The more they say, the less you know. That seems to be the maxim behind President Obama’s latest foreign-policy move: his proposal to overturn the Cuba embargo and pursue full diplomatic relations for the first time since 1961.
In the words of the official statement: “Decades of U.S. isolation of Cuba have failed to accomplish our objective of empowering Cuba to build an open and democratic country.”
Against all you’ve heard, here is the central fact: it was never the embargo’s purpose to cause a change in Cuba. Quite the contrary, the embargo’s purpose was — and still is — to protect Americans.
In that endeavor, the embargo, far from being a failure, has been a striking success. But hardly anyone sees it that way, because the matter has been buried beneath a fiction that haunts even those who might oppose the president’s proposal.
In its first 18 months of power, Castro’s regime seized American businesses and properties to the tune of $1 billion (1960 dollars). That massive theft was the proximate cause of the embargo. The U.S. cut its purchases of Cuban sugar and then cancelled nearly all trade.
As everybody knows, the U.S. then tried to overthrow Castro’s regime at the Bay of Pigs. That benighted event has given a sinister image to America’s Cuba policy. But U.S. efforts to bring about change in Cuba came to a certain end the following year, with the resolution of the missile crisis. And serious efforts by the U.S. to deal with Cuba and Latin America became much more sporadic after JFK’s assassination. For five decades, faute de mieux, the centerpiece of U.S. policy toward Cuba has been the embargo.
Hardly anyone talked about the embargo until the 1980’s, when the Soviet Union, which had been bankrolling Castro’s regime, began to fold. Castro and his allies, casting about for a new patron, looked with hope to the U.S. and created the myth of the failed embargo. The goal of the embargo, they said, had been to change Cuba. But since Cuba had not changed, the embargo was a futile policy and should be withdrawn. It was a sleight-of-hand, with the same party supplying both sides of the argument. While patently false, the argument has turned out to be remarkably durable.
As a matter of fact, the embargo policy has allowed for substantial trade between the U.S. and Cuba. With the total of U.S. exports for the last ten years reaching above $4.2 billion, America is one of Cuba’s largest trading partners. Even in the absence of full diplomatic relations, America’s Interests Section in Havana is a massive installation with several hundred employees; an embassy in all but name.
The problem with the embargo, for Cuban officials, is that it does not allow Cuba to do in the United States what it has done in the rest of the world. The embargo has denied Cuba a credit card on these shores. Cuba has not been able to borrow from U.S. banks or companies. All of Cuba’s U.S. purchases must be paid in hard currency, by advance deposit. These strictures have been well founded, their wisdom amply confirmed.
For decades, Cuba has had one of the world’s worst credit ratings. The reason is simple. The country has defaulted everywhere around the globe. Last April, Moody’s dropped Cuba’s credit rating to its lowest category, ‘Caa2’, termed “highly speculative” and “exotic.” Cuba now owes more than $20 billion to Russia. It’s defaulted on close to $11 billion from the Club of Paris. It’s into Japan and Argentina for close to $2 billion each. Its latest patron, Venezuela, supplied Cuba with oil to the tune of $6 billion in 2012 alone. If you throw in smaller debts of near half a billion, you’ve got China and Mexico. These and other borrowings could make up the lyrics of a Broadway tune.
Only one global financial power has so far been immune from this treatment: the United States, thanks to the accursed embargo.
There, perhaps, is the most important change that the new Obama policy portends. With the backing of the president, Cuba might come to the U.S. and open up a new front in financial perpetration. Can one trust in the reformist intentions of Raúl Castro? Or would Raúl, true to the experience of the last 50 years, hit up the U.S. taxpayer for the money he needs to make the Cuban revolution eternal?
And there, certainly, is the bottom line about Cuba that members of the next Congress will have to examine. When they look at Obama’s proposal, it will behoove them to understand what the embargo was not meant to do, and to acknowledge what it has actually done.
David Landau, a contributor to The Daily Caller, is a publisher whose imprint www.pureplaypress.com