The Price of the World’s Longest Embargo

By Kyra Ward

Editor-in-chief, Economics and International Relations Undergraduate  

Since the collapse of the USSR in 1991, the legacy of the Cold War has continued to have a lasting impact on politics and geo-political power structures worldwide. By this point most of the impacts are legacies, yet almost three decades later there is a country that continues to actively feel the shocks of the cold war: Cuba.

Driving in to central Havana you pass by incredibly large and impressive monuments to the freedom fighters of the Cuban revolution. The largest of these monuments is erected for José Martí, the famous poet who wrote about Cuban independence while it was still a colony of Spain. Right next to this sizable obelisk and impressive statue is an old billboard, partially falling apart and dilapidated, easy to miss if it were not so large. On it reads, “Bloque: El Genocido Más Largo De La Historia” which roughly translates to “The Embargo. The largest genocide in history”, the photo above the writing shows the island of Cuba surrounded by a noose.

bloque.jpg

Photo taken by the author

Even with the decay it is an immensely powerful statement and while personally I think it is ultimately inaccurate, it is hard to deny the lasting and catastrophic effects the American embargo has had on Cuba.

Back in May of 2018, the UN released a report that says the continuing embargo has cost Cuba upwards of $130 billion dollars over the six decades since it was enacted. Every year since 1992 the international community and the UN have expressed growing discontent with the continued embargo, yet the United States under a Trump presidency seems unlikely to lift or ease the embargo in any way.

Why is the embargo so disastrous to the Cuban economy? There are a number of reasons for this, the most obvious being that the US historically had been one of Cuba’s largest trading partners. In the 1860’s Cuba was the chief sugar producer in the world, and by the 1890’s Cuban export revenue to the US was $125 million dollars (adjusted for the year 2000’s inflation). After the Spanish-America war, the United States essentially annexed Cuba and planned to make it a new state in the Union. However, this never came to fruition in part because the majority of Cuba’s citizens were committed to remaining autonomous. Rather, it was more due to the fear of the western US sugar beet farmers that the increased competition from Cuban sugar cane would drive them out of business. Ultimately, Cuba became a sovereign state in 1903 but the US continued to play an incredibly large role in the economy, infrastructure, and industry in Cuba. A USDA report in 2008 on Cuba’s Food and Agriculture says that “By the late 1950s, U.S. interests owned a significant portion of Cuba’s resources: 25 percent of Cuba’s land (75 percent of the arable land), 50 percent of the sugar (and rum) industry, and 90 percent of the transportation and electrical services, plus significant cattle, tobacco, timber, banking, oil, and mining interests…”. In the 1960’s when Fidel Castro came into power he sequestered and nationalized all of the American owned industries. Fidel’s government supplanted American trade with China and Russia, but neither could compete with the quantity of American trade and with the added effect of the embargo Cuba’s economic growth slowed considerably. Still, during the cold war the USSR continued to help Cuba and supply enough aid to keep the country functioning. After the USSR fell, Cuba sank into another economic crisis; the already emaciated economy became even more threatened and ushered in what Cubans refer to as, “the Special Period”.

Another unspoken problem which would appear on a superficial level to not be an issue but has had lasting impacts on the economic functioning of the country is the power of the dollar in global markets. Despite the EU and other third-party countries trading with Cuba, despite the US embargo and historically the threat of economic repercussions against countries that would trade with Cuba, the level of trade remains minimal. On the surface it looks like countries are not worried about US backlash from Cuba, but if you look at actual trade levels and investment it is clear that while the embargo is still in place, no other country is going to take the risk of investing in the Cuban economy. In large part this is also because of the fear of the Cuban government nationalizing foreign industry and that is also a very legitimate obstacle in foreign investment. However, to assume that the US’s foreign policy towards Cuba does not also impact the international attitudes towards the country would be naïve.

What is important to keep in mind when discussing Cuba-US relations is the power dynamics between the two countries. One journalist I spoke to on this issue is American by birth but has lived in Cuba for the past 30 years. He described the power dynamic in very visual terms. Imagine the US is a water bottle and Cuba is a water bottle cap. Economically the water bottle cap has no bearing on the water bottle, the amount of water it can hold is negligible compared to the bottle. The water bottle, however, can crush the cap, in every capacity it is larger and more capable. Now that there is no nuclear threat from Cuba and the only thing left from the Cold War is the communist government, which is not a substantial threat. The threat of communism spreading is largely non-existent since the Cold War, but even with the argument of not supporting communist governments, it still begs the question of why the measures are so harsh against the Cuban people. The United States has supported many dictatorial and damaging governments in the past and the continuation of the embargo against Cuba feels more like a petty grievance rather than a real condemnation of the governing politics of the country.

Ultimately, the continued embargo and aggressive foreign policy towards Cuba by the US is unnecessary and deserves to be re-evaluated. Like the Cold War, this level of animosity deserves to be put into the past. The lasting effects of this embargo, even if it was lifted today, will surely impact the country for years to come. This is actively bad diplomacy and further delegitimizes US claims to a superpower status on the global stage. The Obama era policies and effort to move towards lifting the embargo and normalizing relations between the two countries were a step in the right direction for the US and Cuba. As the longest embargo in history continues, what is proven is not that the US is strong, or that Cuba is wrong, or even that embargos work to achieve ones political and economic goals; what is proven is that the losers have been and will continue to be the Cuban people.


Featured photo provided by Pexels

First photo provided by Kyra Ward

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