Why you should care
Letting Americans sue foreign companies doing business in Cuba could become a new source of tension between America, Europe and China.
The United States and Cuba — which eked out its 60th year of revolution in January — have brokered respectable changes in the recent past. President Barack Obama rewrote Cold War policy that governed the decades-long stalemate. Embassies reopened, air travel recommenced and an economic-development vision was put in place. Obama even traveled to Havana to meet with Raúl Castro. Something new was afoot.
Or so it seemed. Critically, the rapprochement did not abrogate the U.S. embargo against Cuba, nor did it nullify the 1996 Cuban Liberty and Democratic Solidarity Act, otherwise known as the Helms-Burton Act. A retaliatory measure against the Cuban government for having shot down two planes of the exile group Brothers to the Rescue, the law swiftly passed both houses of Congress and was signed by President Bill Clinton. Among the many stipulations of Helms-Burton is Title III, which authorizes lawsuits to be filed in U.S. courts against financial entities “trafficking” property seized from Americans in 1959, including those from Cubans who subsequently became U.S. nationals. Properties deemed nonresidential and minimally valued at $50,000 at the time of confiscation would be considered fair game.
Since the law’s passage, every president has regularly suspended Title III. But President Donald Trump has broken this norm to allow limited enlistment of Title III to take action against a specified number of Cuban companies and agencies deemed in violation after a 30-day suspension introduced at the start of March by Secretary of State Mike Pompeo. And that could end up breaking Western unity on a rare front where Europe and much of Latin America is standing with America: Venezuela.
Forcing Cuba toward democracy by tightening the economic grip has never worked, and there are more signs that changing course has brought emboldened acts of liberalization.
Here’s how. Cuban president Miguel Díaz-Canel assumed office with a far-reaching plan to improve his nation’s economy. A significant portion of the budget — $2.5 billion annually — relies on foreign investors. China, Spain, France and a growing list of European countries have their sights set on contracts that range from hotel chains to energy plants. Trump appears keen on using Cuba as a bargaining chip to pressure countries to adopt even stricter action against Venezuela — Spain, for instance, still has significant trade with the South American nation.
The tactic fits with the administration’s domestic approach. It would help Trump further scale back or eliminate initiatives approved by his predecessor. Processing lawsuits also bolsters his America First mantra and seemingly does not prevent U.S companies from doing business in Cuba. In fact, adherents would argue that lawsuits by U.S. plaintiffs would reduce foreign competition. Title III implementation might help Trump to court a reinvigorated exile base in South Florida in the 2020 election. Joining the pro-Trump Cuban-American community is the growing Venezuelan contingent that champions the hardline stance against President Nicolás Maduro. Drawing a socialist line from Fidel Castro to Hugo Chávez to Maduro permits Trump to pivot against his progressive adversaries — some of whom identify as Democratic Socialists — while broadening his loyal constituency in Florida. Even some Democratic representatives in the Sunshine State have conceded to Trump’s maneuvering on the Venezuela question.
Ramping up legal proceedings, however, would set up a showdown between the administration’s domestic and international game plans. Russia has already rejected the validity of Title III. Expect reprisals from Cuba and European and Chinese creditors and challenges to U.S. claims of jurisdiction in Cuba. It is unclear whether the full tendering of Title III would be enforceable under international law. What is clearer is that America’s allies don’t take kindly to coercion. Trump’s unilaterally reintroduced sanctions against nations that trade with Iran have only pushed Europe into a partnership with Russia and China. Strong-arming other nations on Venezuela, using Cuba as a pawn, is similarly unlikely to yield a win in Washington. Instead, if the Western unity over Venezuela crumbles, the beneficiary will be Maduro, whom Trump wants to oust.
And what about Cuba? Full deployment of Title III would be another ineffectual salvo to revive Cold War triumphalism. Like the embargo, Helms-Burton has done nothing to change the Cuban government. Forcing Cuba toward democracy by tightening the economic grip has never worked, and there are more signs that changing course has brought emboldened acts of liberalization. Among these has been the expansion of private enterprise and property holdings for everyday Cubans. The nation is also in the midst of landmark constitutional reform, which provides a valuable instance in which U.S. leadership could be constructive rather than hindering, as is the current path.
The immediate effect of the procedural shift is already palpable. The move retreats from advancements fashioned between America and Cuba, including potential investment by U.S. companies. It also might slow Cuba’s capacity to attract foreign money. Left out of this calculation are the consequences Cubans would have to endure as a result. The United States would again alienate the very population it wants to win over. It would exploit the rift between Cubans and the Cuban-American population, thereby exacerbating wounds in the name of political gain.
John A. Gronbeck-Tedesco is a professor of American studies at Ramapo College of New Jersey.