Obama Will Change Cuba Policy—But How?

Since 1962, the height of the Cold War, U.S. policy toward Cuba has been to pressure the island's Communist government to become a democracy, chiefly through an economic embargo. But after close to half a century of trying with seemingly no effect, that approach has become perhaps Washington's most widely conceded foreign policy failure.

Two years after Fidel Castro, now 82, fell ill, power formally passed this year from him to his brother, the longtime defense chief, Raúl, 77. Raúl Castro has embarked on a few cautious economic reforms, while leaving Cuba's political structure intact. Diplomatic contact between Havana and Washington remains narrowly limited.

Washington's pressure tactics—scorned globally as unjustified and counterproductive—intensified during President Bush's years in office, as he further restricted travel to Cuba and remittances to the island from Cuban-Americans. American companies may still sell food to Cuba—but for cash only, no credit. The Bush administration also sought to crack down on illicit travel by Americans to the island, which in the 1950s was a major destination for American tourists.

Most Cuba watchers have believed for years that the embargo and parallel efforts to isolate the island politically have actually strengthened the Castros' political standing and made reforms—including on human rights issues like the jailing of dissidents—less likely. Poverty remains widespread among Cuba's 11 million people, and a black-market economy for goods and services thrives.

But the island has been slowly recovering from the economic catastrophe that befell it after the demise of the Soviet Union in the early 1990s. Tourism and services have been expanding in recent years, and a range of countries—from China and Russia to those in Latin America and Europe—have been doing business where U.S. companies cannot. The likelihood of major offshore oil finds in the future should further fuel Cuba's economic recovery.

Meanwhile, expectations are running high both in Cuba and in the United States for a policy shift under incoming President Barack Obama. He has not supported removing or easing the embargo itself—a bold step that Obama says would be taken only if Havana "begins opening Cuba to meaningful democratic change." But he is calling for rolling back Bush's steps in 2004 and 2005 to tighten up on Cuban-American travel and remittances. And he has said he is open to the possibility of meeting with Raúl Castro without preconditions—a posture that Castro has taken recently as well.

In Cuba, meanwhile, Raúl Castro has undertaken initial reforms in agriculture, including land use, and in Cubans' access to tourist hotels and to consumer goods, such as mobile phones and DVD players. Broader changes, such as unifying the system of two pesos (one convertible, one not) and easing strictures on small, private enterprises, have not yet been attempted.

Cubans are awaiting an eventual generational shift to a younger group of Communist Party officials. The outcome of such a succession is unclear. "What you're going to see in Cuba is an evolutionary pace of change rather than a radical break," says Dan Erikson, a senior associate at the Inter-American Dialogue and author of The Cuba Wars: Fidel Castro, the United States, and the Next Revolution.

Still, change is in the air on the Cold War relic known as U.S. Cuba policy. The views of Cuban-Americans—long the dominant political factor in America for holding onto current policyare changing. Polls suggest support for the embargo is dropping as younger Cuban-Americans come on the scene. A majority of that group voted for Obama. A shift from full-on pressure to diplomacy—to some degree—looks likely in the future Obama administration.

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