Helping Cuba on the Road to Reform

Earlier this month, five Cuban nationals – sponsored by the Center for Democracy in the Americas – made the trek from Havana to Washington to discuss the openings they, and Cubans like them, are pursuing in the nascent private economy. Having traveled to Cuba with CDA as a congressional staffer, this reciprocal exchange was exciting to witness.

It felt like one was eavesdropping on a meeting at the Central Havana Chamber of Commerce. Comments like, "Opportunities are open to everyone, without discrimination," and "You control how much you earn," were common. (Until one of them said, "Thankfully, it's not full-on capitalism.")

Without question, the winds of change are coming to Cuba, which now has about 450,000 people working in the non-state sector. It is planning to grow this sector so that 40 percent of Cuba's Gross Domestic Product will come from the private economy. Unlike in previous decades, when reforms appeared to have promise but were later rolled back, the government is now acting to make the changes permanent.

Cuba is providing social benefits – like after school services and maternity leave – for the growing ranks of Cubans working in the private economy. The state is also using its contracting authority to buy from non-state enterprises. The state-run tourist company, for example, will be using NostalgiCar, a new small business with its fleet of 1950s era Chevys, for its patrons. Cuba is also allowing state institutions, like a center where indigent Latin Americans receive sight-restoring eye surgeries, to contract out its facilities and stock its food service with fruits and vegetables that offer patients and staff more diversity and fresher food.

Even Cuba's decision to relax travel restrictions on its people – it is now easier for a Cuban to leave the island and return than it is for American citizens to get U.S. government permission to visit Cuba – is having a surprising effect on the private economy. Cubans are returning to the island more committed to building their futures at home and opening businesses, rather than migrating overseas permanently. They are coming back with ideas for marketing and operating their firms. Even Cubans who years ago thought the country was stuck are now returning home. They have greater autonomy and feel they have greater control over their own lives.

Should this matter to the U.S.? Yes. To be clear, this process is going to succeed or fail based on what happens in Cuba, and not what is said or done in the U.S. Yet, there is a creative role that the U.S. could play to encourage the reforms, and President Obama should be willing to take some additional steps.

Since Obama's administration took office, he has restored the right of Cuban Americans to visit their relatives on the island and provide them with financial support. These so-called "family remittances" are providing finance to capital-starved Cubans who want to start businesses. Obama also boosted travel opportunities for Americans not of Cuban descent – not tourism, but educational exchanges – by restoring certain categories of so-called people-to-people travel. Many of the restaurants that these groups frequent, and services that they utilize, are in the growing private sector, helping to empower individual Cubans rather than the Cuban state – a key goal of U.S. foreign policy.

In fact, when Obama visited Miami earlier this month, he said to Cuban dissidents at a public event, "Keep in mind that when Castro came to power, I was just born. So the notion that the same policies that we put in place in 1961 would somehow still be as effective as they are today in the age of the Internet and Google and world travel doesn't make sense." Obama also said "we have to be creative," and "we have to continue to update our policies."

What's needed now, then, is a strong public statement from Obama that the economic reforms in Cuba are heading in the right direction and that boosting incomes and increasing the autonomy of the Cuban people is a good thing. No matter why the Cubans are making these reforms, the results are clearly in line with the historic goals of U.S. foreign policy.

Obama should also increase opportunities for travel – he can open the gates wider without getting the required Congressional authorization for tourist travel – because every new U.S. visitor to Cuba provides new sources of commercial demand for Cubans whose small businesses provide services and products to legal travelers. Additionally, he should explore the recommendation by the Cuba Study Group, which suggested that the U.S. open the borders to goods crafted by Cuba's private sector for import into their closest foreign market.

As the Center for Democracy in the Americas reiterates often, support for entrepreneurs in Cuba offers an alternative to stale U.S. diplomacy and supports the idea of a more prosperous Cuba with greater opportunity for its citizens. Call it private-sector diplomacy. The bigger point here is that Obama inherited the Cold War policy, but he doesn't have to keep it. And the five Cuban nationals in Washington this month are showing the way forward for a White House wanting a much-need diplomatic win on the foreign policy front.

Michael Shank, Ph.D., is the Director of Foreign Policy at the Friends Committee on National Legislation and Adjunct Faculty at George Mason University's School for Conflict Analysis and Resolution.