Obama in Cuba & Argentina: Fanny Pack Optional

By Samuel George

Bye, haters

Bye, haters

{This article initially appeared on the Global Economics Dynamics blog}

In the coming days, US President Barack Obama will make his eighth foray into Latin America, with scheduled visits to Cuba (March 21-22) and Argentina (March 23-24).

Whereas logic dictated his first seven trips – four to Mexico (a major trading partner and neighbor to the US), one to Brazil (the region’s largest country in terms of population, economy and territory), and international conferences in Panama and Colombia – these upcoming trips could ultimately define Obama’s legacy in the region, and could prove a turning point in US – Latin American relations.

In this post, we take a closer look at Obama’s trips and consider why they matter moving forward.

Obama in Cuba – A Game Changer

With his scheduled trip to Havana, President Obama will advance US-Cuban relations to a point of no return. Sure, the trade embargo will remain in place as long as Congressional Republicans wish to continue to prosecute the Cold War, and a Republican President could certainly slow the process, but the moment President Obama sets foot in Havana, full normalization of relations with Cuba—however long it takes—becomes inevitable.

While the symbolic power of a US President in Cuba cannot be understated, the executive reforms announced in the run-up to the visit should not be overlooked. Two key moves include significantly easing US travel restrictions to the island and the opening of US financial institutions to Cubans living in Cuba. Both reinforce the momentum towards normalization.

Travel restrictions to Cuba have become increasingly lax since President Obama announced diplomatic normalization in late-2015. Now, however, traveling to Cuba under leisurely pretenses will be akin to driving 30 miles per hour in a 25 mph zone.  The US Treasury Department allows US citizens to essentially issue themselves visas to Cuba under certain (often professional) circumstances.

See our video: Cuba at the Crossroads: 

In recent years, the “people-to-people” license has been a convenient catch-all clause for folks wanting to visit the island, though it required joining fixed tour groups and itineraries that neatly transited fanny-pack wearing gringos from one pre-packaged event to the next.

Now, US citizens can engage in “people-to-people” trips on an individual, independent nature. Did you keep a journal? Did you catch a baseball game? Go to the art exhibit? (All good ideas in Cuba, by the way…) Well, then your trip was cultural and “people-to-people”, and, most importantly, legal. Fanny pack optional.

Cuba likely does not realize the deluge of Americans that are about to crash upon it dilapidated malecones. These tourists—let’s call them what they are—will bring dollars and iPhones and Beyoncé. And as more and more Americans visit Cuba, notions of the island as an enemy to be economically punished will become increasingly antiquated.

The more dollars and iPhones and Beyoncé pumping into Cuba represents a sourly needed adrenaline shot to the island’s flagging economy. By easing financial restrictions on Cuba, President Obama has ensures that the Cuba’s emerging entrepreneurs will bank and transact in and with the US.

In the near term this will facilitate momentum for Cuba’s inchoate private sector. In the mid-term, it will make the congressionally upheld trade embargo appear evermore preposterous. In the long term, it will ensure that Cuba’s future as a market-oriented island—let’s call it what it is—will be banked by the United States.

Argentina – Bringing Back the Bottom of the Map

Overwhelmingly, the media attention on President Obama’s forthcoming trip will be placed on his first stop in Cuba—brace yourself for photos of Obama and Raul and think pieces from US journalists that spoke broken Spanish to some guy in a tourist trap in Old City Havana and now thinks s/he has a scoop.

But one can argue that the more important stop is the second one, in Buenos Aires, Argentina. Let us consult a map. Cuba is a Vlad Guerrero throw off the southern tip of Florida. Traveling to Argentina, on the other hand, is a significant commitment. President Barack Obama has a point to make.

See our video: Argentina at the Crossroads Here – 

Cuba is a small economy that, one day, may become market oriented. Argentina is a large economy that is market oriented.  A pivotal piece of South America’s Southern Cone, Argentina’s relations with the US suffered through the presidencies of Nestor and Cristina Kirchner (2003-2013); an ideological difference exacerbated by US hedge funds that picked over the corpse of the Argentine economy following the country’s 2001 economic crisis.  

In recent years, Argentina has been in a torpor, stumbling through economic stagnation, monetary turbulence, fiscal profligacy and a recalcitrant federal government that faced mounting corruption charges. However, the 2015 election of President Mauricio Marci has rejuvenated the country, and sparked internal and international optimism for his technocratic, market-friendly platform.

President Obama’s visit reflects international support for this transition. Stealing the country back into the US fold in the twilight of his presidency would be a major coup.

The Geopolitical Consequences

To paraphrase 21st century US poet Warren Griffen III, let us both hold up and wait.

Why Cuba and Argentina? And why now? Let’s return to our map. Just some years ago, a group of leaders either ambiguous or hostile to the US had a relatively firm grasp on the Atlantic side of Latin America.

In 2010, Cristina Kirchner’s Argentina boasted a gaudy 9.5 percent annual growth rate. Brazil – still under President Lula – grew at 7.5 percent. The Venezuelan economy was already showing cracks, but remained in the strong hands of President Hugo Chavez. Cuba – subsisting off Venezuelan largess – muddled on as the left’s cherished heirloom (a position familiar to the island, which remained a prized jewel of the Spanish until 1898).

According to Chavez, at that point, it was more important to be in Beijing than Washington, DC.

Fast forward five years and Argentina has elected a pro-market president who Obama will actively court in the romantic austral autumn. Brazil’s rise now mostly refers to what corruption defendants have to do when the judge enters the room. And Cuba realizes that Venezuela can’t afford it any more—a critical factor behind the island’s economic opening.

With one fell swoop, Obama could potentially pull Cuba and Argentina back to the US’s lunch table in the global cafeteria. This would redefine hemispheric relations, leaving pink-tide holdouts such as Venezuela and Ecuador increasingly isolated.

So go for it, President Obama. Let’s see some socks and sandals. Have that mojito, enjoy that parrillada. In perhaps your final trip to the region, you will reshape the future of US-Latin American relations.

And in an ode to longstanding US tradition, the fanny pack remains an option.

See more from Samuel George HERE 

 

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