Russian Warships Arrive in Cuba

Saturday, August 3, 2013
There's quite a trend developing:

Russia gives U.S. intelligence leaker Edward Snowden asylum.

Russian warships arrive in Havana.

Russia seeks to re-establish its electronic espionage base in Cuba.

Cuba sends Russian arms to North Korea.

Similar Russian warships transport arms to Syria.

From RIA Novosti:

Russian Warships to Arrive in Cuba on Official Visit

A Russian naval task force, led by the Moskva missile cruiser, will arrive Saturday on a five day official visit to Cuba, a spokesman for Russia’s Black Sea Fleet said.

The Moskva, the flagship of the Black Sea Fleet, is accompanied by Udaloy-class destroyer Vice Admiral Kulakov from the Northern Fleet and the Ivan Bubnov tanker.

“The task force will call at the port of Havana on Saturday after a long trans-Atlantic voyage,” Capt. 1st Rank Vyacheslav Trukhachev said on Friday.

Western military experts believe that the visit signals Russia’s intention to rekindle military ties with its former Communist ally in the Caribbean.

Moscow had a military presence in Cuba for almost four decades after the Cuban crisis, maintaining an electronic listening post at Lourdes, about 20 kilometers (12 miles) from Havana, to monitor U.S. military activity and communications.

Bilateral military cooperation ended abruptly after the surprise closure of Lourdes facility in 2001.

During his visit to Cuba in April, Russia’s Chief of the General Staff, General Valery Gerasimov, met with Cuban Defense Ministry officials and reiterated that Russia and Cuba remain defense partners.

Some Russian military sources have previously indicated that Moscow could resume operations at the Lourdes facility and also use airbases in Cuba for refueling of strategic aircraft.

Cuban Explosives and Live Munitions Found on North Korean Vessel

Friday, August 2, 2013
Panamanian authorities have confirmed to EFE that Cuban explosives and other live munitions have been found on the Chong Chon Gang, the North Korean vessel smuggling weapons between both totalitarian states, in violation of U.N. Security Council sanctions.

These include munitions for RPGs ("rocket-propelled grenades") and unidentified explosives for heavy artillery.

Needless to say, they were not among the list of supposedly "obsolete" weaponry the Castro regime identified in its official statement after being caught red-handed.

UPDATE from AP:

Panama finds undeclared munitions aboard North Korea-bound ship from Cuba

Crews unloading a North Korean-flagged ship detained in the Panama Canal for carrying undeclared arms from Cuba have found live munitions on board, a Panamanian official said Friday.

Explosive-sniffing dogs found ammunition for grenade launchers and other unidentified types on munitions, said anti-drug prosecutor Javier Caraballo, who did not specify the amount of munitions.

He said the munitions boxed were closed and would have to be examined by explosive experts to determine the amount and types.

The weapons discovery triggered an investigation by the U.N. Security Council committee that monitors the sanctions against North Korea. The council is sending a team to see if it violates U.N. sanctions. Panama earlier this week asked to postpone the visit to Aug. 12 because it is taking so long to unload the ship.

North Korea is barred by the U.N. from buying or selling arms, missiles or components, but for years U.N. and independent arms monitors have discovered North Korean weaponry headed to Iran, Syria and a host of nations in Africa and Asia.

Remarks at Puerto Rico Manufacturers Association (PRMA)

“Reform and Change in the Cuban Political Economy in 2013”

By Mauricio Claver-Carone

Puerto Rico Manufacturers Association (PRMA)
San Juan, Puerto Rico
August 2nd, 2013

Thank you so much for the kind invitation.  It’s a real pleasure to be here in San Juan.

Puerto Rico has always stood in solidarity with the courageous advocates fighting for freedom in Cuba. Its people -- each of you -- have opened your arms with generosity to Cubans fleeing repression.  For this, we thank you.

I pray this doesn't change -- for you are currently on the right side of history.

Frankly, I wish the topic of today’s discussion was how Puerto Rico can continue to help Cuba’s democracy movement, but I don’t get to choose the format.

Cuba and U.S. policy towards Cuba -- particularly the issue of trade -- are topics of great passion, comment, reflection and debate.  And that’s a good thing.

Unfortunately though, too many times at these events, speakers tend to hype and cherry-coat business opportunities in Cuba, disregarding the unpleasant economic and political realities involved.

They are going to try to sell you some elusive “beach-side property” in Cuba.  I suggest you sell them some real beach-side property right here in Puerto Rico instead.

You’ve already gotten a taste of this.

In August 2011, direct charter flights from Puerto Rico to Cuba were announced with great fanfare.

Yet, only three months later -- as reality settled -- they were cancelled due to weak demand.

Similarly, Cuba charter service planned from Baltimore-Washington, Atlanta, New York and other U.S. cities was also halted.

Hopefully, those travelers are opting to visit Puerto Rico.

Others will point to European and Canadian investors, and argue that they are getting a "head-start" on business opportunities in Cuba.

How have these European and Canadian investors fared?

You tell me.

In 2000, there were 400 foreign companies operating in Cuba through minority joint ventures with the Castro regime, which is sadly the only permissible legal vehicle for foreign companies to invest in Cuba.  Today, there are only 190 left.

In the last few years, European investors have seen over $1 billion arbitrarily frozen in Cuban banks by the government.

As Reuters reported, "the Communist-run nation failed to make some debt payments on schedule beginning in 2008, and then froze up to $1 billion in the accounts of foreign suppliers by the start of 2009."

Moreover, during this time, the CEOs of various foreign companies with extensive business dealings with the Cuban government have been arrested.  Some are still sitting in jail -- without charges.

Cy Tokmakjian of Canada’s Tokmakjian Group was arrested in September 2011, when his Havana office was unexpectedly raided and its assets confiscated.  Nearly two years later, Tokmakjian has yet to be charged with anything.

Sarkis Yacoubian of Canada’s Tri-Star Caribbean was given a 9-year sentence despite months of interrogations in which he admitted to everything his interrogators desired – and then some.

Amado Fahkre and Stephen Purvis of Britain’s Coral Capital fared a bit better. Fahkre was arrested in October 2011 and Purvis in March 2012. Just last month, they were sentenced to time served and allowed to return to London.

Let me stress that these were not casual investors. They these were some of Cuba's biggest business partners, having each invested hundreds of millions, with direct access to the highest officials.  This has all been confiscated now.

The U.K.’s Telegraph tells it best:

Mr. Purvis, 52, spoke out last week to warn other British entrepreneurs of the risks in Cuba, which has courted foreign investors in recent years to revamp its moribund command economy. They were risks, though, that he himself thought he no longer had to worry about, given that his own firm, financed by private European backers, was among the best-established on the island. Since setting up there in 2000, it has invested in everything from tourism through to factories and docks, and even financed El Benny, a Cuban film about the country’s most famous singer, Benny Moré.

Mr. Purvis was also a pillar of Havana’s expatriate community, working as vice-chair of Havana’s international school, where diplomats sent their children, and producing ‘Havana Rakatan,’ a Cuban dance show which has toured London’s West End.

What followed was a first-hand insight into Cuba’s darker side - and confirmation that for all its attempts at reform, its security services remain as repressive as ever.

‘At first I was taken to a run-down villa in the middle of nowhere, where I was interrogated for two hours every morning, afternoon and night,’ said Mr. Purvis. ‘They accused me of passing information to a foreign state, but never said who, where or how. At the end of each day they would make me write up a summary of events, even though they kept their own notes too. Then, after five days, they put me in ‘pre-emptive detention’ in Villa Marista.’”

Villa Marista is the infamous high-security prison of the Ministry of the Interior -- a torture-chamber for Cuba’s political prisoners.

Let’s hope that doesn’t ever happen to any of you.

Just last week, the International Chamber of Commerce's Court of Arbitration ("ICC"), based in Paris, ruled that the Cuban government must compensate a Chilean businessman, Max Marambio, $17.5 million for the confiscation of his company in 2010.

Marambio was a bodyguard of former Chilean President Salvador Allende, who fled to Cuba after the 1973 coup and made a fortune doing dirty deeds and business deals for the Castro brothers.

This came to an abrupt end in 2010, pursuant to a dispute between Marambio and the Castros.

Soon thereafter, Marambio's half in his joint venture with the Cuban government, a food company known as "Rio Zaza," was confiscated and its Chilean General Manager was mysteriously found dead in a Havana apartment.

Marambio will likely fare no better in collecting this $17.5 million than Cuba’s Paris Club and London Club debtors, who are owed tens of billions by Castro (more details later).

While my presentation may sound somber for the short-term -- I promise it is optimistic in the long-term.

In full disclosure, I am a free-trader.  I believe and advocate for the principles of free trade.  However, I do so without the distortions that some would like for us to accept under the guise of trade.

I believe in the principles of free trade as were envisioned by its original thinkers.

In The Wealth of Nations, a book considered to be the foundation of free trade, Adam Smith held that trade, when freely initiated, benefits both parties.

Smith did so in criticism of the mercantilist policies of the 17th and 18th centuries, whereby commerce was simply a tool to benefit and strengthen the authoritarian nation-states of the time.  Puerto Rico was itself a victim of mercantilism during colonial times.

I believe -- as did Smith -- that free trade requires property rights and the rule of law as pre-conditions. If no such rights exist, then there is no real opportunity to trade, for the government could just take from you what they want, when they want, wherever they want -- for their sole benefit.

Do these pre-conditions exist in Cuba today?

According to the 2013 Index of Economic Freedom, an annual guide published by The Wall Street Journal and The Heritage Foundation:

Cuba ranks 176th out of 177 countries in the world in terms of economic freedom. The only country that ranks worse is North Korea.”

Perhaps this is the reason for Cuba and North Korea’s mutual affinity for weapons smuggling.  After all, who wants to be the sole remaining totalitarian state in the world?

(As I’m sure you are aware, a few weeks ago the Panamanian authorities intercepted a North Korean vessel with a Cuban arsenal hidden within 10,000 metric tons of sugar -- a violation of the U.N. Security Council’s arms embargo.)

Cuba is the least-free economy in the Western Hemisphere and internationally, it ranks worse than some pretty unattractive investment environments, including Iran and Zimbabwe.

According to the report:

"A one-party Communist state, Cuba depends on external assistance (chiefly oil provided by Venezuela's Hugo Chávez and remittances from Cuban émigrés) and a captive labor force to survive. Property rights are severely restricted. Fidel Castro's 81-year-old younger brother Raul continues to guide both the government and the Cuban Communist Party. Cuba's socialist command economy is in perennial crisis. The average worker earns less than $25 a month, agriculture is in shambles, mining is depressed, and tourism revenue has proven volatile. But economic policy is resolutely Communist, and the regime rejects any moves toward genuine political or economic freedom."

Regarding the rule of law, it states:

"The constitution explicitly subordinates the courts to the National Assembly of People's Power and the Council of State. Corruption remains pervasive, undermining equity and respect for the rule of law."

Within this framework, let me also address Cuba's political system, as it has important implications for the subject of trade with Cuba.

First of all, Cuba is not China and it is not Vietnam. It is not an authoritarian bureaucracy. As I previously mentioned, and the 2013 Index for Economic Freedom correctly notes, Cuba is one of the last totalitarian states remaining in the world (alongside North Korea).

I hate to sound patronizing, but it's important to understand the dynamics of a totalitarian state in order to understand the Cuban reality.

A totalitarian state strives to control every aspect of public and private life. Totalitarian regimes, such as Cuba's, maintain themselves in power by means of an all-embracing cult of personality; propaganda disseminated through a state-controlled media; a single party that controls the state; absolute control over the economy; restrictions on discussion and criticism; the use of mass surveillance; and state terrorism to foment fear and submission.

None of this has changed.

Some of you are probably wondering:

What about the "economic reforms" that have been so widely reported in the media?

Let me address some of these:

a. Agriculture: The most aggressive "reform" announced has been in agriculture, where the Cuban government enacted a law in 2008 seeking to distribute idle agricultural land to small farmers and cooperatives. These lands are granted in usufruct -- with ten years leases for individuals and 25 years for cooperatives, both renewable. The government retains ownership.

Yet, according to a recent report in The New York Times, "Because of waste, poor management, policy constraints, transportation limits, theft and other problems, overall efficiency has dropped: many Cubans are actually seeing less food at private markets."

And just this week, Reuters reports: “Agriculture in Cuba remains in crisis and the country is still dependent on imports five years into Raul Castro's presidency and efforts to reform the sector, according to a government report released this week.

Despite this failure, the government is now similarly experimenting with some non-farm cooperatives. There's no reason to expect the results will be any different as the fundamentals remain the same.

But don’t believe me.

Earlier this month the Cuban government invited a group of business journalists from Europe and the U.S. to visit Havana for a propaganda presentation of Castro’s "reforms."

Here’s what CNBC reported:

"In a week-long program packed with events, visits, news conferences, and a cocktail party, the government did not show visiting reporters any of the new cooperatives—which the minister of employment said now number 197, in the restaurant, construction, industry, and transportation sector.

CNBC tried to find some independently, but a new transportation group told us its start had been delayed. A privately-run wholesale warehouse on the outskirts of town, which was set to open July 1, stood empty. The guard told us it would open in a few weeks. A group of nine air-conditioning repairmen who took over a state-run air conditioning business invited CNBC to their headquarters at a small house in the suburb of Miramar, but then told us they didn't want to speak with us. It is unclear why."

By the way, much of the speculation regarding Castro’s agricultural “reforms” -- and some of the stories you will be told here today -- has also been written about North Korea.

Here’s Reuters just last Fall:

North Korea plans to allow farmers to keep more of their produce in an attempt to boost agricultural output, a source with close ties to Pyongyang and Beijing said, in a move that could boost supplies, help cap rising food prices and ease malnutrition.”

Adds The Washington Post:

[E]ven skeptical North Korea watchers say that Kim’s emerging policies and style — and his frank acknowledgment of the country’s economic problems — hint at an economic opening similar to China’s in the late 1970s.”

Sound familiar?

b. Self-employment: After the collapse of the Soviet Union in 1991, the Cuban government sought to ease economic pressure by temporarily allowing -- through special licenses -- limited self-employment. These licenses were streamlined starting in 1998, when the Cuban government secured massive oil subsidies from Venezuela.

Faced with similar economic challenges today, Raul Castro has once again eased some restrictions on self-employment, which allow individuals to lease the practice of one of 181 pre-approved services, i.e., doll-makers, party clowns and food stands. However, all means of production are legally owned by the state.

Overall, there's nothing particularly new here. It’s an on-again, off-again effort by the Cuban government to control the black market.  I'd also note that more than 25 percent of those self-employed have returned their licenses because of the government's burdensome oversight and predatory taxation.

c. Home Sales: The Cuban government has now allowed citizens to buy and sell the homes in which they reside.  Cubans have supposedly owned the property where they reside since 1986, although they couldn't be sold. Cubans dealt with the no-sell edict by "swapping" homes among each other and setting up a black market in housing. The government routinely confiscated homes of those who left the island and in 2000 the police began to crack down on the swaps and black market transfers.

Nonetheless, the newly-authorized sales are subject to limitations -- not least of which is a regular Cuban's $25 per month income. Another notable restriction requires the transaction be made in hard currency and that it be deposited in Cuba's Central Bank, pending the government's approval of the sale and an investigation into the source of the funds. At the time of closing, the Central Bank will issue a check to the seller in non-convertible (worthless) Cuban pesos. It is not surprising that the number of formally recorded sales remains minimal.

What role do foreign investors play in these "reforms"?

None. Foreign investors in Cuba cannot do business with private citizens. They can only do business with the Cuban government through minority joint ventures. Moreover, the Cuban government's constitution clearly states that all foreign commerce is strictly reserved for the state.

Foreign investors cannot hire or pay workers directly. They must go through the Cuban government employment agency, which picks the workers. The investors then pay the Cuban government in hard currency for the workers, and the Cuban government pays the workers in worthless pesos.

For example, some foreign companies pay the Cuban government $10,000 a year per Cuban worker, which is a bargain in itself. But it's even more of a bargain for the Cuban government, which then gives the workers about $20 a month in pesos -- and pockets the difference. This is a violation of international labor norms.

Even the most unconditional advocate of business ties with the Cuban government would admit that Raul Castro has done little to attract foreign investment since taking the reign from his brother Fidel. To the contrary, as I mentioned earlier, he's stifled it.

Here’s The Financial Times’ take on this issue, pursuant to the Cuban’s government’s propaganda presentation earlier this month:

"Asked repeatedly about foreign investment opportunities, the officials offered nothing new at all, repeating stock lines about investment being complementary to their development schemes and that existing regulations were flexible and adequate [...] None of the 190 [foreign] companies managing and temporarily in joint ventures in Cuba own any property outright, nor do they have the right to sell shares except with the authorization of their partner, the state."

While on this topic, let me specifically address off-shore oil exploration. As you may recall, this too began with a media flurry – until reality struck.

It is an important issue for the Cuban government due to its fear of the demise of the current Venezuelan government and its generous subsidies of 100,000 free barrels of oil per day. These subsidies comprise nearly two-thirds of Cuba's energy consumption.

Despite much hype throughout 2012, these off-shore oil exploration efforts -- in joint ventures with Spain's Repsol, Malaysia's Petronas and even Venezuela's PDVSA -- have been a bust.

Frankly, this was predictable since Brazil's Petrobras and Canada's Sherritt stated in 2011 that such ventures were not commercially-viable. Yet, it had become Castro’s “El Dorado.”

Bottom-line: The chapter of Cuba’s off-shore oil exploration is officially closed for the short-to-mid-term.

Speaking of changes, I'd be remiss not to mention that one significant and tangible change that has taken place in Cuba under Raul Castro is a dramatic rise in repression.

In 2012, documented political arrests of peaceful democracy activists reached the highest levels (6,602) in decades. These have been accompanied by the mysterious deaths of some of Cuba's leading pro-democracy figures, including the founder of the Ladies in White, Laura Pollan, and the head of the Christian Liberation Movement and author of the Varela Project, Oswaldo Paya.

Impunity still reigns in Cuba.

If the Cuban people are prohibited from engaging in foreign commerce, then who is the Cuban counter-part for foreign investors?

The armed forces' holding company, called GAESA, is the dominant force in the Cuban economy. Founded by Raul Castro in the 1990s, GAESA controls a wide array of companies, ranging from the very profitable Gaviota S.A., which runs the island's tourist hotels, restaurants, car rentals and nightclubs, to TRD Caribe S.A., which runs all retail operations. In plain words: GAESA controls virtually every economic transaction in Cuba, making it -- by far -- the most powerful company in Cuba's totalitarian-command economy.  It is run by Raul's son-in-law, Colonel Luis Alberto Rodríguez Lopez- Callejas.

As relates to the U.S., American companies are prohibited from investing in Cuba or conducting commercial, financial or tourism-related transactions. However, there is one exception: The sale of agricultural commodities, medicines and medical devices, which were legalized on a cash-payment basis by the 2000 Trade Sanctions Reform and Export Enhancement Act (TSREEA).

The counter-part in Cuba for these U.S. agricultural sales is a state company called Alimport. Therefore, to speak of "trade with Cuba" is in itself a misrepresentation. To "trade with Cuba" is not about trading with the people or non-state actors; for only one company is allowed to transact business with American exporters for these commodities -- that company is called Alimport.

I'm a regular Cuban citizen, I have a self-employment license, and I want to import food products from Puerto Rico. I'm not allowed to - even if I had the capital to do so. Only the head of the Cuban government's Alimport, is authorized to import products to Cuba - to the entire island. That's it.

Thus, every dollar that the nearly 200 companies from 35 U.S. states have transacted in agricultural sales with Cuba since TSREEA has only had one Cuban counterpart.

I always jest with my colleagues from the various farm bureaus and trade associations that we should be forthright and call it "trade with Alimport," or "trade with the Cuban government" -- or mercantilism, which Adam Smith rightly defined as antithetical to trade.

What is the future of U.S. policy towards Cuba?

The US has a dual track policy towards Cuba. It seeks to - first and foremost -- provide support to the constantly besieged Cuban civil society (by civil society, I'm referring to opposition groups, religious organizations, independent journalists, and other marginalized, independent - and therefore illegal -- trade groups); while -secondly -- denying hard currency and resources to the Cuban dictatorship. In other words, U.S. policy seeks to weaken the Cuban government's absolute monopoly over power and resources, in order to help the Cuban civil society create some sort of "playing field" for itself, despite the grossly disproportionate circumstances it faces.

Within this context, U.S. policy sees sanctions as an important tool that not only denies resources to the regime, but also provides important moral and political support to the Cuban civil society. However, U.S. sanctions towards Cuba are not defined indefinitely, they are subject to conditions, and have been specifically codified into U.S. law as such.  Since 1996 -- with the codification of this policy -- the power to ease or terminate sanctions shifted from the executive to the legislative branch of the U.S. government.

According to law, the U.S. will only lift the remaining sanctions and normalize relations with the Cuba when three essential conditions are met:  1. the unconditional release of all political prisoners, 2. the recognition and respect of the fundamental human, political, and economic rights of the Cuban people, and 3. opposition parties are legalized leading to free and fair elections.

Currently, there is strong bipartisan support in the U.S. Congress for this law. Thus, these conditions are unlikely to change in the new 113th Congress. Don’t allow anyone to blow smoke at you and tell you otherwise.

Moreover, even some long-time Congressional advocates of unilaterally lifting these conditions - by changing the law - in order to further facilitate the terms and financing of agricultural sales have taken a hiatus from these efforts, as the Cuban government has imprisoned an American development worker, Alan Gross, who has been held hostage since December 2009. Mr. Gross had been helping the island's small Jewish community with Internet connectivity when he was arrested.

(Not only is Cuba one of the least-free economies in the world, it is also one of the most hostile to Internet connectivity.)

Speaking of financing, Cuba also remains one of the world's greatest credit risks. With a debt of $30.5 billion dollars, Cuba ranks second on the Paris Club's list of debtor countries.  Indonesia ranks first with a debt of $40.2 billion -- despite a population 23 times the size of Cuba. Cuba's unpaid debt represents nearly 10% of the Paris Club's total outstanding claims.

Today, the total of nearly $75 billion in foreign debts and claims against the Cuban government is nearly impossible to repay for a country with an economic output barely one-fifth the size of Greece's (similar population to Cuba) own troubled economy.

This is even more troubling considering that in 1959, when the current regime took power; Cuba had foreign exchange reserves totaling $387 million -- worth more than $3.6 billion today adjusted for inflation. Cuba's reserves were third in Latin America, behind only those of Venezuela and Brazil, despite having just a fraction of the population.

The good news is that the U.S. currently has zero credit exposure to Cuba, as U.S. law prohibits the extension of credit to the Cuban government.

However, the Cuban government still has not paid compensation for the approximately $8 billion worth of property that was confiscated from U.S. citizens. Let's not forget that this remains the largest uncompensated taking of American property by any foreign government in the history the U.S. Outstanding claims range from companies like Coca-Cola, to Ford, to Texaco, to Chase Manhattan Bank.

As previously stated, I have mostly focused on the U.S. Congress because the executive branch can only authorize the commercial and financial transactions with Cuba that have been previously mandated by Congress. President Obama has the authority to modify regulations related to purposeful travel, e.g. family, religious and academic travel, and remittances - and he has amply done so. Yet, even in this case, tourism-related transactions ("tourism travel") were codified into law in 2000 - and only Congress can authorize them.

What's next?

The current Cuban government, since its taking of power in 1959, has always survived off subsidies. With the exception of a brief period in the 1990's, foreign subsidies have always been Cuba's main source of income.

First, the Soviet Union provided $6 billion dollars in yearly subsidies through 1991. Cuba received more money from the Soviets than all of Europe received from the U.S. Marshall Plan after World War II.

Thereafter, Venezuela has provided $10 billion dollars in yearly subsidies since 1998.

With the passing of Hugo Chavez and the growing political and economic crisis in Venezuela, the Cuban government is looking for its third major subsidy.

Moreover, with Fidel Castro at 86-years old and Raul Castro at 82-years old -- it's safe to say time is not on their side.

Cubans are extremely smart people, they know that it is not the U.S. or sanctions that prohibit them from freely expressing themselves; that keeps them from entering and enjoying those beautiful resorts, with their restaurants and bars owned by the military; that keep them enjoying the fruits of their labor; or that keeps them from choosing their own destiny. It is the Cuban government that does so.

Furthermore, Cubans on the island know what democratic ideals are. In many cases, they have given the ultimate sacrifice in pursuit of those ideals. Let's not forget, Cuba has the largest prison population - per capita - in the world. Ten percent of the Cuban population has died, either trying to cross the Florida Straits, executed or imprisoned. Add to that another ten percent that has been exiled. Those are Stalin-Mao proportions.

So the questions remain:

Do we make a short-term investment in Cuba's current fledgling government that monopolizes the lives of Cubans, or do we make a long-term investment in its future leaders?

Do you want to deal with a trading partner that is as poor as North Korea, or would you rather deal with a neighbor as rich as South Korea?

Do we want to be in the position that European companies recently found themselves in post-Qaddafi Libya or two decades ago in post-apartheid South Africa -- begging for forgiveness and scrambling for the opportunity to renegotiate deals with the former victims of those dictatorships?

Or, do we want to be in a position of market preference -- eventually gaining what I like to call a "freedom premium" -- similar to that which Coca-Cola enjoyed in the former Soviet bloc pursuant to the fall of the Berlin Wall.

Hopefully, the answer will be the latter.

In a bit of corporate history, Pepsi first entered the Soviet Union in 1972, pursuant to a barter agreement in exchange for Stolichnaya vodka. Pepsi was infamously perceived to have been deeply entrenched with the communist government. Meanwhile, Coca Cola didn't make a move until the fall of the Iron Curtain.

However, immediately upon the fall of the Berlin Wall, Coca-Cola's former CEO Roberto Goizueta made sure that every automobile that crossed the border received free cases of Coke and those on foot got six-packs and single cans.

Perhaps Goizueta, a Cuban-American, who experienced first-hand what it was like to be a victim of oppression, instinctively knew that those newly-free would reward them in some fashion -- for they stood in solidarity with them during their darkest hour.

Tom Standage, author of "A History of the World in 6 Glasses," a book that divides world history into the beer, wine, spirits, coffee, tea and Coca-Cola ages - notes that when the Berlin Wall fell in 1989, East Germans began buying Coca-Cola by the crate-load:

"Drinking Coca-Cola became a symbol of freedom."

In 1991 Pepsi was outselling Coca-Cola 10-to-1 in the former Soviet Union. By 1994, Coca-Cola gained the lead, and retains it to this day.

Even more broadly, it is not a mere coincidence that the countries of Eastern Europe, who lived through similar ordeals, are the staunchest allies the U.S. has in the world today.

So let's focus on the big prize: a free and democratic Cuba that within a decade could --once again -- become one of the richest countries in the Western Hemisphere. This will not be because of its beaches and natural resources -- that only goes so far -- but because of its people. Note I haven't even mentioned Cuba's emblematic sugar and tobacco industries, which are in shambles.

An economy based on imagination, creativity, risk-taking and hard-work needs a rule of law and political freedoms. Cubans have constantly proven this ability from the moment they set foot in exile, whether in Miami, San Juan or anywhere else they’ve found freedom.

And in the meantime, let's work on re-orienting some of those Canadian and European tourists visiting Cuba and bring them right here to Puerto Rico, in order to enjoy all that “La Isla del Encanto” has to offer.

Let’s start a campaign right here today asking anyone who is trying to pitch Cuba as an “investment opportunity” – what have you done for Puerto Rico lately?

Thank you so much. I look forward to your questions.

Iran Calls for Expanded Ties With Cuba

The disturbing trend continues.

From Tehran Times:

Iran calls for expansion of ties with Cuba

Iran’s Majlis Speaker Ali Larijani has called for the expansion of ties with Cuba in all areas, saying that the two countries enjoy exceptional relationship.

He made the remarks during a meeting with Cuban Vice President Ricardo Cabrisas in Tehran on Saturday.

Larijani said the Cuban official’s visit to Iran to attend the swearing-in ceremony of President Hassan Rohani reflected the deep-rooted friendship between Tehran and Havana.

The Cuban official, for his part, hailed the increasing relations between the two countries, adding that efforts should be made to enhance parliamentary ties.

Cuba's Long History of Arms Smuggling

From El Universal:

Cuba has spurred a clandestine industry of weapons

For years, Havana traded arms in Africa and Latin America

One way of exporting the Cuban revolutionary project powered by an anti-US ideology was the supply of weapons to countries and organizations that had troubles to buy them or were banned from doing so. As a result, a black market with Cuban trademark gained strength.

Sale of weapons by Cuba during the Cold War was part of the scheme of Castro's diplomacy. In this way, Cuba formed alliances in all continents and oxygenated its dependent economy as a satellite of the Soviet Union.

The finding on July 10 of 240 tons of arms of Soviet origin and property of Cuba onboard the North Korean vessel "Chong Chon Gang," hidden beneath thousand sacks of sugar, revives the issue of the underground business of weapons.

Havana acknowledged being the owner of the weaponry to the authorities of the Panama Canal. However, it labeled the load as "defensive and obsolete," listed stocks of Mig-21, missiles and tanks, and claimed that everything had been sent to North Korea "for repair" and timely return.

The close ideological ties between Cuba and communist Pyongyang are not a secret. Therefore, Havana's lines of argument are hardly credible according to analysts.

"Cuba seeks a niche in the alternative market of weapons set by North Korea with countries in the Middle East, Africa and Southeast Asia," said Colonel Juan Reynaldo Sánchez, a former bodyguard of Fidel Castro.

A strength scheme

Upon the establishment and internationalization of the Cuban revolution in 1959, Fidel and Raúl Castro erected a weapon business with the Soviet help. Most of the arms would reach Angola or Latin America to bolster guerrillas.

"Cuba backed plenty of anti-US regimes and revolutionary and terrorist groups. Some of them are still alive, trying to impose Marxism. This is the case of the Democratic Republic of Congo," noted Jaime Suchlicki, the director of the Cuban-American Institute.

The connection with the Soviet Union enabled Cuba to develop a local military industry with skilled technicians. To date, 80% of Cuban military materials are of Soviet origin.

"Following the collapse of the socialist field, such industry boasts of 67 sites spread over Cuba, comprising the Military Industrial Union," Sánchez spelled out in a paper posted on website Café Fuerte.

The very Cuban Ministry of Defense has contended that the island "counts on the facilities and the necessary human potential to embark in its territory on any repair of its proprietary armament."

To the mind of Colonel Sánchez, economic restraints would be the only obstacle to undertake such repairs. The Cuban Government has no money to buy spare parts, let alone new weaponry.

Anyhow, "buying the parts from Koreans and repairing the equipment in Cuban factories is cheaper" due to labor savings, he warned.

"Is it possible that Cuba managed to buy modern arms from Russia with Russian credits and even Venezuela's aid? Suchlicki wonders.

Quote of the Day

The biggest obstacle to reform is the model itself.
-- Dr. Carmelo Mesa-Lago, Cuban economist, EFE, 8/2/13

Castro Sells "Security Software" to Venezuela

Thursday, August 1, 2013
According to El Nacional newspaper, last year the Castro regime exported over $3 billion in "security, citizens databases and communications interception software" to the Venezuelan government.

The transactions were conducted through Albet, a Cuban state-owned company linked to the University of Information Sciences (known as "UCI"), an entity created by Castro in 2002 to form the regime's "cyber-warriors."

The UCI is located at a "former" Soviet espionage and communications interception base.

A former Venezuelan government consultant recently described Albet as “a camouflage of Cuba’s G2.”

Ironically, Cuba maintains the lowest Internet connectivity rate in the Western Hemisphere and one of the lowest in the world.  

But it's #1 in control.

To learn more about Cuba's information technology penetration in Venezuela, see this recent report.

Russia Boosts Cuba Ties

Yet, Castro claims he sent his Russian-weaponry all the way to North Korea for "repairs," in violation of the U.N. Security Council's arms embargo.

In The Washington Times:

Russia boosts Cuba ties

The Russian military recently dispatched a guided-missile warship to Cuba as part of what U.S. officials say are growing military, intelligence and economic ties between Moscow and Havana.

The missile cruiser is the Moskva, the flagship of the Russian Black Sea fleet, according to state-run Russian news reports.

“The cruiser Moskva and the large seagoing tanker Ivan Bubnov set off for Havana on the fourth week of their long-distance deployment,” a fleet spokesman told Interfax-AVN on Friday. On the way, the ship conducted a test launch of a cruise missile, he said.

After Havana, the warship will visit Caracas, Venezuela; Managua, Nicaragua; and Praia Port in the Cape Verde Islands off eastern Africa.

The visit to Cuba is part of what the U.S. officials said is a push by Moscow to boost relations with Cuba in the military, energy and transportation sectors.

Riddle Me This, Raul

Wednesday, July 31, 2013
Cuban dictator Raul Castro during his "26th of July" remarks last week:

"The years have passed, but this continues to be a revolution of the young... The new generations will continue to defend the revolutionary ideals."

Really, Raul?

Then why are young Cubans fleeing in droves?

From Reuters:

The number of Cubans leaving their country has increased steadily in recent years, the government reported on Wednesday, reaching levels not seen since 1994 when tens of thousands took to the sea in makeshift rafts and rickety boats.

According to Cuba's annual demographic report for 2012, 46,662 Cubans migrated permanently in 2012, the largest annual figure since more than 47,000 left the communist-ruled island in 1994 after what international observers dubbed the "Rafter Crisis."

Over the last five years, Cubans have been emigrating at an average annual rate of more than 39,000, the report said, higher than in any other five-year period since the earliest years of the revolution.

Today on "From Washington al Mundo"

Cuba and North Korea Also Peddle "Reforms"

Read the stories below very carefully.

Just replace the words North Korea with Cuba, and Kim Jong-un with Raul Castro.

The Castro regime and the Kim regime are peddling more than weapons.

They are also peddling bogus "reforms."

Yet, some "experts" keep happily playing along.

From The Washington Post:

In authoritarian North Korea, hints of reform

Under new leader Kim Jong-un, North Korea in recent months has shifted its rhetoric to emphasize the economy rather than the military and is introducing small-scale agricultural reforms with tantalizing elements of capitalism, according to diplomats and defector groups with informants in the North.

The changes, which allow farmers to keep more of their crops and sell surpluses in the private market, are in the experimental stage and are easily reversible, analysts caution. But even skeptical North Korea watchers say that Kim’s emerging policies and style — and his frank acknowledgment of the country’s economic problems — hint at an economic opening similar to China’s in the late 1970s.

Since when is North Korea "authoritarian"?  

It's a quintessential totalitarian regime.

And here's Reuters:

North Korea plans agriculture reforms

North Korea plans to allow farmers to keep more of their produce in an attempt to boost agricultural output, a source with close ties to Pyongyang and Beijing said, in a move that could boost supplies, help cap rising food prices and ease malnutrition [...]

But it is unclear how far Kim Jong-un can go in liberalizing the economy without losing his family's firm grip on power, most independent analysts say.

This could have easily been written in Havana.

Note that it's not poor Kim Jong-un's fault (for he's a "reformer").

It must be some "hard-line" elements within his totalitarian regime.

Sound familiar?

More Failed "Reforms" in Cuba

Why are Raul's so-called "reforms" failing?

The answer is obvious:

Because they are cosmetic.

From Reuters:

Cuba reports little progress five years into agricultural reform

Agriculture in Cuba remains in crisis and the country is still dependent on imports five years into Raul Castro's presidency and efforts to reform the sector, according to a government report released this week.

More Cuban Weaponry Found on North Korean Vessel

From Daily Mail:

Panamanian investigators unloading the cargo of a seized North Korean ship carrying arms from Cuba under sacks of brown sugar found yet more military hardware on Tuesday.

The authorities discovered 12 engines for MiG-21 fighter jets and five military vehicles that officials said resembled missile control centers.

Investigators earlier in July had found two MiG-21 fighters and two missile radar systems on board the Chong Chon Gang, which was bound for secretive North Korea when it was stopped by officials.

Cuban LGBT Activists Denounce Mariela

Tuesday, July 30, 2013
From The Washington Blade:

Cuban LGBT rights advocates arrive in D.C.

Two Cuban LGBT rights advocates who are visiting the United States for three months on Monday arrived in D.C.

Ignacio Estrada Cepero and Wendy Iriepa Díaz on Monday met with staffers of Us Helping Us, an HIV/AIDS service organization, and Casa Ruby, a multicultural LGBT community center. Estrada and Iriepa are also scheduled to meet with Florida Congresswoman Ileana Ros-Lehtinen on Capitol Hill on Wednesday before they return to Miami.

Estrada, who founded the Cuban League Against AIDS in 2005, told the Blade while at Casa Ruby that he and Iriepa, a transgender woman who used to work for Cuba’s National Center for Sexual Education (CENESEX) — which is directed by Mariela Castro Espín, daughter of Cuban President Raúl Castro — want to “show how we live, how we work” in Cuba while they are in the U.S.

The couple, who married in a high-profile wedding in Havana, the Cuban capital, in 2011, said Mariela Castro presents what they described as a distorted reality of the island’s LGBT community to the world.

“Mariela totally manipulates the LGBT community,” Iriepa said.

Estrada and Iriepa arrived in D.C. less than three months after Mariela Castro traveled to the U.S. to accept an award from Equality Forum, a Philadelphia-based LGBT advocacy group.

Mariela Castro’s supporters note she successfully lobbied the Cuban government to begin offering free sex-reassignment surgery under the country’s national health care system in 2010. Iriepa herself had SRS in 2007 while she worked at CENESEX.

Observers have credited Cuba’s condom distribution campaign and sexual education curriculum with producing one of the world’s lowest HIV infection rates. Cubans with the virus also have access to free anti-retroviral drugs.

CENESEX in May scheduled a series of events across Cuba to commemorate the annual International Day Against Homophobia and Transphobia. Mariela Castro has also spoken out in support of marriage rights for same-sex couples in the country.

“I am very proud of how we have advanced [LGBT rights in Cuba,]” she said during an Equality Forum panel in Philadelphia.

Estrada and Iriepa and other Cuban LGBT rights advocates remain critical of Mariela Castro and her father’s government.

Leannes Imbert Acosta of the Cuban LGBT Platform claimed authorities last September detained her as she left her Havana home to bring materials to CENESEX on a planned exhibit on forced labor camps to which the government sent more than 25,000 gay men and others deemed unfit for military services during the 1960s. Estrada said that last fall during a New York City panel organized by Cuba Archive – a group that documents human rights abuses on the island –  more than 500 people with HIV/AIDS remain in prison for what he described as the crime of “pre-criminal social dangerousness.”

When the Blade attempted to address criticisms from Estrada and other LGBT rights with Mariela Castro during a press conference before she accepted the Equality Forum award, the group’s Executive Director Malcolm Lazin interrupted, preventing the questions from being asked.

“You work for the community but you aren’t really from this community without rights,” Estrada told the Blade. “And without rights nothing can be achieved.”

Guillermo Alvarez Guedes (1928-2013)

Rest in peace.

Click here for an afternoon laugh in his honor.

U.S.-Cuba Democracy PAC Announces "Young Leaders Group"

U.S.-Cuba Democracy PAC Announces "Young Leaders Group"

New Group Will Play Key Role in Policy, Community Outreach and Social Media

The U.S.-Cuba Democracy PAC ("PAC") is pleased to announce the creation of its new Young Leaders Group ("YLG").

The YLG is composed of dynamic young professional and student leaders (under-35) with a proven commitment to democracy, human rights and the rule of law. The founding Board of Directors is composed of members from Miami, Washington, D.C., Philadelphia and Atlanta.

"The passion and enthusiasm of these young leaders is not only inspiring to me, but proves that we are passing the torch with a stronger flame than ever," said Gus Machado, co-founder and Treasurer of the PAC.

The YLG will play a key role in the PAC's policy discussions, community outreach and social media.

"I look forward to working together with these young leaders to ensure that human rights and democracy remain at the forefront of U.S.-Cuba policy," said Mauricio Claver-Carone, 37-year old co-founder and Director of the PAC.

(Below is the official Mission Statement, Agenda and Biographies of its founding Directors.)

The U.S.-Cuba Democracy PAC is a non-connected, non-partisan, federal political action committee dedicated to the promotion of an unconditional transition in Cuba to democracy, the rule of law and the free market. It is the single-largest foreign-policy political committee in the U.S. and the largest Hispanic political committee in history.

Mission Statement

The US-Cuba Democracy PAC Young Leaders Group ("YLG") is a group of young professionals and students who work to promote democratic values, human rights and the rule of law as the cornerstone of US-Cuba policy. The YLG is dedicated to spreading awareness among young Americans regarding the brutality of the Castro dictatorship and the courageous efforts of Cuba's young, vibrant and diverse pro-democracy movement. Its mission will continue until a free and democratic future is ensured for all Cubans.

Agenda

Social Media Campaigns - The U.S.-Cuba Democracy PAC Young Leaders Group ("YLG") will spread awareness of the injustices in Cuba and the need for a comprehensive U.S. policy that promotes human rights and democracy through social media campaigns encompassing all relevant platforms.

Issue Advocacy - The YLG will continue to advocate for a U.S. policy towards Cuba that holds paramount the fundamental right of the Cuban people to be free and enjoy all liberties. This includes publishing Op-Eds and other methods of engaging with mass media, hosting conferences, meeting with community and political leaders and peer-to-peer engagement.

Community Events - The YLG will host community events in order to connect other young professionals and students interested in supporting a policy that emphasizes democracy and human rights for the Cuban people.

Founding Board of Directors

Anthony Cruz is a student whose dedication to human rights marks his college career. His advocacy and enthusiasm for liberty and democracy has driven him to be active on campus and in his community on issues involving Cuba and Cuba policy. Cruz is a rising junior studying political science at the University of Pennsylvania.

Keith Fernandez is a former campaign advisor to Rep. Ileana Ros-Lehtinen and has held leadership roles in various Florida-based statewide and local campaigns. He co-authored a widely covered bipartisan petition that urged the Pope to meet with dissidents during his 2012 visit to Cuba. He has been published in the Cuban-American Bar Association Briefs and the Miami Herald. Fernandez holds a B.A. in Political Science from Florida International University and a J.D. from the University of Florida, Levin College of Law.

Carlos M. Gutierrez, Jr. is an attorney who resides in Washington, DC. Gutierrez is a former aide to Congressman Mario Diaz-Balart and a former international development professional with the Inter-American Development Bank. Carlos holds a B.A.from the University of Michigan and M.A. and J.D. from Georgetown University.

Gregory Hernandez is a law clerk at the law firm of Alvarez Arrieta & Diaz-Silveira LLP, a member of the Cuban American Bar Association and Belen Alumni Lawyers. Mr. Hernandez graduated from the Catholic University of America with a Bachelor of Arts in Political Science and minors in Literature and Philosophy in 2008. He received his J.D. in 2012 from the University of Miami School of Law and is pending admission to the practice of law in the state of Florida.  Mr. Hernandez is dedicated to preserving freedom for those at home and abroad and has made that a focus of his personal and professional endeavors. He has been active in community affairs and has participated in a number of development missions abroad including to the Dominican Republic, Belize and Honduras.

Marco Leyte-Vidal is a civil trial attorney who works for the advancement of his community and human rights. Leyte-Vidal has been recognized for his work in the legal field, recently being awarded the Cystic Fibrosis Foundation’s 40 Under 40 lawyers of Miami-Dade County and Florida Trend’s Legal Elite Up and Comers. He hosts an annual domino night against cancer, benefiting La Liga Contra el Cancer, and started a scholarship at the FIU College of Law.

Vanessa Lopez is studying law at Emory University Law School. She was a research associate at the Institute for Cuban and Cuban-American Studies at the University of Miami. She was a founding member of UMCAUSA - Students for a Free Cuba at the University of Miami. She holds a Bachelors in Arts and Masters in International Administration from the University of Miami.

Rudy Mayor is active in human rights and pro-democracy issues, has organized events to raise awareness of political prisoners and was featured in a documentary titled "Oscar's Cuba" on former prisoner Dr. Oscar Elias Biscet. Mayor authored an Op-Ed on Cuba policy for Fox News Latino and previously worked for the Center for a Free Cuba. He is a Hialeah native and also a third-year law student at The George Washington University Law School in Washington, D.C.

Senior Cuban Official Visits North Korea

The Castro regime's state media has reported that senior Cuban Communist Party official, Jose Ramon Balaguer, is in Pyongyang today, where he held high-level meetings with North Korean officials.

According to the report, "both sides agreed to the good state of bilateral relations, to strengthen links and expand cooperation."

This visit comes amid the scandal of a North Korean vessel caught smuggling a Cuban arsenal through the Panama Canal, in violation of the U.N. Security Council's arms embargo.

It is curious that Castro has chosen the 81-year old Balaguer to lead this trip.

He is a former Health Minister and Cuban Ambassador to the Soviet Union.

Most importantly, Balaguer is a close Castro confidant, which means they want to ensure the utmost secrecy in dealing with (and lying about) this crisis.

Castro Criticizes Vulgarity, Yet Dissidents Pelted With Feces

Earlier this month, dictator Raul Castro gave a speech criticizing the Cuban people for incivility and disrespect.

He specifically criticized widespread littering, graffiti and acts of vandalism.

Yet, Castro has no problem with his security forces pelting dissident's homes with feces, condoms filled with paint and even bottles with gasoline.

That's exactly what they did this week to the home of Julio Cesar Alvarez Marrero, of the Human Rights Clarity Movement, and his wife, Catalina Hidalgo Nonell, of The Ladies in White.

Pedazos de la Isla has more details here.

U.N.: Concern Over Women's Rights in Cuba

The U.N.'s Committee on the Elimination of Discrimination Against Women ("the Committee") concluded its 55th session last week and adopted its concluding observations and recommendations on Cuba.

Here are some key segments:

The Committee is concerned about the general lack of awareness of the Convention and of the Committee’s General Recommendations in the State party. It is particularly concerned that women themselves, especially those in rural and remote areas and women belonging to minorities, are not aware of their rights under the Convention, and lack the necessary information to claim their rights.

The Committee remains concerned about the lack of effective access to justice for women and about the multiple factors that prevent them from effectively accessing justice, such as a general lack of awareness of the Convention and the Committee’s General Recommendations on the part of the judiciary and enforcement officers, absence of free legal aid provided by the State and the stigmatization of women who bring their cases to courts. The Committee is also concerned about “re-education” of women involved in prostitution without clear and transparent objectives and procedures, as well as about the lack of information about the number and conditions of women in detention. 

The Committee is also concerned about the absence of a complaint mechanism to report cases of discrimination and the violations of women’s human rights and the lack of an independent national human rights institution in the State party.

The Committee is concerned at the persistence of violence against women, including domestic violence, in the State party, which remains under-reported due to the prevalence of discriminatory social and cultural norms and the denial by the State party of the existence of different types of violence. 

The Committee is deeply concerned that the State party does not acknowledge the existence of exploitation of prostitution. The Committee is further concerned at the lack of statistical data, disaggregated by sex and geographic area, on trafficking and exploitation of prostitution in the State party. The Committee is also concerned about the lack of efforts to prevent the exploitation of prostitution and to address its root causes, and the lack of protection and services available to victims of such exploitation.

The Committee is concerned about the vulnerability of women of African descent, elderly women, rural women and women with disabilities, as well as about obstacles preventing them from enjoying basic rights, such as access to health-care services, social benefits, education and participation in political and public life. 

The Committee notes that the adherence of the State party to the nine major international human rights instruments  would enhance the enjoyment by women of their human rights and fundamental freedoms in all aspects of life. The Committee therefore encourages the State party to consider ratifying the treaties to which it is not yet a party, i.e. the International Covenant on Economic, Social and Cultural Rights, the International Covenant on Civil and Political Rights and the International Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families.

The entire report can be accessed here

Tweet of the Day

Monday, July 29, 2013

Today on "From Washington al Mundo"

Must-Read: Castro's Get Caught in the Act

By Mary Anastasia O'Grady in The Wall Street Journal:

The Castro Brothers Get Caught in the Act 

News of arms shipments to North Korea rudely interrupts the happy talk about reforms in Cuba. 

The news that Cuba was caught smuggling fuel and weaponry on a North Korean freighter through the Panama Canal surprised many who have bought the line that the Castro regime is reforming and eager to lose its reputation for criminality.

They are like the fabled frog that agrees to carry the scorpion on his back across the water. When the scorpion stings the frog midstream, the amphibian is confounded because it is clear that both will drown. But the scorpion explains that what he did was inevitable because "it's my nature."

The same goes for the Castro brothers. They are simply incapable of containing their beastliness.

To pretend otherwise is to deny that the Castros, who lobbied the Soviets for nuclear war against the U.S. in 1962, are still dangerous. Yet denial is in fashion in some newsrooms and in the cloakrooms on Capitol Hill, which is why the weapons-smuggling story was so evanescent.

The scorpion nature of the Castros is hardly news to Cubans. They are not permitted to use the Internet, to watch independent news broadcasts, to earn dollars, to speak their minds, to send their children to private school or to worship freely. Something as basic as milk for children is hard to find.

Some Cubans who rebel languish for years in dungeons. Others are now victims of a new method of repression that observers call "catch and release." The Council of Human Rights Rapporteurs in Cuba reported last week that "in the first six months of 2013 the Cuban government political police made more than 1,000 arbitrary arrests for political activity, the majority [of the arrests] violent and lasting on average between 12 and 24 hours." The council counts more than 70 political prisoners serving multiple-year sentences.

Increased repression has accompanied recent efforts to bring in more foreign exchange by attracting American visitors through "educational" and "cultural" excursions that are permitted by the U.S. under its long-standing embargo. The movements of these visitors and their interaction with Cubans must be tightly controlled by the dictatorship to ensure that they don't see too much of the real Cuba. They are supposed to go away singing the praises of the happy communist paradise, and many do.

A dictatorship is apparently an exotic curiosity for well-to-do Americans. They are being herded through selected parts of the country in large numbers to view firsthand what deprivation can inspire.

This week the elite Phillips Exeter Academy announced that it would join with Miss Porter's School "on a week-long exploration of the fascinating art and culture of Cuba." There was no mention of whether students in these prep schools would be visiting the jails where nonconformists—including artists, musicians and the black human-rights advocate Sonia Garro—reside. Nor was it clear whether the children would learn about the dual-currency regime in which the military government pockets dollars from the visitors while it pays workers in almost worthless bits of paper. Somehow I doubt it.

‪Now comes the news of the arms shipment aboard the Chong Chon Gang headed for North Korea, a land of barbed-wire fences and starvation, a regime so dangerous to world peace that even the dithering United Nations Security Council, China included, agreed unanimously in March to heightened sanctions against it.

The Cuban foreign ministry immediately claimed that the weaponry, found hidden under 10 tons of sugar and undeclared, was obsolete and going abroad for repair. But José Otero writes in the Panamanian daily La Prensa that Panamanian officials found two MiG fighters and full tanks of jet fuel, along with "a mid-air refueling plane, two vehicles for towing radars, a rocket-launching platform, a radar antenna with platform and many cables" in the ship's hold.

Experts say the story doesn't add up. Weapons repairs are normally made by ordering parts and flying in technicians. What is more, since everything was made in the Soviet Union, sending it to North Korea doesn't make sense.

Former Colombian President Alvaro Uribe tweeted on July 18 that a reliable source told him that part of the shipment was destined for Ecuador. Colombian journalist Eduardo MacKenzie noted in an online column last week that "seven other North Korean ships had made trips to Cuba in the last four years with itineraries similar to the Chong Chon Gang." A further mystery is what these ships may have brought to Cuba in the first place.

All of this smells bad. Cuba wants to shake off its international pariah status so that it can get World Bank and Inter-American Development Bank handouts and credit from U.S. banks, thereby avoiding economic and political reform. Indoctrinating the girls at Miss Porter's School is part of that effort. The arms-trafficking is, or should be, a wake-up call.

Beware of Raul "the Reformer"

By Jose Cardenas in The Washington Times:

Beware of Raul the Reformer

Cuban arms trafficking puts the lie to ‘change’

In the wake of Panama’s seizing of a North Korean freighter laden with 240 tons of illegal weaponry traversing the Panama Canal from Cuba to North Korea, many observers have professed to be nonplussed by the brazenness of Cuba’s role in the caper. After all, we have been told, this is a “new” Cuba under Raul Castro, who is ostensibly committed to reforming the outdated system of his brother, Fidel, and ushering in a kinder, gentler Cuba.

The reality is that the Panama incident only exposes the carefully constructed narrative of Raul the Reformer as utter propaganda designed mostly to force a unilateral change in U.S. policy toward Cuba. Raul Castro has no more interest in liberalizing Cuba and returning it to the peaceful community of nations than does Syria’s Bashar Assad.

Still, it is remarkable how successful the marketing campaign has been for the idea of Raul the Reformer. Even The Economist has bought the line, writing, “Since Raul Castro took over from his elder brother in 2006, he has moved to dismantle Fidel’s system,” and that the only thing holding his reform effort back is that the outside world “is not helping enough.”

What bunk. The only transition underway in Cuba today is from a personalist dictatorship under Fidel Castro to a military one under brother Raul. And neither is good for U.S. security interests.

Since Raul Castro took power, the only defense minister that Cuba has known in 50-plus years has moved methodically and systematically to purge his brother’s civilian acolytes from positions of power and replace them with generals loyal to him. Today, eight of the 15 members of the Cuban Politburo are members of the military, as are four of seven vice presidents on the council of ministers.

However, the militarization of the regime doesn’t end there, as Mr. Castro has also created a parallel ruling body off the books where the real power lies. This 14-member junta is stocked with military men only, including the country’s four most powerful generals: Leopoldo Cintras Frias, 72, minister of defense; Abelardo Colome, 73, minister of the interior; Alvaro Lopez Miera, 69, first vice minister of defense and chairman of the Joint Chiefs; and Ramon Espinosa, 74, vice minister of defense. In other words, not a group that can be expected to be a font of new thinking. (It’s worth noting that Mr. Castro’s much-ballyhooed successor, the 53-year-old nondescript civilian Miguel Diaz-Canel, is not a member of this group.)

Mr. Castro has also further expanded the military’s reach into Cuban society by cutting it into lucrative economic enterprises, especially in the tourist sector. Today, the Cuban military elites control more than 60 percent of the Cuban economy. Operating under the holding company GAESA, the array of companies the military operates rakes in an estimated $1 billion a year for the generals to divvy up.

Yet even as the military has been steadily permeating all sectors of Cuban society, all that most outside observers focus on are minuscule reforms on the margins of the Cuban economy. That some Cubans are now allowed to work outside the state under a circumscribed list of microenterprises such as doll-repairer and refilling disposable cigarette lighters is myopically hailed as a stunning breakthrough.

The bottom line is that under Raul Castro, there has been absolutely no fundamental change in the regime’s repressive governing philosophy. Cuban citizens are still subordinated to the state, and there is no recognition of their inalienable rights to think and do as they please. The tepid reforms to date reflect not a new willingness to grant more freedom to Cubans to better fend for themselves and give them a stake in their own future, but to help ensure the primacy of the regime in maintaining absolute control.

And, today, with military elites comfortably ensconced as captains of profitable economic enterprises such as tourism and dollar-only stores, the prospects for true reform in Cuba are as negligible now as they were under Fidel Castro.

The final irony regarding the Panama incident is that just as authorities there seized the North Korean freighter, State Department officials were sitting down with Castro regime officials to resume long-suspended immigration talks. As to why the Obama administration thinks the time propitious to restart talks with an unrepentant and inflexible Castro regime on any subject is what is truly incomprehensible. It certainly cannot be based on anything positive that is happening on that captive island nation.

In light of the Castro regime’s egregious actions in trafficking illegal arms to North Korea under the U.S.’ nose, what is needed now are not State Department talks for the sake of talking, but meaningful measures to hold Cuba accountable for its latest undermining of regional and international security.

Castro's New (Old) Strategy: Deny and Lie

Sunday, July 28, 2013
In a letter published in state media today, Cuban dictator Fidel Castro writes:

"In recent days there was an attempt to slander our Revolution, trying to portray (President Raul Castro) as tricking the United Nations and other heads of state."

The regime has already admitted to sending (smuggling) missile components, fighter jets and other weaponry to North Korea, which is clearly in violation of the U.N. Security Council's arms embargo.

After all, the were caught red-handed.

So why is Castro now adopting a new strategy of "deny and lie"?

Is he afraid of what has yet to be discovered?

Or are old habits tough to break?

Cuba: 60 Years of a Fiasco

By Andres Oppenheimer in The Miami Herald:

Cuba celebrates 60 years of involution

Cuban President Gen. Raúl Castro celebrated Friday the 60th anniversary of the guerrilla attack on the Moncada barracks that marked the beginning of the Cuban revolution, but the event could just as well be remembered as marking six decades of Latin America’s biggest political, economic and social fiasco.

Granted, many of us, especially those born outside the island, once saw the “Cuban revolution” with a dose of romantic admiration. But even if you brush aside the fact that Cuba’s revolutionaries toppled one dictatorship to install another, the cold statistics of the past six decades tell a story of thousands of senseless deaths, a massive emigration that split Cuban families, and an economic collapse with few parallels anywhere.

In 1958, the year before then guerrilla leader Fidel Castro took power, Cuba had a per capita income of roughly $356 dollars a year, one of the three or four highest in Latin America, according to Carmelo Mesa Lago of the University of Pittsburg, co-author of “Cuba under Raúl Castro” and one of the most prominent experts on the Cuban economy.

By comparison, Costa Rica was poorer, and Asian countries such as South Korea were much poorer, with per capita incomes of less than $100 a year.

Consider how much things have changed since:

•  According to the World Bank’s databank, South Korea, which started welcoming massive foreign investments in the early 1960’s, today has an annual per capita income of $22,600; Costa Rica of $9,400, and Cuba of $5,400. And according to Mesa Lago, Cuba’s real per capita income is probably lower than that because the figures have been manipulated by the island’s government.

•  South Korea has 276 cars per 1,000 people, while Costa Rica has 135, and Cuba only 21, the World Bank statistics show.

•  In South Korea, 37 percent of the population has access to broadband Internet, compared with 9 percent in Costa Rica and 4 percent in Cuba, they show.

While South Korea has become a world industrial powerhouse — its Samsung electronic goods and Hyundai cars are exported everywhere — and Costa Rica has high-tech factories from companies such as Intel, Cuba is an industrial basket case.

The island has not even been able to continue producing sugar or cigars at its 1958 levels. According to Cuban government figures cited by Mesa Lago, Cuba’s sugar production has fallen from 859 tons to 106 tons per 1,000 people over the past six decades, and Cuba’s cigar production has fallen from 92,000 cigars per 1,000 people to 36,000 over the same period.

Until recently, Cubans used to joke that the three biggest accomplishments of Cuba’s revolution are health, education and the restoration of national dignity, while its three biggest shortcomings are breakfast, lunch and dinner.

But even Cuba’s health and education standards have fallen in recent years, and its national dignity has been compromised by its almost total economic dependence first from the former Soviet Union, and lately by Venezuela.

Today, Cuba’s life expectancy of 79 years is the same as that of Costa Rica, and below South Korea’s 81 years. In education, Cuba deserves credit for virtually eliminating illiteracy sooner than most other Latin American nations, but its higher education is far from what it used to be.

A newly released ranking of Latin American universities by QS, a well-known London-based university research firm, places the once prestigious University of Havana at the 81st place in the region. It ranks way behind universities of Brazil, Chile, Colombia, Argentina, Colombia, Costa Rica, Venezuela and Paraguay.

Asked whether Castro’s latest pro-market reforms to revert Cuba’s economic disaster will work, Mesa Lago told me in an interview that “these are the most important economic reforms that have been implemented in Cuba since the revolution. The problem is that excessive regulations, bureaucratic red tape and taxes are blocking their success.”

My opinion: Cuba’s apologists will probably argue that I’m influenced by the Miami exile “mafia”and will come up with Cuba’s own figures purporting to show the island as a model country.

But when I heard the presidents of Uruguay, Bolivia, Nicaragua and other countries who were standing next to Gen. Castro on Friday’s anniversary in Santiago de Cuba praising the “achievements of the revolution,” the first question that came to my mind was: if Cuba is such a success and Cubans are so happy, why hasn’t the government allowed one single free election in six decades? The answer is that Cuba’s dictatorship knows very well that its revolution has been a fiasco, and that it would lose them.

Cuban Dissident's Digital Media Revolution

From PBS:

Cuban Dissidents Harness Blogs, Social Media to Spread Cause Globally
 
For the past half dozen years, dissidents such as Yoani Sanchez and her blog “Generation Y” have opened the political debate like no other time since the Castros came to power in Cuba.

But Cuba’s dissident movement has deep roots, with many working in relative obscurity for decades.

That’s all changing with modern technology.

With the global expansion of the Internet, dissidents have been able to step into the international limelight, using blogs and social media to generate vast networks of supporters.

Websites such as Voces Cubanas and The Havana Times allow dissidents to critique the government, offer alternative perspectives and connect with other civil society groups.

Although only 5 percent of Cubans have access to the Internet, dissidents have used innovative methods to spread their messages.

“The Cuban who is writing the blog cannot easily or inexpensively access the Internet to update the blog,” said Ted Henken, professor of Latino Studies at Baruch College of New York, “so they have a partner abroad who voluntarily helps them do that … So for example Havana Times … the editor lives in Managua, Nicaragua, the webmaster lives in Japan and all of the writers live in Havana. They harness people around the world who translate, who administer.”

Creative Ways to Bypass the Government

Because the Cuban government condemns all anti-communist speech as “enemy propaganda,” activists still must take extreme precautions.

They often download the blogs and secretly share them on flash drives to allow Cubans on the island to access these materials. This gives dissidents the power of the Internet even when they cannot get online.

Henken explains that the Internet has also enabled activists to form stronger connections with Cubans living in the diaspora. Now, when the government attempts to suppress dissidents, a global audience stands united to critique those actions.

“For example in 2008, the lead singer for the punk group … Porno Por Ricardo … he was arrested and was going to be charged with pre-criminal dangerousness,” Henken said. “There was a local outrage and very soon it became visible on the international scale through the Internet, and there was an international petition that was started. Before, if you were a dissident you tried to hide because you would be vulnerable, but now … visibility has become an asset.”

Henken said the growing unity within Cuba’s civil society and its connections to the diaspora could create significant political leverage in years to come.

Pitfalls of Activism

The leverage will not fall into the hands of the Cuban people automatically, however.

Cuban dissident Antonio Rodiles understands that democracy will only become possible when stronger ties exist between domestic and exile opposition forces.

Rodiles’s organization, “Estado de Sats,” strives to create public spaces where Cubans can discuss reform and build a wider network of support. The organization has filmed about 70 panel discussions and distributed them on DVD to generate conversation.

“The strategy is to try to create bridges between all different sectors of society, between the activists and artists and lawyers and all the actors,” Rodiles said. “We are trying to create a nexus of support and collaboration … If we do not have a civil society, we are not going to develop a democracy. We are going to develop an unpredictable system.”

Rodiles spearheads a campaign called “Por Otra Cuba,” or “For Another Cuba.” The initiative aims to pressure the Castro regime to ratify the two United Nations’ agreements for civil and political rights signed in 2008. Already, “Por Otra Cuba” has gathered more than 4,000 digital signatures.

But Rodiles said this work is more difficult than it sounds. Last year, the government detained him for 19 days on charges of resisting arrest.

He says the government uses these forms of intimidation to stifle the dissident movement.

“The Cuban Government is going to try to use violence to stop us — in fact they have been doing this to social actors for years to send a clear message to the rest of society,” Rodiles said.