Cuban Crisis Is Avoidable If Bush Can Copy Poppy

Feb. 20 (Bloomberg) — The U.S. presidential primaries have been crowding out news about the change in Cuba. That's because most of us are telling ourselves not much happened in Havana.

One dictator, Fidel Castro, handed over the reins to another dictator, brother Raul. We imagine a gradual story, with Cuba going step by step toward democracy. Before you know it, Castro will be popping up in Louis Vuitton commercials, soulfully advertising a line of overnight bags. That, after all, is what happened to Mikhail Gorbachev.

But a neat, news-free transition may be wishful thinking. There's half a century of frustration pent up in Cuba. When signs of weakness come, some citizens will go after the thugs of Castro's regime. Others will work to tighten the Venezuelan-Cuban connection. Still others will just want to get out of Cuba on the off chance that even worse tyrants lie in the island's future.

The Cubans who would be living in Florida if they could far outnumber the 125,000 who came in 1980 with the Mariel boatlift. A happy end for the Cuba story is more than possible, but good U.S. policy has to be part of that.

So how can President George W. Bush and Congress prepare for the tide of history? By imitating another president who faced an earlier communist transition: George H.W. Bush.

The situation in Cuba resembles that of East Germany. On Oct. 18, 1989, strongman Erich Honecker was forced to resign. Unperturbed, the press focused on his successor, Egon Krenz — exploring issues such as Krenz's age and what exactly he had done in the Free German Youth movement. Like Raul Castro, Krenz was praised for his pragmatism.

Missing the Story

We missed the big story. Krenz was just a figurehead. So was Hans Modrow, who succeeded him. East Germany was already dead. Germans were merely waiting for the right moment to push their way through the border checkpoints. Within less than a month, they had brought down the Berlin Wall.

The first good move by George H.W. Bush — the 41st U.S. president — was to allow that change to happen without intervening. In 1989, you didn't see NATO moving to prop up the Warsaw Pact. Bush just waited. He wasn't as in-your-face as Ronald Reagan, although he did say "Tear down the Iron Curtain," in a Texas speech in May 1989. And he wasn't shoring up teetering communist regimes either.

The second wise decision by Bush 41 was to know when to move to action and what partners to pick when the Wall fell. With a boldness still underappreciated, he silenced Margaret Thatcher and the nervous French and insisted that the goal be some form of German reunification.

'Four Plus Two'

In 1990, the "four plus two negotiations" took place, the four being the U.S., the Soviet Union, France and the U.K., and the two being East and West Germany. Enormous care went to ensuring that all participants were happy in their roles. Among those who tended the egos was Condoleezza Rice, then at the National Security Council.

Bush 41 had a wonderful partner in another underrated leader: West German Chancellor Helmut Kohl. Bush and Kohl both understood that East Germans would flood West Germany if there were no hope for an economic and political future in East Germany. They also realized the window of opportunity wouldn't be open for long. Reunification had to be complete in a year or two, before the Soviets thought again.

Kohl, with the support of Bush, made a big wager. He would promise each East German that "none would have it worse than before," and many would have it better. East Germans would get one deutsche mark for each of their East German marks, though that was hardly the exchange rate the market would have determined. Enormous subsidies would flow eastward for 10 years as well.

Furious Free Marketeers

The wager was controversial. Free marketeers were furious that Kohl didn't make East Germany into one big enterprise zone. It was also costly. People were angry when Kohl imposed wicked surtaxes on West Germans to pay for it all. The German economy became as sluggish as a snake that had swallowed an elephant.

But Kohl and Bush won the bet. Enough East Germans stayed in East Germany, and the eastern states became effectively western within a decade.

There's evidence that the current president is already following the first part of his father's strategy. That's why Deputy Secretary of State John Negroponte has been telling reporters that the trade embargo on Cuba still stands. Negroponte isn't pleasing Democrats, but his position makes sense.

The larger part — timely action after the regime cracks — has to come as well. The best policy for the U.S. is to respect Cuba and send it serious emissaries — a good point man would be Carlos Gutierrez, the Commerce secretary, who was born in Cuba. In addition, Cuba needs help finding hope — new roads, health supplies, food, free-trade agreements. Ideally, it would become a free market, playing Hong Kong to the U.S.

No Vacuum

Yet, like Germany, Cuba doesn't operate in an economic vacuum. U.S. love, therefore, may also take the form of subsidies, dollars for pesos, and — who knows — trips to Disney World, anything that supplies such hope so Cuba can move forward.

Cuba is a harder challenge than East Germany. Russian President Vladimir Putin was still an underling in Dresden when the Wall came down. Venezuelan leader Hugo Chavez is already preparing to rule the hemisphere. Still, George W. Bush and his successors can help Cuba to freedom. The first step is to copy Poppy.

(Amity Shlaes, a senior fellow in economic history at the Council on Foreign Relations, is a Bloomberg News columnist. The opinions expressed are her own.)

© Copyright 2008 Bloomberg

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