Tuesday, December 22, 2015

Cuba reparations talks should look to future, not past

Cuba reparations talks should look to future, not past
The Times Editorial Board

Just over a year ago, President Obama began thawing the half-century
Cold War chill between the U.S. and Cuba when he and President Raul
Castro agreed to reestablish diplomatic relations. More recently,
Florida-based Stonegate Bank announced it would start issuing debit
cards that American travelers can use in the island nation, a first for
an American firm. Last week the administration permitted U.S. airlines
to resume flights to Cuba, which will make it easier for approved
travelers who have been relying on a complicated charter system to get
to the island. While rapprochement with Cuba is long overdue, it will
take a significant amount of time and delicate negotiations before full
reconciliation can be achieved.

One of the thorniest elements [facing U.S. and Cuban negotiators] is
ensuring that Cuba makes good on the assets it seized from Americans and
U.S.-based companies 55 years ago.
One of the thorniest elements is ensuring that Cuba makes good on the
assets it seized from Americans and U.S.-based companies 55 years ago.
When Fidel Castro's guerrillas swept dictator Fulgencio Batista from
power in 1959, the new regime quickly converted the island's governance
to a communist system and nationalized billions of dollars in private
property, from small homes and farms to foreign-owned utilities, hotels,
sugar cane estates and other corporate assets. Castro settled property
claims with England, Spain, Mexico and others, but negotiations with the
U.S. ended in 1960 when President John F. Kennedy barred Americans from
buying from or selling to Cuba. The embargo came in response to Castro's
seizure of refineries owned by U.S. companies that refused, under
Kennedy's order, to process Soviet oil. More than 5,900 claims with an
initial value of $1.9 billion have been certified by the Justice
Department's Foreign Settlement Claims Commission, and estimates put
their current value, with interest, at more than $7 billion. Notably,
those claims do not include losses by Cubans who later fled to the U.S.

Cuba, meanwhile, argues that the U.S. is on the hook for some, if not
all, of the $117 billion in damages it claims were caused by the
embargo. While the Cuban responsibility to compensate for nationalized
property is clear, it's specious for Cuba to argue that the U.S. owes
damages because it refused to engage in trade. Murkier is the validity
of a Cuban court ruling 15 years ago that found the U.S. was also
responsible for damages caused by the Bay of Pigs fiasco and other
CIA-backed incursions. How enforceable that might be is a question that
ought to be wrapped into the negotiations.

It's a thorny situation, especially since the U.S.-based claims would
consume a significant chunk of Cuba's $77-billion gross domestic
product. One compromise worth exploring would be to compensate smaller
claimants for at least some of their losses with cash, while paying off
larger creditors by giving them access to Cuban markets and resources —
a deal that also would help Cuba by pumping some energy into a generally
low-performing economy.

The biggest obstacle to moving forward, though, is Congress. Although
the Cuban embargo began with executive orders, Congress later added its
own stamp, most significantly with the Cuban Liberty and Democratic
Solidarity Act of 1996, which effectively bars the president from
lifting the embargo unilaterally. Better known as the Helms-Burton Act,
it precludes U.S. assistance until there are democratic reforms that
don't involve the Castro brothers, and it authorizes sanctions against
corporations and countries that do business with Cuba. It also calls for
the very reparations that are under discussion now.

Unfortunately, the president and influential lawmakers are at odds over
the sagacity of normalizing relations with Cuba. But Obama is on the
right track here. The embargo has not only exacerbated the hardships
faced by people living under the Castros' totalitarian regime, it has
harmed Americans and American companies without weakening the Castros'
grip on power. With Fidel retired and Raul promising to step down in
2018, now is an optimal time for the U.S. to begin exerting positive
influence on one of its nearest neighbors.

The administration should ensure through these crucial negotiations that
Americans who lost property to the Cuban revolution receive some measure
of justice. Yet the United States' most pressing interest here lies not
in making amends for the past, but in forging a better future. Congress
should join the Obama administration in this effort, and lift the embargo.

Source: Cuba reparations talks should look to future, not past - LA
Times -

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