House Votes to Open Cuba Trade

In what has become something of an annual ritual, the House of Representatives yesterday approved an amendment to appropriations legislation to expand commerce with Cuba. But while the House has voted every year since 1999 either to lift the embargo or the travel ban, this year it limited itself to an important technical change that would kick start farm exports to the island dictatorship:

By voice vote, the House adopted an amendment by Jerry Moran, R-Kan., that would block the Treasury Department from enforcing a rule that has effectively limited agricultural sales to Cuba. The rule requires payments for U.S. goods to be made before a ship leaves port. It replaced an earlier regulation that allowed U.S. firms to accept payment after the goods were received in Cuba. Moran said the current restriction is “disruptive” to the U.S. economy and hurts the country’s reputation as an exporter because it slows the flow of agricultural goods.

In a brief House floor debate on the amendment, supporters argued that Cuba is–technically–open to U.S. agricultural exports now, due to an exemption from the embargo approved in 2000. Two years ago, however, the Treasury Department began to require that Cuba pay for these goods before they are shipped. And why is that such a problem? Because Cuba doesn’t pay its bills. This is from the floor statement of Congressman Lincoln Diaz-Balart, a Cuban American proponent of the existing policy:

[The 2005 amendment] stemmed from requests by U.S. financial institutions that were becoming concerned by the increasingly slow rate of payment for agricultural sales by the Cuban regime. The financial institutions requested OFAC to clarify the legislative intent of cash in advance, which is in the law, in order to protect the interests of those financial institutions on their claims. The Cuban regime’s entity in charge of agricultural purchases has an abysmal record of not paying its creditors and has been known to extort or seek to extort agricultural associations in order to increase the regime’s lobbying pressure in favor of the unconditional lifting of sanctions, which is sought by the regime. The regime promises more agriculture purchases if agriculture interests lobby Congress for what the regime seeks, an end to sanctions. In effect, the opening of mass U.S. tourism and trade finance. Currently, Mr. Chairman, the Cuban regime’s foreign debt represents close to 800 percent of its GDP, and it is ranked by international credit agencies as the second worst, if not the worst, credit risk in the world. Countries throughout the world are taking extreme measures to obtain restitution for billions of dollars they are owed, which the Cuban regime refuses to pay.

It’s not the change in Congressional leadership that’s led Cuba trade advocates to lower their sights, according to the WEEKLY STANDARD”s own Duncan Currie. He says “there was not an anti-embargo majority when Republicans were in control; now, my guess is, there would be. But if any bill weakening Cuba sanctions reaches his desk, President Bush will veto it… he has been absolutely consistent on this issue.” And in case you think President Bush might change his mind, the ‘Statement of Administration Policy’ on the bill includes this rather clear statement: ‘If the final version of the bill contained a provision that weakens current restrictions against Cuba, the President would veto the bill.’ So if Fidel wants to enjoy any American farm products before the good Lord takes him away, he’d better get out his checkbook.

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