home Cuba, Economic Sanctions, U.S. Politics, Virginia Terry McAuliffe’s Potential Cuba Problem, Part 2

Terry McAuliffe’s Potential Cuba Problem, Part 2

The gubernatorial debate earlier this week was a clear win for Cuccinelli camp. They needed it. McAuliffe demeanor throughout the debate telegraphed a somewhat dismissive air; an individual devoid of ideas and determined to stick with a talking points approach for just about everything.

I have not really been focusing on the Virginia gubernatorial campaign, but I decided to watch. Listening to the two candidates spar on economic issues reminded me of a blog post regarding McAuliffe’s somewhat mysterious 2010 trip to Cuba.

Last year Virginia was the second largest exporter of agricultural products to the communist island. This data point surprised me. I had no idea Virginia growers did that much business with the regime. So I did some digging to try and figure out what the Cubans would want from this part of the country as well as McAuliffe’s role in that process. Frozen turkey exports to Cuba spiked the year after the visit, but it is not clear if the turkeys were from Virginia. It could have been tobacco. Yes, Cubans need to import tobacco because the regime has destroyed the domestic cigar industry.

Americans who work for agriculture companies, or contracted to represent them (as in the case of McAuliffe), can legally travel to Cuba without applying for a license from the Treasury Department. Two weeks before and two weeks after the trip, travelers need to submit a report to Treasury’s Office of Foreign Assets Control (OFAC) identifying both the traveler, the producer or distributor, as well as a description of the purpose and scope of the trip.

Upon return, a more detailed report is required. This time travelers must detail the business activities conducted, the persons with whom the traveler met, as well as the expenses incurred. Why is this such a big deal? A lot of people are very dismissive of U.S.-Cuba sanctions, bordering on cavalier. Yet, there are certain people in Cuba with which U.S. persons are not allowed to do business with; they are called specially designated nationals. Americans are also limited as to how much money they can spend in Cuba.

Doing business in Cuba is a risky proposition. Cuba is, after all, a State Department designated state sponsor of terrorism and a narcotics country of concern. Regime officials routinely engaging in money laundering to hide assets from the state. Side deals are cut to keep money from flowing to regime coffers. There are also many human rights abusers throughout the government, some of them SDNs, that Americans are prohibited from transacting business with.

Virginia voters deserve to know before election day what McAuliffe was doing in Cuba as well as who he met with. Here are some questions that need answering:

  1. What agricultural interests hired him to travel to Cuba?
  2. Prior to the trip, what contacts did he have with Cuban regime officials that made him especially suited for the trip? Was it the Cubans who wanted to meet him or did he meet the Cubans in DC?
  3. Who did he met with while in Cuba?
  4. Who was the organizer of the trip and did they have the necessary OFAC authorizations and file the required reports?
  5. What did the Cuban government request in exchange for the purchase Virginia agricultural products? Remember, for Cubans, the sales are all done by the communist party members and is always a political component attached to the sale, usually, to ease economic sanctions
  6. How much did the Cubans agree to buy from Virginia producers and for how many years?
  7. Did the delegation every meet with any SDNs (specially designated nationals)?
  8. Did the Cubans ask for support with lobbying of the U.S. Congress or the Obama Administration to ease sanctions? Any advocacy done in this regard requires registration pursuant to the Foreign Agent Registration Act and other federal lobbying laws.
  9. McAuliffe told The Washington Post a few years ago that the primary purpose of the trip was to introduce Virginia wines to Cuban regime. The regime supposedly agreed to host a Virginia win exposition. Did that ever happen?

Senior officials of the Virginia Democratic Party have been fascinated by the Cuba market for some time. Not sure why. It is bad for business and exposes the Virginia brand to some rather bad people. Virginia companies deserve better than doing business with Cuba. There are plenty of other potential markets in Latin America and the Caribbean that are better equipped and more transparent than Cuba that would be more than willing to buy a lot of Virginia goods. We should be focusing on these places, rather than Cuba.

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