Restored Trade with Cuba: They Get a Roaring Economy and Strong Military; We Get Cigars, More Immigrants, and New Stops for Caribbean Cruises

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– 17 August 2015 –

Patulcius:

Patulcius-sqThe Left has long maintained a peculiar love affair with Fidel Castro and his beard, and now they are rejoicing because of all the new breakthroughs in U.S.-Cuba relations.  Eventually they hope to see the elimination of the trade embargo that the U.S. imposed in 1960.

The first major breakthrough happened in 2014.  After months of negotiations, Cuban and American diplomats met at the Vatican where they eventually hashed out an agreement:

On December 17, 2014, the framework of an agreement to normalize relations and eventually end the longstanding embargo was announced by Castro in Cuba and Obama in the United States. Cuba and the United States pledged to start official negotiations with the aim of reopening their respective embassies in Havana and Washington. As part of the agreement, aid worker Alan Gross and an unnamed Cuban national working as a U.S intelligence asset were released by the Cuban government, which also promised to free an unspecified number of Cuban nationals from a list of political prisoners earlier submitted by the United States. For its part, the U.S. government released the last three remaining members of the Cuban Five.

Then, on April 14 of this year, Obama unilaterally dropped Cuba from the list of terrorist sponsors.  On July 20, the two countries restored normal diplomatic relations, with embassies opening in Washington and Havana.

Now we have reports that the Guantanamo Bay terrorist prisoners may be relocated to Kansas or South Carolina.  This suggests that Obama will finally fulfill his promise to close the prison at Guantanamo Bay.  Might this also suggest, in light of the “Cuban Thaw“, that we might give up our perpetual lease of the Guantanamo Bay Naval Base itself?

The main sign at the U.S. Naval Station at Guantanamo Bay, Cuba March 5, 2013. REUTERS/Bob Strong (CUBA)

Could Obama love Communist Cuba so much that he would give away the entire Guantanamo Naval Base for free, just like Jimmy Carter gave up the Panama Canal in 1977?

This would not be unprecedented.  Jimmy Carter, in 1977, negotiated away America’s rights to the Panama Canal in exchange for the Panamanians agreeing to not dislike us as much.

The Establishment and the Left are working together to end the the embargo.  On July 28, a Republican Congressman from Minnesota, Tom Emmer, introduced a bill, the “Cuba Trade Act of 2015”, that would remove the restrictions on American businesses trading with Cuba and American citizens traveling there.

Currently U.S. policy states that we may only lift the embargo when Cuba elects a democratic government, improves its human rights record, and moves toward a free market economy.  But the way we are headed, the Castro government in Cuba will have to sacrifice nothing in exchange for everything.  I guess they’ll probably accept those terms.

Once the embargo is lifted, Cuba can follow the models of other nominally free-market, politically Communist states such as China and Vietnam.

Thanks to absurd trade policies with China, supposedly to give us leverage to force them to become a free-market, democratic state, China has become the number one economy in the world and a rapidly-growing military power.  All without significant political reforms.  The United States showed them!

Vietnam, like China, retains its Communist government, a government that the United States fought against for twenty years.  And also like China, the economy of Vietnam has grown rapidly since 2000.  They have also been growing their military.

800px-A_HCMC

Ho Chi Minh City is looking quite lovely these days. I wonder where all of the money came from?

The U.S. has exported countless manufacturing jobs to China and Vietnam, taking advantage of their cheap currencies and underpaid workforces.  A cheap labor pool in Cuba, along with their weak currency and close proximity to the U.S. market, makes business production in Cuba very attractive to American corporations.

The Cuban government would use this new-found wealth to endear itself to its people, just as China and Vietnam have done.  They would also use it to cement their power and protect themselves from outside forces, namely the U.S. military.  Cuba has already forged military ties with Iran, North Korea, and Venezuela, countries not known for their friendliness to the United States.  In twenty years’ time, Cuba could have a roaring economy and strong military just like Vietnam and China have.  The main difference between those countries and Cuba is the Cuban proximity to the United States, just ninety miles from the coast of Florida.

And what would the United States get for the deal?  Not much.

Netflix (NFLX, Tech30), Airbnb, American Express (AXP) and Mastercard (MA) have already put a foot in Cuba’s door — a virtual foot though. None of those companies actually have an office or employees in Cuba.

Over 200 business leaders congregated two weeks ago at the Cuba Opportunity Summit in New York, co-hosted by Nasdaq and UPenn’s Wharton School.

“Cuba presents probably the largest opportunity — outside of China — to grow our industry,” Frank Del Rio, CEO of Norwegian Cruise Lines (NCLH), a Miami-based company, told CNBC last week.

Airlines and tourism companies stand to benefit from American travelers’ pent up demand to see Cuba, which has been off limits for 50 years. Plus Cuba offers what most in the Caribbean don’t: beautiful beaches and a big, historic city. JetBlue (JBLU) already charters flights to Cuba, but it wants to start commercial flights, a sentiment echoed by other airlines. . .

. . . Food and agriculture stand to win too. Caterpillar sees Cuba, with all its farmland, as a big opportunity for its farming equipment business. Caterpillar (CAT) and food supplier Cargill have separately lobbied for the embargo to be lifted.

cuban-beach-resort

Cuba gets a strong government, economy, and military. The U.S. gets fine cigars, a rejuvenated hostile neighbor to the south, and some nice sandy beaches for vacationers.  Obama, the diplomatic genius, puts Bismarck to shame!

So Cuba gets a stronger government, economy, and military while the United States gets beautiful vacation beaches, cigars, and a medium-sized market for ag products.  Not to mention a new source of poor immigrants and a potentially hostile neighbor in our backyard.

Could we expect anything less from our government these days?

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7 Comments

  1. Reblogged this on Brittius.

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  2. I don;t care about the embargo or whether Cuba is communist or liberal democracy (not much difference except commie countries tend to lack some of the degeneracy we see here). What I do care about is MORE Latino immigrants, legal and illegal, flooding in. why stay in poor oppressive Cuba when you can come over to rich America? Send us your poor, LGBTQWTF, criminal masses yearning for free stuff!

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    • I don’t want more Cubans, but I don’t want a strong enemy near our borders either. It’s too easy to keep this status quo, as there is insignificant pressure to change it. Obama supports it because it further weakens the U.S.

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      • How strong could Cuba really become? Its a tiny, poor country. As long as other, larger countries aren’t sending troop in we can probably take them in an afternoon and Cuba must know this. I doubt they’d start a fight anyway, its much more lucrative to invite US tourists and businesses to Cuba while sending Cuban undesirables to us.

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      • In the short to medium-term, you are right. Cuba poses no threat except for, as you’ve said, a source of more immigrants. And they only have 12 million people, which is only half of the population of Vietnam. Even after the country turns around in perhaps 20 years, we could still militarily destroy them easily even with our weakened pansy military. The danger I see from Cuba is more of a threat in conjunction with other powers, perhaps as a base of operations if we’re stupid enough to allow it. It’s not an enormously increased threat, but what do we have to gain as a nation by lifting the embargo that outweighs even this relatively small, long-term threat?

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      • Seems to me whether we lift the embargo or not we still have to keep an eye on who Cuba allows in. However, lifting the embargo, if done right, could win us some Brownie Points with the Cuban populace.

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      • I see your point, Roger, though I’m still not persuaded. You’re right about us having to watch who is operating in Cuba regardless of our policy towards them.

        But who cares whether the Cubans like us or not so long as they are weak and leave us alone? I’m not sure that we could make friends with the Communist government even if the people liked us. I can’t remember who said it, but nations don’t have friends; they only have interests. The potential gain is too small to justify the potential loss, though in all fairness to your point, the stakes are pretty small either way.

        I was just reminded yesterday about something that I forgot all about: the fact that Cubans who arrive in the United States gain asylum just about automatically.

        https://en.wikipedia.org/wiki/Wet_feet,_dry_feet_policy

        Lifting the embargo, at the very least, should be tied to the end of the asylum policy.

        But it’s another reason to be suspicious of Obama’s interest in removing restrictions between the U.S. and Cuba.

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