of his conversation with Fidel, “It was almost like listening to an old friend…. In my household I told Castro he is known as the ultimate survivor.” That Fidel Castro has also seen himself as the ultimate enemy of the United States did not seem to occur to the CBC idolaters.

According to CBC Chairwoman Rep. Lee, “The 50-year embargo just hasn’t worked. The bottom line is that we believe its time to open dialogue with Cuba.” But she also told CNN’s Wolf Blitzer that the delegation had gone to Cuba to “listen to Cuban officials” which means she is not interested in liberating the people of the island, only strengthening the dictatorship that has opposed them for half a century. The Castro regime is facing a crisis as the ruling brothers age. There is a strong desire on the part of the American Left that there be no change in Havana’s “progressive” policies in the transition to a successor regime.

It is often said that the trade and investment embargo on Cuba be lifted because it has “failed.” But what is meant by this? The notion that economic sanctions are sufficient to topple a regime without additional pressure from domestic revolutionary groups or outside military intervention is a straw man.

Sanctions are a form of pressure. They are meant to persuade foreign states to refrain from behavior at odds with American interests and values by raising the costs of such actions. Where, however, a regime is determined to follow an adversarial course -- as has been the case of Castro’s Cuba where ideology has taken precedence over the welfare of the people, the aim of sanctions has been to weaken the ability of the rogue state to act by denying it material resources and financial aid.

Rep. Lee and her cabal are clearly interested in providing the Castro brothers with more resources by lifting trade sanctions. They want to open the U.S. market to Cuban exports, pump investment capital and bank loans through state agencies, and expand the island’s tourism business. As Rep. Lee said, "When you look at new markets, my God – Cuba has a lot of manufacturing equipment. We talked about tourism. We talked about what possibilities exist for America and Cuba.” The resulting flow of funds would give the regimen the means to keep itself in power, while claiming to be a success.

The United States first imposed economic sanctions on Communist Cuba in 1960. Testifying before the Senate Foreign Relations Committee in 1964, Secretary of State Dean Rusk laid out the aims of the policy, which it should be noted did not include any expectation that the sanctions alone would lead to the overthrow of the Castro regime.

“First, to reduce Castro’s will and ability to export subversion and violence to the other American states; Second, to make plain to the people of Cuba that Castro’s regime cannot serve their interests; Third, to demonstrate to the peoples of the American Republics that communism has no future in the Western Hemisphere; and Fourth, to increase the cost to the Soviet Union of maintaining a Communist outpost in the Western Hemisphere.”

Measured by its aims, U.S. sanctions policy has been successful in Cuba, and should be maintained because it continues to serve the first three of the four ends set out by Secretary Rusk.

The only goal that is no longer a concern is number four, as the Soviet Union has disintegrated. Before its collapse, the USSR was providing Cuba with $5 to $7 billion in aid each year and spending scarce hard currency on the purchase of oil for Cuba. With some effort, it was able to offset Cuba’s loss of trade with the U.S. though the cost became another nail in the Soviet coffin.

It was also during this time, that the Castro regime was sending troops to fight in support of Marxist regimes in Africa and sending money, weapons and advisors to revolutionary groups and terrorist organizations throughout Latin America. It was also modernizing its own military and internal security forces which are the foundation of Castro’s control of the island. In other words, when Castro had the means to do so, he showed his determination to destabilize the international order.

With the collapse of the Soviet Union, Castro lost his Moscow subsidies. U.S. trade sanctions have taken an increasing toll on Cuba’s resources in the years since. Castro has not been able to send his troops abroad, and his ability to support violence in Latin America has diminished. Leadership of left-wing subversion in Latin America has shifted to the Hugo Chávez regime in Venezuela where oil revenue provides the means to cause trouble. Chavez has also taken on the burden of subsidizing the Castros.

Rep. Charles Rangel (D-NY), another CBC member and chairman of the powerful House Ways and Means Committee, has in the past suggested that Cuba be allowed to join the Caribbean Basin Initiative. The CBI was established by President Ronald Reagan to support the growth of democracy and capitalism in the region to better defend against Castroite influence. Members of the CBI are given trade preferences. The fragile economies of these countries need U.S. help. The creation of a Cuban trade rival would take away part of their American export market and divert capital from their needs to Havana. Trade policy should be conducted for the mutual benefit of friends and allies, not to aid adversaries.

American policy should certainly not be used to bail out a failed dictatorship and help it survive to fight another day against American and allied interests. Relations cannot be “normalized” with a Cuban despotism that is not “normal” in its ideology and actions.

FamilySecurityMatters.org William Hawkins is a consultant specializing in international economic and national security issues.

A (Timely) Historic Reminder

http://www.capitolhillcubans.com/2009/09/timely-historic-reminder.html

September 1, 2009
by William Hawkins*

The United States first imposed economic sanctions on Communist Cuba in 1960. Testifying before the Senate Foreign Relations Committee in 1964, Secretary of State Dean Rusk laid out the aims of the policy, which it should be noted did not include any expectation that the sanctions alone would lead to the overthrow of the Castro regime.

"First, to reduce Castro's will and ability to export subversion and violence to the other American states; Second, to make plain to the people of Cuba that Castro's regime cannot serve their interests; Third, to demonstrate to the peoples of the American Republics that communism has no future in the Western Hemisphere; and Fourth, to increase the cost to the Soviet Union of maintaining a Communist outpost in the Western Hemisphere."

Measured by its aims, U.S. sanctions policy has been successful in Cuba, and should be maintained because it continues to serve the first three of the four ends set out by Secretary Rusk.

The only goal that is no longer a concern is number four, as the Soviet Union has disintegrated. Before its collapse, the USSR was providing Cuba with $5 to $7 billion in aid each year and spending scarce hard currency on the purchase of oil for Cuba. With some effort, it was able to offset Cuba's loss of trade with the U.S. though the cost became another nail in the Soviet coffin.

*"No 'Normalization' Until the Castro Regime is Gone," Family Security Matters, April 10, 2009.

From truffles to fox furs, U.S. ships more than food to Cuba
http://www.miamiherald.com/news/americas/cuba/story/1220161.html

BY MARTHA BRANNIGAN

When a Havana family sits down for pollo asado, passes pan de ajo across the kitchen table or splurges on some chocolate soy ice cream, chances are the ingredients came from U.S. farms.

Venezuela may boast of its revolutionary friendship with Cuba, and China may send its youth there to study Spanish, but the United States has emerged as the No. 1 exporter of agricultural products to Cuba.

And that's not all that can be sent to Cuba legally. Try live primates, truffles, azalea bushes, fox furs -- even cigars.

When President Obama announced plans in April to ease the embargo by lifting family-travel restrictions to the island and allowing U.S. telecommunications firms wide latitude to do business there, many analysts said the policy changes could significantly expand ties between the estranged neighbors -- assuming Havana responds positively to the overture.

But fairly significant commerce has been going on since the Trade Sanctions Reform and Enhancement Act of 2000 opened the door to U.S. food and medicine exports to Cuba -- despite the tense relationship between Havana and Washington and a trade embargo that has spanned nearly 50 years.

U.S. agricultural exports to Cuba hit a record $711.5 million in 2008, as prices for commodities soared. That makes the United States Cuba's fifth-largest trading partner overall.

``We are the natural provider of food and agriculture products to Cuba,'' says Kirby Jones, president of Alamar Associates, a consulting firm for U.S. companies aspiring to trade with Cuba. ``We're No. 1 and could be selling a lot more, were it not for the restrictions.''

Over the past nine years, Cuba, which imports 80 percent of its food, has come to rely heavily on its nemesis to the north for wheat, corn, soy goods and scores of other key agricultural products.

American companies provide two-thirds of Cuba's imported chicken and more than 40 percent of its pork imports. Utility poles, organic fertilizer and chewing gum also make their way in.

Not much medicine has been shipped, however, since Cuba has other options

CASH FLOWS FROM U.S.

Much has changed since President John F. Kennedy imposed a total economic embargo of Cuba in 1962, making it illegal for Americans to spend any money in Cuba or trade with Havana.

The chinks began when some travel restrictions were lifted in the late 1970s, and through the years there has been a tightening and loosening of the embargo as administrations change in Washington.

In recent years, Cuba has raked in U.S. dollars in a host of other ways, too:
• The Castro government charges a 10 percent fee to exchange greenbacks for convertible pesos, or CUCs, used by Cuban Americans and other visitors, and there's another 10 percent hit due to the unfavorable exchange rate given by money changers.

• Cuba also gets millions of dollars -- perhaps hundreds of millions -- in fees from U.S. telecommunications companies that already provide long-distance service to the island through third countries.

• When Cuban Americans make trips to Cuba, they generally travel heavy, lugging an estimated $3,000 to $5,000 in goods for family and friends. If just half of the 200,000 Cuban travelers expected this year carried even the low end, or $3,000 worth, that would amount to $300 million of clothing, electronics and household gadgets winding up in Cuba in 2009 alone. These travelers also are allowed to spend up to $179 per day while in Cuba, according to U.S. regulations.

Cuba's airport-related fees levied on U.S. air-charter companies average $120 per passenger, according to charter officials, which would bring in some $12 million for the 100,000 U.S. visitors last year and possibly double that amount this year.

• And money sent by individual Cuban Americans to help family members amounts to an estimated $400 to $800 million a year, according to a 2004 study by the Commission for Assistance to a Free Cuba, which noted some estimates put U.S. remittances as high as $1 billion a year.

Even with all major portions of the embargo still in place, such commercial ties between the United States and Cuba could easily exceed $2 billion a year.

TOUGH BUSINESS

Meanwhile, a series of intentional hurdles reflects the U.S. government's conflicted attitude toward dealing with the communist regime that has outlived nine U.S. presidents.
The cash-strapped island must pay in advance for U.S. goods, and with no banking ties between two nations, Cuba has to pay through a bank in a third country, typically France.
U.S. exporters need clearance from the Office of Foreign Assets Control and the Commerce Department's Bureau of Industry and Security. Cargo ships carrying goods from the United States must go directly to Cuba before visiting any other nations, and they are forbidden from picking up anything to haul elsewhere. Cuban food inspectors often can't get visas to visit U.S. facilities.

And the trade remains a one-way street. Virtually nothing can be imported to the United States from Cuba, with the exception of artwork, printed materials and recordings. Last year, that came to a grand total of $39,126.

That gives Cuba the curious distinction of helping the United States with its chronic balance of trade deficit, albeit in a token fashion.

The obstacles to Cuba trade have tipped the scales in favor of agribusiness Goliaths like Cargill, Archer Daniels Midland and Tyson Foods.

For American businesses, there is only one customer in Cuba: Alimport, the government agency that coordinates purchases from the United States.

Small and mid-sized exporters are often spooked by the maze of regulations and the opaque process of selling to Cuba. More than a few would-be exporters have ventured to Havana trade fairs only to come home empty-handed.

``People [looking to export to Cuba] get discouraged,'' says Jay Brickman, vice president of government services at Crowley Maritime Corp. He travels frequently to Cuba for his company, which sends a cargo ship with chicken and other agricultural products to Havana from Port Everglades every week.

``They confuse being nicely received by the Cubans with the idea they're going to get business. Cuba is limited [in its ability to buy imports], and they're price-conscious. You almost have to have a certain passion to really want to be there,'' he said.

Some U.S. business executives imagine big opportunities in an untapped market. Others are drawn to the forbidden fruit.

Naples businessman John Parke Wright IV shipped beef cattle to Cuba from Port Everglades three years ago and flew to Havana to shepherd his herd from the dock.
Last year, Wright, a member of the Lykes family that owned vast agricultural lands in Cuba before they were seized in the revolution, exported 2,500 straws of Brahman bull semen from the J.D. Hudgins ranch in Hungerford, Texas, to impregnate Cuban heifers.

Now he's negotiating more cattle deals for Florida and Alabama Brangus cattle and semen. Wright, who has been making frequent visits to Cuba for nearly a decade, sees big potential for agricultural development on the island, in keeping with President Raúl Castro's recent call to the Cuban people to work the land. ``There was and there is another Florida there in the land mass and agricultural potential,'' says Wright.

But many others have called it quits after a few sales. Independent Meats shipped some goods about a year and a half ago, but decided its Idaho location is too far west to compete with other U.S. suppliers.

``It just didn't make a lot of sense for us,'' said Independent Chief Executive Patrick Florence.

Cuba, meanwhile, has spread out its purchases among as many U.S. states as it practically can in hopes of drumming up support in Congress for an end to the embargo.

And yet, this year, U.S. exports will likely trail 2008 as Cuba struggles with severe financial problems that limit its ability to pay for foreign goods..

CUBA'S CREDIT WOES

Some experts believe Cuba is facing its biggest challenges since the early 1990s, when the collapse of the Soviet Union left Fidel Castro scrambling for support in a changed world.

Just as poor families do, the Cuban government often makes purchases based on access to credit. That leaves U.S. businesses at a disadvantage, since transactions must be in cash.
U.S.-grown rice, especially the long-grain style favored in many recipes, was a huge hit with Cubans until 2005, when the Bush administration changed the meaning of cash in advance to mean payment before a product leaves U.S. shores -- instead of when it arrives in port in Cuba.

Since that tightening of policy -- which is expected to be reversed under provisions in the 2009 omnibus appropriations bill -- U.S. rice exports to the island have plunged. Cuba has relied more on Vietnam, which is thousands of miles away and sometimes delivers broken rice but provides generous credit.

Some argue, however, that the cash-in-advance rule is a blessing in disguise for American companies, because it ensures that they get paid.

``Cuba generally doesn't pay on time,'' says John Kavulich, senior policy advisor for the

Its amazing that they have to import chickens. Is their an easier farm animal to rise than a chicken? And over there seems to be very little sea food. After all, it’s an island. Do fish not bite a hook in Cuba? Cuba has some of the most fertile fishing waters in the Caribbean. Chickens are “self sufficient" and reproduce like crazy, yet they are imported.

Of course there is sea food in Cuba but only for tourist, .the Cubans doesn’t have access to sea food or beef. This has been going on for years, .they eat soy beef instead. The real embargo that the Cubans suffer has a name "Fidel & Raul". As soon as they are removed from power in Cuba, they will have access to everything they need.

Cuba imports ketchup, mostly from Spain (that is a long way to ship what are basically tomatoes with water and a little salt) and some from Mexico. Can’t these Socialist Genius figure out how to make ketchup? To me it sums it all up in a nutshell, and exposes the complete and utter failure of the Socialist system in even the most basic of industries, and their inability to feed their own population on a tropical island with more land mass than all other Caribbean islands combined.

In Cuba people earn about $18 dollars a month. They get a miserable government rations that lasts them about ten days. You can certainly buy food in communist Cuba, but you pay just about the same amount of money that a free person would pay in the USA. A hamburger in Cuba cost $3. How can a person making $18 a month at a government job afford a hamburger?

Iniciado por Tamakun

In Cuba people earn about $18 dollars a month. They get a miserable government rations that lasts them about ten days. You can certainly buy food in communist Cuba, but you pay just about the same amount of money that a free person would pay in the USA. A hamburger in Cuba cost $3. How can a person making $18 a month at a government job afford a hamburger?

While I don´t approve of the Cuban gregime, your claims are dishonest, since you leave out the facts pertaining free education, free healthcare, free housing, and other benefits that add up to much more than 18 dollars a month. Cuba has a higher income and standard of living than some of the Central and Caribbean states that are capitalist, for instance.

The embargo serves no purpose but to give the corrupt regime propaganda material.