Opponents of U.S. economic sanctions, especially many in Congress as well as K Street special interests, argue that U.S. sanctions have not worked and, as such, it is time to try something different. Academics, politicos, and lobbyists have built careers trying to undermine sanctions as a viable foreign policy tool and Cuba remains their poster child. Of course, they’re wrong.
For example, a recent article in Frontera News about foreign investments in Cuba — Projects in Cuba Face Uphill Struggle for Funding — the author points out that “European banks’ fear of U.S. sanctions and Cuba’s rock-bottom debt rating, which makes any borrowing costly and complicated” (emphasis added) make doing business in Cuba very difficult for European investors. Notice that word, fear. That is the very essence of economic sanctions, to dissuade market players from engaging in certain behavior, in this case, doing business in a totalitarian, Communist police state.
To be an effective deterrent economic sanctions, especially unilateral sanctions, require that a series of variables be in play – a limited or small marketplace, such as Cuba, is one of them. Cuba is one of the most overhyped marketplaces in the Western Hemisphere. There are plenty of other places where your capital will go a heck of whole lot further. It is not even, technically, an emerging market. Factor in slave labor, human rights abuses, corruption, lack of rule of law, as well as no central banking system to speak of, why should any serious foreign investor bother with this place? Moreover, why would any European bank waste its time on this mess and risk fines, penalties, and loss of reputation in the marketplace?
If Cuba wants access to our financial system and markets, regime officials need to brush up on things. Times have changed, but they remained anchored in the past. Access to the U.S. market is privilege, not a right. If they want access, then stop fighting the American people. There is a transition roadmap in U.S. law detailing what they need to do to have sanctions removed. It is there for many reasons not the least of which is to protect U.S. taxpayers as well as to advance national interests.
Indeed, Cuba must also compensate U.S. taxpayers for billions of dollars for things it stole including homes, farms, art, and a whole lot more. Until Cuba does these things, we have nothing to talk about. It’s time to put U.S. interest first as well as focusing on the future leaders of Cuba, not the old, but the new leaders that are slowly earning their political stripes. The transition road is a narrow one, but it helps advance U.S. national interests and, in the process, helps the people of Cuba find their way. The best way to make this so is to enforce U.S. economic sanctions.