Debate: Keep the Cuba Travel Ban in Place

(April 29) -- At a congressional hearing today, lawmakers will hear about why the U.S. should relax travel and trade sanctions against Cuba. It would, the argument goes, be good for the travel industry, good for farmers and even good for the Cuban people.

Scott Fritz of the American Soybean Association recently put it this way: "If the travel ban is eliminated, the number of U.S. citizens traveling to Cuba annually would increase to between 500,000 and 1 million. This growth in travel would bring in more hard currency, enabling the Cuban state-trading agency to buy more U.S. agricultural products."

Last year, President Barack Obama also thought easing limits on Cuban-American travel and remittances would help create a more tolerant and democratic Cuban government.

It all sounds compelling, until you understand how the Cuban government actually works.

The first -- probably the only -- beneficiary of a new flow of U.S. dollars into Cuba's state-run economy would be the Grupo de Administracion Empresarial S.A. (Enterprise Management Group), or GAESA.

Founded by Gen. Raul Castro in the 1990s, GAESA controls a wide array of companies, ranging from the very profitable Gaviota S.A., which runs the island's tourist hotels, restaurants, car rentals and nightclubs, to TRD Caribe S.A., which runs all retail operations. In plain words: GAESA controls virtually every economic transaction in Cuba, making it -- by far -- the most powerful company in Cuba's totalitarian-command economy.

The problem is that GAESA is not a benign "development corporation." It is well armed, is trained in repression techniques and acts with total impunity.

A recent article in the U.S. Army's Military Review describes Cuba's Revolutionary Armed Forces as having "transformed itself from one of the most competent combat forces in the region to one of the most entrepreneurial, corporate conglomerates in the Americas" through GAESA.

And as is common with organized-crime enterprises, Raul appointed several of his close confidants and relatives to positions within GAESA. The first chairman of GAESA was Gen. Julio Casas Regueiro. He was named minister of defense after Fidel Castro fell ill in August 2006 and Raul was designated as the country's new dictator. Regueiro's successor at GAESA is Maj. Luis Alberto Rodriguez Lopez-Callejas, who is married to Deborah Castro Espin, Raul's oldest daughter. These soldiers make sure the Cuban "business" enterprise remains in trusted hands.

So the idea that all of this tourist money would find its way into the hands of average Cubans is, at best, naive.

More likely, it would extend the Castro brothers' recurring Ponzi scheme.

Even before seizing power in 1959, the Castros financed themselves and their revolution by luring investors with promises of democratic reform and prosperity. They returned neither, delivering instead a repressive, totalitarian dictatorship. As one set of investors discovers the fraud and cuts off funds, the Castros find new investors with tranches of money to lure. They do so with impunity, never paying off old debts.

The Castros' first "investors" were Cuba's own middle class, which financed the anti-Batista struggle; the Soviet Union provided the Cuban government with billions in annual subsidies and preferential prices between the 1960s and the 1980s; European and Canadian tourists and business interests tried "partnering" with the Cuban government trough the 1990s, pouring capital into mines and developing "all-inclusive" hotels; and in the 21st century, Venezuela's Hugo Chavez has provided billions in oil subsidies.

What return did these investors get for their money? Nothing.

Domestically, Cuba's middle-class investors not only lost their money but their property, liberties and dreams. Underestimating Fidel Castro's pathological hatred of the U.S., the Soviets were nearly drawn into a nuclear war. The Europeans and other foreign financial investors are stuck holding $50 billion in uncollectible IOUs; and with the decline of the international economy, Chavez has had to cut his subsidies to Cuba to deal with economic crises in Venezuela.

So the Castros have set their eyes on a new supply of capital: American tourists. And to get to that money, they are mobilizing an unlikely alliance between Cuba's military and the U.S. farm lobby.

Hence a bill to increase U.S. agricultural sales to the Castro regime, introduced by House Agriculture Committee Chairman Collin Peterson, D-Minn., and U.S. Rep. Jerry Moran, R-Kan., that -- sure enough -- includes a provision authorizing American tourist travel to Cuba.

Meanwhile, democracy advocates in Cuba are waging hunger strikes -- literally starving themselves to death -- in an effort to call world attention to political repression in Cuba. Video clips of the arrests and beatings of Havana's Ladies in White have been broadcast worldwide.

These women -- mothers, wives and daughters of the Castros' political prisoners -- dress in white and on Sundays march through the streets of Havana urging the release of their loved ones.

This is not the time for Congress and American "investors" to finance GAESA and the Cuban regime. It's time to hold the Castros accountable for their fraud.

Mauricio Claver-Carone is a director of the U.S.-Cuba Democracy PAC and founding editor of CapitolHillCubans.com in Washington, D.C. He is an attorney who formerly served with the U.S. Department of the Treasury and has served on the full-time faculty of The Catholic University of America's School of Law and adjunct faculty of The George Washington University's National Law Center.