On Trade, Cuba is Not China"
Senator Jesse Helms
The New York Times
June 24, 2000
Some lawmakers, including a number of Republicans, have argued in recent weeks that if Congress believes trade will promote democratic change in China, then why not adopt the same policy for Cuba? Here is why: Cuba is not China.
The argument that American investment will democratize China has itself been wildly oversold. Beijing is doing everything in its power to dampen the impact of private investment: placing stringent control on the Internet (all users must register with the Public Security Bureau), and most recently declaring that it will insert "party cells" into every private business that operates in China.
But regardless of how one feels about permanent normalized trade with China, there is simply no case to be made that investment would democratize Cuba.
Cuba has undertaken none of the market reforms that China has in recent years; there is no private property, and there are no entrepreneurs with whom to do business. The Fidel Castro regime maintains power by controlling every single aspect of Cuban life: access to food, access to education, access to health care, access to work.
This permits Castro to stifle any and all dissent. Any Cuban daring to say the wrong thing, by Castro's standards, loses his or her job. Anyone refusing to spy on a neighbor is denied a university education. Anyone daring to organize an opposition group goes to jail.
American investment cannot and will not change any of this. It cannot empower individual Cubans, or give them independence from the regime, because foreign investors in Cuba cannot do business with private citizens. They can do business only with Fidel Castro.
It is illegal in Cuba for anyone except the regime to employ workers. That means that foreign investors cannot hire or pay workers directly. They must go to the Cuban government employment agency, which picks the workers. The investors then pay Castro in hard currency for the workers, and Castro pays the workers in worthless pesos.
Here is a real-life example: Sherritt International of Canada, the largest foreign investor in Cuba, operates a nickel mine in Moa Bay (a mine, incidentally, which Cuba stole from an American company). Roughly 1,500 Cubans work there as virtual slave laborers. Sherritt pays Castro approximately $10,000 a year for each of these Cuban workers. Castro gives the workers about $18 a month in pesos, then pockets the difference.
The net result is a subsidy of nearly $15 million in hard currency each year that Castro then uses to pay for the security apparatus that keeps the Cubans enslaved.
Those who advocate lifting the embargo speak in broad terms about using investment to promote democracy in Cuba. But I challenge them to explain exactly how, under this system, investment can do anything to help the Cuban people.
The anti-embargo crowd should drop its rhetoric about promoting democracy and be honest: the one reason for their push to lift sanctions on Cuba is to pander to well-intentioned American farmers, who have been misled by the agribusiness giants into believing that going into business with a bankrupt Communist island is a solution to the farm crisis in America.
Whoever has convinced farmers that their salvation lies in trade with Cuba has sold them a bill of goods. Cuba is desperately poor, barely able to feed its own people, much less save the American farmer.
Castro wants the American embargo lifted because he is desperate for hard currency. After the Soviet Union collapsed and Moscow's subsidies ended, Castro turned to European and Canadian investors to keep his Communist system afloat. Now he wants American investors to do the same. We must not allow that to happen.
Unfortunately, some in Washington are all too willing to give Castro what he wants. At the least they should stop pretending that they are doing this to promote Cuban democracy and American values.
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It is a great loss for the United States that Senator Helms, probably the greatest American stateman of the whole century, is retiring.
Helms has served his country well.