Anniston Star speaks in favor of trade with Cuba

In today's Anniston (Red) Star, the editors argue that Alabama and the country as a whole would benefit from lifting the embargo on trade with Cuba.

For supporters of free trade, this is a particularly vexing issue. On one hand, there is no doubt that lifting the U.S. embargo would bring significant economic benefits to both sides. On the other, Cuba remains a Communist country where the state exercises absolute control over virtually all aspects of the economy, including foreign trade.

While the Star's editors do a good job explaining the potential benefits of ending the embargo, they all but ignore the fundamental incompatibility between the U.S. and Cuban economies. They summarize their position as follows:

It is high time that the remaining restrictions on trade with Cuba be lifted. This is not to say that we approve of Fidel Castro and his policies any more than we approve of leaders and policies in other authoritarian countries with whom we trade. This is just to say that through unrestricted trade we can improve the lives of the Cuban people and our people as well. As we send Cuba what we have to sell, we also send Cuba a little bit of what America is all about.

This overlooks the fact that Cuba's economic policies differ markedly from those of most other "authoritarian countries with whom we trade." Take China, for instance. It is the Chinese government's policy of economic liberalization that has made improved trade relations with the U.S. and other free market nations possible. China has opened up its economy to foreign trade and investment, privatized thousands of state-owned businesses, and just last year, it added protections for private property to its Constitution. By all measures, it appears that China is well on its way to becoming a market economy, albeit a highly regulated one.

Cuba, on the other hand, has gone in the opposite direction. In May of this year, Reuters reported the following:

HAVANA – Western companies welcomed in Cuba as heroes a decade ago for bucking the U.S. embargo are packing up and leaving as the Communist government rolls back market reforms and squeezes out intermediaries.

Embittered by the change in attitude, small and medium-sized foreign businesses complained this week that they no longer feel welcome and worried they would not recover money owed to them by Cuban partners.

President Fidel Castro's government, bolstered by growing economic ties to Venezuela and China, is cutting back the autonomy granted to state-run companies to do business in the 1990s and restoring central control over trade and finance. ...

During a recent speeches, Castro has reminisced about the 1980s, when the economy was 100 percent Cuban-owned. He said Cuba reluctantly opened up to foreign investment during the deep crisis that followed the collapse of the Soviet Union. ...

Western embassies report increasing complaints from their nationals whose businesses were liquidated without any guarantee they would be compensated.

As late North Carolina Sen. Jesse Helms pointed out back in 2000: when it comes to trade, "Cuba is not China." Until Cuba embraces market reforms and legalizes private property, it will remain on the sidelines of the world economy, and its citizens will continue to suffer the consequences, regardless of U.S. policies. In the meantime, calls for "unrestricted trade" by the Star and others should be rejected as both imprudent and impossible.