Translated from the original Spanish by Ariana Hernandez-Reguant
The end of 2016 has brought about big question marks. The most important international media and press outlets seem to resort to divination to try to gauge the course of US-Cuba future relations. For some, Fidel’s sudden passing would lead Raúl Castro’s government to greater market reforms. In turn, Trump could go back to Obama’s “soft landing”-type of rapprochement. In other hypotheses, neither Fidel’s death nor Trump’s envisioned hard stance toward Cuba would result in any major changes in the island. The fact is that any prognosis should take the following into consideration: What changed in Cuba as a result of the Obama administration’s policies? What was Fidel Castro’s impact on the speed of the economic reforms within Cuba? Trump, however, could have the power to upset these scenarios.
Neither Obama nor Fidel have determined the depth of the reforms
For sure, the Obama administration’s policies have led to new scenarios, particularly within the private sector. To some extent, their impact on the Cuban economy has been positive, chiefly with respect to tourism, commerce, purchasing power and consumption – in the latter case thanks to increased remittances. Of course, in a non-embargoed Cuba, the impact would have been a lot greater, extending to investments, services, ties between both economies, and export opportunities. However, domestic reform has proceeded according to pre-established plans, and the private sector has failed to achieve the level of empowerment envisioned by Obama’s government.
Neither have Fidelista sectors (the so-called old guard), more reticent to deep changes due to their ideological convictions, tried to slow down the necessary economic reforms in Cuba. The real boycotters of the reforms have been those referred to as “rent-seekers” (some politicians, local bureaucrats, entrepreneurs, and apparatchik). In order to not see their power, revenues or comfort diminished, they have faked loyalty to the government, while promoting stagnation. They have resisted change and have tried to take out of circulation all those who could threaten their comfort zone.
In addition, the main roadblocks to reform have been an economic model based on centralization, and a deficient fiscal policy. It is impossible to think about economic growth, foreign investment, and state enterprises’ productivity, (1) without the state providing incentives as well as financing for public investments, and (2) in a context where enterprises must make do with labor and capital assignations, as well as decisions on imports that are pre-decided at the top.
Hence, Obama’s political opening was not the determining factor in the speed of Cuba’s domestic economic reforms. Neither Fidel’s passing should give Raúl Castro’s government more or less leeway to implement a de-centralization process and transparent property rights.
Trump’s Perspective
In almost twenty years, Trump has held three different positions toward Cuba, and none favorable to a dialogue that would be acceptable to Havana. At the end of the nineties, he tried to invest in hotels and casinos in Cuba, only to change his mind later, alleging that such an investment would subsidize Cuban people’s oppression. Then, at the beginning of his presidential campaign, he said that he would not undo the new diplomatic relations with the island, but that he would renegotiate a “better deal” than that of Obama’s. By the end of his campaign, he offered to the Cuban American Republican hardliners to revert all the Cuba-related policies established by the Democrats.
More recently, the bellicose tone of his declarations concerning Fidel Castro’s passing suggests that Trump will not accept an agreement with Havana unless the Cuban government promises to change the status quo. One does not have to be an expert to know that the Cuban leadership, including the one that inherits power from Raúl Castro, will not accept to negotiate with those that pretend to interfere with Cuba’s domestic affairs. And right now, Trump claims that he will only negotiate if the Cuban government implements specific changes.
Having said that, Trump might not be a declared ally to a socialist Cuba, but he might not end up being an adversary either. US-Cuban relations will change without a doubt, but there are several reasons why Trump might be more conciliatory than one might think now. As a pragmatic businessman, Trump might rally his political alliances to call for the embargo’s end. His position regarding immigration suggests that he might see Cuba as a source of illegal immigrants, and move to abolish the Cuban Adjustment Act. Morover, a rolling back of the current opening would make the U.S. government responsible for the financial losses of many companies, like the big airlines (American Airlines, Jet Blue) that are already flying to Cuba, agricultural firms, cruise companies like Royal Caribbean, and other firms like Verizon, MasterCard, Tyson Foods and Netflix. Finally, a continuation of Obama’s policies might help Trump overcome his negative image in Latin America and improve ties with Latin American leaders.
Trump’s New Deal
Trump’s bellicose tone does not impress a Cuban government used to confrontation with the United States. In fact, Cuba has ridden U.S.’s animosity to establish economic agreement with U.S.’ enemies and to forge new international alliances.
Domestic social and economic change in Cuba is unavoidable. There are few doubts, even within the Cuban government, that the current economic model is dysfunctional and that cosmetic reforms, without deep change, are sterile. A direct confrontation by the United States, demanding changes, would only antagonize the Cuban government and delay domestic change, if only to not give in to U.S. demands. U.S. antagonistic politics would only serve to empower those within the Cuban leadership who resist change, and thus reinforce economic instability.
President Trump will need to overcome a few challenges if he pursues a dialogue with the Cuban government. To negotiate with Cuba will not be like in “The Apprentice”’ second half, when Trump determines who will be fired, to a soundtrack of The O’Jays’ “For the Love of Money.” For starters, he will have to take care of four major issues:
First: He will need to promote good faith as the basis for dialogue with the Cuban government. That might not be easy given the fact that Trump has called Fidel Castro a tyrant and an oppressor, and is also including pro-embargo officials in his team.
Second: He will need to define coherent and realistic negotiating points. For instance, to demand the return of North American properties would just hijack all progress. Most of these properties are now used as schools, hospitals and other public services, or were transferred to cooperatives and families. To compensate their former owners would cost Cuba more than sustaining the country’s economic grown on a 10% during five consecutive years.
Third: He would have to clearly identify the priority subjects in his policies. It is obvious that the interests of Florida exiles opposed to dialogue with Cuba are incompatible with those of businesses or of the Midwest’s agricultural interests, to just give one example.
The fourth challenge will entail his administration’s recognition of a “safe context for the Cuban Revolution.” Fidel Castro created a socio-political order alternative to that of the U.S. Cuban institutions, as well as many Cuban citizens, might not stay faithful to that ideology, but will surely fight for both national sovereignty and political stability within Cuba. Cuba, moreover, has the support of many foreign countries, which favor a gradual transition, in economic terms (toward a mix economy) as well as political (toward a market socialism or social democracy). Such support is in many cases predicated in Cuba’s position as an alternative to U.S. hegemony.
In Conclusion
A Cuba without Fidel could evolve gradually toward an economic and political transition. Initially, that transition would unravel under the Development Plan’s guidelines, announced during the 7th Communist Party Congress and intended until 2030. Once Raúl Castro relinquishes the presidency, the process could accelerate. A Trump administration could alter these plans, either with a costly and fruitless reality show (a return to the Cold War and to U.S.-Cuban conflict) or with a real politik of greater positive consequence than that of Obama’s in normalizing relations between the two countries.
Cover Image: montage by Kris Juncker