Center for Security Policy.
NewsMax.com. Friday, Sept. 29, 2000
WASHINGTON – Congressional leaders agreed Wednesday to the most
significant erosion of U.S. sanctions against Communist Cuba in four decades by
approving the sale of American food products to that island nation.
According to the New York Times, the deal would allow Cuba to make cash
purchases of U.S. food products, financed through third countries. The
agreement, hammered out after intense lobbying by U.S. agribusinesses, would
also eliminate restrictions on travel to Cuba for those who seek to export
foodstuffs there.
The move is a giant bound onto the slippery slope toward full normalization
of relations with one of the world's last unreconstructed totalitarian regimes –
something the Clinton-Gore administration clearly intends to effect before
leaving office.
At this point, the only impediment to House and Senate adoption of this deal
will be if the proponents decide to try to get all they want in one bite, rather
than the two contemplated by the current approach.
Even in this electoral silly season, with the remnants of budgetary
discipline being sacrificed left and right in the quest for votes, many
legislators are clearly uneasy about not just selling Castro food but having the
American taxpayer pay for it.
Since the only prospects for large-scale sales of U.S. food to the
impoverished Cuban people and/or government is to have them subsidized by the
U.S. taxpayer (e.g., in the form of Commodity Credit Corp. credits), the
greediest of the agribusinesses and their champions on Capitol Hill are intent
on striking from the pending compromise restrictions on CCC and other
taxpayer-subsidized lubricants to trade.
The case for opposing even the relatively modest – to say nothing of
the more costly – of these openings to the Castro regime was made by the
Center for Security Policy's president, Frank J. Gaffney, Jr., in testimony last
week before the U.S. International Trade Commission.
In the following prepared statement and orally delivered remarks, Gaffney
made clear that, while easing the embargo may advance the interests of a
relatively small number of American companies (as opposed to individual farmers,
who are unlikely to benefit appreciably from the sweetheart deals Castro will
secure from unscrupulous multinational agribusinesses), the net effect is likely
to be to provide economic life support for Fidel's despotic government.
This would be in the interests of neither the United States nor the
long-suffering Cuban people.
* * *
Submitted Testimony by Frank J. Gaffney, Jr. President, The Center for
Security Policy Before the International Trade Commission
Washington, D.C. 19 September 2000
'Freedom is served by Maintaining Sanctions on Cuba'
I am grateful for the opportunity to appear before the International Trade
Commission to address the impact of the economic embargo the United States has
long maintained against Fidel Castro's Cuba. I do so from the perspective of a
former senior official in the Reagan Defense Department and as the current
President of the Center for Security Policy - an organization that concerns
itself with strategic developments that bear on our national defense and
international interests.
As the Commission evaluates the impact of the U.S. economic embargo on Cuba,
you will be urged to embrace three seductive notions. Permit me to address each
in turn briefly:
Untrue: The Embargo has 'Failed'
The first of these is the proposition that the embargo has been a failure.
In making this claim, critics of our present economic sanctions define success,
at least implicitly, in terms of removing Fidel Castro from power.
To be sure, this certainly would have been desirable to have accomplished
years ago – for both the United States and for the Cuban people who have
long-suffered under Castro's totalitarian misrule. Economic sanctions,
especially ones actively undercut by other nations, have limited ability to
effect regime change.
That does not mean, however, that the embargo has "failed." In
fact, I believe that it would be more accurate to describe the effect of the
embargo on Cuba as an incomplete success, and certainly no abject failure.
After all, there can be no doubt that U.S. economic sanctions have succeeded
in crippling Castro's ability to amass the wealth that would have enabled him to
assemble a far more formidable military and other threats to U.S. interests.
That said, Fidel has certainly pursued – and continues to do so –
what are known as "asymmetric" threats to the United States, its
forces and interests. These are believed to include biological weapons programs,
information warfare capabilities and a nuclear reactor program that, if brought
on-line, could threaten to unleash Chernobyl-like levels of deadly radiation
upwind from millions of Americans.
These potentially lethal means of doing harm to the United States pale by
comparison, however, with the magnitude of the threat a richer Castro regime
would surely have sought to mount in an international marketplace awash with
long-range ballistic missiles and nuclear and other weapons of mass destruction.
Of course, no one can say for sure how much worse things would have been in
these and other ways had the constraints imposed by the American economic
embargo not been present. We do know, however, that when Castro was able to
offset them with the largesse of his Soviet sponsors, he managed to dispatch
expeditionary forces to Africa and to provide underwriting for a variety of
Marxist and other terrorist groups and odious governments in the Western
hemisphere.
Fortunately, with the fall of the Berlin Wall and the end of what President
Reagan accurately described as the "Evil Empire," however, its Cuban
outliers had their hands full just keeping the Castro regime afloat. Given the
dire straits into which Fidel has plunged Cuba's economy, even the considerable
cash flow the government is garnering from illegal narco-trafficking (with which
Castro is reportedly personally implicated) has been insufficient to support the
sort of aggressive international agenda Cuba pursued as a Cold War proxy for the
USSR.
Had this not been the case, it seems unlikely that the hemisphere would have
reached the point it did during the 1990s when Cuba was the only nation in the
hemisphere that did not enjoy democratic rule.
Unfortunately, that happy state of affairs has already begun to unravel. In
Venezuela, Ecuador, Colombia and Panama, for example, we are witnessing
developments that suggest trouble ahead for the political stability and economic
opportunity of the region. Notably, Venezuela's dictator-in-the-making,
President Victor Chavez, has publicly declared that he "loves" Fidel
and is actively working to inflict upon his country Castro's "revolutionary"
model.
In short, in weighing the success and shortcomings of the U.S. embargo, it
may be difficult to say with precision how much worse would things have been
without it. But the embargo has, in my judgment, helped reduce Castro's capacity
for malevolence. Should it be removed or eased while he retains power, moreover,
a fundamental truth will likely apply: The more cash Castro has at his disposal,
the better able Fidel will be to cling to power - and to try to make up for lost
time by reinvigorating and consolidating his anti-U.S. and anti-democracy
campaigns throughout much of Latin America.
Untrue: U.S. Farmers and Businessmen Are Missing a Windfall
Second, those who claim the embargo has failed often insist that its only
effect has been to punish American concerns who could otherwise be making good
money selling food, medicine and other commodities to the Cuban market. Here
again, the facts suggest that "it ain't necessarily so."
For one thing, it turns out the rest of the world is not making huge profits
selling in the Cuban market. Last year, for example, the Wall Street Journal and
Los Angeles Times published reports documenting the fact that Canadian, European
and Latin American governments and companies that once were convinced they could
make a killing investing in Cuba (with the Americans held at bay) have been
sobered by hard experience with the Cuban government.
As the Journal reported on 28 June 1999, "'[In 1993], there was an
effervescent feeling that Cuba had opened up a process of change,' says
Archibald Ritter, a prominent Cuba scholar at Carleton University in Ottawa."
In light of Fidel's double-dealing (e.g., giving proprietary information
developed at one company's expense and contracts based upon them to
competitors), his capriciously instituted impediments to doing business in Cuba
(e.g., confiscation of portable copiers on the grounds that they could be "subversive
tools") and his regime's determination to maintain control over foreign
investments, even the companies that seemed to delight in defying U.S. policy –
like Canada's Sherritt International Corporation – have pulled back.
The Journal reported that Sherritt "had raised nearly $500 million
three years ago to invest on the island. Now the mining and energy company is
looking elsewhere; it just bought a share of a nickel mine in Australia for
about $35 million. 'There's a limit to the rate you can invest in Cuba,'
Sherritt Chairman Ian Delaney told reporters after the company's annual meeting
in May."
In words that were intended to be prescriptive to other businessmen,
moreover, a Canadian entrepreneur – who once was enthusiastic about
investing in Cuba – last year wrote in a financial newsletter quoted by the
Wall Street Journal that "The best way to see Cuba is on a holiday package
to the island's beautiful beaches. Don't waste time in the business district."
An underlying fact of life is that the Cuban people have no money with which
to buy American products – any more than they do those of our competitors.
In other words, the only way in which American farmers and businessmen are
likely to prosper from selling their products in so impoverished a place as
Castro's Cuba is if American taxpayers subsidize their sales.
Under certain circumstances, such subsidies can be rationalized. But in
every case, before the taxpayer is obliged to underwrite transactions that can
not only wind up costing the U.S. Treasury dearly but that can have undesirable
political and strategic repercussions, to boot, these subsidies must be
subjected to the closest scrutiny. National decisions to do business in that
fashion should then proceed, if at all, only after open, informed and
above-board deliberation.
It is deeply distressing that the present, frenzied effort to get the
embargo lifted appears to be a stalking horse for securing such subsidies,
instead, through a non-transparent and back-door manner. Presumably, this is
because the huge agribusinesses – which tend to benefit far more from this
sort of taxpayer-subsidized trade than do the small farmers whose plight is far
more often touted by those who would end U.S. trade sanctions – are
reluctant to be seen seeking a renewal of the sorts of Commodity Credit
Corporation hand-outs that previously cost the American people hundreds of
millions of dollars worth of write-offs on grain sales to countries like Saddam
Hussein's Iraq and the Soviet Union.
Untrue: 'Engagement' Will Free Cuba
Finally, proponents of doing more business with Castro's Cuba often try to
dress up their true motivations - namely, greed - with pious pronouncements that
doing what will profit them is actually noble. They typically contend that
economic "engagement" will not only improve the lot in life of the
people they intend to sell to, trade with and employ in countries like Cuba; it
is said that it will also produce, at least over time, desirable political
reforms.
Unfortunately, time after time, in country after country where this practice
has been applied, it has proven to be cynically exploited by the government in
question to secure legitimacy and financial life-support from the West, while
staving off political liberalization. This was true with the first Communist
government in Lenin's Soviet Union – which survived its infancy only by
securing Western investments and other cash infusions. It has, moreover, had
similarly dismal results in each of the Communist nations where it has
subsequently been applied.
For example, reasonable people can disagree about the significance and
extent of changes U.S. and Western "engagement" has effected in the
economic system in China. But trade on basically Beijing's terms has, to this
point, certainly has not created the liberty, the freedoms – to say nothing
of the democratic institutions – that have often been promised as the
inevitable result of "engaging" the Communist Chinese.
The point is, if we are genuinely interested in promoting freedom, then
enriching those who are responsible for repressing it is a real formula for
failure. And that, regrettably, would be the ineluctable consequence of lifting
the embargo while Castro remains in power.
What is more, were we to lift the embargo while Fidel remains in charge, we
may well make more problematic the chances for real reform after he finally
goes. In this connection, I commend to the Commission's attention the views of
one of our government's most astute and informed observers of developments in
Cuba – Rep. Lincoln Diaz-Balart – who believes that Cuba would
probably enjoy a transition to democratic capitalism unless the U.S. embargo
were lifted now.
In that case, Rep. Diaz-Balart has warned, chances are good that Castro
would be succeeded by a government determined to pursue the "Little China"
model of fascist capitalism – under which foreign infusions of capital are
welcome, provided they are effectively controlled by the state (e.g., through
joint ventures, state-owned entities, etc.) and political control remains firmly
in the hands of the regime and its adherents.
Conclusion
I would like to conclude my remarks by quoting an individual whose savoir
faire in the world of international business is the stuff of legends. In an
op.ed. article in the 27 June 1999 editions of El Nuevo Herald, the
Spanish-language version of the Miami Herald, Donald Trump made the following
observations:
"I perfectly understand the arguments that are frequently used in favor
of lifting the embargo. The Cold War has ended. Castro has not much time left.
Investing money in the Cuban economy would benefit a people that has suffered
for a long time. It would be a way of exerting pressure so that Cuba "opens
up": it would help export democracy and promote free enterprise. All those
arguments are totally false.
For me, there are no doubts regarding the embargo. Of course we must keep
the embargo. We must keep it until Castro goes."
In short, Mr. Chairman and members of this distinguished Commission, I am
convinced that – even if some small subset of America were to benefit
economically from lifting the U.S. economic embargo – it will not translate
into, on net, a positive result for the Nation as a whole. And it certainly
would not help the people of Cuba.
Note: The center's publications are intended to invigorate and enrich
the debate on foreign policy and defense issues. The views expressed do not
necessarily reflect those of all members of the Center's Board of Advisors.The
above publication of the Center for Security Policy can be found, fully
formatted and hyperlinked to related documents, on the World Wide Web at the
following address: http://www.security-policy.org/papers/2000/00-F46.html
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