[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]





 
           CUBA: ASSESSING THE ADMINISTRATION'S SUDDEN SHIFT

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON FOREIGN AFFAIRS
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            FEBRUARY 4, 2015

                               __________

                           Serial No. 114-15

                               __________

        Printed for the use of the Committee on Foreign Affairs
        
        
        
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                      COMMITTEE ON FOREIGN AFFAIRS

                 EDWARD R. ROYCE, California, Chairman
CHRISTOPHER H. SMITH, New Jersey     ELIOT L. ENGEL, New York
ILEANA ROS-LEHTINEN, Florida         BRAD SHERMAN, California
DANA ROHRABACHER, California         GREGORY W. MEEKS, New York
STEVE CHABOT, Ohio                   ALBIO SIRES, New Jersey
JOE WILSON, South Carolina           GERALD E. CONNOLLY, Virginia
MICHAEL T. McCAUL, Texas             THEODORE E. DEUTCH, Florida
TED POE, Texas                       BRIAN HIGGINS, New York
MATT SALMON, Arizona                 KAREN BASS, California
DARRELL E. ISSA, California          WILLIAM KEATING, Massachusetts
TOM MARINO, Pennsylvania             DAVID CICILLINE, Rhode Island
JEFF DUNCAN, South Carolina          ALAN GRAYSON, Florida
MO BROOKS, Alabama                   AMI BERA, California
PAUL COOK, California                ALAN S. LOWENTHAL, California
RANDY K. WEBER SR., Texas            GRACE MENG, New York
SCOTT PERRY, Pennsylvania            LOIS FRANKEL, Florida
RON DeSANTIS, Florida                TULSI GABBARD, Hawaii
MARK MEADOWS, North Carolina         JOAQUIN CASTRO, Texas
TED S. YOHO, Florida                 ROBIN L. KELLY, Illinois
CURT CLAWSON, Florida                BRENDAN F. BOYLE, Pennsylvania
SCOTT DesJARLAIS, Tennessee
REID J. RIBBLE, Wisconsin
DAVID A. TROTT, Michigan
LEE M. ZELDIN, New York
TOM EMMER, Minnesota

     Amy Porter, Chief of Staff      Thomas Sheehy, Staff Director

               Jason Steinbaum, Democratic Staff Director
               
               
               
               
               
               
                                    (II)              
               
               
               
               
               
                            C O N T E N T S

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                               WITNESSES

The Honorable Roberta S. Jacobson, Assistant Secretary, Bureau of 
  Western Hemisphere Affairs, U.S. Department of State...........     6
Mr. John E. Smith, Deputy Director, Office of Foreign Assets 
  Control, U.S. Department of the Treasury.......................    12
Mr. Matthew S. Borman, Deputy Assistant Secretary of Commerce for 
  Export Administration, Bureau of Industry and Security, U.S. 
  Department of Commerce.........................................    20

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

The Honorable Roberta S. Jacobson: Prepared statement............     8
Mr. John E. Smith: Prepared statement............................    14
Mr. Matthew S. Borman: Prepared statement........................    22

                                APPENDIX

Hearing notice...................................................    66
Hearing minutes..................................................    67
The Honorable Edward R. Royce, a Representative in Congress from 
  the State of California, and chairman, Committee on Foreign 
  Affairs:
  Letter from the White House dated January 30, 2015.............    69
  The Wall Street Journal article entitled ``The U.S.-Cuba Deal 
    Heightens the Spy Threat''...................................    71
The Honorable Eliot L. Engel, a Representative in Congress from 
  the State of New York:
  Statement for the record by Alan P. Gross......................    73
  Statement for the record on behalf of the Honorable Barbara 
    Lee, a Representative in Congress from the State of 
    California...................................................    75
The Honorable Ileana Ros-Lehtinen, a Representative in Congress 
  from the State of Florida:
  Letter to the Honorable Barack Obama, President of the United 
    States of America, from officials of Cuban-American 
    communities in the State of Florda dated February 3, 2015....    76
  National Review Online article entitled ``Yes, Cuba Is a State 
    Sponsor of Terror''..........................................    78
  The Hill article entitled ``U.S.-Cuba policy: Myth vs. 
    reality''....................................................    81
  National Review Online article entitled ``Call Cuba to 
    Account''....................................................    83
The Honorable Gerald E. Connolly, a Representative in Congress 
  from the Commonwealth of Virginia: Prepared statement..........    86
Written responses from the Honorable Roberta S. Jacobson to 
  questions submitted for the record by the Honorable Edward R. 
  Royce..........................................................    87
Questions submitted for the record by the Honorable Eliot L. 
  Engel to Mr. John E. Smith.....................................    88
Questions submitted for the record by the Honorable Eliot L. 
  Engel on behalf of the Honorable Barbara Lee...................    89
Written responses from the Honorable Roberta S. Jacobson to 
  questions submitted for the record by the Honorable Ileana Ros-
  Lehtinen.......................................................    90
Written responses from the Honorable Roberta S. Jacobson to 
  questions submitted for the record by the Honorable Paul Cook, 
  a Representative in Congress from the State of California......    93


           CUBA: ASSESSING THE ADMINISTRATION'S SUDDEN SHIFT

                              ----------                              


                      WEDNESDAY, FEBRUARY 4, 2015

                       House of Representatives,

                     Committee on Foreign Affairs,

                            Washington, DC.

    The committee met, pursuant to notice, at 10:08 a.m., in 
room 2172, Rayburn House Office Building, Hon. Ed Royce 
(chairman of the committee) presiding.
    Chairman Royce. This hearing will come to order.
    Today we look at the Obama administration's sudden shift on 
Cuba policy. And sudden it was. Members of Congress were left 
in the dark. Most of the administration--including the State 
Department--was left in the dark. Instead, talks with the Cuban 
regime were conducted by two White House officials. 
Unfortunately the White House was unwilling to provide these 
key witnesses today. This committee, charged with oversight of 
our foreign policy, is handicapped when those officials most 
involved in policy making are unavailable. The administration's 
growing track record of secret negotiations, whether this is on 
the subject of Iran or the release of the five Taliban 
commanders, is increasingly troublesome.
    Had the White House consulted more widely, it may have 
heard that Havana is facing the threats of losing Venezuelan 
oil subsidies and mounting public pressure for basic reforms 
within the country. This could have been used to leverage 
meaningful political concessions on human rights in Cuba by 
that regime. But this was a one-sided ``negotiation,'' with the 
U.S. making a series of concessions to Havana.
    The release of 53 political prisoners is one area in which 
the administration did secure a commitment from the Cuban 
Government. But in an odd twist, the administration kept these 
names secret for weeks. Only after bipartisan pressure from the 
committee was the list ever released, and human rights 
advocates can now track whether these individuals are put back 
in jail, harassed, or monitored.
    Of course, 4 years ago, Raul Castro promised to release all 
political prisoners. Yet in a recent Freedom House report, we 
read that: ``Systematic use of short-term `preventable' 
detentions--along with harassment [and] beatings,'' are used to 
intimidate the opposition, to isolate dissidents, and maintain 
control. Advocates put the number of political arrests in Cuba 
last year at over 8,000.
    Assistant Secretary Jacobson, I appreciate very much your 
meeting with dissidents while you were in Havana last month. 
But I am very concerned that your Cuban counterparts are 
attempting to link your discussions to a commitment that the 
U.S. cease all democracy programs.
    Indeed, Castro is making even more demands. Last week, the 
dictator called for the return of the U.S. Naval station, an 
end to U.S. broadcasts, and ``just compensation,'' in his 
words. There is little debate over the importance of this 
facility for the U.S. Navy to conduct counternarcotics, 
intelligence, and humanitarian missions. And of course, our 
broadcasts are vital until a free media is allowed to operate. 
I hope the State Department is here today to assure us that 
none of Castro's demands are being considered.
    In defending this policy change, the President has compared 
our economic relationship with Cuba to that of China and 
Vietnam. But in China and in Vietnam, while Communist, at least 
foreign firms can hire and recruit staff directly, without 
their paying directly to the government.
    Not so in Cuba, which is more like North Korea than it is 
Vietnam or China. A Cuban worker at the foreign-owned resort 
receives only a fraction of their salary, as little as 5 
percent. So in the regimes that the Castro brothers or the Kim 
family run, the method is the same; extract hard currency for 
foreign businesses and invest it in the security apparatus.
    Instead of dismantling a 50-year-old failed policy, as it 
claims, the administration may have given a 50-year-old failed 
regime a new lease on life to continue its repression at home 
and militant support for Marxist regimes abroad.
    Before going to Mr. Engel, I am now going to yield my 
remaining time to Ileana Ros-Lehtinen, the chairman emeritus of 
this committee. Born in Havana, Chairman Ros-Lehtinen fled Cuba 
as a refugee at age 8. Her years of work on this committee have 
been marked by a tireless commitment to freedom and democracy 
for people around the world.
    Ms. Ros-Lehtinen. Thank you so much, Mr. Chairman, and I 
strongly second your grave concerns about the way that foreign 
policy is being run from the White House by secretly 
negotiating with the Castro regime while keeping the Congress, 
the American people, even our own diplomats in the dark.
    This foreign policy decision is in line with the 
President's other examples of Executive overreach and bypassing 
consultations with Congress. Just like the Taliban 5 trade with 
Bergdahl, the President has established a dangerous precedent 
that the United States does, in fact, negotiate with 
terrorists, putting a target on every American's back and 
jeopardizing our national security.
    Ever since the secret negotiations began of June 2013, this 
is what the Castro regime has been doing since day one of the 
talks as the U.S. establishes diplomatic relations. Just a few 
examples.
    July 15, 2013, a North Korean flagged cargo ship called 
Chong Chon Gang was caught in Panama after it left Cuba heading 
to North Korea. After inspections, the shipment included 
various components of surface-to-air missile systems and 
launchers, MiG-21 jet fighter parts and engines, shell casings, 
rocket propelled projectiles as the cargo hide under 200,000 
bags of sugar. October 6, 2013, over 135 democracy activists 
arrested in 1 day throughout Cuba. Also arrested was the leader 
of the Ladies in White, Berta Soler, who was dragged through 
the streets by her hair, and her husband, Angel Moya, was 
arrested.
    November 4, 2013, a Cuban artist, a young man called 
Critico, was on the verge of death due to a hunger strike. 
January 24, 2014, Dr. Oscar Elias Biscet, arrested. He was 
awarded the Presidential Medal of Freedom by President Bush. 
June 12, 2014, Jorge Luis Garcia Perez Antunez and Yris Perez 
Aguilera, Ladies in White, leader Berta Soler and Angel Moya, 
and others arrested. July 16, 2014, Cuba and Russia agreed to 
reopen the Lourdes missile--the Lourdes spying facility. In 
fact, in 2014, Mr. Chairman, it led to almost 9,000 arrests of 
pro-democracy leaders in 1 year. Almost a 40-percent increase 
from 2013, while we were in negotiations.
    In 2013, 2014 and last month, while the U.S. delegation 
arrived in Havana, Russia's spy ship docked in Cuba, and just 
last week, last week, the Castro regime sentenced a Cuban 
rapper, a young man known as El Dkano, to a 1-year prison 
sentence, and check out the charge: ``Dangerousness likely 
leading to a crime.'' That is an actual charge in Castro's 
Cuba. And 2 days ago, just to wrap it up, Mr. Chairman, a Cuban 
pro-democracy activist, Arelis Palacio, was brutally beaten all 
over her face and body, and she told state security, ``I would 
rather die than remain quiet and accept this.''
    All of this happened while the U.S. was secretly 
negotiating with the Castro regime. Shame on us.
    Thank you.
    Chairman Royce. We go now to our ranking member, Mr. Eliot 
Engel of New York.
    Mr. Engel. Thank you very much, Chairman Royce. Let me 
thank you, firstly, for calling this hearing. As a former 
chairman of the Western Hemisphere Subcommittee, I follow Cuba 
closely. For many years, I have worked with Ileana Ros-Lehtinen 
and others trying to bring freedom to Cuba.
    Let me also thank our witnesses for their testimony today 
and for their dedicated service to our country. Thank you, to 
the three of you, for coming.
    First and foremost I am delighted that Alan Gross is 
finally home after 5 long years. I first met his wife Judy back 
in December 2009. One of my sons went to school with one of the 
Gross' children. So I have always felt a connection to the 
Gross family. Alan's release from prison was long overdue, and 
I am overjoyed that he has been reunited with his family.
    As we all know, President Obama announced several major 
changes in U.S. policy toward Cuba, but this is not the end of 
the story. The onus is now on the Cuban Government to respond 
by moving forward with real reform. And what exactly does this 
mean? To me it means free and fair elections, respect for the 
rule of law, an independent press, and upholding the values 
enshrined in the Inter-American Democratic Charter. It also 
means releasing each and every political prisoner currently 
jailed in Cuba and ending the harassment of political 
activists. We want to see the formation of political pluralism 
there. Only then will we be comfortable with Cuba moving along 
the path to democracy.
    President Obama has the authority the reestablish relations 
with Cuba, and to make the regulatory changes that he announced 
on December 17. At the same time, however, Congress has the 
authority to maintain or eliminate the trade embargo on Cuba, 
and again, normalizing relations with Cuba cannot be a one-way 
street. It cannot be. It has got to be give and take on both 
sides, and at this time, I believe that Congress must see a 
greater political opening in Cuba before lifting the embargo.
    Last month Chairman Royce and I sent a letter to Secretary 
Kerry. We asked for the names of the 53 political prisoners the 
Cuban Government committed to releasing. I was very grateful 
for Secretary Kerry's rapid response to our letter with a full 
list of the released prisoners. To be sure, the release of 
these 53 prisoners was a very positive step. Unfortunately, a 
few of these prisoners were subsequently detained because of 
their political activism. While these individuals are no longer 
in jail, we must be vigilant in ensuring their safety. I urge 
the State Department to use its talks with Cuban officials to 
continue pushing for the release of all political prisoners.
    Finally, let me say that the upcoming Summit of the 
Americas in Panama presents an important opportunity for all of 
the countries in the region. We will be eager to hear from 
Cuban civil society leaders, along with other independent civil 
society leaders from throughout the Americas. I hope to be 
there, and I hope that we will have a delegation, a bipartisan 
delegation, going there too. I urge the Panamanian Government 
and all regional leaders to be as open and transparent as 
possible in allowing for civil society participation at the 
summit.
    And one request before I close, Mr. Chairman, I ask 
unanimous consent to submit for the record two statements; one 
on behalf of Alan Gross, and the second from our colleague 
Representative Barbara Lee, a former Foreign Affairs committee 
member, along with her questions for the record.
    Chairman Royce. Without objection.
    Mr. Engel. Thank you, Mr. Chairman.
    I would like to close again by thanking our witness for 
being here today. I look forward to hearing from each of you, 
and thank you again, Mr. Chairman, for holding this important 
hearing.
    Chairman Royce. Thank you, Mr. Engel.
    We go now to Mr. Jeff Duncan, chairman of the Subcommittee 
on Western Hemisphere for 1 minute.
    Mr. Duncan. Thank you, Mr. Chairman, and in addition to the 
other comments, I remain deeply skeptical of the Obama 
administration's unilateral Cuba policy shift. In addition to 
circumventing Congress, failing to consult any Cuban dissidents 
or civil society, and ignoring the wisdom and advise of 
seasoned American foreign service officers, the President's 
made his decision to embark on a new course in Cuba, using 
political speech writers on the National Security Council staff 
to craft his policy change.
    Mr. Chairman, I want to associate myself with your remarks 
and those of the gentlelady from Florida, Ms. Ros-Lehtinen, 
emphasizing my deep concern for the President's lack of 
transparency and the manner and process used to develop this 
policy change.
    Yesterday, witnesses in testimony in the Senate hearing 
recognized that the Western Hemisphere--excuse me--recognized 
that Russia is one of the most--openly challenged the United 
States in regard to Cuba; these are external actors that have 
influence in the region.
    And in view of the events that I thought the gentlelady 
from Florida spelled out, the U.S. must protect the United 
States' national security interest in any future negotiations 
with the Cuba Government, including maintaining U.S. permanent 
rights to the U.S. Naval station in Guantanamo Bay.
    And with that, I yield back.
    Chairman Royce. Thank you. I now recognize the ranking 
member of the Subcommittee on the Western Hemisphere who also 
is the one other Cuban-born member of this committee. Mr. Sires 
also was born in Havana. Were you about 11 when you----
    Mr. Sires. Yes.
    Chairman Royce. Well, thank you. Mr. Albio Sires.
    Mr. Sires. Thank you, Mr. Chairman.
    Yeah, I did come to this country when I was 11 years old in 
1962, and I experienced some of this government's tactics, but 
I am--my biggest disappointment with this whole process has 
been that I always felt that the embargo and the pressure that 
we were putting on Cuba would lead to some changes in Cuba. I 
really don't see how what we negotiated is going to lead into 
anything. You know, it is just beyond me that a signature on a 
piece of paper somehow relieves this dictator of this pressure.
    People are not going to benefit. You still have to go 
through the government for anything. Even if you want to put a 
church in Cuba, you have to go through the government. They 
have to okay this church. And do we think that we are going to 
be able to invest and do economic progress for the Cuban 
people? I don't see that happening.
    And I would like to associate myself with the chairman's 
comments and my ranking member's.
    I just don't see where we are headed with this. I know it 
is the last 2 years of the President. I know that he has a 
history to build, but I was disappointed in the fact that we 
are not using this as a pressure point on a government that has 
been so brutal. There are thousands of people in jail. I deal 
with these people today. My district has the second largest 
concentration of Cuban Americans in this country. I probably 
get more intel from the people on Hudson Avenue in Union City 
than I get from some of the briefings that I get in this place.
    So I thank you, Mr. Chairman.
    Chairman Royce. Thank you, Mr. Sires.
    This morning we are pleased to be joined by witnesses from 
the Departments of State and Treasury and Commerce.
    Ms. Roberta Jacobson is the Assistant Secretary of State 
for the Bureau of Western Hemisphere Affairs, and formerly 
served as the deputy assistant secretary for Canada and for 
Mexico.
    Mr. John Smith is the Deputy Director of the U.S. 
Department of the Treasury's Office of Foreign Asset Control, 
that is OFAC, and previously he served as an expert to the 
United Nations Al-Qaida and Taliban Sanctions Committee from 
2004 to 2007.
    Mr. Matthew Borman currently serves as the Deputy Assistant 
Secretary of Commerce for Export Administration.
    Without objection, the briefers' full prepared statements 
will be made part of the record. Members will have 5 calendar 
days to submit statements and questions and any extraneous 
material that any of these members of this committee want to 
put in the record.
    So, Ms. Jacobson, if you would please summarize your 
remarks in 5 minutes, and than we will hear from the other two 
witnesses.

   STATEMENT OF THE HONORABLE ROBERTA S. JACOBSON, ASSISTANT 
     SECRETARY, BUREAU OF WESTERN HEMISPHERE AFFAIRS, U.S. 
                      DEPARTMENT OF STATE

    Ms. Jacobson. Thank you very much, Chairman Royce, Ranking 
Member Mr. Engel, and members of the committee. And thank you 
for the opportunity to testify today on the new approach to 
U.S.-Cuba policy. I want to say that I appreciate this 
committee's engagement in the western hemisphere, and I know 
all of your strong commitments to democratic values, human 
rights, and social and economic opportunities in the Americas 
and in Cuba.
    I want to thank you also for support in welcoming the long 
overdue return of Alan Gross to his family. During Mr. Gross' 5 
long years of detention, the administration has worked closely 
with many Members of Congress in both Houses and from both 
parties to secure his release. As the President and the 
Secretary have said, we are also grateful for the essential 
roles of Canada, Pope Francis, and the Vatican in reaching an 
agreement that made Mr. Gross' freedom possible.
    On December 17th, the President announced a new policy 
toward Cuba, one that will better enable us to effectively 
advance our values and help the Cuban people move into the 21st 
century. Other previous approaches to relations with Cuba over 
half a century, though rooted in the best of intentions, failed 
to empower the Cuban people. Instead, it isolated us from our 
democratic partners in this hemisphere and around the world. In 
addition, the Cuban Government used this policy as an excuse 
for restrictions on its citizens, and as a result, those most 
deprived were the Cuban people itself.
    Our new approach is designed to promote every Cuban's 
universal rights, as well as our national interests, and we are 
already seeing signs that our updated approach gives us a 
greater ability to engage other nations in the hemisphere in 
advancing respect for fundamental freedoms in Cuba.
    Ultimately, it will be the Cuban people who drive economic 
and political reforms. That is why we lifted restrictions to 
make it easier for Cuban Americans to travel and send 
remittances to their families in Cuba and open new pathways for 
academic, religious, and people-to-people exchanges. Our new 
steps build on this foundation by increasing authorized travel 
and commerce and the flow of information to, from, and within 
Cuba.
    Nobody represents America's values better than the American 
people, and increased people-to-people contact will empower the 
Cuban people and reduce their dependency on the Cuban state.
    The regulatory changes we announced will increase financial 
resources to support the Cuban people and the emerging Cuban 
private sector, and they enable U.S. companies to expand 
telecommunications and Internet access within Cuba. U.S. policy 
will no longer be a barrier to connectivity in Cuba.
    Two weeks ago I made a historic trip to Cuba, one that 
helped me understand the burden and hope embodied in this 
policy when average Cubans and Cuban Americans wished me luck 
or said, ``God bless you,'' and encouraged our efforts. During 
talks, we were clear that our Governments have both shared 
interests and sharp differences. On practical issues, such as 
establishing direct mail service, counternarcotics, or oil 
spill mitigation, we agreed to continue dialogue and deepen 
cooperation, but this administration is under no illusions 
about the nature of the Cuban Government.
    I also raised with Cuban officials our concerns about their 
harassment, use of violence, and arbitrary detention of Cuban 
citizens peacefully expressing their views. I met with 
dissidents, entrepreneurs, and independent media voices to talk 
about what they need from their government and from us.
    We will continue to use our diplomatic efforts to encourage 
our allies, now more likely to work with us, to take every 
opportunity to support increased respect for human rights and 
fundamental freedoms in Cuba. As the President has said, the 
United States believes that no Cuban should face harassment, or 
arrest, or beatings simply because they are exercising a 
universal right to have their voices heard, and we will 
continue to support civil society there.
    I encourage Members visiting Cuba to expand their 
engagement with independent civil society voices in Cuba. They 
offer us valuable insights and a diversity of views. And I 
raised several elements in Havana that presently inhibit the 
work of our U.S. intersection, including travel restrictions on 
our diplomats, limits on staffing, local access to the mission, 
and problems receiving shipments. The successful resolution of 
these issues will enable a future U.S. Embassy to provide 
services commensurate with our diplomatic missions around the 
world. I hope you won't object to having seen our diplomats in 
action most recently, if I take this opportunity to salute 
their tireless efforts to advance our interests on the island. 
They are dedicated public servants.
    We have only just begun this effort to normalize relations, 
and we appreciate that there is a diversity of views in the 
U.S. Congress on this effort toward Cuba. We hope that we can 
work together to find common ground toward our shared goal of 
enabling the Cuban people to freely determine their own future.
    Thank you very much.
    Chairman Royce. Thank you.
    [The prepared statement of Ms. Jacobson follows:]
    
    
    
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    Chairman Royce. Mr. Smith.

  STATEMENT OF MR. JOHN E. SMITH, DEPUTY DIRECTOR, OFFICE OF 
    FOREIGN ASSETS CONTROL, U.S. DEPARTMENT OF THE TREASURY

    Mr. Smith. Thank you, Chairman Royce, Ranking Member Engel, 
and members of the committee. Thank you for the invitation to 
appear before you today to discuss our recent amendments to the 
Cuban Assets Control Regulations. I will be addressing the key 
changes we made to our regulations that Treasury's Office of 
Foreign Assets Control, or OFAC, made on January 16th to 
implement the changes to U.S. policy toward Cuba announced by 
the President the month before. These amendments ease sanctions 
related to Cuba in a number of key areas, including travel, 
remittances, financial services, and trade, and they are 
intended to have a direct and positive impact on the lives of 
the Cuban people. Cuba is the only OFAC sanctions program that 
restricts travel to a country. The recent regulatory amendments 
ease the travel restrictions by generally licensing certain 
travel within the 12 existing categories of travel in our 
regulations. This means that the travelers who satisfy the 
criteria of the general licenses may travel to Cuba and conduct 
travel-related transactions there without requesting individual 
authorization from OFAC. Travel to Cuba for tourist activities 
remains prohibited.
    These expanded general licenses are intended to lessen the 
burden on authorized travelers, making it easier for Americans 
to travel to Cuba to interact with the Cuban people, provide 
humanitarian assistance, and engage in certain educational and 
cultural activities.
    The regulatory amendments also authorize airlines to 
provide air carrier services to, from, and within Cuba in 
connection with authorized travel. Air carriers wishing to 
provide services will still need to secure regulatory approvals 
from other concerned U.S. Government agencies, such as the 
Departments of Transportation and Homeland Security. Travel 
agents and tour group operators may now also provide travel 
services in connection with authorized travel. These changes 
are intended to make authorized travel easier and less 
expensive by reducing the paperwork burden for, and increasing 
competition among, those providing travel and carrier services.
    To improve the speed, efficiency, and oversight of 
authorized payments between the United States and Cuba, OFAC 
has authorized U.S. banks to establish correspondent accounts 
at financial institutions in Cuba, and to allow travelers to 
use their credit and debit cards while in Cuba.
    Within the context of trade, OFAC has also modified the 
regulatory interpretation of the term ``cash in advance,'' 
which describes the financing requirement for trade between the 
United States and Cuba that is imposed by statute. OFAC has now 
revised its interpretation of the term to allow the export of 
American-produced agricultural, medical, and other authorized 
goods to Cuba so long as payment is received by the U.S. 
exporter prior to the goods' arrival to a Cuban port. This 
change should increase authorized U.S. exports to Cuba.
    Cuba has an Internet penetration of approximately 5 
percent, one of the lowest in the world. In order to better 
facilitate the free flow of information to, from, and among the 
Cuban people, OFAC eased restrictions to better provide 
efficient and adequate telecommunications services between the 
United States and Cuba, and to increase access to 
telecommunications and Internet-based services for the Cuban 
people.
    As I conclude, I should make one thing absolutely clear. 
Even with these changes I have described, most transactions 
between the United States and Cuba, most imports, most exports, 
and most other activities, remain prohibited. As OFAC 
implements these recent changes, we will continue to enforce 
the Cuba sanctions program vigorously, using all of our 
available tools, and take action against violators as 
appropriate.
    The President's December 17th announcement laid out a new 
course for our relations with Cuba, driven by a hope for a more 
positive future for the Cuban people. OFAC's amendments to the 
regulations, in concert with the regulatory revisions my 
colleague at Commerce will highlight, mark significant changes 
to our Cuba sanctions policy that implement the new changes 
announced by the President. These changes are intended to 
directly benefit the Cuban people and help them to determine 
their own future.
    Thank you, and I am happy to answer any questions.
    [The prepared statement of Mr. Smith follows:]
    
    
    
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STATEMENT OF MR. MATTHEW S. BORMAN, DEPUTY ASSISTANT SECRETARY 
 OF COMMERCE FOR EXPORT ADMINISTRATION, BUREAU OF INDUSTRY AND 
             SECURITY, U.S. DEPARTMENT OF COMMERCE

    Mr. Borman. Mr. Chairman, Ranking Member Engel, members of 
the committee, thank you for the opportunity to appear before 
the committee today to describe the Department of Commerce's 
regulatory revisions to implement the Cuba policy changes 
announced by the President on December 17th.
    As the President noted, these changes are intended to 
create more opportunities for the American and Cuban people, 
promote positive change in Cuba, and influence outcomes 
throughout the western hemisphere.
    On January 16th, the Department of Commerce's Bureau of 
Industry and Security (BIS) amended the Export Administration 
Regulations to authorize the export and re-export of certain 
items to Cuba that are intended to improve the living 
conditions of the Cuban people, support private sector economic 
activity, strengthen civil society in Cuba, and improve the 
free flow of information to, from, and among the Cuban people.
    BIS amended the regulations to expand two existing general 
authorizations, or license exceptions in the Commerce 
regulations, create a new license exception, and describe a 
licensing policy.
    Under the embargo on trade with Cuba, all items that are 
subject to Commerce regulations require a license for export or 
re-export to Cuba unless authorized by a license exception. BIS 
administers export and re-export restrictions on Cuba 
consistent with the goals of the embargo and with relevant 
laws. Thus, BIS may issue licenses for specific transactions or 
make types of transactions eligible for license exceptions that 
support the goals of the United States' policy while the 
embargo is in effect. Only items of lower technological 
sensitivity that are subject to limited export restrictions are 
eligible for these license exceptions.
    The first license exception that was expanded is the 
license exception related to gift parcels. The change here is 
to allow consolidated shipments of gift parcels to go under 
this license exception. Previously they required individual 
licenses. This change will enable more donations to the Cuban 
people because individuals who wish to donate eligible items to 
the Cuban people will no longer have to search for a license 
consolidator.
    BIS also expanded license exception Consumer Communications 
Devices (CCD) to now also authorize the commercial sale of 
commercial communication devices such as cell phones, mobile 
phones, computers, radios, and digital cameras. Previously 
these were only authorized under the license exception if they 
were donated. Now they can also be sold commercially.
    The new license exception that we created is Support for 
the Cuban People, or SCP. This license exception enables the 
export and re-export to Cuba of items intended to empower the 
nascent Cuban private sector by supporting private economic 
activity. Authorized items include building materials for 
private sector use, tools and equipment for private sector 
agricultural activity, and goods for use by private sector 
entrepreneurs such as auto mechanics, barbers, hair stylists, 
and restaurateurs. This license exception is intended to meet 
the President's goal of supporting the Cuban private sector and 
facilitate Cuban citizens' lower-priced access to certain goods 
to improve their living standards and gain greater economic 
independence from the state.
    Other provisions of the license exception SCP authorize the 
temporary export by persons leaving the United States of items 
for their use in archeological, cultural, ecological, 
educational, historic preservation, scientific, or sporting 
activities. It authorizes the export and re-export of certain 
donated items for use by the Cuban people engaged in the 
activities I just mentioned, and the export and re-export of 
items to human rights organizations, individuals, or 
nongovernment organizations that promote independent civil 
activity.
    These provisions implement the President's goals of 
harnessing the power of people-to-people engagement and of 
helping the Cuban people reach for a better future.
    As the President observed, nobody represents America's 
values better than the American people.
    To implement the President's goal of empowering the Cuban 
people by increasing their access to information, particularly 
through the Internet, and their ability to communicate with one 
another and with people in the United States and the rest of 
the world, license exception SCP authorizes the export to Cuba 
of items for the establishment and upgrade of 
telecommunications-related systems, in addition to the consumer 
communication devices authorized by license exception CCD. A 
related provision of license exception SCP authorizes the 
export and re-export to Cuba of certain items for use by news 
media personnel and U.S. news bureaus engaged in the gathering 
and dissemination of news to the general public.
    Lastly, this rule recognizes that environmental threats are 
not limited by national borders, and circumstances may warrant 
the export or re-export of certain items to Cuba to protect the 
U.S. and international air quality, water quality, and 
coastlines. Although pre-existing licensing policy provided the 
flexibility necessary to authorize such transactions, we have 
now amended the regulations to make explicit the general policy 
of approving such exports.
    In summary, these regulatory revisions implement the 
President's recently announced Cuba policy changes consistent 
with the comprehensive embargo the United States maintains on 
trade with Cuba. The changes support the President's goal of 
the United States becoming a better partner in making the lives 
of ordinary Cubans a little bit easier and more free, and is in 
line with U.S. national security interests. And I would also be 
pleased to answer questions.
    Thank you.
    Chairman Royce. Thank you. Thank you.
    [The prepared statement of Mr. Borman follows:]
    
    
    
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    Chairman Royce. I would like to go to Assistant Secretary 
Jacobson with a question, because administration negotiators 
stated that they did not seek human rights concessions in 
exchange for taking steps toward normalization; and now you 
know our concern about the State Department and you not being 
included in this on the front end, being kept in the dark on 
it, but the reality is that pro-democracy and human rights 
activists in Cuba have lamented that human rights weren't 
integral to these secret negotiations. In fact, the lead Cuban 
Government negotiator, who would be now your counterpart, he 
said, ``Change in Cuba is not negotiable.'' We have no, you 
know, indication here that the Cuban Government intends to give 
ground, and so if the regime refuses to ease its repression on 
the people in Cuba, how do our concessions advance the 
interests of the Cuban people?
    Ms. Jacobson. Let me be clear, Mr. Chairman, on part of 
this. I think it is crucial to understand that there really 
were no concessions from the Obama administration. Moving 
forward with the establishment of diplomatic relations is not a 
gift or a concession to governments. It is a channel of 
communication. As you know, having Embassies in countries is 
often not seen by governments as a gift. Quite the contrary. We 
are quite irritating to governments sometimes, and in fact, it 
is not necessarily something that the Cuban Government wanted, 
but we think it is--the things that were announced on December 
17th are a much more effective way to pursue our own national 
interests.
    So we believe that we can more effectively pursue the human 
rights policies, and the democracy policies that we want in 
empowering the Cuban people, and in having that direct channel 
with the Cuban Government to convey those concerns and to work 
with allies around the hemisphere who no longer fear 
association with a policy they did not support because of this 
policy.
    Chairman Royce. Well, but if I could just point out, what 
you are leaving out of the equation here is the fact that under 
these initiatives that the White House took without the State 
Department, but the White House took, the White House is now 
increasing the amount of dollars that flow into Cuba, 
specifically, these flow into the regime and helps the regime's 
bottom line at a time when the regime, as you could have told 
the White House, is now--now faces being cut off in terms of 
the subsidy from Venezuela. So at the very time that you think 
we would exert leverage, you have a situation instead where you 
have got sort of a lifeline. I mean, that is--that is my 
concern.
    Let me go to another question I had, and that is last week, 
Raul Castro stated that normalizing bilateral relations with 
the U.S. would not be possible until the U.S. returns the Naval 
station at Guantanamo Bay to Cuba. Is the administration 
considering transferring this military asset back to the Cuban 
people? And I will remind you, when we talked with the State 
Department before on negotiations on another subject, the State 
Department spokesman said unequivocally that the United States 
is not considering the release of any member of the Cuban 5, 
one of whom was convicted for his part in killing four 
Americans, for Alan Gross. So we have got a little history of 
hearing one thing and then finding out another after the fact. 
But on this question on Guantanamo if you could----
    Ms. Jacobson. Sure. The issue of Guantanamo is not on the 
table in these conversations. I want to be clear that what we 
are talking about right now is the re-establishment of 
diplomatic relations, which is only one first step in 
normalization. Obviously the Cuban Government has raised 
Guantanamo. We are not interested in discussing that. We are 
not discussing that issue or a return of Guantanamo.
    We also, I want to be clear, you know, we didn't return the 
Cuban agents for Mr. Gross. We returned the Cuban agents for an 
intelligence agent that we wanted back.
    Chairman Royce. Let me ask you one last question. For years 
the Castro regime has perceived broadcasting by our Office of 
Cuba Broadcasting as a threat. Last week the Cuban Government 
referred to these as illegal, and Castro has demanded that the 
broadcast be stopped.
    To what extent have our broadcasts been discussed as part 
of these talks?
    Ms. Jacobson. The Cuban Government has always raised radio 
and TV Marti both in the migration talks, and they raised them 
again as part of a list of things that they object to in the 
normalization talks, but we have no plans to end those either.
    Chairman Royce. Well, I know that Cuba is demanding that 
they be shut down. I am hoping to hear you say that we are 
demanding that Cuba drop its jamming. But thank you. I am going 
to go to Mr. Engel because my time is up. Thank you.
    Mr. Engel. Thank you.
    Secretary Jacobson, let me just give you a broad leeway, 
because you have answered some of this, but I want to hear 
more. How do you answer the critics who say that we gave away 
the store? That we have--we had leverage and we just tossed it 
away. Didn't get concessions in exchange, and if we didn't, 
doesn't it show you the true intentions of the Castro regime? 
Raul Castro has reportedly said--touted the fact that he gave 
up nothing, and essentially we made all the concessions. How do 
you answer that?
    Ms. Jacobson. I appreciate the question, Congressman. I 
really do, because I think it is important--there is nothing in 
what we decided on the 17th that we believe is a concession to 
the Cuban Government. It is true that we have begun to talk 
about diplomatic relations. It is also true that we are going 
to try and move forward with Embassies in each other's 
countries. We strongly believe that having an Embassy in Havana 
will enable us to do more things that help us more effectively 
empower the Cuba people, not high necessarily on the Cuban 
Government's list of desires.
    We also believe that by allowing American companies to 
engage in telecommunications sales and acting to get greater 
information into Cuba to work with the entrepreneurs who I sat 
down with while I was there, we can begin to increase the pace 
at which people separate themselves from the state, also not 
something that the Cuban Government has on its list of 
priorities. I think that they may tout this as support for 
their government, but we have diplomatic relations with lots of 
governments around the world with whom we sharply disagree. It 
is a channel. It is a mechanism. It is not, as somebody said 
yesterday on the Senate side, it is not the Good Housekeeping 
Seal of Approval, and we will continue to speak out on human 
rights, to support democracy activists, but we believe that 
this policy had become such an irritant in our work with other 
Latin American countries, with our European allies, that it 
also enables us to work more effectively with them in bringing 
about that support in Cuba.
    Mr. Engel. Well, thank you. I mentioned in my statement 
that I was pleased with the release of the 53 political 
prisoners, but obviously much more remains to be done on the 
human rights front in Cuba. The Havana-based Cuban Commission 
on Human Rights and National Reconciliation reported 8,899 
short term detentions in the year 2014, and that was a 39-
percent increase over 2013.
    So what is the Obama administration's strategy for pushing 
the Cuban Government to improve its human rights record? Are we 
working with other governments in the region and in the 
European Union to urge the Cuban Government to put an end to 
short-term detentions and harassment of dissidents?
    Ms. Jacobson. I think that is a really important point, 
because I think this question of short-term detentions is a 
crucial one. We obviously have seen a shift from longer-term 
sentences to short-term detentions. That number has gone way up 
in the last year. It is of enormous concern to us, and we have 
made it clear both to the Cuban Government directly now in 
these talks and others, and also with allies to international 
organizations that it is unacceptable. We do believe, and we 
have had those conversations already, that the new policy 
enables us to work better with other governments. The reaction 
of many governments in the region was: We strongly support your 
policy shift. It has changed the dynamic. What can we do to 
help? As we prepare for the Summit of the Americas, which you 
mentioned, we believe that Cuban civil society activists and 
independent human rights activists will have an opportunity to 
interact with Latin American leaders for the first time. All of 
those things, I think, will help.
    That same national commission has noticed a drop in short-
term detentions in January. Not a trend. I want to be clear 
about that. We cannot know whether that is the beginning of a 
trend, and we will be watching that very carefully because it 
must end. Not just come down, but it must end.
    Mr. Engel. Well, you mentioned civil society. I want to ask 
my final question about civil society and the Summit of the 
Americas. What conversations have you had with your Panamanian 
counterparts to ensure that there is robust participation from 
Cuban civil society at the Summit of the Americas, and then in 
your discussions with Cuban Government officials in Havana, did 
you urge them to allow for civil society leaders from the 
island to participate in the summit? Did you encourage Cuban 
political dissidents to participate in the summit?
    Ms. Jacobson. The answer to all those questions is yes. We 
have had extensive conversations with the Panamanian 
Government, with the nongovernmental organizations that will be 
organizing the civil society forum, with other NGOs around the 
hemisphere, including in the United States, as well as making 
sure that the rules for the civil society summit are not the 
same as in previous years. Previously it had been that you 
could only participate if you were an NGO registered with the 
OAS, which would preclude Cuban independent organizations. That 
will not be the case this year so that Cuban dissidents and 
independent organizations may be invited.
    Mr. Engel. Thank you.
    Thank you, Mr. Chairman.
    Chairman Royce. We go now to Ileana Ros-Lehtinen.
    Ms. Ros-Lehtinen. Thank you so much, Mr. Chairman.
    As we know, the U.S. has been negotiating in secret with 
this sadistic dictatorship for now 20 months, because it is 
still secret. For 18 of those months, the White House 
negotiated in super secret to trade three convicted spies for 
an innocent American. Even if you say that that was not a swap, 
that is just so disingenuous.
    Assistant Secretary Jacobson, this week in the Senate, just 
yesterday, you testified, ``This policy is not based on the 
Castro regime changing,'' and you have said more or less that 
now, ``we have no illusions over that.''
    So let me get this straight. We are telegraphing to the 
Castro regime ahead of time that it doesn't have to change. We 
have no illusions that it is going to change. So we are going 
to get further concessions from this administration. What is 
the point of negotiations, then, if we say we are negotiating, 
we have no illusions, let's see where this leads us?
    Now, the media has been reporting just this week that 
arrests in Cuba for last month in January decreased to only 
178, making it seem like the arrest of peaceful pro-democracy 
activists, 178 of them, is a low number. Only in Castro's Cuba 
could the arrest of 178 people in 1 month be considered a 
victory.
    Now, for the President's State of the Union address last 
month, I invited Marlene Alejandre, the daughter of our Armando 
Alejandre. They were also kept in the dark about this trade/
non-trade, this swap/non-swap. Her father was murdered by the 
Castro regime when his Brothers to the Rescue plane was shot 
down over international waters, and on December 17th, the 
President released and pardoned Gerardo Hernandez, a Cuban spy 
who was convicted in our U.S. courts for conspiracy to commit 
murder for his connection to the shootdown.
    So the Alejandre family wanted me to ask you these 
questions, Assistant Secretary Jacobson: How will I explain to 
my three little girls that their U.S. Marine Vietnam veteran 
grandfather was denied the only justice for his murder when 
Gerardo Hernandez was set free, pardoned, and returned to Cuba? 
Next question: Why was the U.S. so willing to give Gerardo 
Hernandez the opportunity to father a child while he was in 
prison? Very interesting, when some of the victims of the 
shootdown will never be able to have children of their own.
    Now as if negotiating in secret is not bad enough, the 
Castro regime continues to defy this administration, as the 
chairman has pointed out and the ranking member, setting 
preconditions publicly on the negotiations, such as demanding 
the return of the land of Guantanamo, which is so vital to U.S. 
national security interests. It is so pathetic for this strong, 
wonderful, generous country to look so weak when negotiating 
with the Castro regime.
    Isn't it true that Cuba owes American taxpayers at least $8 
billion in certified claims for the unlawful taking of 
property, of businesses, of unpaid debts owed to the American 
citizens? Isn't it true that Cuba has failed to pay these 
claims for close to 60 years, and isn't it true that U.S. law 
requires that these claims be resolved before relations be 
normalized?
    So I urge all of your departments to explain how illegally 
confiscated properties will be resolved. U.S. claim holders 
deserve their claims to be protected. Don't you agree? And, 
Assistant Secretary Jacobson, it is important to note what the 
Castro regime will do with this new assistance that President 
Obama is going to provide on telecommunications.
    Now, in 2012, Pope Benedict visited the island, as you 
know. The Castro regime responded with rounding up and 
arresting hundreds of civil society individuals, and he blocked 
the phones of the opposition leaders, and as we know, Castro 
held an American jailed for 5 years for trying to provide 
Internet equipment to the Jewish community in Cuba. So the 
track record is clear about Castro and his hatred of this 
telecommunication equipment, and in this latest misguided 
talks, the Castro regime asked the U.S. Interests Section to 
stop providing Internet services for the Cuban people. So his 
track record is clear. It has no intent of opening up the 
Internet or telecommunications opportunities. In fact, if given 
that opportunity, it is probably going to be used to further 
oppress the people of Cuba.
    And then just one last thing, and you can answer it 
whenever you can in writing. Did Secretary Kerry lie to the 
United States Congress when he told us that we would not free 
up these convicted murder--these convicted spies, or was he 
kept out of the dark of these negotiations? And were you part 
of the negotiations from the start, or did you enter them later 
on? But I have run out of time.
    Thank you.
    Chairman Royce. Well, I am just going to suggest a little 
response in writing, and that way we can go to Mr. Brad Sherman 
of California.
    Mr. Sherman. Thank you.
    It is said that our policy toward Cuba for the last 50 
years has failed. This comes from an American view that it is 
all about us, that the only thing--that if Cuba isn't better, 
it must be our policy that would have been the difference. Our 
policy is exactly different, or has been for the last 50 years, 
than Europe and Canada's policy. Maybe it is their policy that 
failed to bring democracy to Cuba, maybe it is ours.
    Ms. Jacobson, Cuba got caught smuggling 240 tons of weapons 
to North Korea, violating U.N. sanctions. Cuba is not 
cooperating in the U.N. investigation. Are these reasons to 
keep Cuba on the State Sponsors of Terrorism List?
    Ms. Jacobson. Congressman, we are undertaking the review of 
the State Sponsors of Terrorism List right now. We are 
evaluating all of the information.
    Mr. Sherman. I know that. Please.
    Ms. Jacobson. We also made clear when we were looking at 
that incident with the Chong Chon Gang that we did not think 
Cuba's--we did think Cuba's behavior violated the sanctions 
regime. The only entity that was sanctioned, as you know, as a 
result of that investigation was the North Korean company, 
which can no longer operate.
    Mr. Sherman. I have got to reclaim my time. I have got----
    Ms. Jacobson. Okay.
    Mr. Sherman [continuing]. So many questions.
    Ms. Jacobson, Americans paid in blood for Cuban 
independence. We got a base in Guantanamo that is valuable to 
our national security. Are you prepared, and hopefully this is 
a yes-or-no question, to say right now: This administration 
will not abandon, return, or fail to pay the modest fee so that 
we can have that Naval base for the next 2 years?
    Ms. Jacobson. I don't see that discussion taking place.
    Mr. Sherman. That is not what I am asking for. That was in 
your testimony.
    What--can you make a commitment--because you have got to 
see it from our side here. We were shocked. So you telling me 
that you are not thinking of something means I got to get ready 
to get shocked tomorrow.
    The administration was so angry that they hadn't been 
consulted on bringing one guy to speak here--it was not a lot 
of consultation on this huge change in Cuba policy.
    Would the administration object to language in an 
appropriations bill designed to make it impossible for this 
administration to give back the Naval base?
    Ms. Jacobson. That issue is not on the table with the----
    Mr. Sherman. Would the--it could be--it could be on our 
table. Would you object?
    Ms. Jacobson. I don't know the answer to that as it is a 
matter of Executive policy.
    Mr. Sherman. Okay. Let me go on to Mr. Smith. We have got 
the Cuban Liberty and Democracy Solidarity Act. It doesn't 
allow us to deal with certain properties that have been seized 
by Americans. You have got new regulations on travel, credit 
cards, et cetera. How do you plan to make sure that American 
travelers aren't breaking the law by staying at hotels that 
were confiscated from Americans or otherwise violating the 
Cuban Liberty and Democracy Solidarity Act?
    Mr. Smith. One thing I should say at the start about that, 
the act, though, is that the act--what that does is say that 
you can't provide a loan or credit or provide financing to 
further those transactions involving confiscated property. It 
doesn't say that you can't have--you can't stay at a hotel or 
engage in any other kind of activities.
    Mr. Sherman. Does the credit card company extend a loan 
when you use a credit card to pay for a hotel stay at a 
confiscated property?
    Mr. Smith. A credit card company may extend a loan to the 
traveler when you stay there.
    Mr. Sherman. So you are extending the loan to facilitate 
staying at the hotel. You think that is in conformity with the 
act?
    Mr. Smith. Certainly. We have the provision of the act that 
is replicated in our regulations. We will follow to the letter 
what is in the act, because we have it in our regulations. We 
will follow that. But nothing that we have authorized would 
abridge those provisions of the act.
    Mr. Sherman. I would just close by saying I might be more 
favorably impressed by the policy if it hadn't been such a 
complete shock and if Congress had been involved, and this U.S. 
Government will work better if we coordinate on foreign policy 
and have one national foreign policy that reflects the views of 
both elected bodies instead of a view of Congress as simply an 
annoying body that has to be consulted now, and then. I yield 
back.
    Chairman Royce. We go now to Mr. Chris Smith of New Jersey.
    Mr. Smith of New Jersey. Thank you so much, Mr. Chairman, 
for calling this extraordinarily important hearing. You know, I 
say to our distinguished witnesses, and welcome to the 
committee, The Washington Post has done several editorials, 
one, Obama Gives the Castro Regime in Cuba an Undeserved 
Bailout, pointing out that with the Soviet Union and certainly 
now Venezuela less able to prop them up, now potentially U.S. 
funds will do that. Secondly, President Obama's Betrayal of 
Cuban Democrats, and the fact that we should have listened to 
Berta Soler, the Ladies in White, who will be testifying here 
tomorrow at a hearing I am chairing. She, along with Antunez 
and Ms. Fonseca, two of those are going back, two of those 
individuals. Talk about bravery, speaking to the Senate, now 
speaking to the House, and they are going back. And yet the 
Post, which is hardly a conservative bastion, talks about a 
betrayal of Cuban democrats. And in another editorial it said 
with no consequences in site, Cuba continues to crack down on 
free speech.
    I would ask you, if you would, now an assessment, since it 
has been in effect, the negotiations and the publicity or 
visibility of them, are there any second thoughts? And I say 
that, 2012, Ileana Ros-Lehtinen and I had a hearing, and we 
heard from Dr. Biscet, who spent 11 years in prison. And the 
same type of scenario is playing out for even some of the 53 
that were freed. Five have been rearrested. He was in and out 
of prison constantly. It is part of the harassment and the 
modus operandi, and we understand, and maybe you can verify it, 
that some 100 to 200 additional prisoners over the last 6 weeks 
have been arrested.
    Is that true or is that is not? Some comments have been 
made that the ICRC may get to go to Cuba. That is not the 
issue. They need to go to the prisons, and the last time 
Armando Valladares was able to negotiate that, when he walked 
point in the 1990s, and I was with him in Geneva at the Human 
Rights Commission, when he secured that, representatives went 
into the prisons, interviewed people; and everybody, including 
family members, were severely retaliated against. The ICRC has 
to have unfettered access to the prisons. Meeting with Fidel 
Castro or anybody under him just doesn't cut it. I would like 
to go again. I have tried repeatedly. Madam Secretary, maybe 
you can help facilitate that. I want to go to the prisons and 
lead a delegation to the prisons. I have been to prisons in the 
Soviet Union. I have been to prisons in East bloc countries, as 
well as in Asia. Cuba is the one that won't let me or others 
into the prisons. Please help us with that. If you could answer 
those questions.
    Let me ask you, in the negotiations there are many 
convicted felons, including Joanne Chesimard who gunned down 
Werner Foerster in my State in cold blood, shot in the back of 
the head gangland style having escaped from prison, convicted, 
a fugitive felon, and yet she got asylum there. Was that part 
of the negotiations, the discussions, or was it not?
    Finally, just let me ask with regards to, with the time I 
have, please answer those, and I will come back.
    Ms. Jacobson. Okay. Let me say that the whole point of this 
new policy is not that we are telescoping to the Cuban 
Government that they don't have to change or that we expect 
them to change right away. Certainly we want those practices to 
change. We simply are not naive about how quickly they may 
change, and so our efforts are to empower the Cuban people to 
take their lives into their own hands. I had not heard that 100 
to 200 people had been arrested. There were certainly as many 
as 50 or more arrested around the time of Tania Bruguera, 
performance artist. To the best of my knowledge, most, if not 
all, have been released, although there are severe constraints 
on them; and none of them should have been arrested, just as 
there are still political prisoners in Cuba who should be 
released. I want to be clear about that, and the fact that a 
downturn in detentions is not good enough----
    Mr. Smith of New Jersey. The game they play, Madam 
Secretary, is that they arrest, rearrest and let out. Like when 
Antunez goes back. Seventeen years in prison. He has been 
tortured.
    Ms. Jacobson. Right. I completely agree.
    Mr. Smith of New Jersey. Dr. Biscet testified here by way 
of phone, and he said don't lift the embargo because you have 
got to get real substantive concessions.
    Ms. Jacobson. Agreed, and I saw Oscar Biscet when I was on 
the island, and I have the utmost respect and admiration for 
him and his views on this. Let me also say that every time I 
talk with the Cuban Government, I mention the case of Joanne 
Chesimard. I am a daughter of New Jersey. I grew up with this 
case and other fugitive cases.
    Mr. Smith of New Jersey. What is their response?
    Ms. Jacobson. We have not gotten a positive response on 
Joanne Chesimard.
    Mr. Smith of New Jersey. What did they say?
    Ms. Jacobson. They have said that they are not interested 
in discussing her return. Now, on other cases, we have made 
some more progress. There have been felons, accused felons, 
expelled to the United States. This is a very high priority for 
us, and we are frustrated that we have not made progress. There 
are other cases that we will continue; all of these cases, we 
will continue to pursue. We are going to have further dialogue 
on fugitives and law enforcement because this is critical to 
us. That is part of what we hope we will do better on in having 
conversations that are more expansive with our Justice 
Department colleagues. This is a critical part of having a 
channel.
    Mr. Smith of New Jersey. Just one last thing. We all know 
the Castro brothers have pushed this as a major diplomatic win 
for them. I would have hoped, and I think we all would have 
hoped, that human rights concessions would have been first 
before being recognized diplomatically.
    Chairman Royce. We go now to Mr. Greg Meeks of New York.
    Mr. Meeks. Thank you, Mr. Chairman. Madam Secretary, it is 
good being with you. Let me first go on record as saying that I 
wholeheartedly agree with the President's change in direction. 
I think that it is clear that over 50 years, nothing has 
changed with the policy that we had, and time says that you 
don't do the same thing over and over again and you get the 
same result. So I wholeheartedly agree and think that the time 
is finally there for a change in policy. I should also say that 
I do feel the passion of, for example, my good friend, the 
ranking member of the Western Hemisphere in listening to his 
opening statement, because clearly the passion that he has is 
for the people of Cuba. And in listening to his opening 
statement, you know, some of the questions he had, I hope that 
there is that kind of dialogue that goes forth because this 
should be about trying to make sure there is not only a better 
day and a better change in our policy, but also a better day 
for the Cuban people.
    So in that regard, and I have been down all of, been to 
Cuba several times and all other places in Latin America and 
the Caribbean, et cetera, and I have found that one of the 
major obstacles that we have had in the region is Cuba and our 
Cuban policy. It has caused a kind of friction, et cetera. They 
have all said to me that we needed to change. In fact, when I 
look at it, I think about multilateral relations as opposed to 
unilateral relations. We were the only country in the world, 
the only country in the world, all our major allies, everybody 
that had sanctions against Cuba, unlike, for example, this 
administration has been successful in putting together huge 
sanctions. When we work together, I think we are more 
successful. I think that is part of what has taken place, even 
Iran now with the P-5+1, even in Russia with the Russian 
sanctions. It is when we work closely with everyone. And I 
would like that to happen right here in our own hemisphere, but 
we need to work more closely with our allies.
    Our closest and biggest allies, when I talked to them in 
Latin America, I asked what is the one thing that we should do 
in Latin America that would make it better for all of us that 
share this hemisphere? They said change our Cuban policy. Now, 
that being said, can we now, with the changing dynamics or with 
the new policy, after that, what realities with our allies and 
can we put additional pressure; or will they work with us to 
change and make human rights an issue high on their agenda so 
that we can make a difference in the lives of the people that 
are living on the island?
    Ms. Jacobson. Congressman, I think that is a critical 
point. And the next part of the question, we support your 
policy on Cuba. This is a very important day in Latin America, 
and for your relations with us, how can we help is, well, you 
can start raising the issue of human rights and democracy in 
Cuba much higher on your agenda. And we believe that this is 
going to be a very important turning point in countries' 
engagement, especially countries which have a history of 
working on these issues in the region that have been afraid to 
work with us too closely because of not wanting to appear 
aligned with our previous policy.
    That has been evident in working on the summit where we 
were able to work strongly now with countries to highlight the 
democratic governance and citizens participation themes in the 
summit and accelerate planning on the civil society dialogue. 
It has been very evident even when I was in Cuba 2 weeks ago 
and we invited Ambassadors, not from this hemisphere--I spoke 
with them separately at one point--but we invited Ambassadors 
from Europe and Asia, for example, to a reception with 
dissidents and human rights activists. They never come to those 
receptions in the past, almost universally. There are few 
countries that have routinely come. They all came, and they 
were able to interact with dissidents for the first time. The 
dissidents had access to a wider range of diplomats than they 
had ever before. That is what we are hoping for.
    Mr. Meeks. Let me ask because I see I am running out of 
time, so I am going to ask two questions real, real quick. One, 
given that, and I know that there has been talk, has there been 
any real reactions directly from the Cuban civil society after 
the announcement? So I would like to know if there has been 
that, as well as, you know, when I was down there, one of the 
problems that I had was getting on the Internet. The Internet 
now will be open; and what, if any, impact would having an open 
Internet have on the civil society?
    Ms. Jacobson. Yeah. I mean, I think that would be huge. On 
Cuban civil society, I think the thing that struck me in both a 
small meeting with Cuban dissidents and then a much larger one, 
including many members, 12 members of the 57 who were released 
4\1/2\ years ago are not able to travel. They are not permitted 
by the Cuban Government to travel, so I was able to see many of 
them. That has to change. They need to be able to travel.
    But what I was struck by, I also met with El Critico, Angel 
Yunier, one of the younger members of this group. I was struck 
by the diversity of youth. Some support these measures and the 
change in policy, and some are obviously very strongly opposed, 
and I think that has to be respected, and we want to hear from 
and continue to support all of them.
    The second thing is on the Internet, I think that is really 
crucial, and I don't know whether the Cuban Government will 
allow that opening. They have said they will. They have said 
they are interested in telecommunications. It is obviously 
critical to economic progress, but I think that is why we have 
to aggressively try and make it possible for our companies to 
provide that service and see whether the Cubans are willing, 
without the excuse that the Americans are the reason they can't 
do it.
    Chairman Royce. We go now to Mr. Dana Rohrabacher of 
California.
    Mr. Rohrabacher. Thank you very much, Secretary Jacobson. 
This is a difficult task for you to be here. I think one of the 
main concerns that we have here is that instead of changing the 
Castro regime into a more democratic regime, the President is 
acting as if he has the right to rule by dictate and over his 
presidency is changing our country to be more like Castro than 
having Castro change to be more like a free and open society. 
Ruling by dictate and having secret negotiations is not what 
America is all about. That is not the way we make policy here, 
and many of us are very disappointed. This isn't the first case 
of this however, but dealing with a regime that is odorous--is 
``odorous'' a word? Odorous, is that the word I want? There it 
is. Onerous and odorous. I think it is both. There you go. But 
we have a regime that stinks one way or the other and is 
oppressive one way or the other that we are dealing with, but 
yet we have had secret negotiations and deals that are 
announced to us, and you are here to explain it.
    So let me ask this: When you said there are no concessions, 
you mean we go into an agreement with a regime, and we have had 
50 years of American policy changed, and there are no 
concessions from the Cuban Government?
    Ms. Jacobson. I don't think there were concessions from the 
U.S. Government in going into----
    Mr. Rohrabacher. We have changed 50 years of American 
policy. Isn't that a concession enough? All right. Thank you. 
Let me ask you this; with the changes that we can expect, is 
there any agreement that part of this ending of U.S. policy, of 
making a stand that there be a more democratic and open society 
before we have a more expanded relationship with them, is there 
any agreement part of this that there will be, for example, 
independent unions, say we are going to have more economic 
activity? Was there any type of concession--well, the word 
``concessions.'' Is there an agreement that they are going to 
permit independent unions in Cuba?
    Ms. Jacobson. There were no agreements ahead of time on 
that.
    Mr. Rohrabacher. Okay. So we are going to open up economic 
trade. There are no unions, then we have also heard that maybe 
the money that is going into the pockets--supposedly into the 
pockets of the working people--is actually going to be 
transferred directly to the government; or that money might go 
directly to the government and then be handed out to the 
working people. Is that right? We agreed to that?
    Ms. Jacobson. We believe that on balance, the Cuban people 
will benefit more from this than the government will.
    Mr. Rohrabacher. That is not the question, whether you 
think it and whether we think it. Do you think the Cuban people 
want, that people who are going to be working for these 
companies that now we have permitted to go into Cuba, that the 
Cuban people want their government to take their pay and just 
give them back a pittance?
    Ms. Jacobson. I am sure they don't.
    Mr. Rohrabacher. Okay. Fine. Whose side are we on? On the 
side of the people who are taking the money from the central 
government. Are there going to be opposition parties, new 
opposition parties?
    Ms. Jacobson. We are going to continue to support those who 
want to have their voices heard peacefully----
    Mr. Rohrabacher. There have been no concessions on their 
part, so we have changed five decades of U.S. policy, and they 
still won't have any independent unions or opposition parties. 
I can't imagine that they are going to have opposition 
newspapers, and the rallies--listen, this is a regime. The 
Castro brothers came in, and once they were in power, they 
murdered the patriots who overthrew the Batista regime. They 
personally did. The fellow that we were negotiating with took a 
pistol and went and took these patriots out and shot them in 
the head by the hundreds. And after that, they decided to have 
a relationship with the Soviet Union, which was then our main 
enemy, and encouraged the Soviet Union to put missiles that had 
nuclear weapons on them and encouraged them to use them on the 
United States. This is the regime we are dealing with, not to 
mention the criminals that they have given safe haven to. Now, 
how we can change five decades of policy by dictate from our 
President here? And then to hear there were no concessions on 
their side is disillusioning on our part and upsetting. Thank 
you very much.
    Ms. Ros-Lehtinen [presiding]. Thank you, Mr. Rohrabacher. 
And now we go to Mr. Sires of New Jersey.
    Mr. Sires. Thank you. Mr. Smith or Mr. Borman, can you tell 
me what percentage of the Cuban businesses are owned privately?
    Mr. Borman. I can't tell you a precise percentage, but 
certainly there are over 200 categories of private sector 
economic activity that are authorized by the Cuban Government, 
so we recognize that it is----
    Mr. Sires. Authorized by the Cuban Government?
    Mr. Borman. That they are legal, and there are private 
businesses.
    Mr. Sires. Mr. Smith, you?
    Mr. Smith. I don't have any additional details.
    Mr. Sires. I can tell you. About 15 percent. Eighty-five 
percent of the businesses in Cuba are owned by the military. 
The hotels are owned by the military. The bed and breakfasts 
are run by the families of the military. The umbrella agency 
that approves all the business is the son-in-law of one of the 
Castros. So when you say to me that the Cuban people, which is 
what I am interested in, are going to benefit by doing business 
with the Cuban people, you are not reaching very many people. 
You know, the private sector runs the hot dog stand, maybe. But 
we are talking about the big businesses which employs people 
are run by the generals. And if you want to put a big business 
in Cuba, you want to build a McDonald's and you need 100 
employees, you have to go to the government, and you need 100 
employees, you have to go to the government, and they give you 
the rate, and they give you the employees. And those employees 
are people who are part of the government system. So the people 
that are fighting for liberty and are fighting for democracy on 
the island are basically left out. These are the things you 
have to negotiate away from the Cuban Government.
    So if your intention really is to help the Cuban people, 
the ordinary Cuban people, you are not helping them. This is a 
society that has upheld themselves with this kind of business 
that they run.
    Mr. Borman. So just to be clear, the changes that we have 
made in our regulations are designed exactly to get items to 
the 15 percent. That is the way the regulations are structured 
so those items that can now be exported without individual 
licenses have to go to the true private sector.
    Mr. Sires. In terms of millions of dollars, Mr. Smith, this 
whole change, what do you think is going to benefit the Cuban 
Government, how many millions?
    Mr. Smith. We don't have a figure on any millions that 
would benefit the Cuban Government. I think the changes have 
been focused on private entrepreneurs, the small-scale 
business, private business that we are talking about. Again, I 
would repeat that most of the transactions between the United 
States and Cuba remain prohibited under these changes. We have 
just carved out a few areas that, as Mr. Borman talks about, 
are focused on the private entrepreneurs.
    Mr. Sires. I mean, if we go in to sell wheat to Cuba, are 
we going to buy sugar from Cuba? There is no real crop of sugar 
in Cuba anymore. Cuba used to be the leading world supplier of 
sugar. Cuba does business with the rest of the world. This 
whole idea that you have to grow this in some sort of a 
corporate has ruined the entire economy. There is no real free 
business in Cuba. Even the people that you deal with that you 
say they got 200 licenses, the Cuban Government can remove 
those license at a drop.
    Ms. Jacobson. It is true, Mr. Sires, but if I could, I met 
with seven or eight of these entrepreneurs, people really 
trying to run their own businesses, restaurateurs, a barber, 
women making soap, women doing decoration on clothes, and you 
can see people beginning to separate their own economic future 
from the government and having trouble because they can't get 
the supplies. The state doesn't want to provide them the 
supplies. That is who we are trying to help.
    Mr. Sires. But yet the elite in Cuba have all the supplies, 
and this is what I am trying to break. This is what runs the 
island, the generals, the people you see them driving in the 
cars. You see them living in the houses that were repossessed 
from people who worked hard in the business before the Castro 
takeover. I just don't see where we have any more leverage to 
get some of these changes to help the Cuban people.
    I was just talking to my colleague. My aunt came from Cuba 
a couple years ago. I don't have a birth certificate. I asked 
her, when you go to Cuba, can you please get me a birth 
certificate. I don't know what my mother did with it. When she 
went to the municipal building what they said to her, we can't 
give you a birth certificate because we have him classified as 
a terrorist. I left at the age of 11, so I am a terrorist. And 
I don't want to share the story of what happened to my cousin 
who has a son who was educated in Russia to become an engineer. 
It is too tragic to even share that story with you because my 
feelings are that these people are just dictators. They are 
brutal dictators. People forget that Raul Castro, Che Guevara 
sent out the firing squads in Cuba that killed thousands of 
people, and I see people wearing a Che Guevara shirt. I am 
sorry. Thank you.
    Ms. Ros-Lehtinen. Thank you, Mr. Sires. Mr. Chabot, of 
Ohio.
    Mr. Chabot. Thank you, Madam Chairman, and thank you for 
calling this very important hearing to discuss the 
administration's new Cuba policy. I believe that President 
Obama's announcement to unilaterally change U.S. policy toward 
Cuba sets a dangerous precedent. In fact, it furthers an 
ongoing pattern of his utter disregard for Congress, but that 
is the way this administration operates. It gives a backhand to 
the elected representatives of the American people, and treats 
Congress like the proverbial mushrooms; keep them in the dark 
and feed them manure.
    Ms. Jacobson, you said there were no concessions, and this 
wasn't necessarily something that the Cuban Government wanted. 
Those statements on their face, they are just not credible. You 
also said that the Obama administration was under no illusion 
about the nature of the Cuban Government. Well, I would submit 
that the administration is just about as naive about the nature 
of the Cuban Government, apparently as it was about ISIS when 
the President famously described them as the JV, or junior 
varsity. Tell that to the families of those who have been 
brutally massacred by those barbarians.
    This Cuban policy, this new policy, is, in my view, 
tragically flawed. And the way it was brought about with such 
utter disregard--which you are hearing on both sides of the 
aisle--utter disregard for the elected Representatives of the 
American people, is disgraceful, and it is just as flawed.
    Now, I would like to yield the balance of my time to the 
gentlelady from Florida, who as we all know was born in Cuba, 
and feels just as passionately about this as anybody in this 
place. Ileana Ros-Lehtinen.
    Ms. Ros-Lehtinen. Thank you so much, Mr. Chabot. And 
following up on your thought about the victims of brutality, 
wherever those victims are, I wanted to give Ms. Jacobson the 
opportunity, Assistant Secretary Jacobson, to answer the 
Alejandre family questions. How can Marlene Alejandre explain 
to her daughters why their grandfather who was killed by the 
Castro regime, his life meant nothing, and the person who was 
in jail as a co-conspirator for the murder of her father was 
pardoned, set free and returned to Cuba and received a hero's 
welcome. What does she say to her girls?
    Ms. Jacobson. Let me start out by saying I can never bring 
back her grandfather, and I can never do more than express my 
sadness and my condolences to her at the start. That is 
something that should not have happened.
    Ms. Ros-Lehtinen. When she was told by you and others that 
a trade would not take place, a trade by any other name--this 
was a swap, was it not? You talk about----
    Ms. Jacobson. Madam Chair, I just want to say an exchange 
of intelligence agents between two countries is something that 
this government and previous administrations have done many 
times.
    Ms. Ros-Lehtinen. But had the State Department not met with 
the family, and didn't the State Department time and time and 
time again tell her that Gerardo Hernandez would not be set 
free by this administration? Yes or no?
    Ms. Jacobson. To the best of my knowledge----
    Ms. Ros-Lehtinen. Did Secretary Kerry state right here to 
us that such a swap would not take place.
    Ms. Jacobson. That a swap for Alan Gross would not take 
place we affirmed and we did not do.
    Ms. Ros-Lehtinen. You just call it something else and say 
we were always telling the truth.
    Ms. Jacobson. We don't believe that is what took place.
    Ms. Ros-Lehtinen. Was the family under the impression, 
because you gave it to them, that that exchange would not take 
place, that Gerardo Hernandez would serve the complete 
sentence? Did you give that impression at any time or anyone in 
the State Department?
    Ms. Jacobson. Certainly I regret if the family felt 
additional pain because of an impression that we had left.
    Ms. Ros-Lehtinen. An impression, so that is all that they 
had to have. They had a false impression, that all this time 
while you were meeting with them, while you were meeting with 
them, you were already cooking up this swap, whatever you call 
it, that Gerardo Hernandez, for all intents and purposes, what 
happened is he was set free. He was pardoned by President 
Obama. He was returned to Cuba. He was given a hero's welcome, 
but that was just the impression that they got. It was a false 
impression because you were never going to do that. While you 
met with them. Don't you at least feel a little bit bad that 
you were lying to them?
    Ms. Jacobson. Well, in the first place, no one who met with 
the family ever lied to the family about what our 
understanding--Gerardo Hernandez was in jail on a lifetime----
    Ms. Ros-Lehtinen. My time is over. I am going to enjoy 
listening to the families when they hear that testimony coming 
from you. It is just pathetic. Thank you. Now Ms. Bass of 
California. Thank you, Mr. Chabot.
    Ms. Bass. Thank you very much, Madam Chair. Let me just say 
before I begin, that this is, I find it particularly difficult 
to talk about Cuba because I want to acknowledge the 
experiences and the family situations of my colleagues, Mr. 
Sires, and also Ms. Ros-Lehtinen. But, you know, to talk about 
it and understand and acknowledge what your families went 
through, you know, I understand. I do, though, support what has 
happened in changing our relation with the island. And one of 
the things that I have always felt is that as an American, I 
want to be able to travel anywhere in the world, and I did 
recently go to Cuba specifically looking at a drug that the 
Cubans have invented for diabetes, and I want to talk about 
that in a minute. I have a couple of questions.
    I know that this April there is the Summit of the Americas, 
and I wanted to know what the reaction has been from the 
international community about Cuba's participation, and other 
world leaders, regarding this policy change?
    Ms. Jacobson. Congresswoman, we have really seen 
universally from the hemisphere and those participating in the 
Summit that they strongly support the policy, that they think 
it changes the whole dynamic in the hemisphere for the United 
States on other objectives that we have, high priorities for 
us. It changes the entire debate. President Santos of Colombia 
called it historic. Dilma Rousseff said it changes the entire 
debate, President Rousseff of Brazil. They feel strongly that 
the policy of isolating Cuba was not the right one. We 
obviously disagreed with them for many years, but we found that 
it was isolating us in conversations and impeding our ability 
to have conversations on human rights and democracy not just in 
Cuba because they would not really engage on that issue, but 
also our ability to engage with them on human rights and 
democracy issues broadly speaking throughout the hemisphere, 
and we know that this is a concern in other countries in the 
hemisphere.
    Ms. Bass. Okay. You know, about the trip that I mentioned 
that I recently took. It was the Congressional Diabetes Caucus 
went specifically because in Cuba they have developed a drug 
that is called Heberprot-P, and it basically is a drug that 
reduces the need for amputations in diabetics. As I understand, 
and I think my question is directed to Mr. Smith, as I 
understand, this drug has been approved for a clinical trial, 
but because of our policy it is not approved to be marketed in 
the U.S., which means that a company is not going to invest in 
a clinical trial if they can't market it. So I am wondering if 
the changes that have been made in the law would allow for 
this. And basically what the Cubans are reporting, but we 
obviously have to test it and see if it is correct, they have 
been able to reduce the need for amputations by 70 percent, and 
we have tens of thousands of people in the United States who 
are diabetics who wind up losing their limbs, their feet, 
because of diabetes. Are you aware of what I am talking about?
    Mr. Smith. Madam, I am. Nothing in the recent changes 
changes our policy with respect to those types of drugs. But 
they are not prohibited from coming into the United States flat 
out. Those companies can apply to OFAC for a specific license. 
We have a long history of evaluating those license 
applications. We receive them. We refer them to other agencies 
in the United States Government, including the State Department 
and often the Food and Drug Administration. And we evaluate 
whether any additional U.S. activity with respect to those 
drugs makes sense. And then we can grant what is called a 
specific license to authorize it.
    Ms. Bass. The other pressure that I feel coming from 
California is from the agricultural industries, and I am 
wondering if the policy changes would lead to our ability to 
export. There is a number of companies in California that are 
interested in exporting agricultural goods as well as 
livestock.
    Mr. Smith. So what we have heard over time is that, even 
though there are certain categories of transactions and goods 
that have been authorized, including agricultural products, we 
have heard from exporters and many Members of Congress that our 
previous financing rules didn't help the situation and didn't 
help them to be competitive with their counterparts in other 
countries. So what we did is, we made a change to provisions in 
a statute that deals with the term ``cash in advance,'' and 
basically we have made it more advantageous for U.S. exporters 
to export their products. This is what they have been asking 
for--to make them more competitive--and what many Members of 
Congress have been asking us to do.
    Ms. Bass. Thank you.
    Ms. Ros-Lehtinen. Thank you so much, Ms. Bass. And we will 
go to Judge Poe of Texas.
    Mr. Poe. Let me start with the presumption that Cuba is a 
violator of human rights. I think we all know that, especially 
the folks in Cuba. The policy of the President, I think, I 
don't want to go into the issue of whether, with or without 
Congress' approval, the President made some decisions. I want 
to cut to the one issue that I have a question about. What is 
the purpose of the current U.S. policy toward Cuba? That we 
basically have no contact with them. We don't trade with them 
generally. This policy that we have been talking about that has 
been implemented for 50-something years, what is the purpose? 
What is the goal of that policy? Is that clear?
    Ms. Jacobson. You mean the previous policy?
    Mr. Poe. Well, the previous policy until it was changed by 
this President, tweaked a little bit.
    Ms. Jacobson. The goal of the previous policy was that via 
isolation of Cuba and keeping our distance from that 
government, we would hope to bring about change in the regime 
and simultaneously we would hope to empower the Cuban people to 
be able to make that change.
    Mr. Poe. Change the regime? Change their communism? Change 
what?
    Ms. Jacobson. Certainly change their behavior toward their 
own citizens.
    Mr. Poe. So our goal is that Cuba internally changes the 
treatment of Cuban citizens? I am not trying to catch you on 
semantics. I am just trying to see what our goal is. Our goal 
is to do this so that the Cuban people are treated like they 
should be?
    Ms. Jacobson. In terms of international human rights 
standards and that sort of thing, yes.
    Mr. Poe. And would you say that has not worked?
    Ms. Jacobson. I would.
    Mr. Poe. Fifty years doing something and if it doesn't 
change, that policy or that goal has not been achieved because 
the Cubans are treated, I think, just as bad as they ever have 
been.
    Ms. Jacobson. I believe so, yes, sir.
    Mr. Poe. Let me ask you this: Is the policy, is our goal 
ever to do what--our relationship with Cuba, whatever that may 
be in the future. Is that for America's benefit or for Cuba's 
benefit? As we look at changes toward Cuba, is this because we 
want to help American businesses, for example, or Americans to 
be able to travel; is that the goal that we are moving toward, 
or are we looking to a goal of what is still best for the 
Cubans?
    Ms. Jacobson. Our goal is to do what is in our national 
interest and to help the Cuban people to be able to do what 
they wish, to be able to make their own decisions.
    Mr. Poe. So it is both?
    Ms. Jacobson. Yes. I would say the first priority is to do 
what is in our national interest, which includes our core 
values of democracy and universal human rights.
    Mr. Poe. Would our policy have anything to do with helping 
trade from the United States?
    Ms. Jacobson. Certainly.
    Mr. Poe. Let me give you an example. I am from Texas. I 
represent a lot of, not as many as I used to, but a lot of rice 
farmers. When I got elected to Congress, I thought rice came in 
a box. I have learned a lot about rice farming. There is long 
grain; there is short grain; there is two seasons, all that 
stuff. Historically, Texas rice farmers traded internationally 
with Iran, Iraq, and Cuba. Bummer. You can see that that hasn't 
worked out so well. They want to trade long grain rice to Cuba. 
The Cubans want to buy long grain rice. They want that as 
opposed to California short grain rice. Well, they do. Set 
aside all the other issues. Would that not be in the best 
interests of the United States and American exporters that we 
would facilitate trade with Cuba?
    Ms. Jacobson. You are going to get me into some trouble 
because I am not sure I can set aside all the other issues, but 
if I really could in a vacuum, it would be in our interests. I 
am not sure we always do those things in a vacuum, though.
    Mr. Poe. Oh, I understand that. There is a lot of other 
issues to be involved. What I am saying is having this barrier, 
to me, of trade hurts Americans. I don't know about the Cubans. 
They get their rice from Vietnam. Oh, I am out of time. I have 
some other questions that I would like to submit for the record 
to be answered.
    Mr. Ros-Lehtinen. Without objection.
    Mr. Poe. Thank you very much.
    Ms. Ros-Lehtinen. Thank you, Judge Poe. And we will go to 
Mr. Cicilline of Rhode Island.
    Mr. Cicilline. Thank you, Madam Chair, and thank you to the 
witnesses. I too want to begin by acknowledging the experiences 
and passionate leadership on Cuba-American relations by 
Chairwoman Ros-Lehtinen and Mr. Sires, and thank you for being 
so open with your experiences at this committee. I think it 
adds to our understanding of these really complicated issues.
    I think all members of this committee are equally and 
deeply committed to help the Cuban people achieve freedom and 
democracy, and I think the difference of opinion is what is the 
best strategy for bringing that about, and I really thank the 
witnesses for being here today, and I expect that you will 
continue to keep Congress informed throughout these discussions 
with the Cuban Government. And I am hopeful, and I think most 
Americans are hopeful that the President's efforts to engage in 
real and substantive negotiations with the Cuban Government 
will ultimately advance the national security interests of the 
United States and benefit the Cuban people. But I think like 
most Americans, I remain very deeply concerned about the long 
record of human rights abuses and the denial of basic freedoms 
that have been caused at the hands of the Cuban dictatorship. 
And while our current policy has failed to bring about lasting 
change in Cuba, as we update our policy, I think we have to be 
sure that we are doing it in a measured, comprehensive, and 
thoughtful way that is aligned with the current reality. My 
hope is that the President's efforts here are met with honest 
engagement by the Cuban Government toward a more open, free, 
and tolerant society for the Cuban people.
    So my questions really are, I have really three questions, 
and I invite you to respond to them. The first is, there has 
been a lot of talk about what the neighbors and our allies in 
the region have for a long time identified as a problem, the 
Cuba-U.S. policy. So what is really the kind of best way that 
we can engage some of these partners in the region who now can 
point to a change in policy to really use them in a way to help 
bring about the kind of liberties and democracy in Cuba that we 
all want? What's the strategy for effectively engaging others 
in the region to be partners in this work now that the policy 
has begun to change? The second is, how can we as a Congress 
best advance this issue of human rights which continues to be a 
very, very serious issue in a variety of different ways? How do 
we play a role enforcing real progress and helping establish 
progress on the human rights issue?
    And, finally, to build on Mr. Sires' question, how do we 
ensure that this economic engagement that is intended here, 
which is, of course, intended to support the Cuban people, does 
not instead fortify the government at a particularly critical 
time? How do we protect against an unintended consequence where 
we think we are helping entrepreneurs in the private sector 
strengthen, but at the same time are, in fact, helping the 
government at a moment when others are beginning to retract 
some of their support? I invite you to respond to those 
questions, please.
    Ms. Jacobson. Thank you. A couple of things. On engaging 
our allies, there is a couple of thoughts I have about that. 
One is that all of the countries in the region, as well as our 
European allies and others, have Embassies on the island. Many 
of them were hesitant, if not outright refused to engage with 
many of the democracy activists for years. I am very optimistic 
if not having seen concrete results already that they have lost 
that fear with our change of policy. I think that is hugely 
important. Their rhetoric outside the country is important in 
dialogues, but engaging with these activists and supporting 
them on the island I think is just as important. These people 
are often accused of being our tools. I think that others need 
to embrace them openly and talk to them, work with them, engage 
with them, hear from them, and we are saying that to them.
    The other thing is in terms of Congress, I hope as many as 
possible will have real congressional delegations that will go 
to the island and see as many in Cuban civil society, and that 
includes in the arts, in the democracy area, as well as 
entrepreneurs and hear from the ones I heard from, how they are 
trying to keep those funds from going to the Cuban Government, 
but how they believe they are making their own way 
independently even if some of those funds are going to the 
Cuban Government, because I think the psychology of those 
entrepreneurs is a breaking away from the state that is worth 
that price. The Cuban Government went through the period of 
decline of the Soviet Union where it dropped GDP by 30 percent, 
and they survived, so I think this is important that we support 
those efforts.
    Ms. Ros-Lehtinen. Thank you so much, Mr. Cicilline.
    Mr. Cicilline. I yield back. Thank you.
    Ms. Ros-Lehtinen. And we turn to Mr. Salmon of Arizona.
    Mr. Salmon. Thank you. Ms. Jacobson, when specifically--I 
am looking for a date--did you find out about the White House-
Cuba negotiations and the content of the President's 
announcement?
    Ms. Jacobson. What I can tell you, Representative Salmon, 
is that I was aware from throughout that the Embassy of the 
White House was undertaking efforts to secure the release of 
Alan Gross because we were working on the Gross case with the 
family.
    Mr. Salmon. I understand that, but when did you find out 
specifically about the negotiations that have been going on for 
the past year? What date did you find out about those?
    Ms. Jacobson. It was about 6 weeks or 2 months before the 
announcement that I knew more of the content of those 
discussions.
    Mr. Salmon. Okay. And when did you find out about the 
announcement itself?
    Ms. Jacobson. When the actual date of the announcement was 
decided, I knew about it.
    Mr. Salmon. You found out simultaneously with the 
announcement being made?
    Ms. Jacobson. No, no, no, no, no. As that was being 
decided, I knew about that. In other words, I knew about the 
decision to announce the new policy about 6 weeks as it was 
being decided before, and so the date of the announcement I 
knew about as that was being decided at the White House.
    Mr. Salmon. Okay. Can you tell me what resources, what U.S. 
resources were used to ensure that Gerardo Hernandez, convicted 
of killing four U.S. citizens and a member of the Cuban 5, 
could artificially inseminate his wife? What resources were 
used for that?
    Ms. Jacobson. What I can tell you on that is that we have 
always, the State Department, from my perspective, have always 
facilitated the visits of his wife to the prison in California 
when he was incarcerated.
    Mr. Salmon. Right.
    Ms. Jacobson. So those were the resources that we expended 
in terms of her visit.
    Mr. Salmon. I understand that he was able to artificially 
inseminate his wife, and that was facilitated by the U.S. 
Government.
    Ms. Jacobson. Beyond our efforts to facilitate her visits, 
the rest was done by the Department of Justice, and I would 
have to defer to the Department of Justice.
    Mr. Salmon. I would like to know that. I think it is 
incredulous that it would be a U.S. priority to make sure 
Hernandez fathered a child while he was in incarceration, so I 
will wait for an answer on that.
    Last question, these secret negotiations went on for over a 
year and reportedly consisted of seven meetings, so when you 
went to Havana last month for talks, the Cubans made it very, 
very clear they would not allow our diplomats to speak to 
dissidents, and normalization was not possible without the 
return of our Naval base in Guantanamo Bay, as well as other 
nonstarters that we have talked about today. So what did we 
really accomplish, other than maybe getting a T-shirt that I 
have had meetings for over a year and all I got was this lousy 
T-shirt?
    Ms. Jacobson. Well, I guess I would start out by saying we 
got an intelligence asset out of Cuba who was languishing in 
jail there, and we got Alan Gross home, and you know that. But 
beyond that, the beginning of this process of normalization 
starts with diplomatic relations, which is only the first 
start. Normalization is going to take years, and we made it 
very clear that it includes things like property claims, which 
has to be part of this discussion, judgments against the Cuban 
Government, which have been adjudicated in U.S. courts which 
has to be part of this. So that is a much longer process, and 
we haven't acceded to any of the things----
    Mr. Salmon. No, and I don't expect that we will acquiesce 
to any of----
    Ms. Jacobson. It is the start of the process.
    Mr. Salmon. I understand, but what was your response when 
they said we are not going to do anything on normalization 
until you do these things?
    Ms. Jacobson. Well, but what they meant by normalization is 
the end of that year's long process, not restoration of 
diplomatic relations, which is the first part. So I am 
presuming that they mean they won't have full normalization 
until all those things are done, but they will have a 
restoration of diplomatic relations.
    Mr. Salmon. Thanks. I yield back.
    Ms. Ros-Lehtinen. Thank you very much, sir. Mr. Connolly of 
Virginia is recognized.
    Mr. Connolly. I thank the chair. Ms. Jacobson, I believe in 
politics and in diplomacy in a very simple adage, don't give it 
away for nothing. I am very troubled by the abrupt change in 
U.S. policy to Cuba at precisely a moment where we actually 
have leverage. For 50 years, one could argue the Castro 
brothers have loved U.S. policy because it has helped keep them 
in power. Fair enough. But that was then. This is now. Things 
have changed. They are hurting. The economy is hurting. Their 
oil supplier is hurting. And as they look out to the future, it 
is very difficult to see a viable Cuban economy without major 
change, including a change in the relationship with us.
    Now, I take your point about diplomatic exchange, and I put 
that aside, but the liberalization in trade and tourism and 
investment, and, indeed, the President has called to begin the 
process of dismantling the embargo that has been in place for 
half a century. I need to understand what we got in return? 
Where is the reciprocity? Why wouldn't the United States use 
its good offices and its leverage with respect to human rights, 
with respect to press freedoms, with respect to religious 
freedoms, with respect to political dissidents. In our 
briefings from State Department personnel, the answer we got 
when we asked that question was we are not doing that. To me, I 
must admit, that is shocking and I think a disappointment to 
many that we wouldn't use the leverage we finally had to some 
good point. And I wonder if you would address that, because I 
think we have squandered leverage.
    Ms. Jacobson. First I want to start out by saying that what 
liberalization there has been in regulations, and my colleagues 
would certainly specify on all this, is very specific, and I 
think Mr. Smith has repeatedly noted that most transactions 
still remain prohibited.
    Mr. Connolly. If I may, fair enough, but the promise of the 
President, he said explicitly, we are going to start the 
process of dismantling the embargo. So Cubans see promise, not 
just here and now, but a pathway toward the dismantlement of a 
policy we have had in place for a half a century.
    Ms. Jacobson. And the President said he would like to see 
the debate over that. There is no doubt. But the Cubans keep 
demanding this in part because it is still there, so they know 
that this is not a big liberalization yet.
    In addition, I think the most important thing that we have 
made clear to them is we are not letting up on human rights. If 
you were to try and be transactional about this with the Cuban 
Government, the problem with that is that they won't trade for 
anything, and we will end up still not helping the Cuban 
people. The goal of these policies is not to do something that 
relies on the Cuban Government agreeing to give us something 
for a human rights concession. We want to try and go directly 
to the Cuban people. Now, it is true, they may not let the 
telecommunications companies work for more Internet access, but 
what has been news all over Cuba and every Cuban knows, is that 
we are restarting our relations, and the bogeyman of the U.S. 
being their problem is no longer credible.
    Mr. Connolly. Again, my time is limited. I appreciate that, 
and I wouldn't deny that there are lots of people who see lots 
of hope in what has now been started. But my question is really 
more specific. What is the reciprocity? What did we get out of 
this other than the aspirations that things will get better 
with this change because they weren't getting better under the 
old regime? I can't think of a single thing--the release of Mr. 
Gross, of course--but in terms of a policy shift, a concession, 
I can't think of a single one you have announced.
    Ms. Jacobson. I believe that we also will get some things 
that matter in opening our Embassy and hopefully the ability to 
travel throughout the country and see more people and support 
more people. We can't really move outside Havana right now.
    Mr. Connolly. That is what you hope to negotiate.
    Ms. Jacobson. But that is necessary for opening an Embassy. 
That is part of this. I also think that, you know, we will have 
all of these dialogues that they want to have for cooperation, 
that will be part of those discussions as well. It is to come. 
I agree.
    Mr. Connolly. Madam Chairman, I know my time is up, but I 
want to underline, I always think it is a mistake in foreign 
policy to give it away for nothing.
    Ms. Ros-Lehtinen. Thank you, Mr. Connolly, and now we turn 
to Mr. Duncan, the chairman of our Subcommittee on the Western 
Hemisphere.
    Mr. Duncan. Thank you, Madam Chairman.
    You know, if trade and lifting the sanctions is seen as a 
cure-all of foreign policy for the Obama administration with 
regard to oppressive regimes like Cuba, then why did the 
administration impose more sanctions on Venezuela the very same 
week as the policy shift in Cuba? Is this an indication that we 
may see similar normalized relations with North Korea, 
Venezuela or other oppressive regimes?
    Ms. Jacobson. The sanctions that were imposed on Venezuela 
this past week were, in fact, additional visa sanctions. We----
    Mr. Duncan. In December, the same week as the President 
started normalizing relations with Cuba he imposed some 
sanctions on Venezuela.
    Ms. Jacobson. If you are talking about the signing of the 
legislation that was passed by Congress, that includes both 
visa sanctions and assets freezes. It is not a trade sanction 
bill.
    Mr. Duncan. Are we going to see any more normalizations? 
Are there going to be other surprises? We didn't see Cuba 
coming. What are we going to do with Venezuela, North Korea or 
any of the others? Are you anticipating any of that?
    Ms. Jacobson. I can't speak outside my region, but I don't 
expect you to see any surprises on Venezuela. We have been 
consulting on that, and I expect to continue, nor any surprises 
on Cuba. We will continue to consult on that.
    Mr. Duncan. I think you were surprised over the Cuba talks 
and you weren't brought in or read into it until late in the 
discussions, but let's move on because many of the people that 
I speak with about this policy shift on Cuba, some even here in 
Congress, talk about, and point to, the freedom now afforded 
Americans to travel to Cuba.
    So what I ask is, is the same freedom of travel a two-way 
street? Is the same freedom of travel afforded to the Cuban 
people to travel to the United States? In this policy shift, 
all American travelers really stay, unless it is family travel, 
they stay at hotels owned by the Cuban military. Only state-
owned enterprises can accept credit cards. Article 18 of the 
Cuban constitution requires all foreign commerce to be 
controlled by the state. So how does increasing commerce with 
Castro's monopolies help the Cuban people?
    Ms. Jacobson. Let me start out by saying on travel by 
Cubans, we are looking at that really carefully. Since the 2013 
decision by the Cuban Government to allow more people to 
travel, it has gotten better. You have been able to have some 
dissidents here to speak in front of this House who have never 
been able to before, but it is, by far, not good enough. There 
are still people who can't travel, and they should be able to. 
They should all be able to travel freely.
    Let me say that on the trade portion, I will go back to 
what I said. We understand that there will be some benefits to 
the Cuban Government. We really do believe, again, because of 
people that we have talked to who are entrepreneurs, because of 
activists, because of artists, because of some of the small 
agricultural folks working, that they will benefit more than 
the government will if we are able to implement these 
regulations and get them the equipment they need that the 
government won't provide them.
    Mr. Duncan. Right. They will benefit from maybe some 
economic transaction. I will give you that. We will see.
    How about other freedoms for the Cuban people? What was 
negotiated in this? Freedom of speech? Freedom of religion? 
Economic freedom? Freedom of assembly and protest? And I point 
to Ms. Berta Soler's testimony yesterday. I think Chris Smith 
talked about it, but she said,

        ``The truth is the Government of Cuba represses our 
        right to freedom of religion and association, and so we 
        go out, participate in religious activities on Sundays 
        and then are detained. The government is constantly 
        repressing activists who are trying to gather together 
        to discuss issues that are important to them.''

    So the right to peacefully assemble and protest against a 
repressive government is still there. So I ask this: What did 
the U.S. barter in exchange for this new policy shift other 
than Alan Gross' release that benefits the Cuban people and 
ultimately gives them more freedoms? I mean, that is what I am 
about. I want this to be about the Cuban people. If we are 
truly going to pursue a policy to normalize relations, it ought 
to be about the Cuban people and not the Castro regime, and the 
Castro regime is the only one that I see that benefits from 
this economically through the businesses they own and operate. 
I don't see where private property rights are really going to--
you know, maybe. You mentioned that earlier. I think somebody 
asked that question, but private property rights and the claims 
by American Cubans--Cuban Americans and Cuban people in general 
that own property that was nationalized by the Federal 
Government.
    How are we going to address that? I think the private 
property rights is so important and is sort of left out of this 
discussion, and you and I talked about this in my office the 
other day. I think that is critical. So I would like you to you 
talk about the freedoms for the American people--I mean, the 
Cuban people--in the remaining 20 seconds that I have.
    Ms. Jacobson. Thank you, Mr. Chairman, and I agree with you 
that all of those things are what we are seeking as an end. I 
think we all agree that is the goal here.
    Mr. Duncan. So tell me how this policy gets us to that 
goal?
    Ms. Jacobson. The policy gets us to this goal, number one, 
by having a lot more people able to work with us on it from 
outside Cuba than ever before. We were alone. We were not 
joined by anyone else. We are more effective with allies. 
Number two, we believe that there were no concessions here. 
Some of these things are things that we are doing that deeply 
worry the Cuban Government because they may not be able to 
control them, and we don't believe that anything we did on 
December 17th, as the President and the Secretary have said, 
were concessions to the government.
    Mr. Duncan. Well my time is up, but the concessions for the 
Cuban people are important, and I yield back.
    Ms. Ros-Lehtinen. Thank you so much.
    I will now yield to Mr. Lowenthal of California.
    Mr. Lowenthal. Thank you, Madam Chair, and I would like to 
preface my remarks by saying that I have been touched listening 
to both the experiences of those that have been the most 
affected by the repressive regime, and that has been--I join 
with Congressman Cicilline and Congresswoman Bass in saying 
that I have been touched by the testimony of both Congressman 
Sires and Ros-Lehtinen, who talk about their families and some 
of the impacts.
    But having said that, I am very supportive of our re-
engagement and the restoration of diplomatic relations. I say 
that not because I support many of the repressive issues that 
take place, but I say that as someone who represents one of the 
largest if not the largest Vietnamese American communities in 
the United States, people who escaped also an intolerable 
situation, who I believe, while certainly very, very against 
the existing regime in Vietnam, have benefited by having, I 
think, greater ability to communicate some of their concerns, 
and they have had it by having the U.S. Ambassador to Vietnam 
come to a community which is not at all supportive of that 
government and really have a dialogue and be able to express 
some of their concerns. I see that as a very, very positive 
step.
    So my questions are, as we go forward, will there be a 
strategy also to reach out to the Cuban American community in 
the United States who have been suffering a great deal and who 
have the relatives? So that is my first question.
    Ms. Jacobson. Absolutely. Absolutely, sir. And we have 
begun to do that knowing that the views in that community are 
diverse as well, and seeing that activists within Cuba, among 
the four points they could agree on, was that the Cuban 
Diaspora has to be taken into consideration.
    Mr. Lowenthal. I think that is so important, and I really--
if anyone else wants--I really think that is very important, 
and I also would like to know what people have--what we see 
as--as we move forward there is more trade and more tourism, 
how are we going to deal with--when many of those tourists go 
back to Cuba and speak out against their government that is in 
Cuba, have we talked some of those issues?
    Ms. Jacobson. We certainly considered that in terms of 
Cubans coming to the United States, and when that travel policy 
was liberalized, there was an enormous concern among activists 
that if they left and spoke freely, they either wouldn't be 
able to go home, perhaps, or if they went home, they would 
never be able to travel again.
    The fact that some of them have now been able to travel 
repeatedly, I think, is a good sign, but everyone still is 
fearful.
    Mr. Lowenthal. As I am, and so with that I----
    Ms. Jacobson. And we raised that issue.
    Mr. Lowenthal. Does anyone else have any issues or want to 
respond to any--some of the issues--as the policies begin to 
change, what you see in the future as some of the consequences. 
Not so much the reasons--I am wanting to move forward. Where do 
we go from here? What do you see things that we need to look at 
as this policy has changed now?
    Mr. Borman. Well, the two points I would make is, one, we 
certainly, with the Treasury, are doing a lot of outreach to 
all segments of the American public so they understand what the 
current--the new changes are; and then, secondly, we will be 
watching very carefully to see how they actually play out in 
practice, because coming back to the 15 percent of the Cuban 
population or the Cuban economy that is private sector, we are 
really looking to strengthen and grow that with these 
opportunities. So that is something we will certainly be 
looking at very carefully.
    Mr. Smith. I would echo those comments. I think the 
implementation is what we are going to be looking at over the 
next few months, and years, actually, and to see what the 
effects are and what we need to do to make these----
    Mr. Lowenthal. As a member also, because of my own concerns 
and also because of the concerns of the communities I 
represent, I have joined--I have been a very active member of 
the Tom Lantos Human Rights Commission. I have adopted 
prisoners of conscience in Vietnam, actually put pressure on 
the Vietnamese Government to begin to release some of these 
prisoners. I would like to see some of the same efforts even be 
increased as we go forward with our changed policy in Cuba.
    And thank you, and I yield back.
    Ms. Ros-Lehtinen. Thank you, Mr. Lowenthal, and we go to 
Mr. Brooks of Alabama.
    Mr. Brooks. Thank you, Madam Chairman.
    I believe that America's policies should be consistent 
throughout the globe as best that we can do so, and by way of 
example, I would like to just make a quick comparison between 
Cuba and Saudi Arabia, looking at some of this similarities 
between the countries, some of the differences, and also the 
disparate ways in which each is treated by the United States 
Government.
    On trade, American/Cuban trade is very limited, as we all 
know. Less than $500 million per year in exports by America to 
Cuba. But America/Saudi trade is very robust. Roughly $80 
billion per year, perhaps higher.
    On travel, travel to Cuba, very limited by the United 
States Government. Saudi Arabia, quite the opposite.
    On Embassies and diplomatic interaction, in Saudi Arabia we 
have an Embassy and very significant diplomatic interaction. In 
Cuba, we have no Embassy and little to no diplomatic 
interaction.
    I could go on and on, but I think it is fair to say that 
the United States treats Cuba substantially differently than 
Saudi Arabia.
    As I have listened to the witnesses and member comments 
concerning Cuba and why Cuba must be treated differently, I 
can't help but emphasize some of the similarities and 
differences that have been pointed out.
    On the issue of freedom of religion, as bad as Cuba may be, 
and we have heard some comments as to how bad it is, the 
question is, is Saudi Arabia worse? One member commented that 
some religious observance requires Cuba Government consent. Yet 
in Saudi Arabia, open worship by Christians is a criminal 
offense, as is missionary work. If a Muslim dares question 
whether Islam is a true religion, he is severely punished. Raef 
Badawi being a recent example, facing 1,000 lashes and 6 to 10 
years in prison, assuming, of course, that the lashing does not 
kill him.
    On the issue of dictatorial governments, one would again be 
hard-pressed to determine which family government, that of 
Cuba's or the Saudi's is more dictatorial. I think you could 
have a very robust debate concerning that issue.
    On the issue of terrorism, bearing in mind that 15 of the 
19 9/11 terrorists were Saudis, and also bearing in mind that 
so much terrorism funding originates in Saudi Arabia, in 
fairness, much of it opposed by the Riyadh regime, but, 
nonetheless, still a lot of money for terrorism comes from the 
country of Saudi Arabia, one could have a lively debate again 
concerning which country poses a greater threat to world peace.
    Given so many similarities, and also some differences, but 
with Saudi Arabia being treated so much better by the United 
States of America, what factors, in your mind, justify treating 
Cuba so much worse than Saudi Arabia that supports the 50-year 
policy that the United States has had with respect to Cuba?
    Ms. Jacobson. Thank you, Congressman. I think that our own 
view has been pretty clearly laid out by the President on the 
17th, and the Secretary certainly made a number of comments 
that we believe that Cuba, not on its merits necessarily in 
terms of its behavior, but on the effectiveness of policy 
argument, the efficiency and what is in our national interest, 
merits a change in that policy, and so it was announced in 
December.
    I can't necessarily make that comparison between Saudi 
Arabia and Cuba, but I will say that we believe very strongly 
that the values and the ideals of the United States need to be 
pursued aggressively all over, the world, and that they are 
best pursued, and you could expect this from a diplomat at the 
State Department via diplomatic relations and having Embassies. 
Those aren't concessions or gifts. We do them effectively when 
we have a presence, and that is why we want to have that 
presence in Cuba.
    Mr. Brooks. I am running short of time. Let me ask this 
final question.
    Americais always faced with a very difficult choice. On the 
one hand, we can be open, hoping that our relations with this 
country will slowly but surely cause them to accept freedoms 
that we cherish in America, or we can be very restrictive, as 
we have been with Cuba, North Korea, and some other nations, in 
hopes that the punishment will be sufficient.
    What do you think long term is best for Cuba?
    Ms. Jacobson. I think we are most effective when we have 
allies with us, and we were alone vis-aa-vis Cuba. So I believe 
the openness with allies to the Cuban people, not the Cuba 
Government, will be effective.
    Ms. Ros-Lehtinen. Gentleman's time is expired.
    Mr. Deutch of Florida is recognized.
    Mr. Deutch. Thank you, Madam Chairman and Ranking Member 
Engel for working so quickly to ensure that this committee was 
able to hear from the administration on the policy shift.
    I represent South Florida where the administration's 
announcement has a tremendous impact, and let me first say that 
in the immediate term, I have serious concerns about the Castro 
regime's continuing human rights abuses, as many of my 
colleagues have brought up today, and I hope that we expect and 
demand more of them.
    Coinciding with the administration's announcement, one of 
the major South Florida's newspapers, The Sun Sentinel, 
published an in-depth feature called Plundering America, which 
exposed the way in which underground criminal networks have 
exploited U.S. policy toward Cuba.
    Madam Chairman, the United States opened its doors to the 
Cuban people so they could have a better life free from the 
oppressive Castro regime, and the overwhelming majority of 
those who have come here have made incredible contributions to 
this country and become a deep part of the fabric of our 
society. What great examples we have here on this panel with 
our colleagues and my friends, Chairman Emeritus Ros-Lehtinen 
and Representative Sires, but policies that were put in place 
to ensure that those who sought refuge in the U.S. would still 
be able to see their families or send remittances are being 
taken advantage of by a small minority for criminal gain. 
Individuals engaged in organized criminal activity have turned 
our humanitarian policy into an underground criminal enterprise 
by using their ability to return to and from Cuba to engage in 
illicit fraud activities, particularly, the report noted, 
Medicare fraud, and are transporting large sums of cash back to 
the island and evading arrest as the Cuban regime will not 
extradite these fugitives.
    As The Sun Sentinel notes, they have turned our open-door 
policy into a revolving door, enabling, and I quote, ``Crooks 
from the island to rob American businesses and taxpayers of 
more than $2 billion over two decades.''
    As the administration rebalances its relationship with 
Cuba, I hope we are not ignoring the years of criminal activity 
that the Castros have turned a blind eye to, at best. We need 
to know what extent--to what extent the regime or people 
connected to the regime have been or will continue to be 
involved in these illegal crime rings.
    Assistant Secretary Jacobson, I would like to know if your 
initial round of talks with the Cubans included any discussion 
of extradition of fugitives from Cuba; and if not, when and how 
will this issue be raised?
    Ms. Jacobson. Thank you, Congressman, and it certainly did 
include the discussion of fugitives. It did not specifically 
include the question of extradition. As you know, we have a 
very old extradition treaty that has not been used in many 
years. I have no idea whether we will get back eventually to 
actually using it. But it certainly included the question of 
fugitives and the desire to have much more in-depth 
conversation about law enforcement and fugitive issues in the 
future.
    Mr. Deutch. Can you just elaborate a bit on the extradition 
you referred to, the situation that we have now, but in the 
talks----
    Ms. Jacobson. Right. Let me----
    Mr. Deutch [continuing]. How did the talks focus on that?
    Ms. Jacobson. I just want to be clear that the morning of 
the talks that I had were on the diplomatic restoration. The 
afternoon of the talks were on a whole series of subjects on 
which we are going to have experts, who are not me, have much 
more substantive conversations about what we want, right, and 
that is one of the subjects.
    Mr. Deutch. And when--what will be the context of those 
discussions and when will they take place?
    Ms. Jacobson. Right. We are going to try and set those up 
as quickly as possible. Part of that conversation already began 
in the migration talks, because we take with us our lawyers and 
the Department of Justice, and we talk about fugitives in the 
context of the migration talks. So we have actually begun that 
one, but we will have a separate conversation on law 
enforcement and fugitives, basically, as we can set these up in 
the time schedule.
    The Cubans are a little bit overwhelmed by our new wanting 
to have dialogues on lots of different subjects. They have 
accepted the idea of having that, and we will get them set up 
as soon as we can with our Justice Department colleagues.
    Mr. Deutch. Thank you.
    Mr. Smith, understanding that much of this falls under law 
enforcement agencies' purview, has your office looked at where 
the money coming from these Cuban criminal networks--where all 
of that money, which usually comes back to Cuba in cash goes, 
or the role of Cuban Government in sponsoring or even training 
these individuals or what is being done to impede their 
activities?
    Mr. Smith. OFAC does work with our law enforcement 
colleagues on a variety of issues that relate to sanctions.
    With respect to any particular issues with regard to money 
flows or anything that might impact the U.S. law or U.S. 
sanctions, I couldn't talk about anything that we would 
actually be looking at.
    Mr. Deutch. Can you speak to the specific situation that 
was described at great length in these newspaper reports?
    Mr. Smith. I think most of what you described at great 
length from the newspaper reports and the details from the 
newspaper reports, I would refer to the Department of Justice. 
I think that they would have the primary equities there and the 
primary statutes that would be involved.
    What we would do at OFAC is, we enforce the sanctions laws, 
and very little, from what I have seen, would impact our 
regulations that we would enforce.
    Mr. Deutch. Thank you.
    Thank you, Madam----
    Ms. Ros-Lehtinen. Thank you. Gentleman's time has expired.
    Mr. DeSantis of Florida.
    Mr. DeSantis. Thank you, Madam Chairman.
    Secretary Jacobson, you said in response to Chairman 
Royce's question what we did not make concessions to the Cuban 
Government, but yet later in your answers you have conceded 
that the increased economic activity will have some benefit to 
the Cuban Government. So that is a concession. Is it not?
    Ms. Jacobson. It is a benefit they may receive.
    Mr. DeSantis. Especially given their two main patrons, 
Venezuela and Russia, they are reeling with a change in world 
oil prices, and I think the Castro government very much wants 
any type of patronage they can get, and I think as Mr. Sires 
pointed out, you know, money that goes into that country is 
going to be controlled by the government, and if you are going 
to argue differently, why is it that we are really the only 
country that has these restrictions. So you have open 
relations, Switzerland, Australia, whoever. How come with all 
those ties, the Cuban people have not benefited, because you 
said in your testimony in response to a question of Mr. Poe 
that the Cuban people are not better off after 50 years of our 
policy.
    My question is if the other policies of all the other 
countries in the world are so good, why haven't the Cuban 
people benefited from those policies?
    Ms. Jacobson. Congressman, I think part of the problem in 
terms of actual sort of economic policy in Cuba is that they 
have not modernized their system, opened their system, made a 
foreign investment law that adequately attracts investment to 
have those other countries be part of it.
    Mr. DeSantis. And they said that they are not going to 
change. Raul Castro said they are not changing. He said this is 
a victory for the Cuban revolution, and we are not going to 
change. So I don't see where you get that the people of Cuba 
are somehow going to benefit more than the regime. I think the 
regime will benefit from this, but until there is a change, I 
think the benefits are going to be bottled up at the top.
    Ms. Jacobson. But remittances also go directly to Cuban 
people. We raised the remittance amounts, in addition. One of 
the reasons that they haven't rushed to us to implement the 
telecommunications provisions or the Internet provisions, you 
know, they have been very, very wary of all of this is because 
they know full well that they probably won't be able to control 
it, and that the benefits may well reach the Cuban people.
    Mr. DeSantis. And so they are probably not likely to do--
let me ask you this: When you took your trip, were you given 
access to any of the places where political prisoners are being 
held, view that?
    Ms. Jacobson. I was not.
    Mr. DeSantis. Okay. Is there any discussion--has the 
administration trying to get property returned that was 
confiscated both of American citizens when Castro took power, 
including Cuban Americans who were exiled?
    Ms. Jacobson. We made clear in the conversations that the 
issue of expropriated properties has to be part of 
normalization.
    Mr. DeSantis. What was their response?
    Ms. Jacobson. They agreed that that has to be part of the 
conversation and responded that they had issues they wanted to 
raise with us about losses under the embargo.
    Mr. DeSantis. And one of the issues, I know they wanted is 
GTMO. Can you categorically state that on January 20th, 2017, 
at 12 o'clock p.m., a date that a lot of my constituents are 
looking forward to, that GTMO will still be under U.S. control, 
the Naval base?
    Ms. Jacobson. I am certain that Guantanamo will still be a 
U.S. base, but I can't tell you a hypothetical about what may 
be part of these normalization talks. But it is not on the 
table for us right now, and I don't envision that, but I am not 
a high enough ranking person to know, and it is--I am not from 
the Department of Defense. Et cetera, to know whether it could 
be in the future, and--but I can't----
    Mr. DeSantis. Well, I am just talking about over the next 2 
years as this administration is in power, but I understand it 
is not going to be----
    Ms. Jacobson. I can't envision that.
    Mr. DeSantis. Cuba is a state sponsor of terrorism. The 
Federal statutes, in order to be removed from that list, there 
are certain criteria. One of them is that the government has to 
provide assurances that they will not support international 
terrorism.
    Has the Cuban Government provided those assurances, and if 
so, are they credible?
    Ms. Jacobson. Cuba has repeatedly rejected international 
terrorism, and we are in the process right now as we review 
this of also looking at their statements and evaluating whether 
they have or whether they will give such assurances.
    Mr. DeSantis. Well, I am concerned, because if they say 
they are not going to change, they have been a state sponsor of 
terrorism. To me, that is a declaration to the contrary.
    My final question is: Does the administration believe that 
the President has the authority to unilaterally lift the 
embargo?
    Ms. Jacobson. Clearly not or he wouldn't have welcomed and 
encouraged the debate in Congress.
    Mr. DeSantis. Well, but we have been down this road before, 
because he said he couldn't do things a number of times, and 
then turns around and does them. So I just think it is 
important to get this on the record. The statute is very clear 
about what would have to happen in order to have any type of 
waiver of these restrictions, and there is no evidence that any 
of those criteria have been met up to this point. Is that 
accurate?
    Ms. Jacobson. I am sorry. A waiver of--to have lifting of 
what kind of restrictions? Of the embargo?
    Mr. DeSantis. Any type of provisions that can be waived 
requires there are certain provisions that are listed that must 
occur in order for the President to act.
    Ms. Jacobson. To act to lift the embargo, the President was 
clear in the State of the Union that he wants that to be 
debated in Congress.
    Ms. Ros-Lehtinen. Gentleman's time has expired.
    Mr. DeSantis. Yield back.
    Ms. Ros-Lehtinen. Thank you, Mr. DeSantis.
    Mr. Castro of Texas.
    Mr. Castro. Thank you, Chairwoman, and like many of my 
colleagues, I have been moved by the testimony of Ms. Ros-
Lehtinen and also my colleague Albio Sires, who are Cuban 
American, and many Cuban Americans, particularly of a more 
senior generation lost their family members, lost property, 
lost their livelihoods in their country, and for many years I 
think much of our foreign policy toward Cuba was in great 
deference to that fact, and when you hear the stories that is 
very understandable.
    I do think with the President's change in normalization in 
diplomatic relations toward Cuba that the power of American 
culture and the power of our technology and our democracy will 
ultimately win out, and I think that in many ways, this was a 
start of a new revolution in Cuba, and as the Castro brothers 
are in the winter of their reign, I see this as positioning the 
United States for when they are gone.
    And so with that in mind, let me ask you, how does it 
position our country vis-aa-vis Cuba once these folks are no 
longer in power?
    Ms. Jacobson. Thank you, Congressman. I think, you know, 
this really is the question. One of the things that is critical 
is the next generation of activists, of leaders, we want to 
keep faith with them. I thought one of the most important 
things in this policy is how we work with the current human 
rights activists and democracy leaders, the new entrepreneurs 
and artists and expand civil society. How do we encourage them 
when Tania Bruguera wanted to have performance art in 
Revolutionary Square and asked Cubans to speak openly, 300 
artists wrote in support of her effort. Many of them had never 
made a political statement before. So it is the idea of 
expanding people's engagement in civil society, which is novel, 
and is important in preparing for what comes next in Cuba.
    Mr. Castro. Sure. And I know in places like China, for 
example, they can't access social media sites, but they have 
access to the Internet. Many in Cuba have no access even to the 
Internet. Is that right?
    Ms. Jacobson. Absolutely.
    Mr. Castro. And also--and I don't know. I got here a little 
bit late, because like many of my colleagues, I have two 
committee meetings at the same time, but let me ask you, what 
becomes of the wet foot/dry foot policy?
    Ms. Jacobson. At this point, Congressman, we have no plans 
to change that law, and it would--the law, obviously, is in on 
the books. That would be have to be changed by Congress. We 
have no plans to request such a change.
    Mr. Castro. Okay. Thank you.
    I yield back, Chairwoman.
    Ms. Ros-Lehtinen. Thank you, Mr. Castro.
    Mr. Emmer of Minnesota.
    Mr. Emmer. Thank you, Madam Chair, and thank you to the 
panel.
    It is interesting, I hear often in the past few weeks that 
if something hasn't been working for 50 years, you should look 
at changing it, but nobody seems to go directly to the issue, 
except some of the comments I have heard today about how 
nothing has changed within the country, and I am interested in 
a couple of things, because much of it has been covered 
already, but the President broke with policy by appointing a 
couple of White House aids to conduct these secret 
negotiations. I am interested, and I think it is probably Ms. 
Jacobson, because you seem to have at some point been brought 
in and made aware of what was going on, what happened that 
caused that moment in time where the President decided to 
appoint these two to negotiate secretly with the Cubans, and 
why? Why did he break from policy?
    Ms. Jacobson. I can't--I can't answer that question on 
behalf of the President.
    What I can tell you is that one of the two people engaged 
in those discussions is a foreign service officer on loan to 
the White House, a foreign service officer who is one of our 
foremost experts on Cuba, having served there and on the Cuba 
issue at the State Department.
    Mr. Emmer. But you don't know what suddenly sparked now is 
the time that this has to happen?
    Ms. Jacobson. I think there has long been a concern within 
the administration that the policy was not effective in 
empowering the Cuban people.
    Mr. Emmer. So let me ask you this, then, Ms. Jacobson, 
because many of the questions are--I mean, I heard from 
Representative Connolly and others, what did we get?
    If I understand your testimony today, these secret 
negotiations included, for instance, discussions about the 
brutalization of families. In other words, how you are going to 
compensate these families for their personal loss during the 
Castro takeover and since, and there has been a promise that 
that will be part of the negotiations before actual--there will 
be a proposal to ``dismantle the embargo.''
    Ms. Jacobson. What has to be part of full normalization of 
relations, that is, making the relationship with Cuba look like 
every other normal one, and that is the full range of things, 
not just diplomatic relations, is a process and a resolution of 
this longstanding issue of claims, which the Foreign Claims 
Settlement Commission has, and judgements, yeah.
    Mr. Emmer. Got it. All right. So--and I just want it on the 
record so I understand, because you have separated between 
diplomacy and complete normalization, which would be lifting 
the embargo and things that the President says he cannot do as 
the Executive, only Congress.
    Ms. Jacobson. Right.
    Mr. Emmer. When we talk about the diplomacy, opening an 
Embassy, hopefully getting to travel across the island, which 
right now has not been assured, that is diplomacy, and these 
few things that the administration can do without Congressional 
approval.
    The next step, my understanding from your testimony today 
is, there has been a promise that there will be, as part of any 
agreement moving forward, any final agreement, an understanding 
as to how these families will be compensated, not only for 
their personal loss, but for their property losses. Is that 
correct?
    Ms. Jacobson. There will be a process with the Cuban 
Government to come to resolution of those issues.
    Mr. Emmer. So you may not require that they be reimbursed 
or compensated for loss of----
    Ms. Jacobson. I don't--I think in all of these kinds of 
cases, and I will ask my colleagues if they have any comment, 
but it may be Department of Justice that would be placed to 
answer this, in all of these kinds of things, it has to be 
agreed between--mutually between two countries to resolve 
those----
    Mr. Emmer. I understand, but you led us to believe, at 
least you led me to believe, that when these discussions were 
taking place, these are issues that were, in fact, raised and 
have been discussed, and it would lead me to believe, listening 
to questions here today, that there are things that are going 
to be required if Congress is ultimately going to approve a 
full normalization.
    Ms. Jacobson. Right, and that means a satisfactory 
resolution, which means we have to be satisfied, but the Cuban 
Government will have to be satisfied, too, for an agreement.
    Mr. Emmer. And that would include this harboring of 
murderers and thieves and criminals by the Castro regime?
    Ms. Jacobson. The question of fugitives--if you mean the 
question of fugitives or----
    Mr. Emmer. I added it to--you put all of these together 
today, and I see my time is running out.
    My point is that you made it sound as though these are all 
going to be necessary requirements to a final agreement if it 
is actually going to be fully normalized, and I believe my time 
is expired, Madam Chair.
    Ms. Ros-Lehtinen. Thank you so much. Thank you.
    Mr. Clawson of Florida.
    Mr. Clawson. Thank you for coming today.
    I would like to ask a question or two about this deal's 
impacts on religious freedom in Cuba. I represent South 
Florida, Southwest Florida, and of the, you know, 94 percent of 
the Jewish folks left after the revolution, some of them came 
to my district. So this is a question I am sure that is on a 
lot of their minds of those that remain that are family 
members. But there is also other religious folks that have been 
persecuted in Cuba. Christians. We don't talk about Mormons 
much, but there are two Mormon branches, I understand, in Cuba, 
and other religious minorities as well. So I am wondering about 
the impact of this deal on tolerance for religion in general, 
and will missionaries and other folks from different sects be 
allowed to go now and help their brothers and sisters on the 
island?
    Ms. Jacobson. Well, I think--I think it is really 
important, Congressman. The regulations--and I could let my 
colleagues--this really expands the ability of religious groups 
to go, because what we have done is make the religious missions 
part of this, the religious opportunities general license, and 
so we are hoping that there are a lot more religious groups 
that are able to go and see counterparts in Cuba and have that 
interaction.
    In terms of the tolerance for religious freedom in Cuba, I 
certainly hope that there will be an impact certainly by having 
their brethren come and work with them and support them.
    I visit the Jewish community every time I go to Cuba, and I 
visited this time with the church, and there was recently, you 
know, obviously the announcement of a new church to be built, a 
new Catholic church to be built in Cuba, but it is a very 
important part of what we are hoping to stimulate as part of 
civil society.
    Mr. Smith. I could just add to that, that in the past, many 
Americans had to come to OFAC and seek what is called a 
specific license to be able to go to Cuba to engage in 
religious activities, and one of the changes that we made was 
to authorize that in our regulations, which means that people 
may now go to Cuba for religious activities or for religious 
purposes without coming to this government agency to seek 
approval first.
    Mr. Borman. And there are two pieces on our side. One is 
that for those trips that are now generally authorized for 
religious purposes, the things that the travelers want to bring 
with them also can be done under a general authorization rather 
than coming and waiting for a specific authorization from us.
    And another piece of our license exception allows building 
materials to be exported for private sector use, including 
building of churches, for example, again, without individual 
licenses under this general authorization.
    Mr. Clawson. I hope that we will have measurables here. I 
am always worried about bait and switch and using some other 
aspect of the law to really get around things that are 
uncomfortable, and I personally just think it is hard to have a 
meaningful life for a lot of folks if they don't have a 
meaningful religious experience. So I am hoping that the 
administration will follow up here to where we actually see 
meaningful, opening and meaningful religious awakening on the 
island for so many that want it.
    Ms. Jacobson. Thank you, sir.
    Mr. Clawson. I have no more to say. I yield back.
    Ms. Ros-Lehtinen. Thank you, Mr. Clawson.
    Mr. Weber of Texas.
    Mr. Weber. Well, thank you, Madam Chair, and, gentlemen, I 
apologize. You all haven't seemed to be getting a lot of the 
questions, and so let me just ask you all a couple of quick 
questions. Are you all going to be okay while I question her?
    Mr. Borman. Yes, sir.
    Mr. Smith. Yes.
    Mr. Weber. Okay. Thank you very much.
    Ms. Jacobson, let me start out by saying I have really 
appreciated your professionalism and your demeanor and your 
attitude. You have done a good job, and I appreciate that.
    Are the State and Treasury regulations now fully in 
compliance with the intent of Congress, Ms. Jacobson, when it 
passed the Trade Sanctions Reform and Export Enforcement Act of 
2000?
    Ms. Jacobson. Yes, sir, we believe they are.
    Mr. Weber. You believe that they are?
    Going forward, and I understand you said the President 
wants--he doesn't want the dialogue that is happening in 
Congress, and I appreciated Joaquin Castro, my colleague over 
here from Texas' comments earlier about moving forward past the 
current regime. That was an interesting take, but going 
forward, will the ag trade, and I have rice farmers in Texas in 
my district and other producers as well, and five ports. So 
they are very interested in the trade part of this. Will the 
trade of ag products be able to be conducted without a lot of 
input, and some would say interference, from the 
administration?
    Ms. Jacobson. I think that is a great question, and we know 
that there is an enormous amount of interest in that. I 
actually may defer to my colleague on some of this.
    Mr. Weber. They will feel good about that.
    Ms. Jacobson. They will, and it will give me a chance to 
have a little bit of water. So----
    Mr. Weber. Okay. Yes, Mr. Smith.
    Mr. Smith. Well, we made changes in the current set of 
regulations that changed the financing terms to what the ag 
exporters had requested. And so, it should be easier for them 
to be able to send----
    Mr. Weber. Without a lot of red tape?
    Mr. Smith. Without coming in to OFAC for any requirements.
    Mr. Weber. Okay. Good. Mr. Borman, any input?
    Mr. Borman. Well, one thing that we were not able to 
address in our changes were--is the TSRA requirement that there 
be a license that is no more restrictive than a licensed 
exception. So that piece stays in place, but that is a--
currently a 12-day process.
    Mr. Weber. 12-day process? Okay.
    Mr. Borman. For somebody who wants to make an ag export, 
comes in and waits--submits an application to us and gets an 
answer yes or no in 12 days.
    Mr. Weber. Okay. Well, then other than changing the cash-
in-hand rule, what other changes in OFAC, do you know, are in 
the offing? Anybody?
    Mr. Smith. When you say other than----
    Mr. Weber. That would actually give us potentially new 
opportunities for ag products in particular.
    Mr. Smith. So the other thing that we did was we allowed 
U.S. banks to establish correspondent accounts at Cuban banks. 
And what helped with that and with the ag trade is, right now 
if you want--an American exporter has to get payment from a 
Cuban exporter, and then it has to go through a third country 
and then come to the United States. Now under this rule, they 
won't. They can pay directly and the payment can be faster and 
easier and make ag exporters more competitive.
    Mr. Weber. Okay.
    Mr. Borman. And then--sorry. I am going to take another 
shot, but I think also the travel general licenses now make it 
easier for people who want to investigate business 
opportunities in the ag sector to go to Cuba without coming in 
and waiting for an OFAC license.
    Mr. Smith. In many of the cases before, exporters would 
have to come into OFAC to seek what is called a specific 
license to travel down there. Now, they don't have to for a 
variety of activities that they would use associated with 
trade, like the marketing and the export, the delivery, all of 
that can be done without coming into us to seek that license.
    Mr. Weber. Okay, that is an improvement, and then, Ms. 
Jacobson, I am going to come back to you. Joaquin asked about 
the dry foot/wet policy. Tell me what that is.
    Ms. Jacobson. It is--the Cuban Adjustment Act allows that 
Cuban citizens who arrive on U.S. soil are permitted to adjust 
their status here and remain, whereas those who may be 
interdicted by the Coast Guard are--if they have no protection 
concerns, may be returned.
    Mr. Weber. That is what I figured. Well, that is my 
questions, and I thank you all for your testimony.
    Ms. Ros-Lehtinen. Thank you very much, Mr. Weber.
    We were going to go to a second round of questions for the 
three of us left in case you wanted to ask another question.
    The chair recognizes herself.
    The Foreign Claims Commission has found that there are 
almost 6,000 U.S. claims that are judged to be qualified for 
compensation by the Castro dictatorship. The adjudicated value 
of those claims, by adding a 6 percent simple interest, 
according to this commission, makes the total principal value 
of American claims to over $8 billion today. I don't think the 
State Department will enforce Helms-Burton by investigating, 
trafficking, and confiscated U.S. property, nor enable U.S. 
property owners to secure compensation for the unauthorized use 
of property subject to a claim.
    Do you think that you will or won't, and I also worry that 
the administration will use our influence to go even further. 
We will--will we try to help Cuba get membership into the World 
Bank? Into the IMF? Into the IDB? Other multilateral 
development banks? And will we prevent any assistance, any 
financing, or any other benefit from these institutions until 
U.S. property claims have been resolved to the satisfaction of 
American owners?
    And, lastly, if you could tell us what are the three 
conditions according to U.S. law under Helms-Burton for the 
embargo to be lifted, and I know the President is going to 
present us legislation to free up the embargo, what of those 
three conditions have been met that would satisfy the embargo--
or justify the embargo being lifted?
    So first on the claims on what we are going to do, if we 
are going to help Cuba get into these organizations, and then 
the three conditions under Helms-Burton?
    Ms. Jacobson. Let she start out by saying I have been 
cognizant of the importance of resolution of the claims issues 
and the judgements from the very beginning of this process. It 
is very important that those be resolved. The State Department 
as well as other government agencies, the Justice Department 
under which the Autonomous Foreign Claims Settlement Commission 
acted to adjudicate and assign values to those claims. We 
believe very strongly that that has to be part of future 
conversations over the next years, however long normalization 
may take. Those are extremely difficult, obviously, to have 
with any foreign government as those commissions' dealings have 
proven, but we intend to pursue that certainly as part of our 
discussion. I raised that in the very first conversation 
knowing that we weren't going to talk about it that day deeply, 
but it must be part of full normalization.
    Second, on the international financial institutions, there 
is obviously very specific language in the law about this. We 
feel that we are not in a position right now where Cuba is, you 
know, eligible for membership, certainly, and there are lots 
of----
    Ms. Ros-Lehtinen. You say right now. Do you foresee that 
Cuba will be moving in that direction?
    Ms. Jacobson. I think, Madam Chairman, we all hope for the 
day when there would be logical membership, because it will be 
a free and open Cuba with an open economic system that would be 
a logical member, but I don't know exactly at what point. We 
also hope that at some point in the future, they may ask for 
help to open their system. They are not right now. So----
    Ms. Ros-Lehtinen. But just as we said that we weren't going 
to swap spies and we did, even though you--a rose by any other 
name, but you call it something else, will we be advocating for 
Cuba's inclusion in these international organizations that 
would allow it to give it credit to continue to oppose the 
people?
    Ms. Jacobson. We are not advocating for their membership, 
but we also want to make sure that at some point in time, it 
may be useful to have organizations like the IMF, not give them 
help, but help them open their economy, which is what they do.
    Ms. Ros-Lehtinen. Because we are keeping them--these 
institutions are keeping them from opening the economy.
    Ms. Jacobson. No, no, no, but they don't necessarily have--
--
    Ms. Ros-Lehtinen. Let's go to the three conditions under 
Helms-Burton. What are the three conditions that would allow 
the lifting of the embargo, and what of those three have been 
met by the Castro regime?
    Ms. Jacobson. I am sorry. I don't have them in front over 
me. The three conditions in the legislation?
    Ms. Ros-Lehtinen. Well, I hope that when you are 
negotiation with the Castro regime you keep in mind U.S. law. 
U.S. law is the LIBERTAD Act of 1996. The President is calling 
for the lifting of the embargo. Please go and check that out, 
because that is U.S. law, and we are hoping that you will abide 
by that.
    Ms. Jacobson. Absolutely.
    Ms. Ros-Lehtinen. And with that, Mr. Clawson has a follow-
up question.
    Mr. Clawson. I believe that good leadership requires all 
stakeholders to be taken into account. Companies go off track 
when they only think about shareholders, and in government, I 
think it is even more important that we keep all stakeholders 
take them into account and that they are consulted. This felt 
like a sad decision to me because it seemed to bypass a normal 
conversation with all stakeholders with respect to Cuba, 
stakeholders that live in our country, family members and 
others that got surprised, as you did as stakeholders that work 
on the front line, and I kind of want to be on the record on 
that, because I think when we bypass stakeholders, we make 
unfair decisions that are narrow in their bandwidth, and this 
doesn't feel--this decision doesn't feel fair because of the 
process or lack of process that we went through to get here 
surprising people that have stakes in the game of Cuba. So I 
wanted to be on the record on that.
    I also think makes your job on the front lines a lot more 
difficult, and I can't imagine surprising folks that work for 
me, bypassing them and cutting a deal with somebody that--
without them knowing it. It feels like that undercuts your 
authority in the future, and maybe you see that different, but 
I just don't know how that is not the case.
    So I want to say thank you for hanging in there. I think 
your jobs just got tougher, not easier, and I want to express 
my appreciation for you all and the service you do our country, 
and even in times made more difficult like now by leadership, 
and then along those lines I want to say thanks for hanging in 
there today. It is not easy coming up here, and, you know, you 
get it from both sides in our case. So you seem to have done it 
with humor and hung in there and kept your, you know, your 
sense of humor here, and for that, most of all, I express my 
appreciation to you all for making time for us. Thank you.
    Ms. Ros-Lehtinen. Gentleman yields back, and I request 
unanimous consent to submit for the record a letter from South 
Florida State and Local Elected Officials to President Obama to 
express their profound disappointment over the December 17th 
announcement, an Agreement for Democracy in Cuba, which is a 
10-point roadmap from the people of Cuba toward a real 
transition to democracy, op eds from the former staff director 
of this committee, Dr. Yleem Poblete, and questions for the 
record from Congressman Mario Diaz-Balart. And with that, our 
committee is adjourned.
    [Whereupon, at 12:47 p.m., the committee was adjourned.]
                                     

                                     

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