Top Intelligence-Defense Lawmakers Introduce Cuban Military Transparency Act

Friday, June 26, 2015
Top Defense Lawmakers Introduce Cuban Military Transparency Act

Bill prevents Cuban military and Interior Ministry from benefiting from new trade

Congressman Devin Nunes (CA-22), Chairman of the House Permanent Select Committee on Intelligence, introduced a bill in the House of Representatives today that would ban Americans from engaging in any financial transactions with the Cuban military or the Cuban Ministry of the Interior, or with any entity controlled by the military or the Ministry.

Supported by 32 original cosponsors, the Cuban Military Transparency Act will ensure that the Cuban people, and not the Castro regime’s repressive security apparatus, benefit from any increased trade resulting from the Obama administration’s policy to normalize U.S.-Cuban relations. Chairman Nunes and original cosponsors Mac Thornberry, Chairman of the House Armed Forces Committee, and Rodney Frelinghuysen, Chairman of the Defense Appropriations Subcommittee, issued the following statements:

Chairman Nunes: "Despite the Obama administration’s attempts at reconciliation, the Castro regime continues to oppress the Cuban people and to shelter members of the Cuban military responsible for shooting down U.S. civilian aircraft in the Florida Straits. This bill will ensure that the government entities responsible for these acts – the Cuban military and the Interior Ministry – will not reap the rewards of increased trade with the United States."

Chairman Thornberry: "I believe that most Cubans are good people who yearn for freedom and opportunity, but we must ensure that any expansion of trade with or travel to Cuba does not strengthen the brutal Castro regime. I look forward to the day when we can pursue completely free trade and travel between the U.S. and Cuba, but current circumstances require us to move cautiously, as this legislation does."

Chairman Frelinghuysen: "While the Obama Administration appears to be handing the Castro regime everything it wants without placing serious demands on the Castro government, it is absolutely unthinkable that the White House would act to benefit the Cuban military which has violated numerous U.N. resolutions and provided aid and comfort to all sorts of malevolent groups in our own hemisphere."

Castro Son's Bodyguards Attack Reporters During Luxury Mediterranean Vacation

In the spirit of Uday, Saif and Bashar.

From Turkey's Zaman:

Bodyguards of Fidel Castro’s son attack Turkish reporters in Bodrum

Three of Antonio Castro Soto Del Valle's -- the son of former Cuban leader Fidel Castro -- bodyguards attacked photographers from a news agency for filming the younger Castro during his vacation in Turkey's resort district of Bodrum on Wednesday, according to the Doğan news agency.

Castro reportedly had dinner at a restaurant in Bodrum with 12 friends, who included some Turks, on Wednesday night. Castro later thanked each employee who served him at the restaurant. As Castro left the restaurant at around 11 p.m., he noticed that he was being caught on camera by a Doğan reporter and went back inside in a rage, according to Doğan. Castro waited in the restaurant's kitchen for a while before he went out and left the premises in his car, which was brought to the front of the restaurant.

After Castro left the area, a Turk and two Cubans, who were reportedly his bodyguards, punched and threatened the Doğan photographers, attempting to take their cameras. Photojournalist Yaşar Anter sustained a minor injury as a result of being punched. While the two Cuban bodyguards fled the scene, the Turkish bodyguard, H.K., was briefly detained by the police. A group of people who accompanied Castro at the restaurant also left in a van.

Castro recently came to Bodrum with his 50-meter boat from the Greek island of Mykonos and booked five en suite rooms at a luxury hotel for himself and those accompanying him.

Castro's Granma Endorses Gutierrez Cuba Op-Ed

The Obama Administration (and Castro's D.C. lobbyists) weren't the only ones thrilled by former U.S. Secretary of Commerce Carlos Gutierrez's endorsement of the Obama Administration's (give-everything-for-nothing) Cuba policy.

The Castro regime's propaganda mouthpiece, Granma, also gave an official endorsement of Gutierrez's op-ed in The New York Times this week.

Castro's censors clearly found nothing objectionable in Gutierrez's editorial.

Click here to learn why.

In Cuba Policy, Talk is Cheap

By Guillermo Martinez in Sun-Sentinel:

Change in Cuba-U.S. policy hasn't arrived yet

Easing of relations with Cuba is still a long way off

A friend I admire enormously sent me a copy of an article by former Secretary of Commerce Carlos Gutiérrez.

His comment was short and to the point: "In case you missed ..." with "A Republican Case for Obama's Cuba Policy — The New York Times" as a subject line.

The op-ed column said that while Gutiérrez originally opposed President Barack Obama's policy of reestablishing relations with Cuba, now he is becoming optimistic that it actually might bring about a better life for some people in Cuba.

"Today, I am cautiously optimistic for the first time in 56 years. I see a glimmer of hope that, with Cuba allowing even a small amount of entrepreneurship and many American companies excited about entering a new market, we can actually help the Cuban people," Gutiérrez said.

The former chief executive officer of a major American corporation has changed a lot in his retirement. I cannot imagine him saying that when he was working for a Republican president or when he was working for an American company.

It makes no sense. The announcement by Obama and Cuba's President Raúl Castro came on Dec. 17. They pledged to work to reestablish diplomatic relations as a first step toward normalizing relations in the future.

Six plus months have passed since that announcement. American and Cuban diplomats have met officially and socially several times in Washington and in Havana. They have talked — my how they have talked. They have even put up the flagpole at the Cuban Interest Section in Washington waiting for the day the Cuban flag may once again wave in our nation's capital. Still, nothing has happened.

Relations between Cuba and the United States will not be friendly or normal, not until the Castro brothers are dead and buried and the new leaders in Cuba decide they have to grant more freedom to the people.

Gutiérrez talks about the entrepreneurship opportunities now open to the Cuban people. They have been open for years. They are for mom and pop enterprises, and they can only operate under strict government guidelines.

Big American companies cannot invest in Cuba because:

Cuba must reimburse American corporations for the billions of dollars of properties expropriated by the Castro regime;

Cubans have the lowest per-capita income in the Western Hemisphere — about $20 per month. That does not give them much money with which to buy America products;

Congress banned exports to Cuba many years ago. The president cannot override the law with an executive order. The only exception to the law is granted to companies that sell food and medicine to Cuba providing the Cuban government pays for it in cash ahead of time;

If the United States were to grant Cuba credit to buy food and medicines in this country and Cuba could not pay, the American taxpayer would have to pick up the tab.

Gutiérrez adds that he never "expected negotiations to get this far."

He is right. Both countries have talked to their heart's content. Scores of congressional and business delegations have gone to Havana. Yet nothing has been accomplished.

Gutiérrez says negotiations have covered the extradition of American fugitives who fled to Cuba. I have not seen the Cuban regime agree to that.

In fact, since these negotiations began, more Cuban dissidents are being arrested and beaten up in Cuba than before the talks began. Talk is cheap. Actions come at a steeper price; one that the U.S. Congress is not willing to accept.

More than half a dozen appropriations bills for funding of several government agencies have taken out funds for any improved relations with Cuba. These cover the State Department, the Justice Department, Treasury, Commerce, etc. These cuts to the Obama government proposals have come with votes from both sides of the aisle.

Congress has not been willing to give Cuba the free rein Obama would like. Not until Cuba stops persecuting dissidents. Not until it allows a free press. Not until there are free and multi-party elections. Not until the legal framework allows for foreign investment in the country without part of the business going to the Cuban Armed Forces. (Any dollar-producing enterprise in Cuba must be done in partnership with the Cuban Armed Forces and a close relative of President Castro).

The time will come, but it is here yet.

WSJ: When Helping ‘the Cuban People’ Means Bankrolling the Castros

Wednesday, June 24, 2015
By Mauricio Claver-Carone in The Wall Street Journal:

When Helping ‘the Cuban People’ Means Bankrolling the Castros

U.S. legislation to ease sanctions will instead primarily benefit Havana’s state-owned monopolies.

Three bills full of lofty but disingenuous rhetoric about “supporting the Cuban people” were recently filed in the U.S. Senate to ease sanctions. To have an honest debate about sanctions on Cuba, it’s important to understand how that totalitarian regime conducts business. The bills primarily benefit three monopolies in Cuba, all owned and operated by the Cuban government: Etecsa, Alimport and Gaesa.

Let’s look at each piece of legislation:

The Cuba Digital and Telecommunications Advancement Act. This bill’s purpose is to provide millions of U.S. dollars to develop telecom infrastructure for the Empresa de Telecomunicaciones de Cuba, S.A. (Etecsa), owned by the Cuban government. The company works with the secret police of Cuba’s President Raúl Castro, tapping phone lines, monitoring conversations, censoring the Internet and persecuting Cubans discovered with homemade satellite dishes.

Etecsa is very good at what it does, according to a recent report by Freedom House, a nongovernmental organization based in Washington, D.C., that ranks Cuba, China, Iran and Syria as the world’s most Internet-repressive governments.

The cosponsors of the Cuba Digital and Telecommunications Advancement Act, including New Mexico Democratic Sen. Tom Udall and Arizona Republican Sen. Jeff Flake, argue that foreign investment in Etecsa will lead to greater Internet connectivity for the Cuban people. Apparently they are unaware that Telecom Italia owned a 27% stake in Etecsa from 1995-2011. Or that America’s Sprint Corporation provided Etecsa with its first Internet connection in 1996, and that France’s Alcatel-Lucent laid new fiber optic cable for Etecsa in 2012.

None of those “foreign investments” improved connectivity for the Cuban people. What the investments did was improve the Cuban government’s ability to control its people.

Etecsa already provides Internet service in Cuba. The problem is that the Cuban government only allows foreigners and its own apparatchiks to access the Internet. So this Senate bill purports to solve a problem that doesn’t exist and offers nothing to change the real problem.

The Agricultural Export Expansion Act. This bill seeks to provide lines of credit to the Empresa Cubana Importadora de Alimentos, S.A. (Alimport), the Castro brothers’ import monopoly. This government organ is already well supplied by U.S. taxpayers. Since Congress passed the 2000 Trade Sanctions Reform and Export Enhancement Act, nearly $4 billion in U.S. agricultural products have been sold to Cuba. The only buyer was Alimport. As the U.S. Agriculture Department reports: “The key difference in exporting to Cuba, compared with other countries in the region, is that all U.S. agricultural exports must be channeled through one Cuban government agency, ALIMPORT.”

One result is that little of the food and medicine that Cuba imports from the U.S. ever makes it to stores where Cubans shop. It isn’t available on ration cards either. Instead, agricultural imports from the U.S. end up on the tables of Cuban government-owned tourist resorts and in government-owned stores that accept only “hard currencies,” such as dollars or euros.

Experience demonstrates that exporting to Cuba is not about assisting small and midsize farmers on the island, as the bill’s cosponsors, including Sens. Heidi Heitkamp, a North Dakota Democrat, and John Boozman, an Arizona Republican, would like their legislative colleagues to believe. It’s about financing the monopoly run by the Castros.

The Freedom to Travel to Cuba Act is a billion-dollar windfall for Grupo de Administracion Empresarial, S.A.—the most notorious and vile of the Cuban-government monopolies.

Gaesa is the holding company of Cuba’s Ministry of the Revolutionary Armed Forces, Cuba’s military. It is the dominant driving force of the island’s economy. Established in the 1990s by Raúl Castro, who succeeded his brother Fidel as Cuba’s leader, it controls tourism companies, ranging from the very profitable Gaviota S.A., which runs Cuba’s hotels, restaurants, car rentals and nightclubs, to TRD Caribe S.A., which runs the island’s retail stores. Gaesa controls virtually all economic transactions in Cuba and is run by Raúl Castro’s son-in-law, Gen. Luis Alberto Rodríguez López-Callejas.

Arizona Sen. Jeff Flake, one of the cosponsors of the Gaesa bill along with Vermont Sen. Patrick Leahy and others, says that it allows Americans to travel to Cuba. But that is misleading. Any American today can travel to Cuba under one of the 12 broad categories of purposeful travel. What Mr. Flake proposes to lift are restrictions imposed in 2000—Trade Sanctions Reform and Export Enhancement Act—on tourism-related transactions with Gaesa. Those restrictions are there because tourism is to Cuba’s military and security forces what oil is to Iran’s military.

Spending by Canadian, European and Latin American tourists enjoying Cuba’s all-inclusive beach resorts sustains the government’s military and security services. It finances the government’s operations to share intelligence with terrorist groups and rogue regimes and promote violence to subvert democracy in Venezuela—and finances a government that has been caught twice in the past two years smuggling heavy weaponry to the world’s worst violators, including North Korea. Nonetheless, Mr. Flake’s bill effectually earmarks millions in U.S. tourist dollars for Gaesa.

U.S. support for Cuba’s government monopolies can only strength that brutal regime’s totalitarian grip. The Cuban people know it, and U.S. senators ought to be able to figure it out.

Mr. Claver-Carone, an attorney, is a director of the U.S.-Cuba Democracy PAC and host of the foreign-policy show “From Washington al Mundo” on SiriusXM’s Channel 153.

In Support of Obama's Cuba Policy, Gutierrez Acts Like Obama

Tuesday, June 23, 2015
In today's New York Times, former U.S. Secretary of Commerce Carlos Gutierrez tries to defend Obama's Cuba policy.

Gutierrez does a poor job defending Obama's policy, but a great job imitating him.

Scouring through the op-ed, there's not a single mention of freedom for the Cuban people, human rights, democratic reform, political prisoners or a reference to the island's courageous dissident leaders.

This op-ed could have been written by Ben Rhodes at The White House.

Who knows? Perhaps it was.

After all, Gutierrez was one of a handful of Cuban-Americans invited to The White House last month, in a desperate bid to build support for Obama's policy.

The White House seems to have fed Gutierrez (on Cuba) the same recipe that Jonathan Gruber fed the American people (on Obamacare).

One thing is for sure -- for Gutierrez to omit the Cuban people's struggle for human rights, freedom and democracy, is not "A Republican Case for Obama's Policy," as his op-ed suggests.

At least it's not a Reagan Republican's case, or that of his former boss, George W. Bush.

After all, Reagan and Bush did not mince words when it came to the freedom of captive nations, particularly for our neighbors in Cuba.

As President Bush clearly stated:

"[Life will not improve for Cubans] if we seek accommodation with a new tyranny in the interests of 'stability.' America will have no part in giving oxygen to a criminal regime victimizing its own people. We will not support the old way with new faces, the old system held together by new chains. The operative word in our future dealings with Cuba is not 'stability.' The operative word is 'freedom.'"

Instead, in his op-ed, Gutierrez praises the government-to-dictatorship negotiations -- which have left the Cuban people out in "the hot Havana sun" and haven't accomplished anything (other than serve as a distraction for increased repression).

Gutierrez praises the visiting Congressional delegations -- who wine-and-dine with Castro regime apparatchiks, but systematically ignore Cuba's democracy activists.

Gutierrez praises American credit card companies authorizing transactions in Cuba -- which (if operational) would finance stays at stolen American properties and the purchase of stolen trademarks (both against the law).

Gutierrez saves most of his praise, however, for the island's "cuenta-propistas," whom he calls "small-business owners"  -- yet they don't own anything. They are state franchises without property or contractual rights.

He praises the exports of tools, supplies and building materials to these "cuenta-propistas" -- even if they must be funneled though Castro's monopolies.

Ironically, those who argue "cuenta-propismo" is a sign of reform in Cuba conveniently overlook the fact that it's not a product of Obama's embrace of Castro on December 17th.

It's also not a result of Castro's "good-will."

It was a result of economic pressure and political necessity.

So why relegate Cuba's democracy leaders in order to stifle reform?

Pursuant to this op-ed, Gutierrez will gain the short-term praise of The White House; of those who seek profit over principle; and of those who seek accommodation over freedom.

He may even earn Obama's nod as Ambassador to Cuba.

But none are worth the price.

Fact: Since December 17th, U.S. Agricultural Sales to Cuba Plummet

Facts are stubborn -- and sobering.

For years we've heard how an improvement in U.S.-Cuba relations, an easing of sanctions and an increase in travel to the island, would benefit U.S. farmers.

Well, since December 17th, the Obama Administration has embraced the Castro regime -- offering it every concession it can deliver.

As part of these concessions, the Obama Administration eased payment terms for agricultural sales.

As a result of these concessions, American travel to Cuba has increased by a reported 37%.

And this week, the Castro regime announced that its GDP had grown by over 4% during the first six months of 2015 -- thanks to growth in its sugar, trade and tourism monopolies.

Oh, and not to mention the endless U.S. business and trade delegations to Havana.

Yet, as The Washington Post reported last week:

"[I]n the six months since President Obama announced a new opening to the island, sales of U.S. foodstuffs — among the few U.S. products allowed, with restrictions, under the embargo — have dropped by half, from $160 million in the first quarter of 2014, to $83 million this year."

How could that be?

Simple.

The biggest lesson the Castro regime has learned from the Obama Administration is that it has more to gain from coercion than from good-will or behavior.

Thus, cut purchases dramatically, and watch the lobbying for financing, mass tourism and investment for Castro's monopolies intensify.

As we've written before, a policy based on coercion is never in the U.S.'s best (political or economic) interest.

Looking for "Lost Business Opportunities" in Cuba

A favorite argument of the Obama Administration -- and those who lobby for the removal of U.S. sanctions towards Cuba -- is that we are ceding "business opportunities" to foreign competitors.

That's funny.

Below is a great graph recently published in The Financial Times comparing foreign direct investment ("FDI") in Cuba, Dominican Republic and Jamaica.

Cuba is the darkest red -- but pull out your magnifying glass, for it's such a blip that it's very difficult to see.

So where are those great opportunities that our foreign competitors are gobbling up?

The fact remains that U.S. tourism, financing and investment are the "opportunity" for Castro's bankrupt regime and its monopolies -- to survive.

Major U.S. Firm: Cuba Investments Are High Risk

From The Miami Herald:

Cuba investments are a high risk for U.S. companies, new report says

A firm that specializes in commercial real estate and investment management has issued a report stating that the time to invest in Cuba has not yet come.

The report by JLL (Jones Lang LaSalle) — among the nation’s 500 highest-earning companies according to the latest edition of the annual Fortune magazine’s list — cautions U.S. investors against diving into business opportunities in Cuba and concludes that the process of "integration with Cuba, even if the embargo is fully lifted, will take decades."

"What we have determined is that there is still a lot of risk involved, there is not a solid banking system, the physical infrastructure of the country is a challenge and with the current embargo, U.S. companies are not allowed to enter into a contract with the government" as required in joint ventures, said Steve Medwin, managing director of the firm.

"There are a lot of impediments in the way. We do not mean that there won’t be opportunities in the future but right now there are so many hurdles that it is rather a wait and see where things shake out. It's like a double-edged sword: There are opportunities but with a very high risk," he added.

The easing of sanctions by the administration of President Barack Obama could have an impact on increased trade with the island, according to the report, but "development plans and economic expansion" should come first.

The ability to directly export to small private entrepreneurs in Cuba — as new regulations now permit— is evaluated as a "marginal opportunity" to increase the volume of trade with the island.

The authors point out the shortcomings of the Cuban infrastructure, low purchasing power and dealing with the Cuban government as additional elements that hinder the American presence on the island.

While Cuban officials have conveyed a welcome message to the U.S. investors, the Cuban government has not yet ruled on many aspects of the measures announced in January, such as direct exports to private businesses or the granting of permits for ferry services.

"They may be saying that, and there may be those opportunities, but when it comes to an individual or company risking their capital to make an investment, people want to have reasonable assurance on getting a return. What we are saying to our constituency is that, what we see today is not a sound investment because of all impediments that are in the way, although there are opportunities," Medwin said.

In this regard, the report identifies telecommunications and the sale of building materials, as avenues where investment opportunities may be more immediately possible, "but it is not an open country with which to do business," he said.

The sector with the most potential for long-term development, according to JLL, is tourism and associated services, such as hotel services and transportation services specifically tied to the industry such as ferries. However, a substantial increase of U.S. tourism would require the complete removal of the embargo and a new legal framework in Cuba so that U.S. companies can legally invest in the creation of a "solid hotel infrastructure."

JLL also assessed business opportunities for Florida, which could benefit from the possible expansion of the demands of offices for financial and legal services to address businesses in Cuba, to the extent that relations and trade between the two countries move forward. Less clear are the opportunities in the agricultural sector, as the report notes, as a result of concerns from the Florida Farm Bureau Federation that competition could mean the arrival of Cuban agricultural products that are very similar to what is grown in Florida.

Senators Collins and Roberts Pose With Expelled Cuban Spies, Flake Smirks

Sunday, June 21, 2015
If U.S. Senators Susan Collins (R-ME) and Pat Roberts (R-KS) did not want to get used as propaganda tools during their trip to Havana last weekend -- they failed miserably.

But that's what happens when you let U.S. Senator Jeff Flake (R-AZ) lead you down the primrose path.

Collins came back smitten from her trip, where they met with endless Castro regime officials -- but couldn't spare a second for Cuba's courageous dissident leaders.

Surely, Flake warned them that if they met with dissidents, their Castro regime hosts would get upset and cancel their meetings -- so they obliged.

Just imagine what the world would be like if Congressional leaders did the same to Havel, Walesa, Suu Kyi, Sakharov and Mandela during their darkest hours.

Some did and history looks back at them shamefully.

Collins was so impressed by her Castro interlocutors that she posted a picture with them. And, of course, she's probably unaware of the background of some of these apparatchiks.

On the far right (picture below) is Gustavo Machin Gomez, a Cuban spy who was declared persona non grata and expelled from the United States in 2002.

On April 14th, 2000, Machin was one of nearly two dozen Cuban "diplomats" that violently assaulted a small group of peaceful demonstrators outside the Cuban Interests Section (CUBINT) on 16th Street in Washington, D.C.

Machin was expelled from the U.S. in November 2002, pursuant to the Ana Belen Montes case. Montes, a former Defense Intelligence Agency official, was convicted in U.S. federal court for serving as a Cuban agent -- the highest level spy ever caught at the Pentagon.

He would later become Cuba’s Ambassador to Pakistan, where he is believed to have targeted U.S. counterterrorism operations in the region.

Collins was also impressed that the lead Castro regime negotiator with the U.S. is a woman, Josefina Vidal (center).

Of course, she's probably unaware that in May 2003, the U.S. declared 14 other Cuban "diplomats" as persona non grata and expelled them for espionage. This was due to the Castro regime providing Iraqi intelligence with information on U.S. troop movements during Operation Iraqi Freedom.

Among the "diplomats" expelled was the First Secretary of the Cuban Interests Section in Washington, D.C., Jose Anselmo Lopez Perera. His wife, Josefina Vidal, also known to the U.S. as a Cuban intelligence officer, accompanied her expelled spouse back to Cuba.

Yet, unfortunately, Collins was less impressed (or simply unaware) that while she visited Havana last Sunday, 68 members of The Ladies in White were violently beaten and arrested by their hosts.

The Ladies in White are a courageous pro-democracy group composed of the wives, daughters, sisters, mothers and other relatives of Cuban political prisoners.

It would have been a great act of solidarity for the Flake-Collins-Roberts delegation to meet with the leader of The Ladies in White, Berta Soler, in Havana.

But, again, they chose not to.

Of course, Flake knows all of this -- that's why he's just smirking.

Image of the Week: Venezuelan Drug Kingpin Meets With Cuban Mentors

Venezuelan National Assembly President, Diosdado Cabello, who is being investigated by U.S. prosecutors for turning his country into a global cocaine hub, was in Havana today taking orders from his Cuban mentors.

Cabello is also suspected of being the head of the infamous "Cartel de los Soles."

And as Fidel Castro's former bodyguard, Juan Reynaldo Sanchez, detailed in his new book -- the Cuban dictator knows a great deal about how to be a drug kingpin.

Cabello tweeted the image below:

WSJ: Obama Dances With Another Dictatorship

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

Dancing With Another Dictatorship

A U.S. official engages with a top Venezuela politician who is under U.S. investigation.

What was a senior U.S. diplomat doing in Haiti recently meeting with a Venezuelan politician who is reportedly being investigated by the U.S. Justice Department for running a giant cocaine-smuggling operation?

That’s the question raised by photos that surfaced on the Internet last week showing State Department counselor Tom Shannon posing with Venezuelan National Assembly president Diosdado Cabello in Port-au-Prince. Also in the photos: Haitian President Michel Martelly, the Venezuelan foreign minister, and a French chavista with Venezuelan citizenship who is currently posted in Washington.

The most plausible answer is that the Obama administration is once again working to save a police state that is about to collapse under its own weight. The trouble is that every time team Obama sits down at the poker table with thugs—think Russia, Iran and Cuba—it gets cleaned out. The region’s democracy advocates are right to be nervous.

It’s not surprising that Venezuela is ready to talk to the U.S. The two countries have not had diplomatic relations at the ambassadorial level since 2010. Now the dictatorship is nearly bankrupt. Its singular dependence on oil sales to generate foreign currency reserves worked in the days of $100 a barrel oil. But falling prices and gross mismanagement of the state petroleum monopoly PdVSA have crimped income. China and Iran have their own problems and are not helping like they once did. Nevertheless, Cuba, which runs Venezuelan intelligence and state security, still draws on Venezuelan oil to survive.

Mr. Cabello also may have a personal interest in talking. On May 18 The Wall Street Journal cited a Justice Department official who said Mr. Cabello is “a main target” in what the Journal described as a probe into charges that Venezuela has become “a global hub for cocaine trafficking and money laundering.” Mr. Cabello denies any link to drug trafficking.

Between the Justice Department investigation and the Venezuelan economy one would think the U.S. would have the upper hand in any talks. But the Obama administration hasn’t demonstrated great skill in negotiating with its adversaries and Mr. Cabello has a reputation for ruthlessness.

The 52-year-old is often described as the No. 2 man in Venezuela. But he may be running the place. He is said to have more rapport with the military than Hugo Chávez’s successor, the charismatically challenged dictator Nicolás Maduro. If Mr. Cabello is the top drug boss, that would add to his power.

A State Department official told me last week that the issues discussed with Mr. Cabello in Haiti included the treatment of the Maduro government’s political prisoners, the importance of setting a date for parliamentary elections this year, and providing internationally credible observation.

“We remain very concerned about the well-being of the political prisoners. We have called publicly for their release and we believe that in the case of someone such as [political prisoner] Leopoldo López,[a former Caracas district mayor and an important member of the opposition], he is too valuable a political leader to lose,” the official said.

Since April Mr. Shannon has traveled twice to Caracas for bilateral talks with Mr. Maduro. Perhaps the conversation was moved to Haiti this month to lower the profile. But on Monday, when asked at a State Department briefing about Mr. Cabello’s role in Port-au-Prince, State Department spokesman Jeff Rathke said “I was not aware of a meeting with him.”

So either Mr. Cabello’s participation in the talks was supposed to be a secret, or he showed up uninvited. Certainly the photos were not in the interest of the U.S. For Mr. Cabello they lend an air of legitimacy that could counter his image as a narcotraficante. That possibility has caused some observers to speculate that Mr. Shannon walked into a trap.

A State Department spokesperson told me in an email last week that the meeting was “positive and productive.” Translation: Nothing to see here; move along. In fact there’s a lot riding on these negotiations. The end of the chavismo dictatorship would be a good thing. But a descent into chaos of African proportions would take with it the frail democracy movement.

Fair elections could produce a transition back to a democracy not unlike the internationally monitored vote that removed Nicaragua’s Daniel Ortega from power in 1990. Yet it’s worth remembering that Mr. Ortega’s Sandinistas never put down their weapons nor surrendered control of the courts, making true democracy impossible.

Venezuela’s chavista regime—with Cuba working behind the scenes—is not about to let go of power. It wants the international legitimacy it has lost due to human-rights violations and drug-trafficking. Mr. Cabello also likely wants to get himself off the list of suspects in the drug probe. Any promises he makes toward pluralism must be secured by more than his word. If Mr. Obama expects to win concessions by propping up the regime, as he has done with Cuba, there’s reason to worry.

Like With Cuba, Obama Seeks to Bail Out Venezuela

By Jackson Diehl in The Washington Post:

Easing Venezuela’s crash

For months, Venezuelans have been reading reports that one of the most powerful figures in their autocratic and virulently anti-American government, National Assembly president Diosdado Cabello, is a principal target of a U.S. criminal investigation into a Caracas-based drug trafficking cartel. So imagine their surprise when media linked to Cabello began displaying a photograph of the alleged kingpin meeting with a smiling senior State Department official in Haiti this month.

Why would Thomas Shannon, a senior counselor to Secretary of State John F. Kerry, have met and then posed for photographs on June 13 with Cabello, who according to numerous news reports has been targeted by prosecutors in New York and Miami for allegedly leading a cartel that has shipped hundreds of tons of cocaine to the United States?

Cabello and his nominal boss, President Nicolás Maduro, were quick to trumpet their versions. The meeting, Maduro said, was part of a “normalization” of relations between his increasingly beleaguered regime and the Obama administration. Cabello offered it as proof that the reports that he is a U.S. criminal suspect are false. U.S. officials, meanwhile, sounded confused. Both the White House and State Department spokesmen said they were unaware that Cabello had met with Shannon.

I heard another story: that the meeting was part of what has become an increasingly urgent attempt by the administration to broker a soft landing for a collapsing Latin American state. Already deep in crisis before the collapse of oil prices last year, Venezuela now lacks the funds to pay for essential imports of food and medicine as well as its huge foreign debts. It boasts what are probably the world’s highest inflation and murder rates. After a violent crackdown on dissent, the regime is holding more than 70 political prisoners — the most prominent of whom, Leopoldo López, is four weeks into a hunger strike.

It was the threat that López, a moderate leftist and strong advocate of democracy, could soon die in prison that prompted the decision to have Shannon meet with Cabello, sources told me. The former ambassador to Brazil has been leading the administration’s engagement with Venezuela since April, when he was dispatched to Caracas to head off a confrontation between Maduro and Obama at a hemispheric summit meeting. A subsequent conversation with Maduro at the summit convinced Obama that it was worth another attempt to engage a regime that has made anti-Americanism one of its political foundations.

In the short term, the U.S. diplomacy has a modest goal: to prevent López’s death. Shannon told Cabello the continuance of the dialogue between the two governments depended on López remaining alive and being convinced to end his hunger strike, sources said. The former mayor and presidential candidate is demanding the release of political prisoners and the setting of a date for elections to the National Assembly, which are supposed to be held this year.

The longer term U.S. aim is to persuade Maduro and Cabello to hold a fair legislative election, with monitoring by international observers. Since the opposition would be likely to win a fair vote, that could provide a democratic way out of a crisis that otherwise could end in revolution or mass bloodshed.

The Venezuela initiative parallels Obama’s outreach to Cuba, which has been the political tutor of the Maduro regime and that of Hugo Chávez before it. But the attempt to come to terms with Venezuela is more of a long shot than a deal to reopen the U.S. embassy in Havana. Fidel Castro seeded Caracas with his hard-line cadres, who now oversee the persecution of the opposition and the catastrophic mismanagement of the economy. If Raúl Castro represents a somewhat more pragmatic version of Cuba’s Communist regime, then it might be said that “Fidelismo” is making its last stand in Venezuela.

The Obama administration has little leverage. Maduro and Cabello want the lifting of U.S. sanctions imposed on Venezuelan officials for involvement in human rights abuses as well as drug trafficking. But the administration’s answer is that the visa denials and asset freezes were mandated by congressional legislation and won’t be revoked without Capitol Hill’s support. The only way to win that, Maduro and Cabello were told, was to release the political prisoners and agree to an election with international monitoring.

The U.S. criminal investigation of Cabello, too, is unstoppable — and the prospect of being ousted from his post at the National Assembly while he is subject to indictment gives him powerful reason to resist a fair election. Maduro and Cabello are known to lead different factions within an increasingly splintered regime, but it’s not evident that either is willing or able to meet Washington’s terms.

For now, Cabello and Maduro are reaping the propaganda benefits of the meeting in Port-au-Prince. If political prisoners are released in the coming days, and López ends his hunger strike, that would be evidence that the U.S. outreach to a suspected drug lord had produced a positive result.

Obama Admits Cuba Sponsors Terrorism, But...

Last week, the State Department released its 2014 Country Reports on Terrorism ("Report").

The Report examines terrorism activities throughout 2014, prior to Obama's unmerited rescission of Cuba as a "state-sponsor of terrorism."

It provides further evidence of how Obama's decision was not based on the legal requirements for the removal of a country from the list -- but from political manipulation and wishful thinking.

Case and point -- according to the Report:

"The Government of Cuba does continue to allow approximately two dozen members of the Basque Fatherland and Liberty Organization (ETA) to remain in the country."

But, says Obama, Castro promised they'll behave.

"The Government of Cuba does continue to harbor fugitives wanted to stand trial or to serve sentences in the United States for committing serious violations of U.S. criminal laws, and provides some of these individuals limited support such as housing, food ration books, and medical care."

But, says Obama, we should turn a blind-eye for the sake of our one-sided "negotiations" (concessions).

That must be very comforting to the victims and their families.

By the way, those "serious violations of U.S. criminal laws" include domestic terrorism -- so lets call a spade-a-spade.

"There is no credible evidence that the Government of Cuba has provided specific material support, services, or resources, to members of the FARC, or the National Liberation Army (ELN)."

Trust me, says Obama. Nothing "credible."

Of course, in the Rescission Memo, Obama also accepts the Castro regime's lie that it has "never" supported international terrorism. So why not accept another lie?

That's like saying there's no "credible evidence" that the Castro regime exercises control over the Venezuelan government.

Oh wait, the Obama Administration likes to pretend that's not true either.

Never mind the ship full of weapons caught (inexplicably) in Colombia's Port of Cartagena with war materiel purportedly destined for the Cuban military. Though that was technically in 2015, so the 2014 Report can pretend it never happened.

And the continued murders, bombings, kidnappings and extortion by the FARC and ELN? See no evil, hear no evil.

And how did those FARC commanders, who were part of the "negotiating" team in Havana, find their way back-and-forth to the battlefield. For example, Jairo Martinez, who one day was "negotiating" in Cuba and a few days later was killed in action back in Colombia's Cauca province.

And why has the FARC been recently promoting a new battlefield uniform, which includes a Cuban flag on the beret?

Oh wait, this is all taking place in 2015 (as Obama accepts Castro's lies).