Cubaverdad

Foggy Forecast for Cuba-US Relations
Posted: 05/ 2/11 06:21 PM ET

Winds of change are blowing in both Havana and Washington these days,
but in what direction no one really knows. Prevailing headwinds from
entrenched interests on both sides are scrambling the signals, and may
leave the Cuban and American people in the dust.

Let's try to read the variables currently in play. In Cuba, the sixth
Communist Party Congress recently met for the first time in 14 years to
ratify President Raul Castro's promising yet cautious plans to
liberalize Cuba's economy while maintaining a firm grip on political
power. The gerontocracy of "historicos" present at the birth of the
revolution anointed 80-year old Jose Ramon Machado Ventura as deputy to
79-year old Raul. Only three new members were named to the political
bureau, with 12 retreads, including five generals, holding on to their
seats. Younger Cubans once groomed to lead a post-Castro Cuba had been
sidelined earlier for a variety of transgressions. Raul Castro's older
brother Fidel, now officially out of power, appeared on stage to bless
the proceedings as a sort of cheerleader-in-chief.

And yet, underneath the sad spectacle of a fading elite, Raul Castro has
managed to get a potentially sweeping set of economic reforms adopted by
the party apparatus. Framed as essential "to ensure the revolution's
very survival," these new measures look like a desperate attempt to
stave off bankruptcy. They range from licensing private economic
activity, opening idle land to farmers and allowing businesses to hire
employees, to empowering people to buy and sell houses and cars and
encouraging foreign investment. They include tough measures too, like
shrinking the buying power of the longstanding ration card that every
Cuban gets to subsidize basic goods, cutting unemployment benefits, and
eventually dismissing anywhere from 500,000 to one million employees
from the state sector.

It is too early to tell whether these measures will have the intended
effect of breathing new life into a moribund Cuban economy. One key
question is whether Cuban citizens will register enough small businesses
to generate the kind of tax revenue the Cuban regime calculates it
needs, and whether they will have enough left over to survive under a
less generous welfare system. But at least they will have an opportunity
to become more independent of the state, which employs about 85 percent
of the five million strong workforce.

With greater self-employment may come a taste for some political freedom
as well, though the Castros and their allies will no doubt continue to
clamp down on dissent. In a nod toward the younger generation, Raul
Castro agreed to devote a special party congress next January to address
political reforms, including a proposal to limit presidential terms to
ten years. And the recent release of all the 75 political prisoners
caught up in the infamous "Black Spring" crackdown on dissidents in 2003
is one small sign that pressure for change, both internal and external,
is having some effect.

It is not clear, then, whether this cloudy forecast will lead to
brighter days for Cubans or the next Caribbean hurricane. But to the
extent the United States can influence the trend (an assumption too
easily taken for granted), now is the time to try. Unfortunately, a
different type of old guard — this time on Capitol Hill with roots in
the Cuban-American diaspora in Florida and New Jersey — is determined
to block any meaningful change in U.S. policy.

In the earliest days of his administration, President Obama promised "a
new beginning" in U.S.-Cuba relations and to his credit took some
initial steps to expand travel and remittances for Americans with family
on the island. He quickly fell, however, into the trap of a tit-for-tat
approach, demanding additional reforms even as the Castro regime moved
in a more positive direction. Despite having clear executive authority
to do much more to loosen the embargo, Obama chose a timid approach of
hiding behind the case of a USAID contractor arrested in late 2009 for
distributing computer and satellite equipment under a Bush-era democracy
promotion program. This certainly kept the hardliners in Washington and
Miami happy for a while, but did nothing to protect Democrats from
eventual defeat in the 2010 midterm elections. With the ascendancy of
the Republicans to control of the House, including pro-embargo
legislators as chairs of key committees, all hope for congressional
action to soften the embargo is gone.

And yet, swirling below the hot air in Congress, President Obama managed
to release new regulations last January that potentially could unleash
new forces for change here and in Cuba. The new rules, which largely
return us to the Clinton era years of expanded people-to-people
exchange, provide general licenses for religious, media, research and
educational travel; allow more U.S. airports to fly charter flights to
the island; and permit Americans to make financial transfers up to $2000
a year to any Cuban not part of the government or party leadership. This
latter item could open a critical lifeline to new microenterprises
seeking small grants and loans to get started. The Treasury Department's
guidelines, however, still cling to a strict interpretation of the
rules, at least on paper. Humanitarian organizations, for example, may
not rely on one-off volunteers to carry supplies to needy people, and
travelers "are prohibited from importing into the United States any
merchandise purchased in Cuba, including but not limited to cigars and
alcohol." So much for helping struggling small businesses sell their
handicrafts to eager Americans with cash to spend.

Nonetheless, with little room for political change in Cuba or the United
States in the short term, it looks like this is as good as pro-reform
constituencies in both countries are going to get. The key question is
what they make of it. A determined effort by Americans to reach out and
provide help to Cubans willing to take risks for economic and political
freedom could make a difference in building constituencies from below
for further reforms. In the meantime, be prepared for a bumpy ride.

Ted Piccone, Senior Fellow and Deputy Director, Foreign Policy at
Brookings and former senior policy advisor on Latin America in the
Clinton Administration

http://www.huffingtonpost.com/ted-piccone/foggy-forecast-for-cubaus_b_856310.html