Biden’s Cuba Policy Leaves the Island in Wreckage

Old Havana / Getty Images

By Ed Augustin

HAVANA — The sight of hungry people scavenging through dumpsters and panhandling was once more common in cities in the United States and Europe than in Havana. But a series of quiet moves, first by Trump, and now by Biden, have produced a humanitarian crisis throughout Cuba.

As he watches the world go by each day from the shade of his porch in southern Havana, Ramone Montagudo, 72, a retired history teacher, has a front row seat for the wreckage. Until a few years ago, the garbage men regularly emptied the blue waste containers on the corner of his street where he and his neighbors dump their household trash. Now flies swarm over a sea of rubbish in the sticky heat. He watches some of his poorer neighbors – who until a few years ago had enough to eat – pick leftover food out of the rot.

“When it comes to food and medicine, we’re living through an extraordinarily difficult situation,” Montagudo says. “This country has always been sanctioned, and we used to get by. But Trump filled in the gaps.”

Cuba has been sanctioned for longer than any other country in modern history. But almost a decade ago the Obama administration softened sanctions on the island and restored diplomatic relations with Havana, admitting that over half a century of immiserating the island had failed to oust the communist government. The economic rebound was swift. But in the final weeks of the Trump administration, the White House put Cuba back on the State Department’s list of state sponsors of terrorism, alongside Iran, Syria and North Korea, for nakedly political reasons and without providing evidence.

Cuba watchers expected that Biden would restore Obama’s raft of achievements. After all, on the campaign trail in 2020 Biden promised that as president he would “reverse the failed Trump policies that inflicted harm on Cubans and their families.”

Instead, Biden has one-upped Trump by going further than the previous administration in attacking Cuba’s tourism industry – the main engine of the island’s economy. Two years ago, the Biden State Department barred foreigners who visit Cuba from visa-free travel to the U.S. That meant that people from the United Kingdom, France, Spain and 37 other countries found out that a mere holiday in Cuba could forfeit their visa waiver, and many decided not to risk a visit to the island. Unlike the rest of the Caribbean, tourism in Cuba has not rebounded since the pandemic. European travel to the island is only half what it was before the pandemic.

The terror designation, together with more than 200 sanctions enacted against the island since Obama left office, has pulped the Cuban economy by cutting revenue to the struggling Cuban state. Economists calculate that the loss in tourism revenue resulting from the terror designation costs the state hundreds of millions dollars a year. The combined annual cost of the Trump-Biden sanctions, they say, amounts to billions of dollars a year.

But the human cost for Montagudo and millions like him is incalculable. The retired teacher was diagnosed with Parkinson’s three years ago. He can get his prescriptions – Cuba still has more doctors relative to population than any country in the world – but no medicine. Like everything else, the supply has dried up. “Before, you went to the pharmacy and the medicine was there. Now… ”, he bites his lip and shrugs his shoulders.

‘Offload[ing] the Enforcement to the Private Sector’: How the Trump-Biden Sanctions Have Ground Down Cuba’s Economy

The one-two punch of the hardened sanctions and the pandemic have ushered in a grim new reality for Cubans. For many, power outages can now last more than 12 hours a day. With pharmacy shelves barren, the price of medicines on the black market has slipped beyond the reach of much of the population. Without money to repair old infrastructure, hundreds of thousands now live without running water. Worst of all, things have been bad for so many years that people have lost hope.

By driving down people’s living standards and crushing the dream of a better tomorrow, the Trump-Biden sanctions have produced a mass exodus from the island of historic proportions. Over the last three years, a record breaking number of Cubans have left the country. According to official figures, 10 percent of the population – more than a million people – left between 2022 and 2023. 

Still, neither the Trump nor the Biden administration have banned U.S. firms from selling Parkinson’s medication to Cuba. The sanctions on Cuba even formally allow for “exemptions and authorizations relating to exports of food [and] medicine.” And in 2022, the Biden Treasury Department introduced “general licenses” for life-saving goods in Cuba, arguing “the provision of humanitarian support to alleviate the suffering of vulnerable populations is central to our American values.”.

But economic warfare remains a prime weapon in the U.S. foreign policy arsenal, as a comprehensive investigation in the Washington Post recently laid out, and away from the announcements, press conferences and headlines, both administrations have reverted to a policy of regime change premised on reducing the hard currency flowing into the island’s coffers and ratcheting up the suffering of people like Monteagudo. 

Joy Gordon, an expert on sanctions at Loyola University Chicago and author of Invisible War: The United States and the Iraq Sanctions, told Drop Site News that there has been a shift towards minimizing visible harm to civilian populations since the sanctions on Iraq in the 1990s, which resulted in widespread malnutrition and epidemics. “There’s a strategy of trying to offload the enforcement to the private sector,” she said. “U.S. policy has created conditions that make it commercially compelling for the private sector to withdraw from whole markets, resulting in severe and widespread economic harm, but in a form that is not directly attributable to US policymakers.”

The Helms-Burton Act is a good example. In 2019, Trump implemented Title III of the law, which allows Americans to sue companies doing business with Cuba, which every previous president had waived. Cruise liners that took American tourists to Havana during the Obama years have since been sued for hundreds of millions of dollars in a Florida federal court for docking at Havana’s main port. The effect has been to deter multinationals from investing in the island.

But perhaps the best example of an almost invisible but insidious sanction is designating Cuba as a “state sponsor of terrorism”. Presented as a benign policy tool to make the world a safer place rather than an arm of economic warfare, it has contaminated the word “Cuba” more than ever in the global economy. Almost overnight the label provoked both global banks and vital exporters to pull out of the Cuban market, according to diplomats and businesspeople on the island.

“Very few banks want to work with Cuba now,” a Havana-based European businessman, speaking on the condition of anonymity, told Drop Site News. He said his bank informed him his account would be closed just days after the designation. 

The island had been on the State Department’s terror list before, up until 2015. But since the relisting in 2021 the effects have been fiercer. Over the past decade, anti-terrorism and money laundering rules have been tightened. “Over-compliance” has also increased as banks try to dodge multi-billion dollar fines from an increasingly emboldened Treasury Department.

Coercing multinationals to cease trading with the island has meant the state has a smaller and skittish pool of suppliers it can import from. Coercing banks to stop processing payments to and from Cuba has meant that often, even when the state can find the money to buy, and a provider willing to sell, there’s simply no way of making the payment.

“Enforcement is now delegated to the banks which have been dragooned into self-prosecuting,” another Western businessman based in Havana said. They “can’t claim they don’t know anymore.”

With more risks and less payoff, many suppliers have left the Cuban market. “It’s a little country that pays late. The market can’t be bothered,” said a third European businessman who no longer sells high tech equipment to the Cuban Ministry of Public Health.” Doing business with Cuba has always been risky, he added, but the terror designation was a game changer: Now, “if there is a trace of a Cuban account, it will be blocked.”

When asked why many medical equipment and pharma companies have stopped trading with Cuba over the last few years, the founder of a medium-sized European pharma firm put it this way: "It’s a small market: Why rock the boat for small potatoes?"

The source said it is no longer “worthwhile” for his company to supply the Cuban Ministry of Public Health but they do so anyway. “How can you look at that and not feel for them?” he said. The business person spoke on condition of anonymity, worried his company’s bank account could be shuttered if the major European financial institution his company banks with found out they supply Cuba. 

Broken Lifelines

Defenders of the Biden administration argue that Cuba’s economic woes go beyond these punishing measures. They are right. Stop-start reforms by the ruling Communist Party over the last two decades have failed to improve the productivity of the state sector which remains highly centralized and lethargic. State wages are miserable and getting worse. Absenteeism is rife. But to point to multiple causes of the island’s economic problems does not absolve the sanctions.

William LeoGrande, political scientist at American University, said the terror listing amounts to “one front in Washington’s economic war on Cuba.” A direct result of the terror listing and other Trump-Biden sanctions, he said, is that the Cuban state today loses billions of dollars of revenue a year at a time when its principal imports are food and fuel. “The sanctions today,” he added, “have a greater impact on the Cuban people than ever before."

Government food rations—a lifeline for the country’s poor—are fraying. Domestic agriculture, which has always been weak, has cratered in recent years for lack of seeds, fertilizer, and petrol, forcing the state to import 100 percent of the basic subsidized goods.

But there’s not enough money to do that. Last year the government eliminated chicken from the basic food basket most adults receive. Last month, the daily ration of bread available to all Cubans was cut by a quarter. Even vital staples like rice and beans now arrive late. Food insecurity on the island is rising, according to a recent report by the Inter-American Commission on Human Rights. Vulnerable groups—older people, pregnant women, children and people with chronic illnesses—are most affected by the knock-on effects of US policy.

“When food rations are funded by the state, it’s no surprise that if you bankrupt the state, food insecurity would increase, particularly for those who do not have family abroad to send remittances,” said Gordon, the Loyola professor.

In March, the U.S. got a hint of the unrest its policy aims toward, with hundreds of people hitting the streets in the eastern city of Santiago decrying long power outages and shouting: “We’re hungry!”

Most Cubans fleeing this misery head to America. Over 100,000 have emigrated to the U.S. legally since January 2023 through the Biden administration’s “humanitarian parole program.” Many more have crossed the border illegally. A piece of Cold War legislation, the 1966 Cuban Adjustment Act, makes Cuba the only country from which a migrant can arrive in the U.S. illegally, and get a green card a year and a day later. Some Cubans build rickety boats, and more than 140 Cubans have died this year while trying to cross the Florida Straits, according to the International Organization for Migration. Those with relatives who can pay an airfare fly to Nicaragua before taking the perilous trek to the U.S.-Mexico border.

By keeping the terror designation and other sanctions in place, the Biden administration has fueled this record-breaking wave of Cuban migration. Over the last three years, more than a half-million Cubans have arrived in the U.S., according to figures from the Customs and Border Patrol Agency. The whole dynamic has a whiff of madness: record Cuban migration stoked by the Biden administration plays into the broader “border crisis” that is helping Trump as the election approaches.

‘Cuba Is Not a State Sponsor of Terrorism’

The list of state sponsors of terrorism has always stood on the frontier between analysis and propaganda. No matter how bad their records, U.S. allies never make the list; adversaries do. 

The Reagan administration first designated Cuba as a state sponsor of terrorism in 1982. Havana bristled at the decision given the U.S.’s history of backing and condoning terrorist attacks on the island, notably Operation Mongoose, a covert operation that hit civilian targets inside Cuba during the 1960s, and prior knowledge of plans by CIA-trained Cuban exiles to blow up a Cuban civilian airliner in 1976, which Washington decided not to share with Havana, and which killed 73 men, women, and children on board.

Still, during the 1980s, Cuba was backing national liberation struggles in Central America and Africa. Cuba’s freedom fighter was Washington’s terrorist, so the designation at least had some Cold War–logic to it. And indeed, on occasion, some of the movements Havana backed carried out political violence against civilians – better known, depending on your political perspective, as terrorism. U.S. intelligence agencies were thus able to cobble together information-based arguments to support the listing. But as the Soviet Union disintegrated and the Cold War drew to a close, Cuba spiraled into a deep economic crisis at home while its power projection diminished. The days of supporting liberation struggles abroad were left beyond in the 20th Century, yet the terror designation lived on.

According to former intelligence and State Department officials, for the last three decades the U.S. intelligence community’s assessment has been that the island has not sponsored what even the U.S. would define as terrorism since the 1990s. When Obama took the island off the list in 2015, Ben Rhodes, the administration’s point person on Cuba tweeted: “Simply put, POTUS is acting to remove #Cuba from the State Sponsor of Terrorism list because Cuba is not a State Sponsor of Terrorism.”

To put Cuba back on the list, the Trump State Department needed rationales. It argued that Cuba was providing sanctuary to U.S. fugitives from justice and to leaders of the Colombian National Liberation Army (Ejercito de Liberación Nacional, or ELN).

The aging U.S. fugitives are mainly Black Power activists that Cuba granted asylum back in the 1970s and 1980s. Cuban state security monitors them, and there is no evidence that they have ever used Cuban territory to carry out or support terrorist activities.

Meanwhile, the ELN commanders were granted safe haven as part of peace negotiations the Obama administration encouraged Cuba to host. 

The talks were facilitated by Cuba and Norway (Norway has somehow escaped the terror designation despite its role). While the Colombian government and the Revolutionary Armed Forces of Colombia (Fuerzas Armadas Revolucionarias de Colombia, or FARC), the country’s other major guerrilla group reached a historic peace accord in 2016 with Havana's help, peace between the Colombian state and the ELN remained elusive.

In 2019 the ELN carried out a deadly attack on a police academy in Bogota, Colombia, killing 22 people. The Colombian government made multiple requests to Cuba to extradite the ELN leaders, which Cuba sidestepped.

But in 2016 the ELN and the Colombian government signed off on a secret protocol guaranteeing the safety of ELN negotiators in Havana “in the case of a breakdown in peace talks.” The document, signed by the Cuban delegation, makes clear that extradition would not be on the table, and that the negotiators would be able to return to parts of Colombian territory they consider safe.

Furthermore, Colombian President Gustavo Petro—himself a former guerrilla—withdrew the extradition request in 2022 and described Cuba’s inclusion on the list as “an injustice.”

Peace talks between the Colombian government and the ELN, the country’s last remaining guerrilla group, resumed last year in Havana. The two sides have since announced a truce.

Fulton Armstrong, who previously served as the top U.S. intelligence officer for Latin America, said that had Cuba extradited the ELN negotiators it would have undercut its ability to help to wind down Colombia’s bloody wars.

“It’s not a question of being nice to former guerrillas,” he said. “It’s a question of credibility.”

The Policy Review That Never Was 

From its first months in office, Biden’s team has repeatedly said—both publicly and privately to members of Congress—that it was carrying out a broad review of policy towards Cuba, including the terror designation.

Secretary of State Antony Blinken said in 2022 that the administration “will continue as necessary to revisit those to see if Cuba continues to merit that designation.”

But last year, that claim was revealed as bogus. In a private meeting, a State Department official privately told members of Congress that no review process had even begun, according to sources present.

The meeting, hosted by Rep. Jim McGovern, D-Mass., and others who focus on Cuba policy, was part of an effort to push the administration to back off its punitive approach to Cuba. But McGovern and his allies in Congress believed, according to sources involved in the fight, that giving the Biden administration room to maneuver, and reducing pressure on the White House, would lead them to do the right thing. That calculation proved incorrect, and now the State Department has run out the clock. 

By giving journalists dull lines about bureaucratic “processes” that are hard to use in a story (in contrast to the snappy, incendiary language of a “maximum pressure” campaign on the island used by the Trump administration), the Biden administration has closed down a conversation about the listing’s potency.

Journalists have failed to hold the administration to account. But even with good will, tracing the specific effects of sanctions on a population is hard: the interplay between Cuba’s internal economic problems and the interlocking strategies of external strangulation of the island makes it all but impossible to pinpoint any one particular shortage to any one particular policy.

Additionally, the decades-long strategy of outsourcing of sanctions policy to the private sector has also reduced journalism on the effects of the sanctions. News outlets prefer neater one-to-one stories that can be quickly explained to an audience, and finding companies that are willing to speak about how and why they have ceased trading and investing is laborious.

For Armstrong, the former intelligence officer, talk of a “review process” was always a sham. All that was required at the executive level, he said, was to call together U.S. intelligence agencies and ask them whether there was any evidence-based reason not to reverse the re-listing of Cuba as a state sponsor of terror. “It would take half a day,” he said.

Analysts agreed that with political will, Cuba could have been taken off the list within weeks of Biden’s inauguration in 2021. Some 80 House Democrats sent Biden a letter urging him to do just that within weeks of his inauguration. Even if the administration carried out a six-month review as some argue the law requires, the designation could have been lifted by the middle of Biden’s first year in office. Had the White House done so, hundreds of thousands of Cubans might well  have been living at home with their loved ones today, living with better access to food and medicine, rather than fighting their way to the border and battling the byzantine U.S. immigration system.

The Biden administration’s position became even more tangled in May when it removed Cuba from the list of countries that are not “fully cooperating” with the U.S. on counterterrorism. According to official designations, Cuba now “fully cooperates” with counter-terrorism efforts while at the same time  “sponsoring” terrorism. How the same country could do both things remains unexplained. Asked why the State Department had not even begun a review, spokesperson Matt Miller told Drop Site at a press briefing that the U.S. policy was aimed at furthering “the democratic aspirations of the Cuban people,” a reference to the U.S. goal of overthrowing the regime.

“Should there be any rescission of the State Sponsor of Terrorism status, it would need to be consistent with a specific statutory criteria for rescinding that determination,” he said. “Any review of Cuba’s status on the list, should one ever happen, would be based on the law and the criteria established by Congress, but the President and Secretary [Antony] Blinken remain committed to the policies that we have advanced that will advance the democratic aspirations of the Cuban people.”

But there are unvarnished ways to describe the ways and means of sanctions. Back in April 1960, as Washington planners were working out how to deal with the new revolutionary government, a senior State Department official penned a now infamous memo, which gives insight into the rationale behind the unfolding economic warfare. “Every possible means should be undertaken to promptly weaken the economic life of Cuba,” argued Lester D. Mallory, then deputy assistant secretary of state for Western Hemisphere affairs. “While as adroit and inconspicuous as possible,” he added, U.S. policy should make “the greatest inroads in denying money and supplies to Cuba, to decrease monetary and real wages, to bring about hunger, desperation and overthrow of government.” Biden has refused to break with this logic. On Cuba, this is his legacy. 

Correction: An earlier version of this story included a reference to the Darien Gap that was geographically inaccurate.