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New Administration
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The Miami Factor

By JOSÉ DE CÓRDOBA and DAVID LUHNOW
February 20, 2008; Page A1

For the first time since a bearded young revolutionary named Fidel Castro overthrew the Cuban government on New Year’s Day in 1959, both Cuba and the U.S. are about to change leaders, increasing the chance of a thaw on one of the last remaining fronts of the Cold War.

Yesterday, Mr. Castro, who is 81 years old, said he will step down as Cuba’s president, ending his tenure as the world’s longest serving head of state. Most Cubans expect his brother Raúl, who is 76, to be named his successor, raising questions about how quickly things will change. Cuba’s National Assembly meets on Sunday to ratify a new leadership.

Associated Press

“My wishes have always been to discharge my duties to my last breath,” Mr. Castro wrote yesterday in Communist Party daily Granma. “[But] it would be a betrayal to my conscience to accept a responsibility requiring more mobility and dedication than I am physically able to offer.” (Announcement)

In July 2006, Mr. Castro underwent emergency intestinal surgery, handing over power to Raúl on what was characterized as a temporary basis. Since then, he has had several more operations and has rarely been seen in public. Nevertheless, he has remained active in making government decisions.

For the U.S., his resignation could rekindle debate about the best way to bring about change in Cuba: to continue the long-running economic embargo, or to allow trade and engage Cuba’s leader through diplomacy. Although dramatic change appears unlikely under the Bush administration, Assistant Secretary of State Thomas Shannon surprised many a year ago when he praised Canada’s policy of active engagement with Cuba.

The departure of Mr. Castro marks a watershed moment for the island nation of 11 million, one of the world’s few remaining Communist regimes. Mr. Castro is the only leader most Cubans have ever known. He took power before the advent of the Beatles, manned space flight, personal computers and the New York Mets. Barack Obama had not yet been born. Mr. Castro’s defiance of the superpower next door transformed his small nation into a Cold War chess piece. He will leave behind a well-educated populace that has grown frustrated by economic hardships and restrictions on speech.

After a rule of nearly 50 years, Fidel Castro is resigning as Cuba’s president. His departure could signal a new period for relations between the U.S. and Cuba.

Yesterday, the streets were quiet in Havana. State television broadcast Mr. Castro’s announcement, along with interviews of Cubans who said they didn’t think he should step down because he embodied the revolution. Some wondered whether Mr. Castro would continue pulling strings behind the scenes. “He will still be running the show,” said Reinaldo Escobar, a journalist in Havana.

Ismael, a Havana cab driver in his late 50s who declined to give his last name, said yesterday that he hoped the next leader would encourage foreign companies to invest. “But I think death is going to have to come here and get [Fidel],” he said, “because this guy, he doesn’t die easily.”

Many Cuba watchers doubt there will be significant change anytime soon in Cuba, or in its relations with the U.S. In both nations, however, young people have been questioning the confrontational policies of the past.

In Cuba, 70% of the population was born after the revolution. Many of these Cubans lost their parents’ revolutionary enthusiasm amid the privations that have plagued the country, especially after the collapse of the Soviet Union in 1991. Even though most Cubans are barred from using the Internet, some young bloggers have begun to surreptitiously chronicle the struggles of daily life in Cuba.

In the U.S., there is a generational divide among the Cuban-Americans who have driven U.S. policy toward Cuba for decades. In late 2006, an umbrella group of Cuban exile organizations issued a call for the U.S. to lift restrictions on travel to the island by Cuban-Americans and on the amount of money they can send relatives in Cuba. This year, three longstanding Cuban-American Republican members of Congress face key challenges, two of them from Cuban-American Democrats.

Economic Czar

When Cuba’s National Assembly meets Sunday to ratify the leadership after recent party elections, Raúl is expected to be named president. Some experts on Cuba say there’s an outside chance that a younger generation of leaders might emerge. If that’s the case, many people think the post would go to Carlos Lage, a 56-year-old pediatrician. Mr. Lage has been Cuba’s economic czar for years and is seen both at home and abroad as an economic reformer. Fidel himself said in December that he did not want to obstruct a new generation from taking power.

Mr. Castro’s resignation should make it easier for his successor — no matter who it is — to pursue slow reforms aimed at opening up the country’s closed economy and, perhaps, its closed society. Over the past few months, Raúl has indicated that change is afoot, especially in the economy, and has encouraged more open debate about what ails the country. In January, during the election for Cuba’s National Assembly, he promised “important decisions, a little bit at a time.”

Other signs of change include the recent release of a handful of political prisoners, and last year’s deportation to Colombia of a notorious drug trafficker, who was then extradited to the U.S. Some state-controlled newspapers and television news shows even have started running stories critical of inefficiencies at state agencies.

“With [Fidel] still on the scene politically, it had limited Raúl,” says Peter DeShazo, a former U.S. deputy assistant secretary of state for Western Hemisphere affairs. “This frees him up more…it could encourage him to take reforms.”

A hard-line Communist for most of his career, Raúl has become much more pragmatic as he has aged, says Brian Latell, a former Central Intelligence Agency analyst and Cuba watcher who has written a biography of Raúl. What Raúl lacks in charisma, he makes up in management skills, says Mr. Latell. As Cuba’s defense minister, Raúl has often been an advocate of economic reform, pushing for such things as farmers’ markets and allowing more Cubans to become self-employed.

None of this means there will be McDonald’s restaurants in Havana anytime soon. So far, the discussion of economic liberalization has extended to allowing small, family-run firms to adopt cooperative methods of production, which already exist in the farm sector. Extending cooperatives to small shoe-manufacturing and textile firms would enable them to sell part of their production to consumers instead of to the government, and would permit them to expand by hiring employees outside of their families.

Cuba’s next leader will face enormous problems. Chief among them is fatigue and frustration, in particular among young Cubans. Salaries average about $15 a month. Cubans aren’t allowed to stay in hotels designated for the tourist trade, one of the few economic activities that provide foreign currency. They are upset about the nation’s dual-currency system, under which many goods are available only with the “Cuban convertible peso,” which is used by tourists and is out of reach for many Cubans.

Economic Impact

Cubans will expect their next leader to do something to improve their economic condition. The island produces little of what it consumes; it is dependant on the largess of its Venezuelan ally, Hugo Chávez, who provides more than 100,000 barrels a day of the petroleum and fuel products it needs to survive.

Recent talk of change has excited ordinary Cubans. “The drama of this year will be whether they deliver or disappoint on the economic front,” says Philip Peters, who studies Cuba at the Lexington Institute, a Washington-based think tank. “Expectations have been raised to an incredibly high level.”

If Cuba’s next leader doesn’t deliver on those expectations, the consequences could be severe. But pushing for change too quickly could cause Cuban leaders to lose control of the process. “If they slip on a banana peel, they lose the whole thing,” says Mark Entwistle, a former Canadian ambassador to the island who advises foreign companies seeking to do business there.

If Raúl takes over, he must also deal with a hostile neighbor — at least at the beginning. According to U.S. law, the U.S. can’t deal formally with a Cuban government headed by either Castro brother. During a trip to Africa yesterday, President Bush welcomed the news of Mr. Castro’s resignation. “I view this as a period of transition, and it should be the beginning of the democratic transition in Cuba,” he said.

In the Miami area, home to about 800,000 of the 1.5 million Cuban-Americans, the resignation of Mr. Castro wasn’t greeted by celebrations, as had the 2006 news that he had temporarily given up power. Cuban exiles, who hoped back then that the regime would collapse, have become disillusioned as they have watched Mr. Castro engineer a transition to his younger brother.

On the Republican side of the U.S. presidential race, it appears there is little appetite for changing American policy toward Cuba. Sen. John McCain of Arizona, the likely Republican presidential nominee, has said that altering the embargo would serve only to prop up the Communist regime. He said yesterday that the coming transition in Cuba was an opportunity for the regime to “empty their political prisons, to invite human-rights organizations into the country and begin the transition to a free and open society.”

Democratic candidate Sen. Obama advocated lifting the embargo as a Senate candidate in 2003. He has since moderated that view, saying he supports loosening restrictions on travel by Cuban-Americans to the island and on the amount of money they can send back. “If the Cuban leadership begins opening Cuba to meaningful democratic change,” he said yesterday, “the United States must be prepared to begin taking steps to normalize relations and to ease the embargo.”

At a campaign stop, Sen. Hillary Clinton said she might be willing to consider change as well. “If that new [Cuban] government takes some action that demonstrates they are willing to change,” she said, the U.S. should consider reassessing its policy toward Cuba.

Movement in Congress

In Congress, Mr. Castro’s resignation is likely to increase the number of lawmakers seeking to ease restrictions. “We have had a bad policy for nearly 50 years, for bad reasons that have nothing to do with Cuba,” says New York Rep. Charles Rangel, who heads the House Ways and Means Committee. Arizona Republican Rep. Jeff Flake, who has split with the majority of his party to try to lift a travel ban on Americans going to Cuba, said Castro’s resignation could open “a new chapter” in U.S.-Cuba relations.

That view may be gaining currency in Miami, where many Cuban-Americans reside. Younger Cubans who came to the U.S. in the 1980 Mariel boatlift, and who still maintain many family ties to Cuba, tend to be less hard-line than older Cuban-Americans who came as exiles at the beginning of Mr. Castro’s revolution.

“The politics of passion that led to the isolation of Cuba is waning,” says Damian Fernandez, the head of Florida International University’s Cuban Research Center. In a poll conducted last year, FIU found that 65% of Cuban-Americans would support dialogue with the regime, up from 55.5% in 2004.

Tough Policy

Longtime Cuban-American congressman Lincoln Diaz-Balart, who is seen as the driving force behind the U.S.’s tough Cuba policy, wasn’t changing his tune yesterday. “For now, nothing has changed in totalitarian Cuba,” he said in a statement.

But Joe Garcia, a Cuban-American Democrat who is challenging Mr. Diaz-Balart’s brother Mario for a house seat, said the U.S. government risks missing an opportunity to push for change in Cuba. “Our administration is a soundbox to the ultraright-wing in Miami,” said Mr. Garcia, who unlike his opponent, favors lifting restrictions on visits and remittances by Cuban-Americans to their families on the island.

Some U.S. businesses can be expected to push for an end to the embargo, including agricultural exporters, which have already sold more than $1.5 billion of chicken, corn and other foodstuffs to the island since the U.S. began allowing food sales in 2001. Airlines and hotel and tourism companies can be expected to join in the campaign, along with oil companies interested in drilling in Cuba’s coastal waters, where some oil has already been found.

Back in Havana, Yoani Sánchez, who writes a popular blog about daily life in Cuba, said in an interview yesterday that she thought Fidel Castro would remain an obstacle to change. “But at least my son will talk about Fidel as something of the past,” she said. “It’s the end of one cycle, and the beginning of another. I just hope the next one doesn’t last for 50 years.”

–Evan Perez and Joel Millman contributed to this article.

Write to David Luhnow at david.luhnow@wsj.com