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Trump's New Cuba Plan

Trump's New Cuba Plan
Photo: Raul E. Diego/Anadolu Agency/Getty Images
President Trump in June in Miami, announcing his sweeping changes to America’s Cuba policy. “I am canceling the last administration’s completely one-sided deal with Cuba,” he said.
President Trump is ending the short-lived Obama-era détente with Cuba

When President Donald Trump traveled to Miami on June 16th to announce he was “canceling” Obama’s historic opening with Cuba, he made no mention of one of the most popular elements of his predecessor’s policy: the ability of U.S. travelers to purchase and repatriate as many Cuban cigars as they can carry. But, in both tone and substance, the president halted the progress toward normalized relations between Washington and Havana, signaling that the brief era of détente with Cuba will not continue while Trump occupies the Oval Office. 

Trump made his announcement at a rally held at the Manuel Artime Theater in Miami’s Little Havana—the stronghold of hardline opposition to engagement with Cuba—and a venue symbolic of the violent history of U.S.-Cuban relations; Artime was a leader of the ill-fated, CIA-led, Bay of Pigs paramilitary invasion in April 1961. Using this historical backdrop, Trump denounced the dramatic breakthrough in relations during the Obama administration and issued a series of demands that the Cuban government end human rights violations and democratize. “With God’s help,” he promised the cheering audience of Cuban-Americans that included dissidents and veterans of the Bay of Pigs invasion, “a free Cuba is what we will soon achieve.” 

With Rep. Mario Diaz Balart and Florida Sen. Marco Rubio—reportedly the chief architects of the new, hardline policy—at his side, Trump signed a new Presidential Directive, which will curtail travel to, and commerce with, the island in the future.

“Effective immediately I am canceling the last administration’s completely one-sided deal with Cuba,” Trump declared. “I am announcing a new policy, just as I promised during the campaign. Our policy will seek a much better deal for the Cuban people and for the United States of America.”

New Sanctions

In fact, the new policy directive leaves intact much of the structure of Obama’s rapprochement, initiated on December 17, 2014. The reopened U.S. and Cuban embassies will remain open; collaboration on counter-narcotics, counterterrorism and migration, among other bilateral accords, will continue as will the direct air flights and cruise ship travel authorized by Obama last year. The ability of travelers to bring home multiple boxes of cigars, remains unchanged—at least for now. (It could be modified, however, when Treasury Department regulations to implement the directive are published in the fall.)  

But the eight-page directive, titled “National Security Memorandum on Strengthening the Policy of the United States Toward Cuba,” rolls back other key areas of Obama’s open-door policy on travel and trade with Cuba, and abandons the civility of positive engagement that defined U.S.-Cuban relations over the last two years. The document outlines “initial actions” that will “end economic practices that disproportionately benefit the Cuban government or its military,” and “ensure adherence to the statutory ban on tourism to Cuba.” 

The new directive will most immediately affect the latitude of U.S. citizens to travel to Cuba. Under Obama’s relaxation of regulations, U.S. citizens could designate the purpose of their travel under any one of 12 specific categories, which included the broadly defined “educational” travel and “people-to-people” travel. This “self-designation” mechanism has contributed to a surge in travel over the last two years, with more than 600,000 U.S. citizens visiting the island in 2016. However, Trump’s new restrictions eliminate the self-designation process, and according to the Treasury Department’s Office of Foreign Assets Control, “will end individual people-to-people travel.” Unless U.S. travelers qualify for one of the specialized categories of travel—journalism, religious work or academic research, for example—they will have to travel with licensed tour groups and prove they spent all their time in Cuba doing people-to-people activities. The new directive also empowers the Treasury Department to “audit” U.S. travelers; and immigration officials will be able to demand records and journals from returning travelers to demonstrate they are in compliance with the new restrictions. Those who are not could face hefty government fines. Under the new Trump regulations, those restrictions have been expanded to prohibit U.S. citizens from staying in, eating at, or spending any money at numerous state-owned hotels and other businesses that fall under the umbrella of Cuba’s business enterprise group (GAESA), a conglomerate of economic entities controlled by the Cuban military that oversees key sectors of economic and touristic activity in Cuba. Besides hotels, GAESA controls restaurants, tourism buses and other economic and tourism-related activities.

Trump’s directive means that U.S. visitors will no longer be able to stay at some of Havana’s most popular hotels, among them the elegant Saratoga favored by U.S. senators, governors and Congressional representatives who have visited Cuba over the last several years, and the Santa Isabel, where former President Jimmy Carter stayed during his two trips to the island. The five-star Gran Hotel Manzana Kempinski la Havana that opened in May also falls under the GAESA umbrella and will be off-limits to U.S. citizens. As a guide for future travelers, the State Department plans to publish a list of prohibited hotels and businesses they will have to avoid. The Trump directive also takes aim at any future U.S. financial and business transactions with GAESA-controlled entities—which will substantially limit U.S. commercial interests in doing business in Cuba. The new restrictions will not affect U.S. airlines and cruise ships, but could dramatically reduce future business engagement for U.S. manufacturers and hospitality industry suppliers who are seeking export and investment opportunities on the island. Those business interests, along with Cuban entrepreneurs whose new private sector businesses depend on U.S. tourist traffic, have forcefully lobbied the Trump administration to further open travel and trade, rather than restrict it. In early June, Google released a statement highlighting the gains in connectivity on the island; AirbnB published a revenue report showing $40 million going to some 22,000 Cuban hosts over the last several years.

Policy Backlash

White House officials cast the new policy as a way of channeling support away from the Cuban state enterprises and into the hands of Cuban entrepreneurs. “We must channel funds toward the Cuban people and away from a regime that has failed to meet the most basic requirements of a free and just society,” reads the White House directive.

But critics of the policy point out that the new restrictions are likely to have the opposite result—hurting the emerging Cuban private sector, with fewer individual travelers staying in private Airbnb homes, and helping the state-sector with larger tour delegations forced to stay at state-owned hotels and using state-owned buses for transportation instead of privately owned taxis. (Not all state-owned operations are run by GAESA.) Numerous analysts in the travel industry warn that the higher expense of the tours, and the ominous threat of Treasury Department traveler audits would have a chilling effect on future visitation to the island, reducing the number of U.S. travelers and, along with the new restrictions on U.S. business investments, resulting in significantly less U.S. dollars spent to support private Cuban businesses that have dramatically multiplied to meet the demands of expanding U.S. tourism. 

“If the goal is to help Cuban entrepreneurs, adding job-killing regulations on U.S. businesses and increasing government resources to investigate everyday Americans traveling to our island neighbor is not the answer,” according to EngageCuba, an association of U.S. businesses that supports open travel and lifting the trade embargo. “Any policy change that diminishes the ability of Americans to travel freely to Cuba is not in the best interests of the United States or the Cuban people,” says Arizona’s Republican Senator Jeff Flake, who, along with 54 other co-sponsors in the Senate, has introduced “The Freedom for Americans to Travel to Cuba Act.” 

From the perspective of the Cuban government, Trump’s new policy approach, and the harsh, bullying rhetoric accompanying it, threatens a return to the decades of U.S. “regime change” efforts.  Trump was resorting to “coercive methods from the past,” Cuban leaders declared in a statement published in the Communist Party newspaper, Granma. The statement reiterated Cuba’s willingness to engage in a respectful dialogue with Washington but warned that “any strategy aimed at changing the political, economic and social system in Cuba—whether by pressure or imposition or through more subtle means—is destined to fail.” 

But the most rousing rebuttal came from the architect of President Obama’s normalization policy, former deputy national security advisor, Ben Rhodes. Writing in The Atlantic, Rhodes also predicted the Trump approach would fail to achieve its goals. “Trump’s announcement should be seen for what it is,” he concluded, “not as a step forward for democracy, but as the last illogical gasp of a strain of American politics with a 50-year track record of failure; one that wrongly presumes we can control what happens in Cuba.” 

Peter Kornbluh writes frequently for Cigar Aficionado on Cuba.