The Hardliners Get Confused at the U.S. Capitol

March 28, 2014

The strangest thing happened this week in the House Foreign Affairs Subcommittee on the Western Hemisphere. The hardliners put together a hearing, which they designed as a platform for criticizing Cuba and other governments they oppose in the region, but they ran it under a banner with a most unexpected message: “U.S. Disengagement from Latin America: Compromised Security and Economic Interests.” This seems to us a very fair critique of the Cuba policy they’ve championed for more than fifty years.  Was this their idea of post-modern irony, or didn’t they get the joke? For example, could you find a better description of the U.S. embargo they defend so tirelessly, as a policy that leaves our country isolated and disengaged from the big transitions taking place in Cuba’s economy? Tomorrow, Cuba’s National Assembly is likely to enact a law designed to increase foreign investment on the island.  What does it contain? According to Reuters:

  • The Cuban foreign investment law will include big tax cuts!  It eliminates the labor tax and cuts the profit tax in half to 15 percent.
  • It contains eight-year incentives for investors to sign agreements and stay in Cuba to do business.
  • It exempts investors from the income tax.
  • It cuts (dare we say it?) “red tape” from the approval process.
  • It doesn’t require Cuban participation in investments, allowing instead foreign investors to own 100% shares.

The intent is to bring more capital into Cuba’s economy, speed growth, encourage more job creation, and enable more Cubans to leave the state’s payroll and find employment in the non-state sector. Cuba is making this decision on foreign investment to meet its own needs, to march to its own drummer, but the byproduct of this decision on foreign investment – as with economic reform overall – is entirely in line with the humanitarian goals of U.S. foreign policy.  It gives everyday Cubans more choices and more control over their own lives. If only U.S. businesses were there to see it and participate.  But they can’t.  The embargo championed by the people who hosted – and who testified at the Subcommittee’s hearing – bans U.S. companies from investing in Cuba. Even more, they want to cut off U.S. travel to Cuba, the most important people-to-people diplomatic effort we’ve got.  One witness actually called upon the Congress to prohibit transactions that make non-tourist travel to Cuba possible which would, of course, leave our country even more isolated and disengaged than we are now. This is also a characteristic of their diplomacy. One story we feature this week quotes Andris Piebalgs, the development minister of the European Union, who is calling on the EU to make more rapid progress in its negotiations for a bilateral agreement with Cuba. His view is that the EU’s development and political goals for Cuba are more likely to be met, more quickly, the faster the EU replaces its Common Position – which isolated the EU from Cuba – with a foreign policy that emphasizes engagement. Some of our diplomats would love to follow exactly the same path. But they can’t.  Here in the U.S., laws like the Helms-Burton Act leave the U.S. vulnerable to international scorn and rebuke, and act as obstacles to the kind of smart diplomacy the EU is pursuing today. The hardliners are the biggest isolators, the biggest advocates of disengagement we’ve got. They have so confused U.S. interests – so mixed up the means of Cuba policy with the ends our country seeks – they couldn’t even get the name of their hearing right. Read the rest of this entry »

Rubio may have Tupac on his iPod, but Chairman Crenshaw has Jay-Z on his mind

July 12, 2013

Florida Senator Marco Rubio may have Tupac on his iPod, but Florida Congressman Ander Crenshaw appears to have Jay-Z and Beyoncé on his mind.

Crenshaw chairs a House Appropriations Subcommittee with authority over the U.S. Treasury Department budget, which includes spending to enforce U.S. sanctions against Cuba.  This week, his panel approved a $17 billion budget bill that funds the department, but also proposes rewriting the rules for people-to-people travel to Cuba.

To prevent a Jay-Z/Beyoncé trip to Cuba from happening again someday, Crenshaw marshaled majority support in his subcommittee to prohibit legal travel to Cuba“for educational exchanges not involving academic study pursuant to a degree program.”  In other words, U.S. travelers would have to be enrolled in a degree program for their trip to be approved.

Of course, it is unlikely that Jay-Z and Beyoncé are going to return to the island anytime soon, so the legislation is not aimed at them, but against millions of other U.S. travelers who would like to take advantage of what is already a tightly regulated program to visit Cuba.  The Crenshaw bill would end, for all practical purposes, people-to-people travel.

On January 14, 2011, President Obama reopened categories of travel to Cuba to increase people-to-people contacts.  The president both restored rights for scholars and students to travel to the island for coursework that offered academic credit, and provided “specific licensing of educational exchanges not involving academic study pursuant to a degree program under the auspices of an organization that sponsors and organizes people-to-people programs.”

These are not tourist programs masquerading as academic study.  The Treasury Department made clear that “a requirement for licenses issued” under the program “is that each traveler must have a full-time schedule of educational exchange activities that will result in meaningful interaction between the travelers and individuals in Cuba.”

As Treasury reported in April, this is how Jay-Z and Beyoncé went legally to Cuba; but, more important, it is how many U.S. travelers who are not Cuban American can visit the island at all.

In 2009, President Obama also reopened family travel to Cuba which, according to estimates by The Havana Consulting Group, enabled upwards of 475,936 visits by Cuban Americans in 2012 alone.

This means that roughly 5,000 of Rep. Crenshaw’s constituents, and upwards of 260,000 of Rep. Mario Díaz-Balart’s constituents (he serves on the Crenshaw committee, too), already get a free pass to travel to Cuba on an unlimited basis and their freedom to travel will be undisturbed if this legislation becomes law.  It’s the rest of us who would lose the chance to visit the island if this provision is enacted.

Understandably, the subcommittee action prompted Rep. José Serrano, the ranking Minority Member of the subcommittee, to say, “This is the Jay-Z, Beyoncé Bill.  “Absolutely [it’s a response to the trip], and it’s playing to the audience in Miami.”

Mr. Serrano is a heroically consistent supporter of the freedom to travel to Cuba.  But, we say with respect, he is conceding too much.  We know from polling data gathered in 2011, gathered by the Cuba Research Institute at Florida International University that the audience in Miami isn’t so enamored by this policy either.

When 648 randomly selected Cuban-American respondents polled in Miami-Dade County were asked, “Should unrestricted travel by all Americans to Cuba be allowed or not?,” 57% said yes and 43% said no.  But, support levels among respondents of Cuban descent who arrived in the U.S. after 1994 topped 75%.  It’s a fact that Americans broadly support ending the travel ban, and it’s a myth that there’s a big audience in South Florida for keeping this failed policy on the books.

So what happens to the Crenshaw bill now?

Congress is bad at enacting budget bills on time, if ever.  But, if this one gets close to enactment, the administration should issue a veto threat against it, just like it did the last time Congress threatened to mess with the president’s travel reforms.  More to the point, the administration should be looking for ways to create a general license for all travel to Cuba, so the U.S. government could save money by foregoing the enforcement of sanctions that restrict our liberties and injure U.S. interests.

Earlier this year, published a reminder that 10 different federal agencies have enforcement roles in the embargo, hundreds of millions of dollars are spent enforcing Cuba sanctions annually, and that “70 percent of the Treasury’s Office of Foreign Assets Control inspections each year are centered on rooting out smuggled Cuban goods even though the agency administers more than 20 other trade bans.

Rep. Crenshaw is a sworn enemy of waste.  Just ask him:  “I’m happy to stand on the side of the American taxpayer and their strong desire to cut wasteful spending.”

He can save the taxpayer a lot of money and free his mind to think about problems larger than Beyoncé and Jay-Z by using his post to expand rather than restrict travel.  This is a message he should hear from Florida and across the country, as our colleagues at the Latin America Working Group advocate here.  His proposal should not become law.

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