Thursday, July 3, 2014

Illegal, but was it wrong?

The French bank BNP Paribas will pay nearly $9 billion in penalties for violating U.S. sanctions against Iran, Sudan, and Cuba (Herald).

I’ll leave Iran and Sudan out of it and focus on Cuba for this latest case of our tax dollars at work in the application of the U.S. embargo.

There is no doubt that the bank’s actions were illegal. In the Treasury Department’s lingo, it moved funds “in which the Cuban government has an interest” through the U.S. banking system and it handled dollar transactions for Cuba. In the electronic tags attached to those transfers of funds, it concealed the fact that they involved Cuba transactions. Treasury tends to catch things like that, as some bank personnel warned, and it did catch them in this case. Hence the penalty.

But what did this bank actually do? Prosecutors explain in this summary.

The Cuba section explains that the embargo began with executive actions in 1960 and 1962 based on the U.S. government’s judgment that the Cuban government posed a threat to “U.S. national and hemispheric security,” and based on that, sanctions were applied under the Trading with the Enemy Act.

The “conspiracy,” the prosecutors explain, involved the bank’s operation of credit facilities for Cuban entities between 2000 and 2010.

Over the course of six years, from 2004 to 2010, $1.7 billion was transacted. That’s roughly the amount of U.S. farm exports to Cuba over a similar period.

Only two examples of transactions are given: “loans to a Dutch company to finance the purchase of crude oil products destined to be refined and sold to Cuba” and loans for “one of Cuba’s largest state-owned commercial companies,” which sounds like Cimex, but no detail is given about the company or the loan’s purpose. That’s it. There’s no suggestion of any commercial activity that threatens “U.S. national and hemispheric security.”

To prosecutors, the purpose of the transactions doesn’t matter because it’s illegal to move money connected to Cuba, period.

But as a foreign policy matter, for all we know the United States brought this case against a bank that was financing routine imports to Cuba – food, consumer goods, construction materials, etc.

This is the embargo at work under President Obama, who talks about the need to be “thoughtful” and “creative” in Cuba policy, and who likes to imply that our policy is an anachronism that needs to be fixed. Meanwhile, he mainly continues to carry out his predecessors’ policies. He continues to apply general pressure on the Cuban economy, with a special focus on international financial transactions. His policies make imports and credit more difficult and expensive for Cubans, and in this case he causes a conflict with a major European bank and an allied government, without even explaining how anyone’s interests were harmed by the credits extended to Cuba. Maybe one day he will explain how this serves our national interest.

Monday, June 23, 2014


“It’s not just that 40 Cuban and American personalities have asked Barack Obama to ease the embargo against Cuba. It’s that the powerful Chamber of Commerce of the United States traveled to Havana and returned delighted; it’s that ex-Governor Charlie Crist also wants to go to the legendary capital and lift the embargo; it’s that Tampa doesn’t know what to do to to be closer to Havana and and wants to start a ferry. It’s Fanjul’s calculated statements, the memoirs of Hillary Clinton, and now the poll. What to say about the poll, because polls are like appearances of the virgin: some fall to their knees and others say it’s a hallucination. I say that it is a serious indication that there winds of change not only in the relations between Washington and Havana, but also in Miami.

“It is true that there are moral and ideological reasons to oppose Washington, as they say, ‘giving oxygen to the dictatorship.’ But the Cuban political exile community long ago delivered the solution to its national problem to the United States. And the interests of this exile community, whether beneficial or not for the Cuban nation, need not coincide with those of Washington.


“There is no reason to fear accepting and evaluating the facts of Cuban reality, both the good and the bad. The bad are repeated every day. But the others are not. Yes, there is a change in Cuba toward new forms of production. Today the Cuban public is freer socially and economically than two years ago, freer to travel, to emigrate and if they don’t like it, to return; with more rights in entrepreneurship and property than at any time since 1968; government opponents leave and return to their homes in Havana. Raul Castro says that he’s putting everything on the table to negotiate with the United States. Is there an internal debate, no less important for being outside the official media, over the future of the country? Why negate it and insist that all this is nothing more than a pantomime?

“In the standard and acceptable narrative about the Cuban state, its power is on the edge of the abyss. A never-ending abyss into which it never falls. Because the criminal hand of Castro blocks it. That narrative is unchanged for the past half-century. But in the past 23 years that government survived the fall of the Soviet bloc and strengthened its influence in Latin America; since 2007 it has been off the list of human rights violators and for 22 years has managed to have the UN condemn the U.S. embargo. Is that government weaker than in the spring of 1991? No. In the equation to understand its power, there are other crucial factors than those considered in the repeated anti-Castro narrative. In 1996 they rejected Clinton’s olive branch because they were weak, now they are seeking it because they are not.

“The 61 years that have passed since the Moncada attack are an indelible part of Cuban reality and history. There is no way to make them disappear and it would not be right to do so. The same applies to the 57 years of the Republic. This is, whether we like it or not in Miami or in Havana, the history of the Cuban people. There is no other. It carries on by the friendly or terrible hand of a powerful neighbor whom it is as dangerous to idolize as to look down upon. Let’s not continue turning our backs on ourselves.”

   – Jorge Davila Miguel, in Friday’s Nuevo Herald

Friday, June 20, 2014

The end of El Exilio?

El exilio is not going away, either as a state of mind or as a voting bloc never forgets the pain, loss, and grievances of 1959 and its aftermath.

But as the Cuban-American community is increasingly populated by younger generations and immigrants who departed Cuba after the 1970’s, it is no longer defined solely by the exile experience. It is turning instead into an immigrant community with diverse outlooks and political preferences.

To see that this is the case, one need only to observe the flights going to Cuba and to talk to the Cuban Americans on them. They visit and support their families, have their kids stay with their aunt in Cuba for the summer, and think of buying a family home in Cuba in a relative’s name. For them, getting on the plane is not a political act.

Elites are changing too, increasingly looking at Cuba and figuring out ways they can engage in a positive way. The Fanjuls are interested in investing. And Facundo Bacardi has given an interview to Cigar Aficionado, a magazine that offends many in the community because it treats Cuba as a luxury tourism destination. Bacardi reveals that his family is divided about the embargo question. In contrast to the hard-liners’ typical dismissal of Cuba’s changes as “cosmetic,” he has this view: “The society is slowly opening up a bit, and there are reforms. So long as the reforms continue, the people who benefit the most are the Cuban people. Every country does things at its own pace, and Cuba is no different. It’s doing things at its own pace. I can understand that the Cuban government doesn’t want to run the risk of a revolution, so they’re implementing these changes in piecemeal fashion over a period of time. The question is, will Raúl go all the way, or will he not?”

And now, there’s a new poll from Florida International University’s Cuban Research Institute, which has been surveying Cuban American attitudes since 1991.

For the first time, a majority of Cuban Americans, 52 percent, wants to end the embargo. By contrast, in the five polls conducted during the 1990's, support for the embargo averaged 85 percent.

The poll shows that support for hard-line policies is concentrated in the over-65 age bracket, which means that this is a trend, not a fluke.


Support for lifting the embargo is 52 percent overall: 62 percent of those 18-29, 55 percent age 30-44, 55 percent age 45-64, and 40 percent age 65 and higher.

Support for re-establishing diplomatic relations is 68 percent overall: 88 percent of those 18-29, 78 percent age 30-44, 68 percent age 45-64, and 41 percent age 65 and higher.

It’s no wonder that politicians – so far, only Democrats – are taking notice. Charlie Crist and Hillary Clinton are not simply questioning the policy but opposing the embargo head-on; they are, respectively, the first significant Florida statewide candidate and the first (presumptive) major Presidential candidate to do so. The electoral penalty once attached to that position no longer exists.

And President Obama, the first candidate to really figure out the new Miami-Dade math,  continues to think about it.