Reflecting on Carlos Gutierrez’s Cuba Conversion and Why He Was Rebuked

As U.S. Secretary of Commerce in the administration of President George W. Bush, Carlos Gutierrez supported policies to overthrow Cuba’s government and replace its political and economic systems with a framework forged in Washington.

A day after the speeches by President Obama and Castro on their decision to restore bilateral relations, Gutierrez told Time Magazine that the agreement was “lopsided,” and he warned the U.S. business community, “This could backfire in a really big way.”

After some hints and feints earlier this year, Gutierrez has fully and publicly made the transition from anti-Castro caterpillar to pro-engagement butterfly, in what the Miami New Times is calling “a startling turnaround for a Cuban American,” but which others describe as a betrayal.

Mr. Gutierrez published an essay in the New York Times this week, “A Republican Case for Obama’s Cuba Policy,” which follows the arc of his life from 1960 when his family left Cuba and with it all their possessions, to this moment when he can look back after having “achieved personal and professional success beyond anything I could have imagined.”

In December 2014, he found himself, as a Republican and Cuban American, thinking Obama was out-negotiated by a Cuban government determined to extend the revolution. Now, Secretary Gutierrez sees genuine progress in the plans to open new embassies and the bilateral talks on a host of issues, including the status of U.S. fugitives in Cuba.

He writes, “I never expected negotiations to get this far.”

Secretary Gutierrez now believes it is in the best interests of the Cuban people for President Obama’s new policies to succeed. In his op-ed, he urges support for the reforms that seek to help Cuba’s growing class of small-business owners and employees “obtain the tools, supplies, building materials and training in accounting, logistics and other areas” that they need “to chart their own course in life.”

Then, significantly, he turns to his “fellow Cuban-Americans [who] insist that continuing to squeeze Cuba economically will help the Cuban people because it will lead to democracy,” and asks “if the Cubans who have to stand in line for the most basic necessities for hours in the hot Havana sun feel that this approach is helpful to them.”

We think the Secretary’s turnabout and his direct challenge to the hardliners is a pretty big deal. His critics seem to think so, too.

Guillermo I. Martinez claimed the Secretary’s column “makes no sense,” and expressed his feelings of betrayal in writing, “I cannot imagine him saying that when he was working for a Republican president or when he was working for an American company.”

Taking the theme of defection to the next level, Capitol Hill Cubans published this piece saying that “The Obama Administration (and Castro’s D.C. lobbyists) weren’t the only ones thrilled by former U.S. Secretary of Commerce Carlos Gutierrez’s endorsement of the Obama Administration’s (give-everything-for-nothing) Cuba policy,” alleging that the piece had run in Granma, the state newspaper, because “Castro’s censors clearly found nothing objectionable in Gutierrez’s editorial.”

If this language of reproach is familiar, you might be thinking of the reaction to Alfonso Fanjul, the Cuban American sugar magnate, when he told the Washington Post he was open to investing in Cuba. Rep. Ileana Ros-Lehtinen responded by saying “it’s pathetic that a Cuban-American tycoon feels inspired to trample on the backs of those activists in order to give the communist thugs more money with which to repress.”

Or you might be reminded of Senator Marco Rubio’s refrain of betrayal after the White House commended Pope Francis for his instrumental role in the U.S.-Cuba negotiations. Rubio told a packed press conference he’d take it upon himself to “ask His Holiness to take up the cause of freedom and democracy” in Cuba, adding, “the people of Cuba deserve to have the same chances at Democracy as the people of Argentina have had, where he’s from.”

It was only a few days back, when Engage Cuba celebrated its broad coalition – studded with distinguished foreign policy experts, industry leaders, and Cuban American moderates – favoring repeal of the embargo and normalized relations, that Orlando Luis Pardo Lazo, the Cuban dissident and adjunct professor at Brown University, declared war. Literally:

“For pro-democracy activists both on and off the island, the war is no longer against the dynastic and despotic regime of Revolution Plaza, but against the indifferent and indecent establishment of the White House and State Department.”

What makes the brash become so rash when leaders have a change of heart? Social science tells us they are trying to discourage other leaders from changing their minds to stop members of their community from following suit.

Cass Sunstein, a constitutional scholar and public intellectual, has described how the information silos many of us live in make us resistant to changing our minds. He labels as the “the echo chamber effect,” the influence that MSNBC wields on the left and that Fox News exerts on the right. In those communities, groups tend reach the same judgments based on the same arguments, while a desire to get along with the larger group suppresses individuals who might otherwise think differently.

Even though people will dismiss accurate information because it would falsify their convictions (think climate change is real or the embargo hasn’t worked), Sunstein argues that “they may reconsider if the information comes from a source they cannot dismiss.”

That’s why the President and the Pope loom so large. It is also why, when a sugar baron or a former Commerce Secretary changes his mind, the hardliners act as if they are losing theirs.

U.S.-CUBA RELATIONS

U.S. Bishop urges Congress to support legislation opening America to Cuba

Bishop Oscar Cantú of the U.S. Conference of Catholic Bishops has written Members of Congress urging them to oppose the “appropriations riders” that seek to reverse the openings in diplomatic relations and loosened restrictions on travel and trade with Cuba.

Cantú, chairman of the Committee on International Justice and Peace, and Bishop of Las Cruces, New Mexico, also urged Members of the House and Senate to support and cosponsor legislation to allow unrestricted travel and increase U.S. exports to Cuba, reports Independent Catholic News.

The Bishops’ letter puts the U.S. Conference in direct opposition to two budget measures moving through Congress: one, written into the Departments of Transportation and Housing and Urban Development (THUD) funding measure by Rep. Mario Diaz-Balart (FL-25), would prevent the new flights and ferry services to Cuba made possible by executive actions taken by the Obama Administration earlier this year; the second blocks funding in the State Department’s operations budget for improvements to the future U.S. embassy in Havana.

As we previously reported, Pope Francis played a pivotal, behind-the-scenes role in the negotiations that led to last December’s diplomatic breakthrough reached between Presidents Obama and Castro. As the Wall Street Journal reported last December, “papal diplomacy was a key to the Obama administration’s push over the past 18 months to overturn half a century of U.S. policies built around shunning Cuba.

In the letter, Cantú reaffirms the position of the U.S. Conference of Catholic Bishops and their Cuban counterparts in support of ending the U.S. embargo, stating “We share in the view of the Catholic bishops of Cuba that engagement is the path to greater democracy and respect for human rights.

Alabama company first U.S. business to be considered for Mariel Zone

An Alabama company is in talks with regulators at the U.S. Treasury and officials in Cuba hoping to locate a small manufacturing facility adjacent to the Port of Mariel. The company, Cleber LLC, led by two former IBM engineers, is working on the prototype for a low-cost tractor that could be built in Cuba and used by local farmers.

The Washington Post reports that the firm, which has never built a tractor, may be the first U.S. company to apply for the right to locate in the Mariel Special Economic Zone, which would entitle it to receive tax and other concessions.

As The Clarion reported online, Horace Clemmons and Saul Berenthal, the firm’s founders, received a letter from a Cuban government official, Idermis Gonzales Riera, stating, in part, “we favorably endorse the preliminary interest shown by your company to become a user in the Special Development Zone Mariel (ZED Mariel), in the 100% Foreign investment mode. And with the purpose to implement in phases the assembly/manufacturing of tractors for marketing in the Cuba national market, as well as for export.”

The Special Development Zone Mariel, or ZED Mariel, is a joint development between the Cuban and Brazilian governments, and planned to boost economic activity created by the port, which opened in 2014. ZED Mariel combines a free-trade zone, a large container terminal, and an expanded version of the Mariel port that allows access to the newest and largest class of container ships, the Super-panamax vessels. The Mariel project mirrors development projects in China and Vietnam that seek to attract foreign investment with enhanced infrastructure and liberal commercial regulations specific to the designated development zone.

Horace Clemmons praised the Cuban government’s invitation, stating in a press release, “This agreement meets the letter and the spirit of Cuba’s new relationship with the USA and the stated goals of the Cuba Foreign Investment Act. An Alabama Company being accepted as the first U.S. company to establish a business in Cuba is significant for the entire state.”

State Department report criticizes Cuba for human rights abuses

Cuba is among the countries firmly criticized in the U.S. State Department’s annual report on human rights, underscoring the administration’s commitment to maintaining a consistent human rights policy in the context of the new, bilateral relationship with Cuba’s government.

The 2014 human rights report, released this week, cited the use of short-term imprisonment to suppress dissent and lack of political and media freedoms as persistent human rights issues of concern in Cuba.

The Obama administration has defended the policy of openness with Cuba as part of its strategy to help improve human rights in that country through dialogue and engagement, rather than relying on a policy of isolation that has not resulted in change.

American food producers see bonanza in Cuba, but steep barriers remain

The thaw in relations between the U.S. and Cuba has spurred increased interest among U.S. agricultural producers to sell their goods in Cuba; however, agricultural exports to the island have actually declined in the six months since Presidents Obama and Castro announced a new direction in bilateral relations, reports the Washington Post.

Reuters reported in February that U.S. agricultural exports to Cuba had already fallen to their lowest levels since 2003. In the first quarter of 2015, the Washington Post says exports fell by nearly half – from $160 million to $83 million – compared to sales one year ago.

Cuba imports 80% of its food and U.S. producers of products such as rice, poultry, and wheat, see significant business opportunities in the island of 11 million. A coalition of farmers, agribusiness, and policymakers estimate that the market could be worth $2 billion annually.

The inability of Cuban importers to secure credit due to the U.S. embargo has long been identified as a primary obstacle to the expansion of U.S. agricultural exports to Cuba, as products from other countries are more easily and cheaply financed.

In testimony before the Senate Agriculture Committee in April, Riceland Foods vice president Terry Harris estimated that if U.S. export and financing restrictions were lifted, the U.S. rice could comprise 30 percent of the entire Cuban market, and could rise to 75 percent within another ten years.

Hank Greenberg, former CEO of AIG, meets with Cuban officials in Havana

Maurice “Hank” Greenberg, former CEO of insurance giant AIG and current CEO of Starr International, an insurance and financial services company, traveled to Cuba last Thursday to meet with senior officials in Cuba’s government, Fox Business reported.

Greenberg has previously indicated interest in the Cuban market, noting earlier this year that Starr International maintained its headquarters in Havana from 1943 to 1958, and wished to return to its Cuban roots. Greenberg is particularly interested in supporting American tourism companies as U.S. travel and trade restrictions on the island are eased and increasing numbers of American tourists make the short trip to Cuba: “I think there’s going to be more tourism, so there might be a business opportunity for us.”

Although Greenberg declined to name the Cuban officials with whom he met, he did indicate that their discussion was broadly around expanding Starr’s insurance coverage to include the infrastructure of the tourism industry, such as hotels and resorts. Starr International already owns a company called Assist-Card, which provides insurance to Americans traveling to Cuba.

Greenberg led the international insurance giant AIG until 2005 when he was forced to resign. At the height of the global financial crisis, the firm needed an infusion of capital from the U.S. government amounting to $192 billion to stay afloat.

U.S.-Cuban project restoring Ernest Hemingway home near Havana

A U.S. foundation has received approval from the governments of Cuba and the U.S. to send building and construction materials to Cuba to help restore the famed Hemingway House outside of Havana, reports CNN. Named for the house where Ernest Hemingway wrote The Old Man and the Sea, the Boston-based Finca Vigia Foundation will be the first U.S. foundation to import construction materials directly to Cuba.

The Foundation began talks with the Cuban government in 2005 to help preserve the historical home, working to preserve and scan documents, correspondence, recipes, and early book drafts. The recent warming of relations between the U.S. and Cuba has opened up opportunities to pursue additional significant restoration and preservation, specifically new U.S. regulations announced in January 2015 that allow the exportation of building materials to Cuba.

Foundation executive director Mary-Jo Adams said that she has received permission to send $860,000 worth of needed supplies in this endeavor.

U.S. universities see opportunity in U.S.-Cuba opening

The loosening of U.S. travel and trade restrictions on Cuba has presented unanticipated opportunities to a number of U.S. industries and, as the McClatchy news agency reports, the education sector is jumping onboard as well. In the 2010-2011 academic year only 375 U.S. students were studying in Cuba. That number jumped to over 1,600 student in 2012-2013 after President Obama relaxed travel restrictions related to academic work.

The President has continued to reduce travel restrictions to Cuba, and U.S. universities and academic institutions are taking advantage, forging research and teaching partnerships with their counterparts in Cuba. Partnerships tend to focus on fields such as agriculture, computer science, business administration, and similar technical fields. Auburn University’s recently announced an exchange partnership with the Agrarian University of Havana and the Cuban National Center for Plant and Animal Health and Auburn’s College of Agriculture to facilitate joint research projects and study abroad programs.

Florida International University (FIU), located in Miami, has even discussed plans to open a satellite campus on the island. But, as FIU President Mark Rosenberg concedes, plans for a campus in Cuba were still “a long way off”.

However, concerns about academic freedoms and freedom of speech persist. Carlos Ponce, Director of Latin American programs at Freedom House, notes that, “You don’t have academic freedom in Cuba right now. We’re talking about the possibility of something related to academic freedom in the future in Cuba.”

Even noting potential issues related to academic freedom, policymakers and academics alike are coming to the conclusion that engagement with Cuba will reap great rewards than isolation. As John McAuliff of the Fund for Reconciliation and Development recognizes, “Everything between Cuba and the United States right now involves developing trust.”

CUBA’S FOREIGN RELATIONS

Cuba and EU officials meet to discuss Human Rights

The European Union and Cuban government officials met Thursday to discuss for the first time the topic of human rights, according to El Nuevo Herald. The meeting was chaired by EU Special Representative on Human Rights Stavros Lambrinidis and Ambassador Pedro Nuñez Mosquera, Director-General of the Cuban Ministry for Multilateral Issues and International Law of Foreign Affairs.

The EU has repeatedly stated that “human rights remain at the center of EU relations with Cuba,” and Thursday’s meeting was convened to set basic principles for the relationship before moving forward with the broader negotiations.

The bilateral conversations regarding human rights occur within the context of larger bilateral negotiations between the EU and Cuban government. The European Union and Cuban government began negotiating stronger bilateral ties in 2014.

Federica Mogherini, the High Representative of the European Union for Foreign Affairs and Security policy, has sought to quicken the pace of negotiations, and would like to see the basics of an agreement to improve bilateral relations finalized by the end of 2015.

Spanish government offering $45 million credit line to companies operating in Cuba

The Spanish Development Finance Institution (COFIDES), a joint public-private partnership that provides financing to Spanish companies operating in foreign countries, announced on June 22 the opening of a $45 million (40 million) line of credit to Spanish companies operating in Cuba.

COFIDES President Salvador Marín explained that the line of credit is being offered due to “the opening to the outside that Cuba is experiencing, the incentives to foreign investment that [Cuba] will offer, and the interest shown by Spanish business companies.” COFIDES has earmarked up to $2.2m of credit for projects in the Mariel Special Development Zone, which the Spanish Federation of Business Organizations (CEOE) has praised as, “an authentic focus for investments, with major advancements in innovation and logistics.”

Spain’s Secretary of State for Trade Jaime García-Legaz noted two significant developments that encouraged the extension of credit: a recently approved lawaimed at attracting foreign investment to Cuba, and the removal of Cuba from the U.S.’s State Sponsors of Terror list. García-Legaz anticipates additional investment from the private sector, specifically in the areas of transportation, construction, services and renewable energy.

IN CUBA

Cuban economy grows by 4% in first half of 2015

Cuba’s Economy Minister Marino Murillo announced Monday that the island’s economy (as measured by GDP) will be predicted to have grown by 4% in the first half of 2015. Minister Murillo’s estimate surpasses 2014 economic growth of 1.3%, and potentially vindicates a bold prediction made just weeks before the December 17th announcement of detente with the U.S. that the Cuban economy would grow by 4% in 2015.

As Reuters reported, growth in tourism revenues by 15%, contributed to economic growth, along with improvements in sugar production and increases in manufacturing, construction and trade.

Minister Murillo also attributed the healthy economic growth to market reforms instituted by President Raúl Castro in the years since he took over as President from his ailing brother.

Pedro Freye, a specialist in international law at a Miami-based law firm, agreed with Murillo’s assessment saying, “While Cuban economic methodology is different from ours, these numbers would seem consistent with anecdotal evidence, adding “The sheer number of U.S. travelers to the island alone have had an obvious positive impact.”

Recommended Reading

Revisiting the Cuba of My Youth, Mariane Pearl, New York Times

Mariane Pearl, author and leader on women’s empowerment, writes about her recent experiences in Havana and the changes she has seen over the past decades across visits to her cousin on the island.

Republican Case for Obama’s Cuba Policy, Carlos Gutierrez, New York Times

Carlos Gutierrez, former Commerce Secretary in the George W. Bush administration and executive at Kellogg, makes the case for a policy of engagement and openness with Cuba. Gutierrez, a Cuban-American, advocates for supporting Cuban entrepreneurs.

Influx of Cuban players to MLB could increase steadily, Bill Shaiken, Los Angeles Times

Despite the U.S. embargo, which prohibits U.S. professional sports teams from scouting for players in Cuba, interest in Cuban players among Major League Baseball teams is rising. Analysts predict that partially due to spending cap rules on international players, there may be a significant influx of Cuban players who sign with MLB teams in the next few years.

The Cuban Renaissance: The Good, the Bad, and the Necessary, Valerie Wirtschafter, Council on Foreign Relations

Valerie Wirtschafter, research associate at the Council on Foreign Relations, recalls her trip to Cuba in early June and discusses Cuba’s ongoing economic reforms. Wirtschafter describes the growth in economic opportunities for many Cubans and comments on challenges related to income inequality.

Recalling Elián: How Miami Demoralization Led To Cuba Normalization, Tim Padgett, WLRN

A respected journalist who has covered Latin America for almost 25 years-14 of them from Miami-Tim Padgett recounts the dramatic battle for custody of Elián González that spanned seven months in 1999 and 2000. Padgett posits that the Elián fiasco allowed moderate voices in Florida’s Cuban-American community to emerge, indirectly resulting in the current detente between the United States and Cuba.

U.S.-Cuba Normalization and Migration Policy: Changing the Cuban Adjustment Act, Richard N. Gioioso, The Huffington Post

The Cuban Adjustment Act, passed in 1966, allowed Cubans fleeing to the United States to apply for legal, permanent residency after spending a year in the country. Although he concedes that the Obama Administration has no plans to change the policy, Gioioso finds that many Cubans are worried that the quickest route to U.S. residency-the Cuban Adjustment Act-will be reformed or done away with completely.

Recommended Viewing

What Cuba can teach America about organic farming, Jeffrey Brown, PBS NewsHour

As part of its series “The Cuban Evolution,” PBS looks at organic farming in Cuba. The 6-minute video describes the history of Cuba’s agro-ecological farming sector and current challenges facing the island’s food system.

In Havana, Beauty and Decay, Frank Carlson, PBS NewsHour

Photographer Frank Carlson documents Havana in a series of beautiful and raw photos of the people and places that fill daily life in the Cuban capital.

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