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To: Rep. Charlie Rangel, D-N.Y.

From: Jude Wanniski

Re: Cuban Reconciliation

In October 1993, you invited me to a dinner at your home in Harlem to
meet
the Cuban Foreign Minister, Roberto Robaina. You did so because you were

aware of my interest in helping communist countries — the USSR and
People’s Republic of China — convert to market economies. You told me
the
situation in Cuba appeared to be getting worse and that Cuba might find
it
useful in drawing on my experiences with Moscow and Beijing. Because of
a
prior commitment, I could not attend, and you will remember I sent in my

place Irene Philippi, my senior economist for Latin America. She told me

she was impressed with his youthful flexibility in discussion of both
politics
and economics and found “a determination to work at replacing the
crumbing
edifice of Cuba’s political economy.” In a letter she wrote for our
clients
at the time, she said: “Robaina clearly understands that Cuba’s model is

exhausted and the pragmatic openness is required for the nation’s
survival.”

I remind you of the experience, Charlie, because the attention on
Elian provides the opportunity to do something about the estrangement of
the Cuban people — the exiled Cubans and those on the island. Because
you did manage to get me interested in the problem back in 1993, I spent
the next several months working with the Cuban government, through its
Special Interest section in Washington, at the Swiss embassy and the
following year I traveled to Havana and spent several days meeting with
a dozen senior officials of the government, including a two-hour
meeting with Dr. Ricardo Alarcon, president of the National Assembly. On
my return, I stopped in Florida for
a series of meetings with leaders of the émigré community to explain
what I
had learned in Cuba and what I was trying to do. I encountered no
hostility
and in some meetings discovered there were “moderates” willing to
contemplate eventual discussions that would involve Castro.

I was heartened by the trip. You remember the long paper I wrote
after my return from Havana, “A Visit to Castro’s Cuba,” June 23, 1994,
which I wish you would
re-read. It ended on a hopeful note with a recommendation for a
project — perhaps sponsored by the Manhattan Institute — that would
begin
the process of reconciliation. Alas, any hope of such a small beginning
ended when the principal leaders of the Florida Cubans insisted there
could
be no such discussions. Castro had to go into exile somewhere else in
Latin
America or Spain … or die.

What I sensed was that there could be a knitting together of the two
communities — as there has been between the divided Koreas, the Chinas,

the Germanys, and even the Vietnams. Castro has been a petty dictator
over
the 40 years since his band overthrew the Batista regime, but he has not

been a monster on the scale of a Hitler or Stalin. There has been no
Havana
Holocaust and no Berlin Wall. The reason there are 1.5 million
Cuban-Americans is not because that many have gotten here by swimming or
in
little boats, but because they are allowed to leave Cuba if they have a
plane ticket and a visa to some other country. More would come to the
United States, but we limit the number to 20,000 a year. There is a
National Assembly in Cuba which provides for a nascent level of
democracy.
The population is better educated, and far-better fed and healthier than

the people of Haiti, where democratic capitalism reigns under the tender

mercies of the International Monetary Fund. Here is how I concluded my
1994
client report, which will be on my website by the time this article goes to press.

“Reconciliation is not only possible in the Cuban nation, it is
inevitable,
just as the two Vietnams and two Germanys have united, as the Chinas are

coming together, and as the Koreas will sooner or later. It is now
becoming
clear, through Jimmy Carter’s intervention, that even North Korea’s Kim
Il
Sung knows the war is over and that his team lost. As with Castro, Kim
is
maneuvering for peace terms that are as generous as he can manage. Would

the U.S. relationship with Japan have developed as it did after World
War
II if General MacArthur insisted on the abdication of the Emperor?
Outside
parties are useful in getting the disputants to communicate and
negotiate,
but the hard work has to be done by the disputants themselves.

It is in that sense that I advised the Havana Cubans that they will
get nowhere with the United States if they attempt to normalize
relations without satisfying
the Cuban émigrés. They can increase their leverage primarily by seeming

more attractive. This means doing the things that make the Cuban
political
economy more inviting to risk-taking and enterprise. It also means being

generous in their settlement of claims — which they can easily do if
they
get their economy growing rapidly. For the Miami Cubans, who were thrown

out of the house 35 years ago, reconciliation will not be possible if
they
convey the impression that they really do want to restore the status quo

ante, with Batista returning in 1994 garb. They also have to be prepared
to
accept Cuban peso bonds in settlement of their claims, which should be
no
problem at all so long as the bonds are gilt-edged. Both parties should
have a stake in the success of Cuba’s future. As it is, the venomous
hatreds built up during 35 years at the leadership level will not get
the
11 million people of Cuba and the million émigrés in the U.S. very far.

In both Havana and Miami, we recommended a private, scholarly study
be
undertaken to concentrate on the economic requirements of Cuba’s return
to
a market economy. The sketchy advice we offered was meant only to show
that
alternatives are not only necessary, but conceptually available. We
suggested the possibility of sponsorship by the Manhattan Institute in
New
York City, which expressed serious interest in the idea when we posed it

prior to the Havana trip.

The Institute, founded in the 1970s to promote the philosophy of
entrepreneurial capitalism, would be an appropriate academic forum to
develop options for Cuba’s re-entry to the hemisphere’s political and
economic markets. The project would be financed by companies interested
in Cuba’s future. We would draw together some of the finest
minds in business and finance to contribute their expertise toward this
process of reconciliation and renewal. It would require the cooperation
of
the Cuban government, of course, and at least the passive assent of the
leaders of the émigré community — in the same way the community
supports a
flow of humanitarian relief to the island.

I told the Cubans in both Havana and Miami that once relations are
normalized, there is no doubt in my mind that the Cuban economy could
soon
skyrocket. It is the diamond of the Caribbean, a diamond now in the
rough,
a tropical paradise the size of Ohio, 90 miles from Florida. It could
easily become not only a tourist magnet for North America, but also a
bridge between north and south, with Havana revitalized as a commercial
and
banking center as well. I’d had this dream for Puerto Rico, I explained,

and last year thought our efforts with the Puerto Rican business
community
and the new Commonwealth government were ripening in that direction.
Puerto
Rico’s ambivalent political status, unhappily, continues to hold it
back,
its leaders frozen somewhere between statehood and independence. A
reborn
Cuba would have no such inhibitions. Its combined 12 million people,
among
the best educated and industrious in the hemisphere, could create a
dazzling island political economy. Nothing would hold it back.

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