Bush Commerce Secretary Says Obama Gave Cuba ‘a Major Political Win’
Bush Commerce Secretary Says Obama Gave Cuba ‘a Major Political Win’
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Former U.S. Secretary of Commerce Carlos Gutierrez gives a speech during the opening session of the 1st China Conference of Quality at The Great Hall Of The People on Sept. 15, 2014 in Beijing.Feng Li—Getty Images
Former Commerce Secretary Carlos Gutierrez told TIME Thursday that the U.S. “will have egg on our face” following President Barack Obama’s move to normalize diplomatic relations with Cuba for the first time in half-a-century. Gutierrez, a Cuban-born former Kellogg CEO who worked in the administration of President George W. Bush, is now a consultant at the Albright Stonebridge Group.
Here’s his Q&A with TIME, lightly edited and condensed for clarity.
How much flexibility will businesses have if Congress doesn’t actually act to lift the embargo?
How much flexibility there will be for U.S. businesses will depend on how much flexibility the Cuban regime gives to U.S. businesses. That’s the aspect of this that has brought down these agreements. At the end of day, if the Cubans don’t change regulations to allow businesses to go in, invest, and make money [there is not much they can do]. There is talk about opening the Internet, but Cuba is one of most closed Internet countries in world. We have to see this with a certain amount of skepticism that they really are going to allow citizens to have Internet.
There’s always been exception [in the embargo law] to be able to do commerce in the telecommunications industry because communications inside the island and communications outside island can only be a benefit. That’s the rationale. But the roaming rates are outrageously high. Who is able to buy a cell phone in Cuba is a matter of public policy, and there are very strict laws, so you know, what we haven’t seen is what the Cuban government is going to do.
This has been a very lopsided agreement, and I can tell you that the Cubans today feel that they have had a major victory. This is a major political win for Raúl Castro; the fact that we recognize them diplomatically is a major political win. They are going to go to Summit of the Americas [in Panama in April], and Raúl Castro will be the man of the hour. President Obama will be comfortable, with the Latinos cheering him on, but the real test really happens after the summit, and the standing of the U.S. in the hemisphere after the U.S. has given so many concessions and not received anything in return.
Which industries are likely to take advantage of loosened restrictions?
Theoretically, the telecommunications industry, to some extent the agriculture industry, to some extent the pharmaceutical industry. The extent to which they will take advantage of this will rely on the good will of the Cubans. Business will only succeed if the Cubans want business to succeed, and everything we have seen from the Cubans over the last 50 years is that they will not allow business to succeed. Why is it different this time? They need to demonstrate that it is different.
Witness Cuba's Evolution in 39 Photos
An old American car, long a staple of Cuban roads, sits along Guanabo Beach, near Havana.Joakim Eskildsen for TIMEA group of youngsters in Central Havana sit on a street corner to discuss the latest news of the Spanish La Liga football league. Their hair is styled like their idols'—soccer stars and Reggaeton singers.Joakim Eskildsen for TIMEIn route to his job as a welder, 62-year-old Carlos stops at a government cafeteria to buy cigarettes.Joakim Eskildsen for TIMECockfighting, a Cuban tradition, takes place in an anti-aircraft bunker to avoid the police. Fighting is not forbidden, but gambling, which is always present at the matches, is.Joakim Eskildsen for TIMEAntonio Perez Hernandez shows off his prize-winning rooster prior to a fight in Campo Florido.Joakim Eskildsen for TIMEHavana’s most famous street, the Malecón, as a cold front rolls in.Joakim Eskildsen for TIMEAt his teacher's request, Rodney Cajiga, gets his hair cut in Justiz, a small town east of Havana.Joakim Eskildsen for TIMECorrugated zinc sheets barely cover a grocery store.Joakim Eskildsen for TIMEJesus, a fisherman from Puerto Escondido, returns from the sea. “It was a good day, despite the cold front,” he said, displaying one of the fish he caught.Joakim Eskildsen for TIMERoberto, 22, is a college dropout from the East, who moved to a small cottage in Havana to farm with his father, Jorge. “My wife got pregnant and I had to support her and the child. Here I have a chance," he said.Joakim Eskildsen for TIMEA pumpkin for sale, cut in half for clients to see it is still fresh.Joakim Eskildsen for TIMEDelvis Montero, 39, works seven days a week making charcoal and earns $100 a month. “I work hard so my children can go to school and never have to do this extremely hard work," she said.Joakim Eskildsen for TIMEMadelin, who works at a Havana boutique, hitchhikes to work each morning rather than taking the bus.Joakim Eskildsen for TIMEAround 7 in the evening, Cubans begin preparing dinner. Central Havana, usually crowded, look deserted.Joakim Eskildsen for TIMEAt night, neighbors leave their doors open to let the breeze in.Joakim Eskildsen for TIMEYunier Utre, 19, lives in the Teodoro Rivero settlement in Jaguey Grande, Matanzas province. He works in the mango plantations from sunup to sundown.Joakim Eskildsen for TIMETourists relax on lounge chairs at Melia Las Americas in Varadero, which is next to the only 18-hole golf course in Cuba.Joakim Eskildsen for TIMEThe wiring for the electrical system at a tenement in Old Havana.
Joakim Eskildsen for TIMEOld Havana at dusk.Joakim Eskildsen for TIMEJuan Lara, 72, takes his cows to graze roughly 10 miles from his home every morning.Joakim Eskildsen for TIMEJuan Carlos has been a fisherman all his life. Close to 70, he keeps this cottage in the Puerto Escondido fishermen’s village. “I have a real house in my town, 20 miles from here," Carlos said.Joakim Eskildsen for TIMEJaguey Grande’s Library, where students from nearby schools come every day to do their homework.Joakim Eskildsen for TIMEFidel Hernandez sets fire to the bushes around the fence he just installed to keep his goats enclosed. He has taken his grandson with him, as he says that he loves to hang around his grandpa.Joakim Eskildsen for TIMEThe growth of small private businesses, like this one in Pedro Pi, is a sign of changing times.Joakim Eskildsen for TIMEA woman at a telephone booth in Pedro Pi. There is only one phone in this farmer’s community, 12 miles from downtown Havana. Neighbors come to make their calls, get their messages and share gossip.Joakim Eskildsen for TIMEA government-run auto repair shop in Jaguey Grande.Joakim Eskildsen for TIMEA huge concrete school building.Joakim Eskildsen for TIMERicardo Rodriguez and his wife travel 30 miles every day to the town of Ceres to buy charcoal that they later sell in the town of Cardenas, near the Varadaero resort in Matanzas province. “The profits are meager, but we survive on that," Rodriguez said.Joakim Eskildsen for TIMEAguedo Leon (far right), 82, goes to the cattle register in Campo Florido, Havana city, to report the birth of a calf. It is mandatory for farmers to do so immediately after the cow delivers. Failing to report a new birth can result in a $20 fine.Joakim Eskildsen for TIMEOutside Havana, an old American car with a new Japanese engine is used as a taxi.Joakim Eskildsen for TIMEAt the Puerto Escondido fishermen’s village, a welder repairs the carriage they use to move fish into town.Joakim Eskildsen for TIMERiding on horse drawn carriages is still the main way to move in the Cuban countryside.Joakim Eskildsen for TIMEOrmiles Lores Rodriguez, 40, works as an accountant at the Grito de Baire farmimg cooperative. She says salaries have improved and employees get bonuses every three months if they meet their output quotas.Joakim Eskildsen for TIMEDusk falls on Old Havana.Joakim Eskildsen for TIMEDespite its age, the driver claims his car can reach speeds of 100 miles per hour, thanks to its engineering that includes a mix of American, Russian, Japanese and Cuban parts.Joakim Eskildsen for TIMETwo young men wait to go out with a girl in Old Havana. "We dress to impress her," they said, "and we take pictures to our barber for him to know exactly what we want."Joakim Eskildsen for TIMEAlicia, 8, crosses the street to buy candy in Patricia’s Cafeteria, 2 miles from Guanabo beach.Joakim Eskildsen for TIMEAn aging car drives through Old Havana at dusk.Joakim Eskildsen for TIMEA woman prays to Yemaya, the sea goddess, on the Malecón, Havana's main esplanade.Joakim Eskildsen for TIME
What impact will this have on the Cuban economy?
It has some benefit in that the amount of remittances has increased. What we need to remember is that the average Cuban gets paid $20 a month. A rationing card for 30 days only lasts 17 days. The Cuban government has total control. If they let U.S. businesses, let telecommunications, and let credit card companies set up shop freely, the government will lose control. You can use your credit card Cuba, but the banks have to set up inside Cuban banks, and there will probably be a fee that goes to the Cuban government. All of these things are designed to strengthen the government’s hold on the economy, and history suggests that they will not give up an ounce of control.
Will this have any impact on the U.S. economy?
Cuba is an extremely poor country. It is not as if a McDonalds is going to open in three weeks, or we are going to start exporting cars. It doesn’t work like that. People say, now in Cuba you can buy a car and that shows it has opened up, but a car costs $50,000 in Cuba, that’s a heck of a price if you make $20 a month. The big risk here is for President Obama. The Cubans know this agreement can be derailed easily in the U.S. because of politics and because of Congressional intervention. The moment that happens, it is an excuse to blame the U.S. In the meantime, the Cuban government has pocketed all of the concessions. They have been victorious, and they will move on to have the same type of regime they have today, and we will have egg on our face way that President Carter did and other presidents have. That’s the thing to watch, that’s thing to stay close to and not believe that somehow magically Cuba is changing.
