Directors: Let's Start Trading With Cuba
from January/February 2003
Most of the directors interviewed by Corporate Board Member about the embargo of Cuba favor an end to it—but many of them see the opening of trade as a political weapon rather than a specific business opportunity.
“It’s the best way to spread capitalism and democracy,” said Craig J. Duchossois, 58, the CEO of Duchossois Industries, which makes keyless entry systems and similar products, and a director of racetrack operator Churchill Downs and two other companies. Added Barbara T. Alexander, 54, an adviser to UBS Warburg who serves on the boards of four companies, Homestore Inc. among them: “It’s preposterous not to trade with Cuba. Trade has proved to be the fastest way to defeat communism. Go to Saigon today, you’d think we won the war.”
Less sure was Burton M. Joyce, 60, chairman of steelmaker IPSCO Inc. and a director of Terra Industries and Terra Nitrogen. He raised an issue that remains hot among the many Cuban-Americans who oppose any softening of the U.S.’s Cuba stance. “An awful lot of people, companies, and individuals have had their assets appropriated,” he said. “Maybe Cuba needs to do some things too, such as returning property, before we do anything.”
Corporate Board Member asked 100 directors what they thought about the embargo in the course of seeking their opinions on a variety of topics, the rest of which were covered in our last issue. About two-thirds of the board members interviewed favored lifting the embargo. A handful were ambivalent. See the following pages for a sampling of what they said.
Why the U.S. Should End the Embargo:
“If I felt there was a lot of oil and gas in Cuba, I would want to be down there exploring. So I think we ought to have as few trade sanctions as possible. I would think that Cuba and the U.S. ought to be able to work out something so that trade could take place.”
Joe B. Foster, 61
Chairman, Newfield Exploration Co.
(Foster is also a director of McDermott International and New Jersey Resources.)
“Of course we should end the embargo. It’s not even a question. It’s constructive engagement. Are we really afraid that this little Cuban island is going to take us over? You want to know what’s going on with Cuba? Then trade with it. Do you want to get it into the world’s democracies and markets? Trade with it. If the world is big enough to let China into the World Trade Organization, I think America can trade with Cuba. It’s absolutely the most ridiculous foreign policy we have.”
Harriet Mouchly-Weiss, 60
Managing Partner, Strategy XXI
(American Greetings, Viisage Technology)
“We’re not helping the Cuban people get out from under Castro. What we are doing is jeopardizing the health and welfare of the Cuban people and leaving our businesses with one less option. Embargoes don’t work. Politically loud people have kept us in this one for a long time. The bottom line is, we’re losing an opportunity for trade and hurting good people in the process.”
Thomas Chema, 56
Partner, Arter & Hadden
(Fairport Funds, TransTechnology)
“I am an avowed free-trader. I think we need to ensure the viability of the Cuban people, and they need a robust economy to do that. What breeds the activism is when people can’t improve their quality of life.”
James P. Hackett, 47
CEO, Steelcase Inc.
(Fifth Third Bank, Northwestern Mutual Life)
“Fidel Castro is not going to live forever. The regime he has been able to control since I was in college is going to fall apart. Trading with him is going to assist in that falling apart.”
Wade F. Meyercord, 62
CFO, Rioport.com
(California Micro Devices, Microchip Technology)
“If you open up more trade, it will stimulate economic development, which will lead to more political change.”
William H. Coquillette, 53
Partner, Jones Day Reavis & Pogue
(Lampson & Sessions)
“I was in Cuba recently, and the thing that impressed me was that they want the same things we do: employment that brings a decent standard of living, a chance for their families to be better off than they were. Through our trade embargo, those people suffer. The Fidel Castros do not. So what does our trade embargo do? It compounds the suffering and generates a despair that drives people to do things they wouldn’t otherwise do, like trying to row a boat to Florida.”
Robert Furgason, 67
President, Texas A&M University at Corpus Christi
(Hanover Compressor)
“The best way to allow Cuba’s economy and its people to be free of oppression is to be exposed to a free-market economy. It’s been done around the world, and that power will eventually win out. They know of no other system over there, and when they do there will be change.”
Robert Smialek, 58
Former CEO, Applied Innovations
(CoorsTek, General Cable)
“Having the embargo is craziness. We’re trading with China. We’re trading with the former Soviet-bloc nations. Whom do we buy oil from? I don’t think the embargo has worked. The way you defeat communism is not by embargoes and wars but by the free-enterprise system. It’s by letting those people experience what it would be like if Cuba were open to the American people. Castro would be out of there in a heartbeat.”
Barbara B. Grogan, 55
Chairman, Western Industrial Contractors
(Apogee Enterprises, Deluxe Corp., Pentair)
“We should trade with Cuba. We have found over time that trading with ‘enemy’ countries often results in the elimination of enemy status. Through trade, you get understanding and compromise—and the best results here lead to peaceful coexistence, as with Russia and China. We, as Americans, cannot dictate the form of government chosen by people in other countries. We can help those people by recognizing that there is room for all on this earth.”
Norman S. Edelcup, 67
Senior Vice President, Florida Savings Bancorp
(Baron Funds, Valhi)
“If we can trade with China, we can trade with Cuba.”
Joseph L. Bower, 64
Donald K. David Professor of Business Administration, Harvard Business School
(Anika Therapeutics, Brown Shoe, Loews, New America High Income Fund, Sonesta International Hotels)
“Tell me how it is logical that we trade with China, but—based on some kind of human-rights issues or threats to us—we do not trade with Cuba. In fact, it is the vote of Miami that every politician wants that dominates the decision.”
William G. Oldham, 64
Professor of Electrical Engineering and Computer Science, University of California at Berkeley
(Cymer, Nanometrics)
“The embargo has not worked.”
James E. Ousley, 56
CEO, Vytek Wireless
(ActivCard, Bell Microproducts, Datalink, Savvis Communications)
“It’s ridiculous to be carrying on a trade war with a tiny little country—like a flea on the back of an elephant.”
Michaela K. Rodeno, 56
CEO, St. Supéry Winery
(Silicon Valley Bancshares)
“If we can trade with Saudi Arabia and some of the Middle Eastern countries supporting terrorism, how can we not trade with Cuba? Let’s get on the bandwagon.”
John Correnti, 55
Chairman and CEO, Birmingham Steel Corp.
(Corrections Corp. of America, Navistar International)
“I think we should trade with Cuba. It’s a tremendous economic opportunity for the U.S., and we’re way behind the rest of the world. The Europeans and the Asians are already trading with them. I think we’ll have more influence on changing human-rights and political issues if we’re working with them, and they see how other societies function, than by isolating them. But I don’t think that will happen until Castro
is gone.”
Hal Logan, 58
CFO, TransMontaigne Inc.
(Graphic Packaging International, Suburban Propane Partners, Union Bankshares)
“As has been proven, a strategy of economic engagement is far better for the people under a repressive government and provides the basis for constructive exchanges in trade, culture, and tourism. The single biggest contributor to Castro’s longevity has been U.S. policy toward Cuba all these years.”
Christie Hefner, 50
Chairman and CEO, Playboy Enterprises
(Marketwatch.com)
“I think we should. Germany and France and everybody else is doing it, and there’s no reason not to.”
Jerry E. Ryan, 60
Private Investor
(AAON, Global Power Equipment Group, Lone Star Technologies)
“I think we should. It is in close proximity to the U.S., and it would be better to try to have them as a more friendly nation.”
Dennis Foster, 62
Owner, Foster & Leonard
(Alltel, Nisource, Yellow Corp.)
“You’re asking the wrong person, because I used to smoke Cuban cigars. I suspect we should trade with Cuba, since we’re opening up global markets. The threat that Cuba represents now, as far as communism and terrorism are concerned, is pretty minimal. I’d hope there would be a way in which we can extract some human-rights advances in exchange for trade.”
C. McCollister Evarts, 71
Professor of Orthopaedics, Penn State College of Medicine
(Kensey Nash)
Why the Embargo Should Stay in Place
“As much as I’d like to buy a Cuban cigar, I agree with the current administration that until there is further alignment around the humanities and politics, the embargo should stand.”
Lloyd Hill, 59
Chairman and CEO, Applebee’s International
“I think the course the government has with Cuba is the correct one. And I think we should continue until they change. If we trade with them and enhance their economy, I think we assure having a communist, non-capitalist, and non-free system in place.”
Charles F. Pollnow, 70
Chairman and CEO, Brulin Corp.
(DT Industries)
“Until such time as they change their political attitude toward the U.S., I think we should maintain a distance from them.”
Robert J. Potter, 70
CEO, R.J. Potter Co.
(Bradshaw Group, Cree, Molex, Speed FC)
“No, on the principle of human rights and support for the war on terrorism.”
Frank H. Barker, 72
Chairman, U.S. Dermatologics
(Aradigm, Catalina Marketing, Jenex, Welch Allyn)
“We should continue the embargo with Cuba. It continues to put economic pressure on the regime there to modify their human-rights policies, to be more open, and it hopefully discourages expropriation.”
Daniel W. Derbes, 72
President, Signal Ventures
(WD-40)
“Dealing with Cuba is a decision I’m content to leave up to the president. I understand that we lose business opportunities in embargoes. But when our government takes a hard line on something like Cuba, there’s a reason for it.”
Henson Moore, 63
CEO, American Forest and Paper Association
(USEC)
“I think we should probably evolve to a closer relationship with Cuba, but I don’t think we ought to just open up the door now, while they have a totalitarian government and a dictatorship. So I wouldn’t do it now.”
Robert M. Teeter, 63
President, Coldwater Corp.
(Kaydon, UPS, Visteon)
“Just because Cuba could use the trade isn’t enough. We shouldn’t trade unless they’re willing to play ball on human-oppression issues.”
Scott Anderson, 44
Principal, Cedar Grove Partners
(Triton PCS, Wireless Facilities)
Beats Me
“I’m very torn on this issue. Our economic dealings on China are probably leading that country toward changing some of its totalitarian policies. But Cuba trades with the rest of the world, and there is no lessening of its oppression. The United States’ lifting its embargo might have no change in that country, and could bolster Castro’s grip. I don’t support anything which does that.”
Linda Chavez, 55
President, Center for Equal Opportunity
(ABM Industries)
