For anyone who thinks that the U.S. embargo on Cuba harms only the Cuban people, I would recommend talking to the executives at General Electric. They will tell you about the $2.7 million that the feds just took from them for violating the embargo, unintentionally.
Like U.S. sanctions against other countries, the U.S. embargo against Cuba is aimed at causing maximum economic harm on the country’s populace as a way to achieve regime change within the country. Ever since the embargo was first established in 1960, the idea has been that if enough misery could be inflicted on the Cuban populace, it would rise up in a violent revolution, oust the Cuban communist regime, and install another pro-U.S. dictatorship, like that of Fulgencio Batista, the crooked and corrupt dictator who was ousted by Fidel Castro in 1959.
The plan has never worked. Even though the socialism that Castro brought to Cuba has itself caused massive impoverishment, the last thing most Cubans want is to be back under the control of the U.S. government.
What many Americans don’t realize, however, is that the U.S. embargo is also an attack on the economic liberty of the American people, something to which GE can attest.
A fundamental principle of a free society is the right of people to travel wherever they want and to spend their money any way they want. In fact, that’s one of the major deprivations of freedom in Cuba and other communist countries. Communist regimes don’t recognize freedom of travel and economic liberty as fundamental, natural, and God-given rights.
The Red scare
In 1959, the Cold War was in full swing. It had been almost 15 years since the U.S. government had been converted from a limited-government republic to a national-security state, which consisted of the Pentagon, the vast military-industrial complex, the CIA, and the NSA. Although it was originally intended as simply an intelligence-gathering agency to advise the president, the CIA, which was established in 1947, immediately assumed the omnipotent powers of regime change and assassination.
When Castro established a communist regime in Cuba, U.S. officials went ballistic. In their minds, the Cuban Revolution was proof positive that the Reds were on the verge of taking over America. Cuba was said to be a communist “dagger” pointed at America’s neck from only 90 miles away from America’s shores. There was no way the United States could survive, it was believed, with a communist regime so close to the U.S.
Never mind that Cuba never attacked the United States or even threatened to do so. Never mind that Cuba never expressed any interest in invading and conquering the United States. Never mind that Cuba was an impoverished Third World country. Never mind that there was never any possibility that Cuba could defeat the United States militarily. It the communist regime in Cuba was permitted to stand, it was believed, America was certain to fall to the Reds and the international communist conspiracy that was supposedly based in Moscow.
The U.S. national-security state came up with various ways to bring down the Cuban regime. One was through an invasion by CIA-sponsored Cuban exiles, which failed miserably. When the Pentagon proposed a fraudulent plan called Operation Northwoods, which called for a U.S. military invasion of the island, President Kennedy summarily rejected it. The CIA also came up with schemes to assassinate Castro, but those also were unsuccessful.
Regime change via embargo
That left the embargo as the hope for bringing down the Castro regime.
U.S. officials, however, were reluctant to impose an outright prohibition on America’s traveling to Cuba because then they would be seen as destroying what people have long considered is a fundamental right — freedom of travel.
So, instead, U.S. officials prohibited Americans from spending money in Cuba without the official permission of the U.S. government. It didn’t matter to them that they were destroying the right of economic liberty, any more than it mattered to Castro that he was doing the same thing in Cuba. Of course, the ban on spending money effectively operated as a ban on travel to Cuba.
But the ban obviously applied only to American citizens and American businesses. The U.S. government lacks the authority to destroy the fundamental rights of foreigners, many of which continued doing business with Cuba, much to the anger and chagrin of U.S. officials.
General Electric is an American company. The $2.7 million fine it just paid to the Treasury Department was for violating the U.S. embargo on Cuba.
Was that because GE was caught spending money in Cuba? Nope.
So, why then was it fined $2.7 million? And why did it agree to pay the fine?
Three GE subsidiaries performed services for a Canadian company named Sherritt International Corp. It turns out that Sherritt has a joint venture with Cuba’s state-owned nickel company. The joint venture is named The Cobalt Refinery Company. When Sheritt got billed for the services that GE was providing to it, checks to GE were issued out of Cobalt’s account and deposited by GE.
So, what’s wrong with that? Well, it turns out that Cobalt is on the Treasury Department’s official list of companies that U.S. companies are prohibited from doing business with because Cobalt doesn’t voluntarily comply with the U.S. embargo on Cuba. In other words, it’s not just against the law for Americans to spend money in Cuba. It’s also against the law for them to receive money from a Canadian company that doesn’t voluntarily comply with the U.S. embargo and continues doing business in Cuba.
GE has software designed to identify companies that are on the U.S. government’s verboten list. In this case, however, the software failed to catch Cobalt’s name because it only had an abbreviation of Cobalt’s name rather than its full name.
When GE discovered its “crime,” like the good little citizen it is expected to be, it turned itself in to the government and confessed. Because of that and because U.S. officials determined that GE’s offense was “non-egregious,” they decided to go easy on GE by settling for a $2.7 million civil fine and no criminal prosecution. GE was, of course, lucky because not all Americans who violate the U.S. embargo on Cuba are given such a “sweet” deal.
It’s just another day of life in a “free” society, one in which out-of-control U.S. officials plunder and loot Americans in support of a crooked, corrupt, failed, and destructive foreign policy.