Thursday, December 02, 2010

Arturo Lopez Levy and Anya Landau French: U.S. should seize the oportunity to influence Cuba positively

An opening in Cuba? U.S. must step up

By Arturo Lopez Levy and Anya Landau French, Special to CNN

December 2, 2010 10:12 a.m. EST

Editor's note: Arturo Lopez Levy is a lecturer and a Ph.D. candidate at the Josef Korbel School of International Studies of the University of Denver, Colorado. Anya Landau French directs the New American Foundation's U.S.-Cuba Policy Initiative.

(CNN) -- As Havana prepares for its first Communist Party Congress in 14 years in April, the United States should seize the opportunity to positively influence the economic blueprint the party is expected to approve.

The Party Congress, usually held every five years, is the ultimate conclave when Cuba's Communist leaders set the direction of the country for the next five years. A document released ahead of the congress shows that the Cuban leadership is considering ideas without precedent in the Cuban revolution's political debate. It essentially proposes moving away from Cuba's command economy and adopting an economic system closer to the ones in Vietnam and China.

For instance, the central party government will control public sector companies through taxes and regulation, not by administering them. Whereas private enterprise was discouraged before, the party is now clearly moving to a strategy of promoting private and other nonstate-sector companies.

The government has already announced plans to cut more than 1 million workers from state payrolls and move them into the nonstate sector. Crucially, the party seems prepared to grow this sector with the creation of a wholesale market and mechanisms of lending to small private business. Hiring labor by the new private companies will be regulated, but no longer prohibited.

Taking a page from the Chinese playbook, the Cuban Communist Party is embracing development of "special economic zones to promote development." And there are calls to decentralize economic activities such as food production and services to the provinces and municipalities as much as possible.

The party document even hints at the possibility of a real estate market in which Cubans could once again be able to buy and sell their houses. But nothing signals the end of the old model more than the party's plan to phase out the famous ration card.

None of these changes will be easy to implement. Raul Castro's government is attempting to reform the economy and the party in the face of increased demands for participation and socioeconomic development from all segments of society, especially the youth.

To succeed, the economic reformers must overcome a large, self-interested bureaucracy with decades of bad habits to give up, a budgetary crunch, a lack of capital, capacity and regulatory experience in dealing with a much larger private sector, and the longstanding fear in Havana, real or imagined, that any economic opening is an invitation to the United States and particularly the Miami, Florida, exiles to come in and exploit the place.

For all these reasons, the next four months offer the United States a critical window of opportunity to craft a smarter policy toward the island, one that avoids undercutting reformers in Havana and that could even help ensure the success of deeper and necessary economic reforms on the island.

This kind of engagement with Communist countries is nothing new for the United States.

In Vietnam, a nation where 58,000 Americans died in a war against a highly nationalist Communist Party, the U.S. Agency for International Development (USAID) has spent billions of dollars assisting a transition to a market economy, the development of contract capacity and the expansion of the Vietnamese private sector.

The United States has worked with the Vietnamese government to prevent hurricane damage, pandemics, illegal trade and deforestation, worked with its Supreme Court to protect property rights, and has promoted high-technology enterprise in Hanoi and Ho Chi Minh City. No one is excluded from these programs for being a member of Vietnam's Communist Party or for having fought against the United States. Today in Vietnam, the United States promotes change through detente.

U.S. Vietnam policy respects the country's sovereignty while encouraging market-oriented economic development as the best way to promote human rights in that country. In so doing, the United States has never given up the democratic values underpinning its foreign policy. It operates, however, with respect for international law and sensitivity to the nationalist culture of Vietnam. Why not adopt the Vietnam model for U.S. Cuba policy?

President Obama inherited, and has done little to change, his predecessor's regime change policy obsessed with a (highly unlikely) rapid political transition that by definition excludes the United States from exerting any positive influence over the important changes being contemplated in Havana today.

Unlike our allies in Spain and Brazil, who have offered Cuba assistance in developing a more robust private sector, the only U.S. government dollars that reach the island are funneled through U.S.- and third-country nongovernmental organizations to work with a small number of political and human rights activists -- at a time when millions of Cubans are focused on how to provide for their families in increasingly uncertain economic times.

With unprecedented Cuban reforms in the offing that could triple the island's private sector and create economic opportunities for the United States and Cubans living in the diaspora, the Obama administration has shown little interest.

By failing to open broader cultural and educational U.S. travel to the island (U.S. regulations forbid most Americans from visiting the island), precisely when thousands of visitors could nourish the emerging private sector of hostels, restaurants, travel agents, taxi drivers and many others, the United States is squandering an opportunity to help these reforms take hold.

Cuba's Communist Party is laying the foundations of a post-Fidel Cuba. Raul Castro has also called for a party conference late next year, where the party will select its leaders, and it's expected that Fidel Castro would step down as first secretary of the Cuban Communist Party. This is the time to influence the outcome of its internal debates. Will the Obama administration seize the moment? Or will it prove the adage true, that when it comes to Cuba, Washington never ceases to miss an opportunity to miss an opportunity.

The opinions expressed in this commentary are solely those of the co-authors.

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