By Roger Keeran
June 21, 2019
On June 1, just days before President Donald Trump banned most American travel to Cuba, I returned from an eleven-day tour sponsored by Hostos College in the Bronx, New York in conjunction with El Centro De Estudios Martianos (the Center for José Marti Studies) in Havana.
In Cuba, I visited Havana, Trinidad, and Santa Clara, heard lectures by academics and professionals, and had conversations with government and former government officials including Manuel Yepe, the Chief of Protocol after the revolution. I also had the honor of talking with Ramon Labañino, one of the Cuban Five, a Hero of the Cuban Revolution, and now a leader of the largest Cuban non-governmental organization —Associación Nacional De Economistas y Contadores.
Many of my observations and conversations pointed to the new policies of President Donald Trump that are tightening the nearly 60-year U.S. blockade of Cuba and threatening the Cuban economy and living standards. To discuss these changes, I will pose three questions:
- What is new in Trump’s policies?
- What effects are these new policies having?
- What are the responses of the Cuban leaders and people?
What is new in Trump’s policies?
Much is not new in American policy. To be sure, its purpose remains the same: regime change and the end of Cuban socialism. Trump and the nine previous presidents, including Democrats like Bill Clinton and Barack Obama, have embraced this goal. The American economic blockade remains, including the Obama administration’s appalling prohibition on selling equipment to diagnose cancer, and medications for cancer and epilepsy.
Trump is giving new twists to the knife. Most damaging is Trump’s unprecedented decision to invoke Title III of the Helms-Burton Act. In March 1968, Congressional Republicans and Democrats joined together, as they usually do on foreign policy, to pass this legislation, and President Bill Clinton signed it into law. Helms-Burton extended the blockade in many ways, but Trump did something that all previous presidents had not. In 2019 he rejected the option used by preceding presidents of suspending Title III. Title III authorizes U.S. nationals to sue any persons “trafficking,” i.e. profiting, from property confiscated, i.e. nationalized, by the Cuban government. Under the act, American nationals immediately sued the cruise line, Carnival Cruise.
In March 2019, the State Department said that companies covered by Title III included 200 Cuban enterprises controlled by the security forces, many of them part of the tourist industry. Other companies are likewise under threat. Lawsuits against nationalized entities have little chance of succeeding, since these suits have no standing in international law, which recognizes the right of governments to nationalize property, a right that countries worldwide, including the United States, have exercised. Nevertheless, defending oneself against lawsuits cost companies time and money, and the threat of liability and exposure to paying damages creates instability and uncertainty thereby frightening away investors.
On June 5, 2019, Trump banned all American tourism to Cuba as well as the people-to-people visits for educational or cultural activities, a category that embraced most Americans who visited Cuba. Trump’s ban does not touch some previous categories of permitted travel, but what remains is very specific and narrow.
Yet another line of attack aims at reducing the hard currency from abroad that Cuba desperately needs. The money that Cuban-Americans send to their relatives in Cuba constitutes a major source of such money. Under Obama these remittances had no monetary limits. On April 17, 2019, National Security Adviser John Bolton announced that henceforth remittances could not exceed $1000 every three months.
Trump has also tried to undermine the Cuban practice of providing doctors and other humanitarian aid to countries. For example in Venezuela, Cuba has 20,000 doctors, nurses, and other humanitarian workers. Likewise in Brazil, Cuba (until recently) had 8,517 doctors. Without any evidence, or at best dubious evidence, the Trump administration has accused the Cuban aid workers of being military operatives, slaves, and revolutionary agents. Since Cuba receives hard currency and oil in exchange for its humanitarian aid, the Trump administration is trying directly to weaken another facet of the Cuban economy.
Trump has also indirectly hurt the Cuban economy. By placing economic sanctions on Iran, Venezuela and Russia, he has weakened their economies and hence made their aid to Cuba and trade with Cuba difficult.
Trump’s actions and threats have been diplomatic as well as economic. The Trump administration accused the Cuban government of using biological or technological warfare to sicken employees in the U.S. Embassy in Havana. No evidence substantiates these allegations, and only some, not all, employees complained of headaches or other ills. Nonetheless in March 2018, the Trump administration used this allegation as a pretext to drastically reduce the embassy staff. This entailed expense and inconvenience for Cubans seeking visas. In the same month on the same pretext, Trump expelled 17 diplomatic personnel of the Cuban Embassy in Washington, D.C.
Every Washington administration has used the media and technology to try to undermine the Cuban government. Trump has continued past efforts and added one of his own. Following a June 16, 2017 National Security Presidential Memorandum called “Strengthening the Policy of the United States Toward Cuba,“ the State Department created the Internet Task Force. Its task was “to examine the technological challenges and opportunities for expanding Internet access and freedom of expression in Cuba.” In reality these were code words for the use of the internet to promote dissension and create instability.
What effect are these new policies having?
From a short visit and a few lectures and conversations, it is impossible to get a thorough sense of the impact of the new policies and threats. Gauging the impact is difficult because Trump’s moves have occurred only in the last two years, and in some cases the last two months. Still, the likely impact remains clear and grave.
Compared with six years ago, the time of my last visit, Cuba appears much the same or improved, particularly with regard to conditions for tourists. No signs of dire poverty, homelessness, or unemployment exist. New hotels are rising. Renovations and restorations are occurring, though maybe not at the rate needed. The buildings along the Prado look great. Even the famous Copelia ice cream emporium is undergoing refurbishing. Tourists still fill the hotels and restaurants that are stocked with quality goods and provide great service. Tourists fill the commercial streets of Old Havana. The museums are open and well-kept.
Nevertheless, the consensus of the Cubans with whom I met is that Trump’s impact has been serious and will get worse. People mentioned the deleterious effects that are not obvious or not yet manifest. The invocation of Title III of Helms-Burton, for example, is scaring off investors, causing problems with foreign bank loans and other transactions and impeding the flow of oil. The effects appear indirectly in various shortages in the marketplace. The oil shortage is apparent. Compared with six years ago, fewer cars navigate the streets of Havana, and they are mainly taxis. A drive from Havana to Trinidad on a modern highway encountered few other vehicles.
Cuba is also suffering from Trump’s economic sanctions against Venezuela. Since 2014 Venezuela’s economy has contracted by 50 percent and oil production by 65 percent. According to Ricardo Torres, a professor of economics and the Cuban economy at the University of Havana, Venezuelan oil delivered to Cuba “will fall by a similar percentage.” Writing in May of this year, Torres said shortages are not limited to oil. “The fact of shortages of various kinds of products is not new in the Cuban context, but they’ve accentuated substantially in the last quarter. And no improvement can be expected in the short term.”
As stated before, sources of hard currency are shrinking. Since the right-wing government of Trump’s ally, Jair Bolsonaro, came to power in Brazil, Cuba has had to withdraw 8,517 doctors, who were serving 28 million people and for whom Brazil was paying Cuba substantial amounts of money. Trump is now pressuring Venezuela to expel 20,000 Cuban doctors and other humanitarian workers.
Trump’s travel restrictions will hurt the tourist industry, and tourism represents over 10 percent of the Cuban economy. In 2018, almost 5 million people including 650,000 Americans visited Cuba. Cubans noted that the travel ban would entail not only the loss of the money that Americans spend for meals, travel and lodging but also the big tips Americans typically leave. After Trump announced the travel ban, the cruise ship lines, Carnival Corp, Royal Caribbean, and Norwegian canceled trips that will affect 800,000 bookings. The limitation on remittances from abroad will not only reduce the hard currency coming into the country but will also hurt those Cubans who want to use the remittances to buy or renovate houses or start the small businesses that the Cuban government has permitted since the 2011 “Guidelines.”
Whether all of these challenges and hardships amount to a new Special Period remains to be seen. It is doubtful. It is hard to imagine a catastrophe or hardships worse than what Cuba faced after 1990. At that time, the Soviet Union was buying 90 percent of Cuban sugar at four times the world market price, was supplying Cuba with thirty-year loans at 2-3 percent interest, and was sending military and professional experts to Cuba at no cost. Because of Mikhail Gorbachev, all of this vanished overnight, and living conditions plummeted.
Nonetheless, Cuba’s ability to respond to the current crisis is complicated by new circumstances. In 1990, Cuba had an economy that was almost completely nationalized. Centralized ownership and control had many advantages when it came to dealing with national crises, whether generated by other countries or by hurricanes. At that time, only a few thousand of the 11 million Cubans worked in what remained of the private sector. Today, under the “Guidelines,” Cuba is in the middle of a transition designed to reduce the public sector and increase productivity. This involves allowing an increase in the private sector.
Between 2010 and 2018, 1.1 million public sector jobs disappeared, while between 2007 and 2018 private sector jobs increased from 800,000 to 1.4 million. This transition poses its own challenges, namely assuring that this privatization benefits rather than harms the Cuban people and socialism. Added to these challenges are now added the ones created by Trump. It is little wonder that the economist Torres thinks the problems will be more difficult to solve now than they were in 1990. Torres thinks much can still be done to cope with the challenges, but he also thinks Cuba is “at this abyss.”
What is the response of the Cuban leaders and the people?
How destructive Trump’s policies will be depends on how effectively the Cubans respond. In this the Cubans have great experience and human reserves. Some observers may share Torres’s gloom, but on my recent visit that is far from the sentiment I encountered. Some citizens acknowledge the seriousness of the current situation. Some people compare the current situation to the dire times of Special Period, when shortages of food and other vital supplies contracted, and everyone suffered terrible deprivation. Some contrast the current situation with the more positive time of the Obama years, when overall Cuban-American relations improved. Most citizens from whom I heard, expressed an outlook something like this: We have been through similar challenges before. We survived them, and we will survive these. Our needs are not great. We take care of each other. We are unified and disciplined. We will not give into U.S. pressure to give up international solidarity, socialism, or independence.
Cuban leaders express a similar determination and confidence. In response to American Treasury Secretary Steven Mnuchin saying he was “worried” about Cuba destabilizing Latin America, Army General Raul Castro said that what Mnuchin should be worried about is “the example of Cuba before the world, a small island that for more than 60 years has resisted the greatest empire history has known, and it extends its solidarity to all peoples in need, sharing not what we have left over, but even what we lack.” After the June travel restrictions imposed by Trump, the Cuban Foreign Minister Bruno Rodriguez Parilla said, “They intend to strangle the economy and damage Cubans’ standard of living, to wrest political concessions from us. They will fail once again.” Similarly, Cuban President Miguel Diaz-Canel Bermúdez said that his country would not be intimidated or distracted by the new threats and restrictions. “Work, creativity, effort, and resistance is our answer. They have not been able to asphyxiate us. This cannot stop us. We will live and triumph.”
The current situation may or may not lead to hardships as grave as the Special Period, but one thing remains sure, the Cuban people and leaders are as united, committed, and determined now as they were then.