Several news organizations report this morning that a new set of regulations will be issued that will, among other things, allow U.S. companies to open offices in Cuba, hire Cuban nationals, and otherwise keep chipping away at U.S. sanctions on Cuba. As it has done with immigration, the Iran nuclear deal, ObamaCare, and now with the “Iran deal of the Americas,” Cuba, the Obama Administration continues to defy the Congress, ignore U.S. law, and has disemboweled the U.S. sanctions on the Communist island.
Very late yesterday evening, and into this morning, I started to receive phone calls about the new US-Cuba regulations that, as of this writing, are supposed to be available online around 9:00 am today. That the Obama National Security Council keeps overreaching on Cuba is not news; they have been doing the same on Iran for just as long. And in the case of Cuba, they’ve made it up since at least December 17, 2014 and the Congress has allowed them to do so. Of course, Communist Party officials in Cuba have not taken the bait. Far from it.
Every concession granted by the Obama Administration to U.S. businesses has been, essentially, ignored by the regime. Remember a few months ago all the news reports of American ferry operators being granted Treasury licenses to provide travel services to Cuba? Rather than grant a concession to one of these companies, the regime gave the first deal to a company based in Spain! But I’m getting ahead of myself. Let’s focus on what is happening in this town.
For example, at a White House briefing earlier this week with U.S. companies, executives were told to focus on lobbying Congress, not Cuba, to ease sanctions. You ask, why Cuba? Because the Obama has been granting political concessions to the regime the entire year and the Communist regime has failed to reciprocate. This is a terrible deal and process for American companies. So rather than kowtow to a legacy-obsessed Obama administration, U.S. companies should focus efforts on securing concessions from Havana, not the U.S. Congress.
On a substantive and legal note, these news rules, like the ones published earlier this year, contain many flaws at a technical level. However, without delving into export controls or sanctions speak, there are bigger problems with this approach. For example, one of the more egregious assumptions in these and earlier regulations is that there is a ‘private sector’ in Cuba, nor is there rule of law, property law, dispute resolution mechanisms, or even a modicum of what one would expect from a player in the free market.
So if you’re planning on doing business in Cuba, or are already doing so, be sure to contact an attorney that knows what they are doing and understands that market. Cuba remains, and will be so for some time, a very high risk business environment not only because of U.S. sanctions, but also because of the rampant corruption that is natural in a police state. The regime seeks political survival and will do anything, especially break the law and violate human rights, to make it so.
These regulations, in essence, give the Communist regime a voice in our regulatory system because what the Obama Administration has done is incorporated by reference the regime’s definition of ‘private sector’. Wishing something does not make it so. There is no private sector in Cuba. Moreover, there is a legal roadmap in place that the Congress has not amended on how to deal with a transition in Cuba, yet for some odd reason and with a few exceptions, this Congress has done nothing to stop Obama’s hijacking of U.S. foreign policy.
When are American taxpayers going to be paid by Cuba for the more than $7 billion in certified claims it owes them for illegally confiscated property? And what about the ongoing confiscation of properties in Cuba (yes, the regime actually found a way to muck things up even more)? When will the Obama Administration hold the Cuban regime accountable for the ongoing purge of Cuban civil society leaders? When will the Obama Administration begin to follow the law and set a better example to rogue regimes that lawlessness is no way to lead? And when will the Congress hold these people accountable?
A colleague earlier this morning told me when he read the news, rule of law is dead. For a moment I thought he was talking about Cuba, but I realized he was talking about the United States. While I’m not there yet, I do agree with him that the time has come for taxpayers to demand more from our elected representatives in the House and Senate. American taxpayers, and in this case also the people of Cuba, deserve better than kowtowing to a Communist regime just 90 miles from our shores.