As Cuba “celebrated” Fidel Castro’s birthday this weekend, what was the wish he wanted? Despite an historic agreement a year ago, progress is stymied. The Cuban government owes American citizens $8 billion. The Cubans insist the United States owes them $300 billion. This Miami Herald headline “Cuba denies it’s negotiating with U.S. on compensation claims” shows just how far apart we are on the issue of restitution for property seized by Castro’s regime: The two sides can’t even agree if the negotiations have begun or not.
As officials from both sides begin to address the thorny issue of claims and counterclaims that go back more than half a century, will the little guys get sold out?
After the 1959 Cuban revolution, Fidel Castro seized private property, first for political retribution and later as part of the communist economic system. Tens of thousands of people lost their homes, their farms and their businesses. The U.S Department of Justice has certified nearly 6,000 claims by U.S. citizens and corporations against Cuba totaling $1.9 billion, or about $8 billion with interest. (The law does not cover thousands of Cuban Americans who received U.S. citizenship post-confiscation, but they also hope for some kind of restitution.)
With the U.S.-Cuba thaw and the restoration of diplomatic relations, claimants saw a ray of hope. American and Cuban officials have now met twice to discuss property claims. Both sides are keen to find a resolution, both because of the legal implications and to remove a major psychological hurdle between the two nations.
About 900 of the claims are by corporations, representing about 90 percent of the total value. The largest claimant is, in a strange twist of history, retailer Office Depot, which holds the rights to a nationalized electricity company. Starwood Hotels is another sizable claimant, yet this did not stop the company from recently signing a joint venture with the Cuban military to refurbish and operate two hotels.
The Starwood deal may first appear like good news that companies are not letting past claims stand in the way of investing today. Yet it also suggests that some of the bigger firms can negotiate directly with the Cubans. So where will this leave the 5,000 individual claimants with no such leverage?
This leaves the fate of claimants in the hands of the State Department negotiators and what deal they can reach with the Cubans.
The simplest way of resolving claims, an agreed lump-sum payment, is probably off the table. Cuba doesn’t have $8 billion. It’s in a financial crisis, facing both cash and fuel shortages because its Venezuelan benefactor is imploding. Neither does Cuba show any intention of returning property, a process that is greatly complicated by the many decades that have passed.
More important, Cuba does not yet appear to even accept the notion that it should pay for seized property. To many in the ruling communist party, paying the yanquis is revolutionary surrender.
After waiting more than half a century for their property back, American claimants in Cuba will have to wait a little while longer to see what, if anything, their government can — or will — extract on their behalf.
Todd Moss, a former deputy assistant secretary of State, is author of the forthcoming thriller Ghosts of Havana.