Normalizing relations with Cuba

[$iljanus]

I bet there are some Major League Baseball scouts chomping at the bit to get down there and scout some talent without causing a diplomatic incident!

[LawBeefaroni]

LawBeef...my question was on defining them as a "huge" market. What are we basing that on, that the Cuban market is "huge"?

CIA Factbook

Imports: $13.6 billion (2013 est.)

Imports - commodities: petroleum, food, machinery and equipment, chemicals

Imports - partners: Venezuela 38.3%, China 10.8%, Spain 8.9%, Brazil 5.2%, US 4.3% (2012)

I've seen $2-4B/year for the US. $1-2 for Cuba. But that's just direct import/export estimates for existing products. In terms of overall US GDP, sure it's small but for many industries like travel or tobacco it is a huge windfall.

[Zarathud]

No GOP speculation yet that Obama is looking forward to retire in a true Socialist paradise in 2 years? Or is FOX holding on to the story that Obama is going for a third term?

[msduncan]

The cuban communist government was teetering on the edge of ruin and change with both Castro brothers getting to advanced age and ailing health. This unilateral decision (yet again) by this fucking asshole President of ours will just give a shot in the arm for the communist followers of the Castro brothers there.

[Grifman]

And as per usual the Republicans are in an uproar about this move. Foxnews.com currently has a picture of old Castro with the headline "They WIn?" Predictable and yet sad since the Fox audience will step right in line with the message they want sent. I.E. nothing Obama does is good.

I wonder what a US win would be if not normalized relations that lead to massive commercial opportunities for US businesses. Eternal sanctions? Nuking them?

Why do you believe that there will be "massive commercial opportunities"? Cuba has been open to the rest of the world for years now, and there's been no great investment by European countries. Cuba doesn't want US firms operating there. They've had plenty of opportunity to liberalize the economy and haven't. What they want is rich US tourists, who will bring in their money and leave it behind after they leave.

[Grifman]

Shipping arms to NK? Executing and imprisoning people who dare seek freedom? Have we forgotten the plane full of civilians they shot down?

http://en.wikipedia.org/wiki/Human_rights_in_Cuba

I thought we had given up the policy of befriending tyrannical dictatorships where human rights are abused regularly?

Sounds to me like it is just Obama pushing another reset button, because it has worked out so well for him(us) previously.

What makes Cuba different from Russia, China, Saudi Arabia, or countless other nations that we do business with despite their poor human rights records and/or lack of a "representative government?"

Or is Cuba a special case because it's the one Obama happens to be opening relations with?

Russia just shot down a jetliner full of civilians, as a nice parallel.

Guess you kind of forgot about those sanctions

[Grifman]

It's a huge market that will open up to the US and it's in our back yard. That's a pretty good get. Cuba doesn't have a whole lot more to offer, even if it needed to.

Again, why do you think they are going to open their markets? Where are all the investments made by every other country in the world that doesn't maintain an embargo of Cuba?

[Grifman]

[ In terms of overall US GDP, sure it's small but for many industries like travel or tobacco it is a huge windfall.

Uh, those are markets for Cuba, not markets for the US. One involves US tourists spending their money there, the other involves importing Cuban cigars. What exactly the Cuban markets that will benefit us? Cuba's poor, almost dirt poor. It's per capita GDP ranks 95 in the world.

[RunningMn9]

Tourism still isn't allowed, and the embargo is still in place.

[RunningMn9]

The cuban communist government was teetering on the edge of ruin and change with both Castro brothers getting to advanced age and ailing health. This unilateral decision (yet again) by this fucking asshole President of ours will just give a shot in the arm for the communist followers of the Castro brothers there.

Who the fuck gives a shit about communism anymore?!?

[LawBeefaroni]

Again, why do you think they are going to open their markets? Where are all the investments made by every other country in the world that doesn't maintain an embargo of Cuba?

Why do you believe that there will be "massive commercial opportunities"? Cuba has been open to the rest of the world for years now, and there's been no great investment by European countries. Cuba doesn't want US firms operating there. They've had plenty of opportunity to liberalize the economy and haven't. What they want is rich US tourists, who will bring in their money and leave it behind after they leave.

If they can import Soy from Iowa for 20% less than from China, why the hell wouldn't they? If they can get beef from US suppliers for less than from Argentinian ones, surely someone will be motivated by higher margins.

Or a lot of other things:

Resumed trade between the U.S. and Cuba would be of enormous benefit to Louisiana, which already ships some food to Cuba, high-ranking state leaders say.

“They are hungry people, and they really need food,” Agriculture Commissioner Mike Strain said of the Cubans.

In specific, Louisiana farmers could enjoy a “tremendous increase in market for poultry and rice,” which the state produces in abundance, if the U.S. and Cuba eventually resume trade relations. But other possibilities abound.

The promise of increased trade boosted the value of companies that could benefit from better U.S.-Cuba relations. South Florida-based cruise company Carnival Corporation (CCL) saw shares jump 3%. Norwegian Cruise Line (NCLH) shares edged 1.5% higher.

"Cuba is the largest country in the Caribbean, so there's some exciting possibilities," said Carnival spokesman Roger Frizzell, noting that there are ports and some cruising infrastructure already on the island.

The news sent the value of Herzfeld Caribbean Basin (CUBA) soaring 35%. It's a mutual fund that's invested in companies likely to benefit from increased trade with Cuba, such as cargo-ship operator Seaboard Corp. (SEB) and Watsco (WSO), which would distribute air conditioning equipment to the tech-challenged island.

And I'm barely trying. Not all of this will come to fruition but to say Cuba is only good for a net trade deficit (or a minuscule surplus) is silly.

In terms of overall US GDP, sure it's small but for many industries like travel or tobacco it is a huge windfall.

Uh, those are markets for Cuba, not markets for the US. One involves US tourists spending their money there, the other involves importing Cuban cigars. What exactly the Cuban markets that will benefit us? Cuba's poor, almost dirt poor. It's per capita GDP ranks 95 in the world.

I hven't seen a single study of the trade effects of opening Cuba that doesn't have US trade surplus at at least 2:1. We milk our own poor just fine, why not Cuba's? And we can introduce our own efficiencies into their industries. Our hoteliers can buy up properties in Havana. Our oil companies can tap their reserves. I know you can think bigger than just straight import/export of a handful stereotypical products.

[msduncan]

Russia/Cuban Intel in months leading up to this.

This President is rudderless. If I were China I'd be taking the last two years of his Highness' reign to grab as much territory as possible.

[Kraken]

In the end I don't have a problem with the move EXCEPT he got absolutely nothing for it. Too bad he wasn't such a terrible negotiator when it comes to domestic politics.

What else is he supposed to get? Castro to renounce Communism? An outfielder for the Nationals? A husband for his daughters?

It's a huge market that will open up to the US and it's in our back yard. That's a pretty good get. Cuba doesn't have a whole lot more to offer, even if it needed to.

I thought that a longstanding US demand was reparation for the capitalist properties that were nationalized after Cuba's revolution. Since the odds of that ever happening approach zero, I'd think that reopening the island to the capitalists would be the next-best thing. While the Castros might be able to keep developers at bay for a few more years, Yankee dollars are ultimately very persuasive.

The truth probably has more to do with Hispanic votes, especially in Florida, but that's too obscure for me. Judging by right-wing reactions it must be a net plus for the Democrats.

[Holman]

I thought that a longstanding US demand was reparation for the capitalist properties that were nationalized after Cuba's revolution. Since the odds of that ever happening approach zero, I'd think that reopening the island to the capitalists would be the next-best thing. While the Castros might be able to keep developers at bay for a few more years, Yankee dollars are ultimately very persuasive.

That's surely what this will mean. Cuba wants dollars, and ultimately they're going to do what the dollars tell them.

The truth probably has more to do with Hispanic votes, especially in Florida, but that's too obscure for me. Judging by right-wing reactions it must be a net plus for the Democrats.

Polling I saw today says that a majority of Hispanics favor establishing diplomatic ties and ending the embargo. Among the young these majorities are overwhelming; only among the elderly does opinion tilt the other way.

[Kraken]

I thought that a longstanding US demand was reparation for the capitalist properties that were nationalized after Cuba's revolution. Since the odds of that ever happening approach zero, I'd think that reopening the island to the capitalists would be the next-best thing. While the Castros might be able to keep developers at bay for a few more years, Yankee dollars are ultimately very persuasive.

That's surely what this will mean. Cuba wants dollars, and ultimately they're going to do what the dollars tell them.

The truth probably has more to do with Hispanic votes, especially in Florida, but that's too obscure for me. Judging by right-wing reactions it must be a net plus for the Democrats.

Polling I saw today says that a majority of Hispanics favor establishing diplomatic ties and ending the embargo. Among the young these majorities are overwhelming; only among the elderly does opinion tilt the other way.

Well if this turns a purple state blue then no further speculation is needed.

[tjg_marantz]

As a Canadian who vacations in Cuba, I am sad. I'm happy if it helps the population of Cuba but selfishly, thus is poo.

[Grifman]

If they can import Soy from Iowa for 20% less than from China, why the hell wouldn't they? If they can get beef from US suppliers for less than from Argentinian ones, surely someone will be motivated by higher margins.

I suggest you go back and read what I said. I didn't say that there wouldn't be opportunities, I just challenged your assertion that these opportunities were "massive" as you put it.

In specific, Louisiana farmers could enjoy a “tremendous increase in market for poultry and rice,” which the state produces in abundance, if the U.S. and Cuba eventually resume trade relations. But other possibilities abound.

Cuba can barely pay for what they import now. Venezuela is keeping them afloat with cheap oil (we'll see how long that lasts). Where are they going to get the money to pay for importing tons of addktional food from America? They import 80% of their food now so yes, but a lot of that already comes from the US (surprise!) so growth opportunities there are limited. I'll also note that US food exports to Cuba have fallen by 50% since 2008 due to Cuba's financial/fiscal problems, and that's not going to improve much despite all the cheerleading until they introduce fundemental economic reforms, which the Castro's have been reluctant to do.

The promise of increased trade boosted the value of companies that could benefit from better U.S.-Cuba relations. South Florida-based cruise company Carnival Corporation (CCL) saw shares jump 3%. Norwegian Cruise Line (NCLH) shares edged 1.5% higher.

Yes, we all know that tourism would grow, no one denies that.

The news sent the value of Herzfeld Caribbean Basin (CUBA) soaring 35%. It's a mutual fund that's invested in companies likely to benefit from increased trade with Cuba, such as cargo-ship operator Seaboard Corp. (SEB) and Watsco (WSO), which would distribute air conditioning equipment to the tech-challenged island.

Why haven't the Cubans installed A/C already? The US isn't the only country that produces A/C. So if they haven't purchased A/C up to now, why will they do it when the embargo is lifted (hint, it has to do with lack of money and cost of power, problems that won't go away unless the economy is reformed).

And I'm barely trying. Not all of this will come to fruition but to say Cuba is only good for a net trade deficit (or a minuscule surplus) is silly.

You need to go back and read what I said because I never said that. Instead I pointed out that the examples that you gave were only good for trade deficits. Don't blame me for the examples you chose.

I haven't seen a single study of the trade effects of opening Cuba that doesn't have US trade surplus at at least 2:1.

Others disagree:

http://www.ibtimes.com/lifting-us-sanct ... ay-1761780

About 95 percent of the Cuban economy is still controlled by the state, a reality that presents significant challenges for the country’s currency and financial markets. “This change doesn’t address the multiple distortions and structural hurdles [in Cuba], in terms of economic growth,” he said. “Cuba has not become an investment paradise.”

We milk our own poor just fine, why not Cuba's?

Our poor have money, most Cubans don't. 95 ranking in per capita GDP, remember?

And we can introduce our own efficiencies into their industries. Our hoteliers can buy up properties in Havana. Our oil companies can tap their reserves. I know you can think bigger than just straight import/export of a handful stereotypical products.

And you know that Cuba is going to allow direct investment and US companies to operate freely in Cuba how? Have you a direct connection to the leaders in Havana and their thoughts on moving from a centrally planned economy to a free market one? Everything you mention here requires not just a lifting of the embargo but fundamental reform of the Cuban economy. So far we have no evidence that any of that is going to happen in the near to medium term.

[AWS260]

The cuban communist government was teetering on the edge of ruin and change with both Castro brothers getting to advanced age and ailing health. This unilateral decision (yet again) by this fucking asshole President of ours will just give a shot in the arm for the communist followers of the Castro brothers there.

So as soon as the Castros died, Cuba would transform into a democratic paradise? That seems... unlikely.

[Defiant]

What is the desired end game for Republicans with respect to Cuba?

Florida changing from purple to red?


Am I the only one who is "Eh, whatever" about this?

[raydude]

And you know that Cuba is going to allow direct investment and US companies to operate freely in Cuba how? Have you a direct connection to the leaders in Havana and their thoughts on moving from a centrally planned economy to a free market one? Everything you mention here requires not just a lifting of the embargo but fundamental reform of the Cuban economy. So far we have no evidence that any of that is going to happen in the near to medium term.

Sounds to me like an argument that "the more things change, the more things stay the same". If this is truly the case then why would anyone care whether or not relations with Cuba are improved? It would be more like a non-event in this case.

[Pyperkub]

The cuban communist government was teetering on the edge of ruin and change with both Castro brothers getting to advanced age and ailing health. This unilateral decision (yet again) by this fucking asshole President of ours will just give a shot in the arm for the communist followers of the Castro brothers there.

So as soon as the Castros died, Cuba would transform into a democratic paradise? That seems... unlikely.

Yeah, revolution - possibly ending up exported is a much more likely possibility.

[Pyperkub]

Side note - I think the family still has stock in some pre-revolution Cuban enterprises/assets/something. It's been worthless for a very, very long time, but I expect that we'll need to figure out what this could mean regarding this move.

Edit - yup. A few hundred shares of United Cuban Oil, Inc.

[LawBeefaroni]

If they can import Soy from Iowa for 20% less than from China, why the hell wouldn't they? If they can get beef from US suppliers for less than from Argentinian ones, surely someone will be motivated by higher margins.

I suggest you go back and read what I said. I didn't say that there wouldn't be opportunities, I just challenged your assertion that these opportunities were "massive" as you put it.

Look, all this started because of the FOX assertion that Cuba "won" and Rip saying that we basically got nothing out of the deal.

Compared to zero, the opportunities are massive. Compared to the US GDP, they are small. Compared to the milky way galaxy, they are negligible. I was comparing to the assertion that we got zero.


We can go back and forth all day trying to predict the future. I'm just using a bit more imagination. An US partnered Cuba might not be exactly like a non-US partnered Cuba. If you think Cuba is a black hole, fine. If you think we "lost" the great US/Cuba war, fine. I don't.

[GreenGoo]

Guess you kind of forgot about those sanctions

Call me when they re still in effect 50+ years from now. *wink*

[GreenGoo]

edit: Sorry, overly ranty today.

[noxiousdog]

I thought that a longstanding US demand was reparation for the capitalist properties that were nationalized after Cuba's revolution. Since the odds of that ever happening approach zero, I'd think that reopening the island to the capitalists would be the next-best thing. While the Castros might be able to keep developers at bay for a few more years, Yankee dollars are ultimately very persuasive.

The truth probably has more to do with Hispanic votes, especially in Florida, but that's too obscure for me. Judging by right-wing reactions it must be a net plus for the Democrats.

This was always my impression as well. Many of the Cuban property owners fled to Florida when their property was nationalized. They have had a strong influence on Florida politics and both parties had an interest in currying their favor so we had an over-the-top response to Cuba.

Apparently that must be waning.

[Holman]

One thing we ought to have learned is that normalizing relations with communists makes them want to be capitalists. The chance of it going the other way is zilch.

Pretty soon they're going to be all "Si, we want fries with that."

[Jeff V]

I really need to improve my Spanish speaking skills. So how much are hookers in Cuba?

I saw something somewhere once about tour groups from Canada going to Cuba for this reason. IIRC, Americans were restricted to $100 per day spending if visiting Cuba, but for this activity, it was not an obstacle.

Anyway, I wouldn't look at worth of their current, poverty-stricken environment. Look at it after a few years of US investment in resorts and casinos. Cuba was a pretty popular destination before Castro took over and I see no reason it couldn't be one again. After they are pumped up via US investment, we will be the preferred trade partner reaping benefits which could in time be huge.

[Carpet_pissr]

The stereotypical conservative response to things or states they don't like is punishment, not reconciliation, so they are irked here. Also, grey area outcomes like "what happens if we do or don't do this?" are typically not in their talking points - usually VERY black/white results if we do or do not do something...

What happens when we topple Saddam Hussein? as an example. Well, obviously, glory for the liberators, duh.

Also, some data since this is close to my line of work:

USA exports to Cuba in 2013: $359M, which represented about .02% of total US exports last year.
USA imports from Cuba in 2013: $0

Of course those are official stats, and do not cover black market trades.

[Rip]

Anyone foolish enough to invest a bunch of money in Cuba deserves it when they lose it. They stole assets from people who invested there before, no reason to think they won't again.

Venezuela is a somewhat apt comparison if you disregard the oil and that they actually have some measure of human rights. Point is, I would talk to all the people that invested tons of money there to only have it stolen by the government before I got too excited about any opportunities. There is a pretty good reason that all those other countries that have better relations with Cuba have not been doing much investing there. Crap if China wanted they could buy Cuba flat out with nothing more than a months interest on the US debt they hold.

At best it will be a lucrative place to do business for illicit goods and services since embassy or not we all know they won't be throwing anyone in jail at the US's request, as long as they are willing to pay the protection money. Should be a boon for the cartel drug trade. You could almost fling kilos of cocaine right into Florida using a catapult.

[RunningMn9]

Question for the Rips/msduncan types that at least superficially seem to prefer that we maintained the status quo. Was the status quo "working"? Was it achieving any particular goal? Did that goal have anything at all to do with why the status quo was put in place 50 years ago, or is the status quo just a way to achieve whatever shifting goal the current set of politicians enforcing it are after?

If the status quo was "working", then I guess I understand your ire, even if I still don't understand what it was you were trying to achieve (stop it with this notion that we are trying to get them to have a representative government, as that is absolutely NOT why we've been punishing them for 50 years). If the status quo was not working, what would be your preferred solution? More severe punishment?

I currently couldn't care less about Cuba in the sense that whatever they do, it will have precisely zero impact on my day-to-day life. But I'd at least like to understand why someone born 15 years after we started on this path would be so committed to this path, despite what appears to be 50 years of not working at achieving whatever goal was originally trying to be achieved.

[GreenGoo]

I currently couldn't care less about Cuba in the sense that whatever they do, it will have precisely zero impact on my day-to-day life. But I'd at least like to understand why someone born 15 years after we started on this path would be so committed to this path, despite what appears to be 50 years of not working at achieving whatever goal was originally trying to be achieved.

This is an excellent question. My first response was "well, no shit. It's about time" and that's all there was to it. Then the right came in with the "They win" bullshit, and msd started in with the hypercritical nonsense and I was like "Wtf?".

[Rip]

I think we could have negotiated some concessions from Cuba for restoring diplomatic relations and reviewing sanctions. In comparison Iran has at least tried to appear willing to negotiate in order to get sanctions lifted and improve relations. Cuba has done jack squat but we already gave them half of the price for pretty much nothing.

SO am I the only person who finds it telling that we will have diplomatic relations with Cuba but not Taiwan?

The US has become or is well on the way to becoming "The land of the guilty and the home of the fearful".

[Enough]

If they can import Soy from Iowa for 20% less than from China, why the hell wouldn't they? If they can get beef from US suppliers for less than from Argentinian ones, surely someone will be motivated by higher margins.

I suggest you go back and read what I said. I didn't say that there wouldn't be opportunities, I just challenged your assertion that these opportunities were "massive" as you put it.

Look, all this started because of the FOX assertion that Cuba "won" and Rip saying that we basically got nothing out of the deal.

Compared to zero, the opportunities are massive. Compared to the US GDP, they are small. Compared to the milky way galaxy, they are negligible. I was comparing to the assertion that we got zero.


We can go back and forth all day trying to predict the future. I'm just using a bit more imagination. An US partnered Cuba might not be exactly like a non-US partnered Cuba. If you think Cuba is a black hole, fine. If you think we "lost" the great US/Cuba war, fine. I don't.

Yep. It's not perfect and happy, happy, joy, joy... but it's better than the status quo. Besides, Grifster's only listed source for all of that actually retweeted this:

The big fish of Obama and Pope Francis has already begun to destroy the Cuban dictatorship and Bolivarism. Hallelujah!

[Enough]

SO am I the only person who finds it telling that we will have diplomatic relations with Cuba but not Taiwan?

The US has become or is well on the way to becoming "The land of the guilty and the home of the fearful".

What is the tell here? That we continue to be careful with China (as we always have in the last couple of decades, esp. considering that the governing TRA passed in 1979, maybe have a look at the wiki article as it outlines the quite numerous unofficial relations we have with Taiwan) or is that we no longer fear Russian or Chinese backing of Cuba at the same level anymore?

[RunningMn9]

I think we could have negotiated some concessions from Cuba for restoring diplomatic relations and reviewing sanctions.

So if we got more in the exchange, you'd be cool with it? 50 years of this punishment was to achieve "some concessions"? That's our win?

[Rip]

SO am I the only person who finds it telling that we will have diplomatic relations with Cuba but not Taiwan?

The US has become or is well on the way to becoming "The land of the guilty and the home of the fearful".

What is the tell here? That we continue to be careful with China (as we always have in the last couple of decades, esp. considering that the governing TRA passed in 1979, maybe have a look at the wiki article as it outlines the quite numerous unofficial relations we have with Taiwan) or is that we no longer fear Russian or Chinese backing of Cuba at the same level anymore?

The tell is that we make friends with whoever the people we are afraid of tell us to, or avoid being friends with who they tell us not to, and that when we do take a stand all you need to is wait and we will start feeling guilty about it and elect to appease rather than confront. We have become the proverbial "good men who do nothing".

[AWS260]

We have become the proverbial "good men who do nothing".

Amazing.

[Smoove_B]

Forget it. He's rolling.

[Carpet_pissr]

Methinks you forgot a "t"?

As for what we get from Cuba, I would say a Panamax full of cigars would do nicely.