The End of the Cold War? U.S.-Cuba Relations Remain Unchanged : Diplomacy: Legislation before Congress aims to punish Cuba and help drive Castro from power. But it might only be hurting U.S. businesses.

The Cold War is over, but you wouldn’t know it to look at U.S.-Cuban relations. Tensions are as high as ever and likely to increase. True, Cuba no longer poses a security threat or even a foreign-policy problem to the United States. In fact, earlier U.S. preconditions for normalization of relations have all been met: Cuban troops are out of Africa; Cuba no longer supports guerrilla movements in Latin America, or anywhere else, and its dwindling military ties with the former Soviet Union are of no concern to Washington. But none of that has made any difference. The United States, of course, wants to see Cuba move toward a more open political and economic system, but even Cuba’s leading human-rights activists say the best way to encourage that is through a more relaxed approach.

Rather than relaxing a bit, however, the Bush Administration has held stoutly to the status quo. That may not be in keeping with the dynamics of the post-Cold-War era, but at least it does no particular damage to the United States itself. Far worse is to come. Congress now has before it one of the shabbiest and most harmful pieces of legislation concocted this year, called the “Cuban Democracy Act” in the House and the Graham Amendment in the Senate, for its sponsor, Sen. Robert Graham (D-Fla.).

Its proponents call it a “carefully crafted mix of carrots and sticks” and claim it will so tighten the noose on Cuba’s foreign trade that it will hasten Fidel Castro’s fall. It also supposedly provides for improved communications with Cuba, thus helping the Cuban people know what is going on in the world and encouraging them to get rid of Castro.

In fact, however, the legislation does neither of these things. It will not, for example, improve telecommunications. Quite the contrary. By blocking any payments to Cuba of funds collected for past telephone calls, it effectively rules out expanded service. Neither will it lead to direct mail service, or provide any of the other “carrots” that its proponents speak so loudly about.

The “sticks” also are fake. The legislation will not, for example, tighten the noose of Castro’s foreign trade. In fact, it will not reduce Cuban imports at all. The core of the legislation is a provision to prohibit U.S. subsidiaries abroad from trading with Cuba.

Proponents say these subsidiaries are providing the bulk of Cuba’s hard-currency imports and that cutting them off would deal Castro a major blow. Nonsense. True, Cuban purchases from U.S. subsidiaries have increased, along with all its hard-currency imports. No longer able to acquire foods, medicines and other commodities it needs from the former Soviet Union on a soft-currency or barter basis, Cuba must go out on the world market and pay hard currency. Last year, such purchases totaled $4 billion, of which $700 million, or about 18%, came from U.S. subsidiaries. If Cuba could not buy from these subsidiaries, it would simply turn to the wholly foreign-owned companies from which it purchases the other 82% of its imports--as long as it has the hard currency. If the legislation is enacted, U.S. subsidiaries, not Castro, will be the losers.

Nor would that be the most important loss. Washington lifted the ban on subsidiary trade in 1975, because it caused the United States more trouble than it did Castro. For, while we consider these companies to be U.S. subsidiaries, the fact is that they are incorporated in the host countries and come under the jurisdiction of these governments. Historically, the latter regard efforts of other governments to dictate trading practices to those companies as an inadmissible extension of extraterritorial jurisdiction. Canada, Britain and other major trading partners have warned Washington of unfortunate consequences if it tries to turn the clock back to 1975. In addition, the European Community stated flatly, through an official note in April, that passage of the Cuban Democracy Act would “cause grave and damaging effects to bilateral European Community-U.S. trade relations.”

New problems with major U.S. trading partners would seem to be the last thing we need in these recessionary times. Proponents, however, say Congress must enact the legislation anyway, to keep faith with Cuban human-rights activists and others struggling for change inside the island. It is, they say, a matter of principle. But the fact is that Cuba’s leading human-rights leaders oppose the legislation. They say it will not only make their tasks more difficult, but--by stirring up nationalist sentiment and providing the Cuban government with a new excuse for its current economic difficulties--it will actually help Castro more than it hurts him.

Proponents have studiously ignored such entreaties and pointed instead to support for the legislation that had been voiced by the recently organized Cuba Democratic Coalition and its president, Hector Castaneda. But last month, in testifying against other members of the group, Castaneda and two other coalition organizers revealed they have been working for Cuban intelligence. In other words, the key voices inside the island urging passage were in the pay of Castro. Can it be that Castro also believes the legislation would help him, and so had his agents encourage its enactment?

How was such counterproductive legislation ever introduced? Because the ultraconservative Cuban-American National Foundation wanted it and contributed generously to the campaign funds of its key congressional sponsors. Other politicians took the claims of the latter at face value and endorsed what they thought was a carrot-and-stick approach. The sponsors are thus able to claim wide, bipartisan support.

It might be well to remember that no one looked carefully at the Tonkin Gulf resolution either. It, too, had wide bipartisan support. The consequences of the Cuban Democracy Act are not comparable to those of the Tonkin Gulf resolution. For one thing, losses would be only in trade, not in blood. The point, nonetheless, remains: Wide bipartisan support does not necessarily good legislation make.