it's grappling with this new set of changes in technology, maybe it's that nexus and that's what's different. i do think -- the premise of laura's question is really a core issue. we do rely on the market to solve -- right. >> whoever asks, we do rely on the market to solve a whole host of problems. and i think we are in a regime where these problems will not get solved that way. >> every venture capitalist i know encourages their companies to hit home runs, swing for the fences, not to do an incremental -- >> because that's how you return for the lps, that's a business model for the venture capitalist. >> absolutely. that's not part of the problem we're talking about. i think that's a good thing instead of a bad thing. >> but let me translate it to

what actually happens when you have a small startup. the conversation around the board table every single month is about the burn rate and that is about not hiring too many people because you'll run out of runway before you get the product built and revenue generating profit. so, there's never a conversation about it would be really good if we could employ a few more people. that's only a consequence of achieving that hyper growth sometimes, once anyway great while. >> i've heard someone say -- there's a kernel of truthd about this i've heard people say the u.s. has the very best incentives, comparatively speaking, until recent things like patent boxes and the rest of the world -- great incentives to do the research in the united states. we can weak incentives of employment and very weak incentives of profits. all the incentive structure in our tax law and a whole bunch of other thing sincere yes yes, yes, locate around great universities and start the google, apples, everything there. don't worry too much about employment. except for the people you have to employ on your prem isz bass you have to keep the prem isz going. you can do most of this work some other place.

don't worry about your revenues because you can put them in places where they are not highly taxed. i do think this issue of thinking about the employment effect certainly is not something which a wealth generation, venture capitalist or nonventure capitalist has on the top of their agenda. it's not even on the agenda, because labor is a cost. >> exactly. >> labor is a cost. sometimes there's discussion of talent. when you talk about talent, it's something you want to acquire. it's not a cost. but labor is a cost. can i ask the question -- you were both in and out. do you think that -- relative to what john and andrew were saying, you might think that the rate of diffusion, ideas that are generated is slowing down. they're not being picked up. we used to say -- in the clinton administration we were worried about whether there was enough dual use technology to fill

over. now we believe there's a huge amount of dual use technology to spill over. is the recipient -- the catcher not there to catch? what do you think? >> we think all the time about how our technologies are going to move out into the world. some are very statistic military systems and will not move. but the number of enabling technologies, some we talked about today, but also in the information technology arena, do depend on graduate students going off and starting new companies or established companies adopting things out of basic research but fundamentally at some level or another a business decision has to be made around a commercial opportunity. and, you know, there was a time in dartmouth's history when we were scaling the internet and the ciscos and suns and huge number of amazing companies was spinning out from mostly the

university research. that is a very lumpy thing. we're in our sixth decade. there were seasons when there was a huge amount of that activity and other seasons where there's only a modest amount. it ebbs and flows according to when those markets present themselves and entrepreneurs go seek those opportunities. it goes on today. i wouldn't say it's at that level. >> there's no secular. >> so some of this is about whether there's been a secular decline in the ability of the private sector to pick this up and move it forward. my sense is much more about when they see market opportunities and more that organic drive that fuels this big burst of activity or then it moderates -- it's fairly modest. there aren't 20 companies who see huge markets. >> because it's too far from the markets.

it got to the market and then blew out. but, of course, all the social network -- all the stuff that has grown up in the last decade -- yes. >> and just to finish about -- the first decision to put money against the idea of connecting computers was 1968. it was 1993, as i recall, was the year that all of a sudden every business card you got had an e-mail address on it. that's when the market really started exploding. >> we talk aid fair amount of it's especially the high tech sector that's had -- according to the very nice work by john. that says in terms of whatever they happen to be doing it's certainly not showing up in the productivity statistics since 2003. >> i really have to caution you. darpa is 2% of federal spending in r & d. >> retail sector may not have shown any productivity increase because -- the quality of

locating the product you want at the price you want has really improved. >> productivity has been growing in the private sector. that statement this morning was off base. >> okay, well -- >> in that case, it is related in a good way to the decline of mom and pops. the shift away from mom and pop to walmart has been good for the sector. >> whether the retail sector was the right one to use or not wasn't -- is, do you think that given the nature of the technological changes we're going through that this won't -- on what the output actually is? >> made this point. now a couple of days ago that said we're already back 20 years

ago moving. and that's, you know, increased and so i agree, our productivity statistics need work. >> i don't want to rely on that. i think the productivity numbers are weird, especially in the face of this idea that eric and i are putting out there that

we're in this technological surge, so, all i can do is fall back on the other, wait and see. because i do think -- >> well, it takes a long time >> the near feature is going to look different even in some of these very labor intensive low wage service sectors that have seen growth and employment without much growth and productivity and therefore, big increases in their contribution to cpi. you talk about health care. there's a hotel, sorry, a hospital, that just opened up in san francisco where every meal has not been cooked by robots, but has been delivered to patients by robots. the dirty laundry is being carted throughout the hospital by robots. automation is coming to these

sectors, quickly. >> so this is a good point on which to draw the panels together. because the positive part is if you're a patient you'll get your food well prepared on time by somebody who is not going to make a mistake. the bad news is that in every projection i've seen for employment growth in the united states and for other countries around the world, care giving and health care is a major source of employment growth for, let's say, middle educated to low educated workers. if the robots are smarter and can do it more precisely, that's when you start to get to the issue we talked about earlier today. who will be technologically displaced and what do we say as a society if -- one of the most brilliant lines in the book that andrew wrote with eric is the essence of capitalism is that

most people get their income from their labor. had an if brilliant machines take away certain jobs all together and undermine labor for a large fraction of society's workforce? that is a social problem that we have to begin to think about. and i really thank the hamilton project for having us all here today. i thank my very distinguished panel for forcing us to think about technology and business models and how could we get this to work better. it's been a great session and more to come. thank you very much. all this week on cspan 3,

american history tv in prime time. on april 21st 1865, six days after president lincoln's death, his funeral train departed washington, d.c. on a journey to lincoln's hometown in springfield, illinois. the train arrived on may 3rd and his funeral took place at oak ridge cemetery the next day. tonight, a look back at the anniversary of lincoln's assassination. that's at 8:00 p.m. eastern and sign scientists and journalists exam science deny lism and issues such as climate change, space exploration and vaccinations. here's a preview. >> it all starts with evolution. the big lie of science and the catholic church and most mainstream protestant

domination saying wasn't god clever? easy out, right? come on. and what happens unfortunately is is that about this same time that this accommodation is happening, there is the rise of organized labor in the united states. which is a form of collectivism and which it is determined bay handful of protestant ministers to be a satanic distraction from the individual the rugged individualism that allows you to have a direct relationship with god. and so, they become concerned with what are the fundamentals of christianity. and the they actually wrote a series of books and pamphlets called the fundamentals and they are known as fundamentalists and that's where the term comes from. one of the fundamentals is that science is alive. because if you believe the science of evolution, you are rejecting god.

>> and you can watch that entire event part of the annual world affairs conference at the university of colorado in boulder tonight starting at 9:00 eastern. the senate foreign relations committee recently held a hearing as the two nations continued goeshuations. robert roberta jackson and thomas shannon answered questions from senators on the broader policy objectives of u.s. officials including what steps will be taken to ensure a strong stance on improving human rights conditions on the island. senator bob corker who is the chair, ben cardin is rankinging member.

committee would come to order. thank you, guys. thanks for your interest. today, we'll hear from the state department's assistant secretary for western hemisphere affairs on the strategy behind the president's significant shift in u.s. policy towards cuba. assistant secretary jakobson is joined at the witness table by ambassador thomas shannon. a far cry from the time decades ago when it was the most prosperous countries in the region. the cuba policy initiative has been welcomed in latin america and the caribbean. but significant differences which we'll hear today, of opinion exist in the united states. over the extent to which change in this change in policy will

advance u.s. interests and improve circumstances for the cuban people. today, we look forward to our witnesses to speak to how our nation can best interact and help cuba rejoin the mainstream and offer its citizens the same rights and freedoms enjoyed by citizens of other countries and regions. to this end, our witnesses can help us understand that administration's policy goals. with regards to cuba. what do they intend to achieve and relaxes sanctions? we would also like to hear their assessment of what the cuban government goals are for engage ng this process with the united states. every policy initiative will inevitably come into contact with the reality that the cuban state and most importantly, the cuban state's relationship with its own citizens have not yet changed.

in truth, we have to define what a normal relationship with cuba looks like bilaterally. but also in the context of our relationship with the americans more broadly. overall relations with with latin america and the caribbean have evolved significantly over past decades. the last unilateral military intervention in the region occurred more than 20 years ago in haiti. u.s. trade with latin america and the caribbean have more than doubled from 200 to 2012. in the process of opening to increase trade with the united states and each other they have take b steps to adopt market reforms and create more investment standards. the norm is for regular multiparty elections and more broadly interamerican institutions today reflect the commitment by the region to more democratic inclusive

governments. the u.s. relationship with latin america is very different than it was during the spanish-american war in 1898 or during the cold war in 1959. this is the larger strategic context in which the way forward for our relations with cuba will be defined and we thank you both very much for being here. i look forward to the opening comments of our distinguished ranking member, senator carter. >> well, thank you, mr. chairman. i certainly welcome our witnesses today. i thank you very much for conducting this hearing. there's no question that the december 17th action by president obama and his historical speech marked a moment in our relationships towards cube yachlt there are members of this committee who believe it went too far. there are members of this

committee who think it didn't go far enough. but one thing i think is critically important is that we have a open committee hearing and discussion on these issues. that's why i particularly thank the chairman for bringing forward this hearing so that we can engage a discussion on the new direction with cuba. on that date also we celebrate long overdue return to the united states of a maryland resident allen gross and mr. chairman by consent i would ask that his statement be included in our record. we all are interested to hear from our witnesses that today's hearing provides an important opportunity to review the advances achieved under the administration's new cuba policy and understand that the strategy for moving forward. without a doubt this is a complicated process and will take time to achieve the progress we want. i want to underscore that there is one issue that i think united states us even though we may have different views as to where we should move with the cuban policy. and that one area that i think unites every member of this committee and the united states

senate is that we all stand together and our aspirations to see the cuban people have the opportunity to build a society where human rights and fundamental freedoms are respected and democratic values and political plural six tolerated and where individuals can work unobstructed to improve living conditions. this is particularly true with the afro cuban population. we also share concerns about the critical issues such as the cuban government's on going abuses of human rights and the presence of american fugitives in cuba, especially those wanted for the murder of u.s. law enforcement. how can we best advance the adds conspiraciations while also addressing the concerns? our previous policy did not achieve the progress that we wanted to see. so a new approach is needed. they laid out a new path based on the believe that principled engagement brings new results. i think this is the right path to follow for the following reasons. first, for far too long the cuban government has used u.s. policy as an excuse to justify

its shortcomings and hardships of the cuban people. the cuban government xploided policy for diplomatic gains, focusing international debate about what the u.s. should do rather than about what cuba needs to do to better provide for its citizens. this has been a particular challenge here in our own hemisphere where governments and our closest partners preferred to speak out critically about the u.s. policy rather than about the conditions on the island. the president's policy has reset the gee yoe political calculus in the region and will provide new opportunities for cooperation in our latin american and caribbean partners. the recent summit of the americas and panama showcase this point clearly and both

president obama and u.s. were praised widely for leadership. in one particular important development, the presidents of costa rica and uruguay met with president obama in meeting with cuban dissidents. this was an incredibly important moment. it showed the international community. i want to thank senator boxer. senator boxer has a chance to hear from mr. costa that you invited to that hearing. i think that was an important point also. such acts of seeing latin american presidents meeting the u.s. president was unthinkable just six months ago. second, despite differences we may have with the government, our foreign policy should always endeavor to support the country's people to the greatest degree possible. when president obama first came to office in 2009, he created greater flexibility for people to visit families if cuba and

send remittances to the islands. the early policy changes provided important support to the emerging entrepreneurs that have been able to launch new economic initiatives often working out of their own homes. the cuban government limits the activities widely and they're not all able to take advantage of them, u.s. policy is directly responsible for helping the cuban people improve living conditions and achieve new degree of independence from the cuban government. the december announcement went one step further and made it easier for u.s. citizens to engage in travel from cuba. u.s. citizens will now have greater tupts to take place in programs with greater interaction from the people of cuba. i have no doubt that the american society will make a positive contribution to empowering the cuban people and provide them with the resources they need. while they make changes to travel regulation, there is some think that only congress can do.

for that reason, i am a co-sponsor of senator flake's freedom to travel to cuba act. we must robust ties and i think we'll have the opportunity to discuss that bill during this hearing. then third, the administration's new cuba policy will provide u.s. and especially our diplomats with new tools to engage directly with the cuban government to have principle and frank discussions about the issues we disagree about. and how we might work together to better have a common interest on resolving the interests. every day our diplomats around the world demonstrate their ability to engage foreign governments and advance u.s. national interests. it's not unreasonable to think that we'll have a better chance to address the outstanding claims held by u.s. citizens for proper confiscated by the cuban government or to secure the

return of american fugitives to face justice in the united states if we actually engage in direct dialogue with the cuban government and articulate our demands. when it comes to issues of confronting counter narcotics trade or addressing migration issues, it's a national interest of both the united states and cuba to have channels of communication between our two governments. diplomacy will make this possible. the cuban policy put the united states in the right path. we must remain clear eyed about several issues and we must continue to speak out about them. we cannot ignore the cuban government's record of human rights or human trafficking. every month there are way too many cases where the cuban government jails political activists for what they believe in, what they say publicly. freedom of expression must be central to all of our engagements with the cuban government. i know he led a human rights dialogue with the cuban government earlier this year. and i welcome our witnesses' comments on this development. mr. chairman, as i said initially, we do welcome the

witness that's are testify today. i thank you again for this opportunity for our committee. >> thank you very much. now i will -- our first witness is the honorable roberta jacobson. she is the assistant secretary for state for western hem is sphere affairs. assistant secretary jacobson established diplomatic relations and our second witness is ambassador thomas shannon. he is the counsellor to the state department. most recently served as american ambassador to brazil. among his duties, he's also served as senior director for the western hem is sphere at the national security council. we thank you both for being here. you can keep your comments as fairly brief as you wish and we accept your written testimony into the record. thank you. >> thank you so much, mr. chairman and ranking member for the opportunity to testify on u.s. cuba policy today and your interest in the hemisphere more broadly. let me underscore this unique

moment in the america's for the united states. it's remarkable to see how u.s. relations with countries of the hemisphere are increasingly characterized by mature partnerships and shared values and interests. the partnerships we have with canada, brazil, chile, colombia and so many others is extraordinary. i am especially i had proud of the renewed commitment to working with central america and our $1 billion 2015 request that we believe will strengthen prosperity and good governance. since i last appeared in february, we began to see the administration's new approach on cuba providing space for other nations in the hem is sphere and around the world to promote respect for human rights and fundamental freedoms in cuba. at the summit of the americas in panama, engagement by the president and secretary reinvigorated our momentum. our approach drawn attention to the potential for greater

political and economic freedom for the cuban people and the gap between cuba and other countries in the hemisphere. more americans are traveling to cuba meeting cubans and building shared understanding between our people. we've seen practical cooperation on issues like maritime security telecommunications and environmental cooperation. our future discussions on law enforcement will expand the avenues available to seek the return of american fugitives from justice among other issues and we're planning on future talks on human rights and settling claims for property. most importantly, the president's new approach makes it clear america can no longer be blamed on such things as access to information or connecting cubans to the world. fundamentally on this issue, i'm a realist and as anyone who's

dealt with cuba, being a realist is is is essential. indeed as the president made clear, the meeting with raul castro as the summit, significant differences remain. we continue to raise our concerns regarding democracy, human rights and freedom of expression. the policy is based on a policy that determines this tomorrow determine their own future by creating new economic opportunities and increasing contact with the outside world. these changes create new connections between our countries and help the private sector in cuba. but comprehensive changes in our economic relationship will require congressional action to lift the embargo and the president urged conditioning to begin that effort. the administration's decision to resend cuba's kessedesignation at a state sponsor of terrorism was a fact based process as the president has emphasized. while progress has been made if our efforts to re-estabilsh diplomatic relations, we are not there yet. there are still outstanding

issues that need to be addressed to ensure a future u.s. embassy will be able to function more like other diplomatic missions in cuba and wrels in the world. but even today under challenging circumstances, our diplomats unite families through our immigration processing, providing american citizens services, issue visas and aid in refugee resettlement. they work hard to represent the issues and values of the united states. our engagement with the broadest range of cubans will expand once we establish diplomatic relations with cuba and tomorrow we'll be holding a new round of talks with our cuban counterparts to advance these objectives. as we move the process ahead, we hope we can also work together to find common ground towards our shared goal of enabling the cuban people to freely determine their own future. thank you. i welcome your questions. >> mr. chairman, ranking member and members of the committee,

thank you for this opportunity to appear before you. as the chairman noted, we submitted our testimony. so i will just hit a few of the high points. i would like to start by saying it's a pleasure to appear before you. roberta jacobson served as our diplomat in the americas. i want to address the regional context in which our cuba policy is unfolding and to lay out the strategic dimensions of our diplomacy. >> our purpose is not to defend or preserve a presence or restore a past, it is to create the future. and he noted that our global engagement whether it is diplomacy or force of arms is meant to defend one kind of future against another kind of future. it is in this light that we should understand the president's policy towards cuba.

the decision to engage with cuba and seek normalization of our bilateral relationship attempts to create a new terrain on which to pursue a future that correspondence to our values. our commitment to democracy and human rights and hope they know the benefits of liberty and know the sovereigns of their own destiny is no less for our action. the president has been clear about the commitment in our policy to enduring principles of self government and individual liberty. however, he is also clear about our inability to affect significant change in cuba act ago lone across so many decades. instead, he determined that our efforts would be more effective if we could position cuba squarely within an interamerican system that recognizes democracy as a right that belongs to all the peoples of our hemisphere. that believes that democracy is essential to the political economic and social development of our peoples and has the instruments, treaties and agreements to give shape, form, and weight to the commitments. it's our determine that is this kind of environment would be the

most supportive to support the only legitimate agent of enduring political change in cube yachlt the cuban people. to understand this point better, it is worth while to take a closer look at what the hemisphere cuba is a part of looks like in the second decade of the 21st century. the americans and specifically americas and specifically latin america has anticipated manufacture the events that are shaping our world today. it is a region that has largely moved from authoritarian to democratic government from closed to open economies, from exclusive to inclusive societies, from a development to regional development. there are a few points worth making in this regard. first, latin america is the first region in the world and the developing world to committee itself to democracy. it was also the first region to establish regional and subregional instruction tours to promote and defend human rights and to build subregional institutions and mechanisms for dialogue. because of this, it has also built shared economic

understandings including a commitment to market economies, free trade and regional integration. but perhaps most dramatically, latin america today is pursuing a second generation of change or trance formation. it is attempting to use democratic governance and democratic institutions to build democratic societies and states. the great experiment is to show that democracy and markets can deliver economic developmen and can address the social inequities of poverty, inequality and social exclusion. the profound changes unleashed in latin america show that democracy and markets can deliver economic development. and latin america used democracy and markets to launch a peaceful, social revolution that is transforming many countries in the region and long lasting ways. our ability to promote profound and dramatic change in latin america is an example of what

the united states can accomplish through diplomacy and engagement. if we accomplished through engagement, why not try the same approach with cuba? better yet, why not try it in partnership with countryies and institutions that are now prepared to work with us because of the president's new policy. cuba finds itself today part of a dynamic region where change is the watch word. it finds itself in a region where the change will continue to reshape political and economic and social landscapes in such an environment that the cuban people will find many models and partners from which to learn and choose. we should be one of the mod ldz models and partners. thank you very much for this opportunity to speak. we look forward to your questions. >> thank you both. i want to thank the committee for the way that it has handled what i think have been really difficult issues since we began this year.

and i know there is significant differences of opinion relative to the cuba policy that's been laid out. i'm really glad we have the differences of opinion represented here. i look forward to a robust q&a. one of the questions that i've had from the very beginning has been what are the specific changes within cuba that we have negotiated or asked for as it relateses to this policy change? it's my sense that there have really been none. i wonder if you might expand on that. it's been a question that most people have asked that have not been following the cuba situation nearly as closely as you. that is, are there specific things that we expect cuba to do in return for this change in policy towards them?

>> thank you, mr. chairman. i think that as we move forward with this policy, what's important to understand is the majority of the things that the president did, he took action on because he believes strongly we believe that they are in our interests and in the interests of the cuban people. the change as lou for greater purposeful travel that, allow for support from americans to the emerging private sector in cuba. indeed the normalization to pursue engagement. normalization and re-estabilshment of diplomatic relations should be worked out mutually with the cuban government. they were not negotiated with the cuban government. they were action ands policies taken unilaterally by us. we believe that over time,

especially things like support for emerging private sector entrepreneurs and in particular the hopefully the increase in telecommunications and information technology in cubal make a big difference in the ability of cuban citizens to determine their own future. so they were not negotiated with the cuban government, per se. >> ambassador shannon, you want to expand on that any? >> i think she covered it. >> okay. >> i was going to go in a different direction, but since you mentioned technology, it is interesting that u.s. companies were going to be more involved technology-wise. but it's my understand thagt cuban government doesn't really allow much access relative to the outside world with communications. so i'm just wonldering we made a big deal out of that

announcement. what is the net effect of it if the government doesn't allow citizens to participate in that way? >> well, i think it's very important that the cuban government has said as part of the u.n.'s efforts to open information to citizens around the world that they want to expand access for the cuban people. we are hopeful that that will happen. right now, there is not access for most cubans. it's very expensive. it's not available and it's not necessarily something they can have in their own homes. but the ability of the cuban kbost and cuba in general to have a more up to date modern infrastructure on telecommunications and information is something that is critical to the modernization of the cuban economy. and, therefore, we would like american companies to be part of bringing better information technology to cuba which is why the president felt it was important to allow american

companies to do so. the cuban government hasn't yet made decisions to move forward with that. but there are american companies that are talking with the cuban government. and there's no doubt that there is a desire for greater information by the cuban people and we would like to do everything we can to enable that. >> what is it you think will be the response by the cuban government? in other words, what do you think, even though we didn't negotiate or even though we didn't try to leverage in any way, what do you suspect that policy -- what are the policy changes that will occur inside cuba as a result of these changes? >> well, there is already been under way in cuba, obviously some limited economic reforms. at built of half a million or more entrepreneurs to go into 200 or so approved businesses, business areas in private business, self employment.

that is an area i think that is really right for support. that regulations support. i would hope there will be many more of these entrepreneurs emerging and that they will be able to prosper and expand and be agents for change within cuba. there is, obviously, very different views on political system as well as the economic system of cuba. the president's been clear about that. we think engagement by americans with cubans that are there for limited travel and the ability for the private sector to increase and hopefully information to increase. and we're not sure what the cuban government will do in the

face of these things. i think they're still absorbing our changes and making their own policy decisions. but we know from polling that's been done inside cuba that the narrative of the u.s. being responsible for economic privatization and other disadvantages of the cuban people is no longer blamed on the united states. that narrative is eroding. >> okay. thank you. i want to thank you for the time you spent in my office on another matter. i know we talked about the region in general. i wonder if ambassador shannon you might talk a little bit about the effect that this

policy announcement has had on our ability in the region to discuss other issues of importance. >> thank you very much, senator. this is an important component of our policy. because we believe that the decision to engage with cuba removes an irritant that has not only limited where we can work with some of our partners and others in the region, but it has also over time degraded some of our most important multilateral institutions, especially in the interamerican system, within the oas and summit of the america's process. i mentioned in my testimony the region built a series of subregional mechanisms and institutions to build dialogue. for the most part this is very positive. but in some instances, some of these institutions have been decided -- have been built and speaking in particular of the

community of latin america and caribbean nations, to permit caribbean and latin american countries to have a conversation among themselves with cuba where we are not present. and this is in the long term is not in our advantage. and, therefore, by working towards normalization, we actually create an opportunity for the interamerican system to reassert itself as the premier political economic and social institutions in the americas. i believe this is an opportunity that we need to take advantage of. but in regard to cube yashgs the region understands and knows that cuba is the only country in the hemisphere that has not made an explicit commitment to democracy and is not recognized through the charter democracy as a right of all the people of the americas. and although they have taken different approaches than we, have we're now in a position to be able to press them to work harder on democracy and human rights issues inside of cuba. let me quote from the human rights where cuba is a authoritarian station where elections are neither free nor fair. and quoting, "the principle

human rights abuses were the abridgement of citizens to use government threats, extra judicial physical violence, intimidation, mobs, harment, detention to prevent free expression of peaceful assembly, the following additional abuses continue harsh prison conditions, aesh contrary arrests, tlektive prosecutions and denial of fair trials. then it goes on to say interfere with privacy, engage in pervasive monitoring of private communications, do not respect the freedom of speech.

severely restrict internet access. monopoly of media outlines, economic freedoms, maintain significant restrictions on ability of religious groups, refuse to recognize independent human rights groups, prevent workers from forming unions, exercising the labor rights, most human rights aofficials were at the directionst government. impunity for perpetrators remain widespread. that is the most recent report from the state department. and the independent human rights organization, the human commission for human rights and national reconciliation have documented in the first four months of this year about 1600 cases of arbitrary political detentions which is the same was we have seen historic fli cuba over the last three years. i mention that because i want to get specific here for a moment as to how you intend to evaluate cuba's progress on the human rights and use our tools at our disposal to advance that. i use as an example the osce which is a consensus organization without enforcement and yet it's known globally for the commitment to advance human rights much it's linked to the groups. i'm not aware of it having the same effectiveness in terms of advancing human rights. how do you intend to use the oas? how do you intend to use the

united nations now that we removed this obstacle, as you see it as for having credibility to raise these issues? how do we intend to use u.s. leadership to advance human rights progress in cuba and how can we evaluate what we're making progress in that area? >> senator, thank you. i think there are a couple things. first, there's no doubt that we will continue to write human rights reports that are honest and unflinching in what they describe as going on in cuba. that there continue to be these

short term detentions that should not be going on, harassing individual human rights activists groups, prevebting them from having their rights exercised. and so there is a range of tools. one of which the president highlighted in terms of speaking out. but we also now have another tool at our disposal which is direct engagement including the human rights dialogue which will move forward. there is no doubt from the preliminary conversations we've had that we have very different views of human rights and universal internationally recognized human rights. in addition, in terms of international organizations and our ability effectively in those organizations, yub is suspended from the oas. they have been since 1962. but the questions of looking at human rights issues in cuba as ambassador shannon said, whether they are living up to the commitments that all of the rest

of us have made in the hem is fear through the interamerican charter and human rights, those are tools which we are more able to use, reference and discuss with our partners who i think are much more engaged in having that discussion with us post policy engagement. >> how would that be reflected? i understand that. i said that in my opening comments. how come we know that we're making progress? what specific agenda items do you intend to do? and what allies will we have it hold cuba accountable? >> obviously, the best metrics of progress is on the ground in terms of, you know, whether it's a reduction in short term detentions or a growing ability by cube abs of all stripes to be able to speak and be able to exercise their democratic rights. i think the president was pretty clear on our also understanding the change is not going to come to cuba overnight. as we work on this, we have to understand that empowering

cubans and to take their own responsibility for these rights there will be progress and there will be setbacks. we will speak out about those. we'll work with other countries in the various international organizations. i can't tell you exactly what the agenda, where we'll talk with other countries. we'll certainly do so at the oas. we'll do so in the u.n. bodies. whether that is the u.n., human rights council or other instruments such as those. >> what leverage will we exercise over cuba in regards to our expectations that they will make progress on these internationally recognized human rights standards? >> i think one of the things

that is most important is the ability to have embassies and to carry out the functions under the vienna conventions to travel around cuba and to be able to citizens which we've not been able to do up until now. and that is critical that our diplomats also be the first-person observers of things, which hasn't been the case in the past. that is, obviously, something that we're working on right now. >> what countries in our hemisphere do you believe you can work closest with in putting pressure on cuba to comply with internationally recognized human rights? >> well, i think the ambassador may have more to say about this. my own view is there are many countries in the hemisphere will that work with us, whether it's publicly or behind the scenes countries that are committed are obviously democratic countries committed to human rights, countries around the hemisphere such as costa rica and u.r.ruguay

and will be in conversations with us. but in in the region in the caribbean, in central america will be working with us on this, committed to the same principles. >> thank you. thank you, mr. chairman. >> thank you both for being here. secretary jacobson, before i get to my questions i wanted to ask, you discussed that we were in these discussions with the cubans and we have distinct views on human rights and i don't mean to say this is what you meant but let's be clear. these are not distinct views that are legitimate. that is view of human rights we have and a view of under human rights they have which under no circumstances fits under any definition of human rights. their views are not legitimate, they're immoral. the notion that you can round up people and arrest them because they disagree with the government, the idea that you can send thugs to panama to beat up democracy advocates you

would say their views are flat out wrong and immoral in their views is. are. >> we have said clearly we don't think those views accord with international standards and the universal declaration of human rights? >> so the cubans are flat out wrong? >> on repressing people's rights to free speech we think there's no equivalence. >> there's no moral equivalence between our view of human rights and theirs? >> that's not what i was trying to say. >> i wanted to get that clear. let me talk about travel. that's a big part of what everyone's talking about. the truth, is going from "hotel" magazine, they wrote that gaviota, sa owned by the cuban military and a prominent citizen of groupo which controls the entire cue man economy it's also the largest hotel conglomerate in latin america and the caribbean. it has hotel holdings equivalent to the walt disney company.

it's run by raul castro's son-in-law. let me read you something mcclatchy newspapers wrote about this network. "tourist who sleep in some of cuba's hotel fill up their gas tanks and even those riding in taxis have something in common -- they are contributing to the cuban revolutionary armed forces bottom line." in essence recognizing that if you travel to cuba, if you stay in a cuban hotel in all likelihood you're staying in a hotel run by the cuban military. if you rent a car, you're rending it from the cuban military, if you fill up your gas tank, you're filling up from the cuban military and i would add if you stay in a hotel you are staying in all likelihood in a confiscated property a land that was taken from a previous private owner never compensated for it. in essence, when you travel to cuba and stay in one of these hotels not only are you putting money in the hands of the cuban government you're trafficking in stolen goods because it's a property that belonged to a private holder, some of them american citizens who were never compensated for it.

so when we talk about increased travel to cuba and more commerce through cuba through travel what we're talking about is increased business ties with the cuban military for the most part. is that not an accurate assessment at this time? >> it is certainly accurate that cuban state, including the military runs many of those -- a large percentage of the hotels and other infrastructure. we also now have an increasing number of casas particulares, people's homes, airbnb working on that and private entrepreneurs moving into spaces to support the purposeful travel. >> so why wouldn't we limit our opening to say if you travel to cuba you can only say at one of these casa particulares or one of these non-government non-military owned facilities? why wouldn't we as part of our opening say you can travel to cuba but you cannot stay in a property that was stolen and you cannot stay in a property owned

or operated by the cuban government which includes even the foreign flagged hotels because they have majority ownership there as well. >> senator, our strong belief is though we are aware that thereby will be some financial benefit to the cuban government by the larger number of americans going cuba, the benefit of those larger numbers, which could not bt be supported only by individual homes, for example, the benefit to the cuban people of this larger number of americans going far outweighs the increased economic benefit that may accrue to the cuban government. >> just to understand clearly and bottom line is you agree that if you travel to cuba you are staying in all likelihood in a stolen property that is in all likelihood run by the cuban government. but that said, the fact that there's going to be americans present there outweighs the benefit -- the benefit of having americans travel and interact with cuba outweighs the economic

benefits going directly to the cuban military? >> i would say that it's possible those properties are confiscated. it's certainly the case that many of the properties are state owned. but we do believe that the benefits outweighed -- >> which property, other than the private homes that you talked about which are also largely state owned as well but at least an individual is running it, other than the private home which is is a still very small sector of their economy, which cuban hotel is not owned or operated -- which cuban hotel is not owned by the cuban government. >> i said that i assume most of them are state run especially because the joint ventures even joint ventures are -- >> then all of them are state run. is there any private hotel in cuba? >> i don't know. but i assume there are none. but as i say there are these bed and breakfasts in individual homes. but, again, i think the premise on which we're basing this is that the benefits of engagement, purposeful travel, are very, very great to the cuban people

and seen overwhelmingly by the cuban people as a benefit to them as surveys show. >> well i want to talk about the internet for a moment. cubans, as you said, have blamed the u.s. for lack of access to the internet and so forth. it's been couched as a lack of capacity. in fact, the cubans say our own president has said "unfortunately, our sanctions on cuba have denied cubans access to technology that has empowered individuals around the world." but i think you know that that's not true. for example, there is no japanese embargo on cuba. there's no south korean embargo on cuba yet those technologies are not widely available either. is it not true that at the end of the day access to internet in cuba is not simply a function of capacity, because there are multiple other countries around the world that do not have an embargo on cuba that can provide cell technology or internet technology. is it not true that the vast majority of the impediment to access to the internet and technology in cuba is as a result of cuban government censorship? >> i think the denial of access

has been both one of policy and one of -- in terms of american -- access to american products also one a policy of the united states. we're taking one of those two things away. they are now able to have access to u.s. products, which we always believe are the best in the world, and that leaves only policy. >> i understand. but there are still other countries -- i have a samsung. why isn't cuba awash in samsungs? why isn't all these other countries around the world that don't have an embargo on cuba, why haven't they been allowed to come in and offer wi-fi and the things that developed countries have? in essence, it's not a capacity issue. the reason why people in cuba don't have access to the internet ultimately is because the cuban government won't allow it. >> well, there is a question of infrastructure that needs to be present to utilize the -- >> but other countries could have provided by that. >> they could have. so policy is clearly a big part

of this and we don't know whether that policy will change. they have said they want to modern ides their telecommunications seconder. >> so why didn't they do it with the japanese, the koreans, the germans or any other number of countries around the world that have internet and technology capabilities outside of the u.s. capabilities? >> i'm hoping they want our stuff. and that we will be able to compete well. but we also see on the island many samsung phones many other cell phone technology of the latest make but it's not connected to anything yet. >> well, it's connected to the cuban government internet telecommunication. >> and that will be the question. can they open to something that allows their economic development to be -- enter the modern world and connect cubans to the world? >> senator boxer? >> mr. chairman thank you. and senator car bin asdin as the

ranking member on the latin america subcommittee, senator rubio as my chairman i want to thank the committee for looking at this. when you listen to my colleague, you think this was the only country in the world that we have relations with and we're starting to have relations with where the state owns hotels. a lot of my colleagues -- maybe all of my colleagues on the republican side, i can't be sure, but i think -- voted to go ahead with a free trade agreement that includes vietnam an out and out communist country that pays a minimum wage of 70 cents, that owns all the hotels trust me. with but yet and still we have relations. and the reason we have relations are geopolitical reasons. that we want to work to change these places. so i think my colleague with his line of questioning has really proven the point because russia a lot of russian hotels are owned by the country china, are

we going to start telling people what hotels to stay in in china and russia and vietnam and cuba? come on! we don't do that, we're not an authoritarian country. if people choose to stay in an airbnb in cuba that would make me happy. that's a san francisco-based company and i wanted to mention that i'm very proud, they're one of the first u.s. businesses to take advantage of new economic opportunities in cuba. that my colleagues some who sit on this committee, would take away. and in march, a new jersey-based telecommunications company announced an agreement to provide direct international long distance telephone service between the u.s. and cuba. so relatives could talk to each other. these companies have an opportunity to make an incredible difference in the lives of everyday cubans by connecting them to the outside

world. now, there's plenty of problems and challenges that we face, there's no question about that. and i was going to ask you, ambassador, if -- or assistant secretary jacobson, what have been the greatest areas in progress in the talks so far with cuba and what can we expect from this upcoming round of talks. if you could be brief and concise, because i have a bunch of other questions. >> i will thanks. i think the greatest progress so far is just the acceptance by both sides that we do want diplomatic relations, that we want embassies. and our understanding that we will be able to operate in cuba in a way that allows us to engage with more cuban citizens. that is incredibly important and we see that as really critical toll this whole engagement process and i think in terms of

what we will talk about tomorrow, it's really getting the rest of the agreement for an embassy that operates similar to the way we operate in other -- in some other countries. >> thank you. assistant secretary you testified at a subcommittee hearing senator rubio and i held in february about the impact of the president's new policy on human rights and democracy in cuba and i asked you about the impact of the president's new cuba policy on u.s. relations with other countries in the region and the world. and you answered then that the reaction was immediate and extremely positive. those are your words. i was very pleased about that. now, we also discussed, then, the importance of engaging regional partners on issues related to human rights. has the administration been able to leverage regional and international support for its new cuba policy to increase pressure on the castro regime for its blatant violations of

basic freedoms and systemic repression and abuse of its citizens? has there been any success so far in engaging our partners on those issues? >> well, i thank you, senator. i do think that we've had conversations, certainly, with many of our hemispheric partners in a have been much more productive than they were in the past. i certainly would second what senator cardin said act the fact that in panama the president was able to have a round table on civil society with president vazquez of uruguay and president soliz of costa rica which included two cuban independent dissidents as well as 12 15 others from around the hemisphere. that's something very unusual. they would not necessarily have sat with the u.s. president to do that before this policy change and the cuban dissidents who were there were able to connect with colleagues around the hemisphere which wasn't possible in the past.

i also think the reaction of the panamanian government to things that happened in panama, including government-sponsored non-governmental organizations preventing the full exercise of freedom of speech in the civil society forum was very forceful on how democracies operate and that, too, was a change from what we've seen sometimes in the past. >> well, i think fact that our regional partners got to actually meet human rights advocates is very, important because a lot of times, you know, see no evil, that's it. but having spent time with them i think is critical so that's a very good report. now, cuban president raul castro has said he will step down in 2018 following the end of his second term. this means for the first time since 1959 cuba will not be led by one of the castro brothers.

reports indicate that president astro's grooming his first vice president miguel diaz canal to succeed him. can you talk about the importance of this transition of power in cuba and could you shed light on this first vice president? >> i'm not sure i can shed that much light in this area. what i can say is i do think that a transition that is taking place is not just one of -- you know, a normal or even cuban election that is taking place in 2018, it's a generational change and the exit of either of the castro brothers is very very significant. there are changes in the way that elections are going to be done in cuba, still not what we would like to see in a free multiparty election. but i do think it's going to be significant. obviously vice president diaz

canal is the next generation of leaders. we have not met with him, i have not met with him but many of you who v who have gone to cuba. >> mr. chairman, i will close with this. i think 2018 election is a real test for us in a way because if we can focus on democracy and freedom and fairness it's a very specific thing we can work on and i'm going to work on that myself. in closing, my i put my opening statement in the sflord. >> without objection. >> thank you, mr. chairman, secretary jacobson i want to talk about the legal authority president obama is using to take his actions. in 1996 in reaction to the cuban downing of two civilian aircraft, congress passed the cuban liberty and democratic solidarity act of 1996 called

libertad act. the primary purpose was number one to assist the cuban people in regaining their freedom and prosperity as well as enjoying the community of democratic countries flourishing in the western hemisphere and the third someone to provide for the continued national security in the united states in the face of continuing threats from the castro government of terrorism and theft of property from the united states nationals. that was the purpose. now i think it was noteworthy about the act is it cod paid to all restrictions under the cuban assistant control regulations that were enacted by or promulgate bid the treasury department in 1963 and codify it had cuban embargo and what is note war sthi this has long lasting effect on u.s. policy option towards cuba because the executive branch is preventing from lifting the economic embargo without congressional

concurrence until certain democratic conditions set forth in law are met. let me talk about specifically what those conditions are. in section 203, it says that the -- upon making a determination under section c-3 that a democratically elected government in cuba is in power. the president shall upon determining the democratically elected government in cuba is in power submit that to the appropriate congressional committees. so let me first ask, has the president made the determination that a democratically elected government in cuba is now in power? >> the president has not taken actions under those aspects of the libertad act. so he has not eninvoked that part of the libertad act. >> so he doesn't feel like he has to refer to the libertad act

or -- what is he doing if he's not basically lifting the embargo? what is this? how is he skirting it? >> i think the president's made very clear that congress is the only body that can lift the embargo and as he said in his state of the union message he called on congress to do so. therefore he's made clear he does not have the authority to lift the embargo. >> but what's he doing? it just seems like a lifting of embargo to me. >> what he's taken are executive actions and regulatory changes within the executive's purview with the embargo still in place. as you know, there were for years exceptions and continue to be exceptions to the embargo on agriculture. his changes mare ss make telecommunications exceptions and to support the private sector to cuba. those are the exceptions within the embargo that are within the executive branch's purview?

>> do you agree with the primary purpose of that act, which i read earlier, basically to ensure the freedom and prosperity of the cuban people and enhance the national security of senator john kerry do you think that's the two primary policy goals of this country toward cuba? >> well, certainly the president's made clear that what we want is a democratic, prosperous, and stable cuba which i think is very similar to what niece that act. the question of our own national security should always be paramount in our decision making. >> ambassador shannon i was struck by your comments about -- kind of your attitude that democracy and freedom is flourishing in central america. you know, certainly we have some good exam millions in colombia because of courageous leadership but i'm not seeing democracy flourishing in venezuela or cuba for that standpoint. can you help me out in terms of what you're talking about? >> there's no doubt that democracy is not flourishing in cuba. it's part of the president's

effort to pursue a new approach to see what more we can do to help the cuban people begin their own political opening. but as we look back over the last several decades, what's important to remember and acknowledge about our hemisphere is this was a region that was largely ruled by authoritarian governments, some military, some nut. but which has found through its commitment to human rights and through its ability to organize and use inter-american institutions like that inter-american human rights commission and the inter-american court of human rights to develop civil societies around human rights issues and use that to build democracy and whether it's chile in the 1980s, whether it's our work in central america to face down insurgencies and move military governments to allow elections to take place for civilian governments to take over, whether it's what we've done in colombia, whether it's the transitions to civilian and democratic government in argentina, uruguay and brazil i

think this hemisphere has distinguished itself over the past three decades -- >> okay okay. i'm running out of time here. it seems that the primary purpose is to provide the continuing national security to america, is anybody going to make the case that the castro regime has been helpfully promoting democracy and freedom in this hemisphere? is it not true that they are still supporting farc in colombia. that they are supporting the repressive regime in venezuela? isn't that true secretary jacobson? >> well what the what the cuban government has done and we asserted in the report we sent to congress is the support for the farc that we have seen recently is support for the peace process that's going on in cuba between the farc and the colombian government. obviously that was not always the case in the past but at this time we think they are playing a constructive role in that peace process.

in venezuela it's a different issue. but i think in many areas we do not see cuba in national security terms, we believe the engagement with cuba through diplomatic relations will be far better for our interests than the previous policy of isolation. >> the other purpose, to assist the cuban people from regaining their freedom and prosperity, as senator rubio is pointing out the u.s. is basically the only country engaged in an embargo. cuba has been able to trade freely with the rest of the world i'm not seeing the flourishing of prosperity as a result of that engagement. how in the world do we think okay being able to trade with the u.s. will improve their prosperity at all under the repressive regime of the castros? >> well, you're certainly right that their economic system has not made them a magnate for the trade and investment from other countries that that they're able to have. in other words, other countries could have invested and been trading with them more than they are. but cuba has to change to make

that possible. but they have been able to promote a narrative of the u.s.'s embargo and isolation from them as the reason for those economic problems. we have now take than excuse away and so it will be obvious that the problems are the lack of movement in their system. >> thank you, madam secretary. >> thank you senator. senator menendez. >> mr. chairman, today is the 113th anniversary of cuban independence day. it is a bittersweet date given the cuban people's languishing for more than 55 years under a dictatorship. as assistant secretary jacobson reopens negotiations between cuba and the united states tomorrow, let me be frank -- i have deep concerns that the more these talks progress, the more the administration continues to entertain unilateral concessions without in return getting agreement on fundamental issues

that are in our national interest and those are the cuban people. so i know you said? response to another question these are not things we negotiated they're things we decided unilaterally but i really can't believe that. the cubans, castro, said you want a relationship you've got to return the three convicted spies. the three convicted spies of the united states, including one who is convicted of conspiracy to commit murder of three united states citizens in international airspace. check, we gave them the three spies. you want a relationship? take us off the list of state sponsors of terrorism. check, we gave them that. you want a relationship? stop or change the democracy programs that we do throughout the world because we don't like those democracy programs because they're interfering to our totalitarian regime. so i wake up to an article that says from reuters u.s. signals it could change pro-democracy programs in cuba, that havana objects to cuba has long objected to the pro-democracy

program which includes basic courses for my friends sitting in the press in basic journalism and information technology to the u.s. diplomatic mission in havana. check. bring us to the summit of the americas, even though cuba violates the democratic charter of the oas, and your people say it doesn't matter who's invited to the table, it's what's talked about. but guess what? the democratic charter the message that is sent to the hemispheres, you can violate the democratic charter and still be part of the club, so why not violate it if you think you're compelled to do so? pretty amazing. you know i have not seen any movement at all towards greater freedom. as a matter of fact, i like to commend the committee's attention to someone inside of cuba, a cuban blogger in the daily beast cuba's 12 most absurd prohibitions that tourists will never see. and i'm going to read a cup, mr.

chairman. cubans can't access the internet from their homes or on their cell phones. not because in fact, even technology, infrastructure, is not the case they can't access because the government won't let them because information is a problem. so yeah, they want to perfect greater infrastructure, but for them to control it. you can't live in havana without a permit. ar t blogger goes on to say can someone from l.a. live in sfwhashds the washington, d.c.? the answer is yes but you can't live in havana without a permit from the government. no public demonstrations are allowed. imagine that. no political parties are allowed except the cuban communist party. no investment in median and large enterprises. no inviting a foreigner to spend a night without a permit in your own home. and, among many others something as absurd as you can't bring from abroad 25 artificial fingernails in violation of the

law. i ask unanimous consent that the full article be included in the record. >> without objection. >> so here we are, human rights abuses continue unabated with more than 1600 cases of arbitrary political arrests this year alone only five months into the year. so president obama may have outstretched his hand but the castros still have their fists real tight. you and secretary moll now ski came before this committee and heralded there was a downturn. guess what? we're skyrocketing back up in human rights violations and political dissidents being arrested. including the rearrests of the people you negotiated to ultimately be released. several of them have been rearrested. now, despite the desire to move in a different direction, i see we get nothing in return. we still have -- you have taken cuba off the terrorism list. well, john chesimar on the

fbi's ten most wanted terrorist list for murdering new jersey state trooper, charles hill wanted for killing a new mexico state trooper and hijacking a u.s. civilian plane, they're both living in cuba protected by the regime. the regime says, yes, we'll talk to you. we'll talk to you even though your counterpart has already said she got political asylum and she's not going anywhere but we'll talk to you about it. we'll talk to you about it. so they'll talked a infinitum. so i just don't see it. so let me ask -- and i hope my kwleegs are so passionate and i listened to them about democracy and human rights in many parts of the world -- in burma vietnam, and a whole host of places in the world but are almost silent when it comes to cuba. somehow democracy and human right there is is not as important as other places in the world. i hope we can keep the same standard. let me ask you, madam secretary. to your knowledge were you or any member of the state department told not to push for

sanctions on cuba in violation of sending migs and missiles to north korea, in violation of u.n. security council resolutions? the types of missiles that in fact were in the hull of a cargo ship full of sugar. being hidden where the migs of cuba were taken off to try to hid it. were you told not to push or to your knowledge was any member of the state department told to push? >> not that i know of. >> did the u.n. sanction cuba. >> they did not. >> they did not. let me ask you this. in the list of state sponsor of terrorism, you got a letter that says that in fact haas not, never did. oddly the castro regime's assurances asserted the government of cuba has never -- this is in their letter and you in the state department quoted it has never supported any act of international terrorism and that the cuban territory has never been used to organize,

finance, or execute terrorist acts against any country, including the united states. do you intend for members of the committee to believe that the castro regime never supported any acts of international terrorism over the last half century? >> senator, i think that what's crucial is that the -- >> no, not what's crucial. answer my question. do you believe -- do you want this committee to believe that the cuban government has never sponsored any act of terrorism over the last half century? >> i can't say that i would urge you all to believe that it has never occurred. no. >> well, because i hope you don't mean to suggest that the historical examples of providing support to former armed insurgents in the 1980s, including the m-19 in colombia, if ifsln in nicaragua or the fact that the cuban military didn't shoot unarmed civilian planes carrying american citizens over international water for which

there are pending indictments from a united states jurisdiction against several individuals in cuba which i'm wondering are you pursuing that in your negotiations with cuba about them answering those indictments? >> that is why we're going to have the law enforcement conversation for the justice department to be able to pursue. >> do you realize who some of those indictments are against? >> yes, sir. >> and do you think you're going to engage in a conversation with them responding to justice. do you think the castros are going to say yes, we're going to appear that a court. i don't think so. let many ask you one last question if i may, if i may have the chair's indulgence. you know, you all came here and said that oh, there's a reduction of political arrests in january as a sign that the administration's cuba policy was achieving results. not surprisingly, these numbers climbed dramatically in the insuein

ensuing months with 450 arrests in february more than 600 in march, more than 1600 political arrests in total during the first four months of 2015. 1600. in the first four months of 2015. now, as i'm sure you know, this past sunday more than 100 activists in cuba were violently arrested including 60 members of the women in white represented there by berta soleil following their attendance at a church service. so i guess berta was right when she said the cuban government will only take advantage to strengthen its repressive machinery. because all these women were doing is marching in white with a gladiola to church. and the result of that is to be beaten and thrown into prison. that is not success. so i don't get it. so the final thing i'll say mr. chairman, i have a lot of other questions but in deference to my colleagues and i appreciate it

is that this is a one-sided set of circumstances. i don't know what we've gotten in return. we have gotten nothing in return. but the cubans have gotten plenty in return. anden if that's our way of negotiating, then we have a real problem on our hands and the message we send in the western hemisphere, in venezuela where we have -- i don't see our partners engaging with us because we've changed our cuba policy. this opens the door towards promotion of democracy. we're not seeing very much democracy in venezuela. i'm not sure about it happening in other places in the hemisphere for which we have challenges as well. and so i think that that is a hollow promise based on what we see and i appreciate the chair's courtesy because of my interest in this. >> thank you. senator? >> thank you, mr. chairman and thank you both for being here today. this is an important topic. in my career, i've watched and seen the u.s. strategy of engagement in various parts of the world -- china vietnam dominican republic, haiti to mention a few.

it's worked in some; it's not in others. i echo what senator menendez just said about venezuela. we buy $32 billion of oil ay, we haven't affected their regime one iota that i can see. i have three concerns about what we're talking about today with regard to our changing our relationship with cuba. one is their continued support of terrorism. twoch is their human rights record that continues today. and three is their activity in arms smuggling. and we'll get to those in a second. i have a very short question i hope you'll be brief. in 2003 cuba allowed iran to operate on their soil, we know about the attack on u.s. telecommunications. cuba is reported to have supplied intelligence services to venezuela recently and its allies. cuba was providing assistance and safe haven to terrorists including members of farc and the bask eta. they continue to harbor fugitive, one in the u.s. including a fugitive today listed on the fbi's most-wanted terrorist list.

cuba's helped islamic extremists including members of hezbollah slip into north america unnoticed. a cuban state-owned enterprise provided by venezuela with advanced technology they that used to provide illicit u.s. passports, visas and other documentation to 173 individuals from the middle east between '08 and '12. that's ancient history according to the administration. but let's talk about recent history. just since president obama started these secret negotiations with the castro regime since june, the 2013 there have been reportedly 15,000 political arrests. 2,500 such arrests just since the president's speech on u.s./cuban relations in december. and to make it worse, between february and march of this year alone cuba's increased the number of politically motivated arrests by 70%. as troubling as that is i'm even more troubled by cuba's continued nefarious activities with regard to arms smuggling. we know about the earlier shipment of 240 tons of military

equipment confiscated on the way to north korea. but we aren't talking about february 28 of this year, 2015, a chinese-flagged vessel was intercepted in cartagena. over 100 tons of explosives 2,.6 million detonators, 99 projectile heads and 3,000 artillery shells. this was bought by a -- bought from a chinese arms manufacturer named norinko on behalf of a shadow company from the cuban military. the question is, with this type of activity, what assurances can you give us, mr. ambassador i'd like you to take a shot at this first. with this kind of continuing and current activity, why should we be optimistic that just by opening up economic relations with these people this regime that this type of activity will change? >> thank you very much senator. and i can assure you that just by opening up economic activity we will not necessarily change

behavior. it's a longer process than this. but in regard to the larger diplomatic environment and assistant secretary jacobson can address the more specific issues, in regard to the larger diplomatic environment, the fact that these ships were stopped was significant. the fact that they were inspected was significant. the fact that these items were found is significant and shows an ability to cooperate with our partners in the region to control and monitor this kind of activity. and this will deepen with time as people understand that the broader purpose of our diplomacy is not simply to normalize relations with cuba and build a relationship with cuba that will change how we try to promote our interests and democratic values but that it's also about how we enhance the integration and cooperation inside the hemisphere and partners of ours who have been leery of working with us around cuba issues

because they do not want to get caught into the vortex of a very powerful and historic animosity are going to be more open to engaging with us on this kind of activity. so i believe that we're actually going to be able to do more in the area of security. we're going to be able to do more in the area of non-proliferation. we'll be able to do more in the area of finding drugs because of this. >> can i ask a follow up on that mr. ambassador? so to follow up on senator menendez, why wouldn't we make that a prerequisite, that better behavior would lead to open economic relations? or madam secretary either one. >> i think, senator, if i could the real -- we all want the same end. it's a question of how we basically motivate that behavior or how we -- how effectively we can help support change. the president believes firmly that the efforts we made in the past, which were in fact, to say you must change first and

then we will engage just didn't work to make the changes inside cuba. >> may i ask you a question on that? >> certainly. >> we have evidence, though cause and effect, of several other countries, britain, canada, others, having open trading relations with cuba. we're the only one really embargoing and yet that engagement has not changed behavior. so what makes us believe that today our opening up of economic relations with cuba will actually have that effect? >> i mean, i think that's a fair point. and we don't know yet what the effect of this policy will be on the cuban government. we do see already the effect, the beginning of the effect on the cuban people while we decry the detentions of the activists, we know there are cubans who are benefitting from this new policy in their independent businesses and in their belief that they're going to prosper and have a better life because of engagement with the u.s. the other thing i would say is

i'm very engaged with my e.u. counterpart and with my counterpart in spain in working with them so that we can now work together and when we work together not just with our regional counterparts but with our european counterparts that is more powerful. and i think that could have a more galvanizing effect. but it will be slow. i don't deny that. >> thank you. thank you mr. chairman. >> senator? >> thank you mr. chairman, and to the witnesses my colleagues have asked great questions about the particulars of u.s./cuba discussion. i want to talk about the region. the americas and the caribbean are 35 nations i guess by the general account nearly a billion people. if i do my back-of-the-envelope math, 35 nations means about 600 bilateral relationships between the nations in the region. some of the bilateral relationships are strong and friendly some are weak, they're

warm, they're cold and they change over time. is there any other bilateral relationship in the americas that does not include normal diplomatic relationships other than the united states and cuba? i'm not aware of one, but you guys are the experts? >> no, sir. >> so this is the only one of the 600 bilateral relationships in the americas that does not involve a normal diplomatic relationship. let me ask you this -- i'm not aware of any war between nations in the americas our two continents right now, between nations. am i right about that? >> you are correct. >> and the only civil war -- there are security challenges obviously, of many kinds because we're 35 nations and a billion people, but the only civil war right now in the region is the war between the colombian government and farc and another smaller terrorist organization that are is currently subject to a negotiation that cuba is hosting where the u.s. is playing a role accompanying the

colombian government correct? >> right. that's correct. and we're not accompanying but have this special envoy now and it's also the longest-running civil conflict in the hemisphere. >> i don't want to get ahead of myself but if that negotiation works out positively and we are then -- we have the ability to be two continents, all americans, without war, without civil war and without war between nations, that would be pretty unusual in the history of these two continents, wouldn't it? >> it would be an historic achievement. >> and it would be pretty unusual given other continents. wars or civil wars in asia, wars or civil wars in africa. sadly, wars or civil wars in europe. you talked in your opening testimony about the increasing trade in the americas you know, the majority of the american trade agreements are with nations in the americas. there's more trade between the nations in the americas. there is -- there has been a move in the last 30 years from

governments that have been autocratic or military toward democracy. again, no that the there aren't challenges, not that there aren't problem children we're human beings after all, there are going to be challenges. you each have spent your entire professional careers working in the western hemisphere. that's what you've devoted your professional lives to. tell us what it means to the united states of america to potentially be the anchor and the leading nation in two count innocents with no war no civil war, complete diplomatic relations, and an ever-increasing trade and interdependence. talk about what that means to the united states of america. >> senator, i think those are incredibly important points and for me one of the things that i see in this hemisphere is not only the hemisphere's importance to the united states and to our people daily whether it's

trade, familial ties, the growing influence and culture that we share and the way in which the values in this hemisphere are the same as ours, but i also see this as a model with so many flaws that still have to be overcome and challenges that we all face and inequalities of systems and democracies even where they exist. but remember that in the transition from military to civilian government truth commissions and the process of that was first done in this hemisphere with argentina, a model that then south africa looked at and eastern european countries looked at and other countries have looked at in the arab world now. remembering also that the terrible adjustment of the '90s on macroeconomic issues were things that this hemisphere went

through first and now with the free trade agreements the broadening of those economic change changes to be greater social inclusion and ensure that everybody is included in those benefits is taking root here first. so i think it isn't just what we do for ourselves, it's what we are then able to do elsewhere, including working with these partners increasingly capable on global issues that matter to us from climate change to the middle east to peace keeping where uruguay per capita is the largest contributor of peacekeepers in the world. so i think it's not just a phenomenon that we will be proud of here but one that is, in fact, projecting outside. >> if i could just add briefly as we look out on to the globe and see some very demanding and in some instances frightening security challenge, to have a

strategic enclave in our own hemisphere where we are fighting no wars, facing no significant insurgencies or terrorist groups and are able to have commerce both in manufacturing and services but also in political dialogue is a remarkable thing and a remarkable accomplishment. and to have examples of societies that have moved from authoritarian government to democracy, have moved from closed economies to open economies, as i've noted is a confidence builder for other countries around the world who are facing similar challenges because our hemisphere has shown that democracy is not a status quo power structure. it's not about preserving privilege, that it's about addressing profound social problems and doing so in a peaceful way a transformative way. so i think we have a remarkable platform in the western hemisphere from which to engage the rest of the world. and as the assistant secretary noted and as i noted in my

testimony, this is a region moving from globalized isolation to global engagement. in many ways one of the most interesting stories of the first half of the 21st century isn't going to be inter-american relations, it's going to be how the americas relate o wwith the rest of the world and the fact that we have four of our free trading partners being part of the transpacific partnership and looking for ways to transform their own economies by reaching across the pacific into asia and doing so as democratic countries that support open markets, that support free trade and support the international institutions that regulate trade is a dramatic accomplish mtment and will have an impact on the larger economies in south america that have yet to sign up for these kind of larger agreements. so we are at a moment of strategic momentum and if we are able to show that this hemisphere can function hemispherically around establishing priorities and building approaches to those

priorities and if we can show that through our dialogue we can present a consolidated face to the rest of the world we will have done something remarkable. >> i thank the witnesses for their testimony. thank you, mr. chairman. >> thank you, sir. senator flake. >> thank you, mr. chairman. i want to thank the chairman and ranking minority member for scheduling this hearing.in informative and an area where there's much interest here. i want to thank the witnesses and i want to thank them particularly for explaining that this new policy is not a reward for good behavior on behalf of the cuban government. obviously there are huge concerns in terms of human rights that need to be addressed. but i appreciate clear-eyed vision of that that the administration holds. and if you could just explain, ms. jacobson is it easier to have those discussions with regard to human rights or

perhaps negotiating for fugitives from american justice if we have diplomatic relations and have better relationship and better contact than the situation as it has been? >> it's only possible, really, within a policy of engagement. those were things we couldn't do before. >> thank you, that's important in this discussion, i think. we often think well, you know, is this a guarantee now this greater engagement that any improvements will be in the offing? that assumes that we have a good policy now that is yielding benefits and we haven't for about 50 years now now at least there's a point that we might make improvements and see increased freedom for the cuban people so i applaud the administration for taking this position and pursuing this. let's turn travel for a minute.

it was said before that when people traveled some stay in hotels owned by the government and therefore revenue will flow to government. there's no doubt that will happen. but it's significant as was mentioned by senator boxer that companies like airbnb has gone to cuba. this is a web site that books travel, mostly bed and breakfast for people in their private homes. i was looking at it while we were here. if you just control down they have now i understand more than 2,000 listings in cuba. a bit of perspective it took them months or -- ory years in some of their other markets like san francisco to get up to a thousand listings. you've got 2,000 listings i think, and this is just i think, a thousand over just about 50 days. so it's very significant and for the most part or virtually all

of these listings are people in their homes, people who will benefit from visits by americans and others and that there's less of a chance or less of that money certainly will flow through government. nobody denies that increased travel will increase revenue that goes to the cuban government but at what cost to the cuban government? i've always felt that if we lift some of our restrictions the cuban government may seek to impose some of their own because obviously they want the revenue but they fear the -- they fear what else the freedom that might come with increased travel but i've often also said that if somebody's going to limit my travel, it should be a communist. that's what they do. not our own government here. that's not our purview, that's not our prerogative to limit the travel of americans. so with regard to cuban-american

travel i think it's significant. the president lifted some restrictions a few years ago. ms. jacobson could you -- or ambassador shannon, what has happened in that regard in terms of increased travel over the last couple of years with the policy changing with regard to cuban-american travel? >> thank you senator very much. i think it's clear that in the regular tear changes that the administration has made over the last few years to increase the ability for families to see each other, for cuban-americans to go to cuba as well as the changes most recently in december. there have been many more cuban-americans traveling, there have been -- certainly it's been critical to us i think to ensure that remittance amounts go up and they did quite dramatically in the most recent regulatory changes because in many ways they have been the

capital that has founded some of the most important private sector emergence and will almost certainly continue to do so including some of these private homes that are serving on air bee and bee airbnb. people who want to run their businesses in areas that the cuban government will permit but don't have the resources to do so and can be helped by folks in the united states. >> thank you. as one who's traveled frequently to cuba over the past 15 years, i can tell you for several years there it was tough to see any change or progress because the cuban government it seemed that they would loosen controls when they needed to and then tighten them again. but traveling there over the past couple of years there's been a significant difference and i think it's because of the increased travel particularly by cuban-americans that you see the type of the entrepreneurship that has been allowed but will

likely continue now much tougher to turn and reverse. that's certainly the feeling that those of us who've traveled down more recently have gotten and i think that that will only increase increased american travel. like i said before, there are no guarantees that anything will happen. but change is more likely to occur with increased contact from the u.s. let me touch on diplomatic relations and the appointment ultimately of an ambassador to cuba. how will that help with regard to those who do business leadly americans who do business legally in cuba under the new regs and increased number of americans who travel. what benefits will they have if we have full diplomatic relations that they don't have now? >> well, obviously our internext cuba already provides some services in both those areas. but i would say that having a u.s. ambassador having full diplomatic relations is always

much better in terms of being able to engage with governments hat a highest level, the representative of the president and being able to advocate for those businesses, u.s. businesses that can operate legally, being able to advocate for them against competitors. being able to support americans while they're there. it's also critical to us that we have sufficient staff to be able to support the influx of people and americans going to cuba so we can provide those services. we can only do that with full diplomatic relations. >> in closing mr. chairman i want to thank the minority member for mentioning the freedom to travel act which that has the sponsorship of the majority on this committee i think 10 of 19 and i look forward to pushing that forward. thank you, mr. chairman. >> thanks for your interest in this issue senator udall? >> thank you very much mr. chairman really appreciate you holding this hearing and doing

it, you and senator cardin, in such a balanced way. i appreciate that. i'm honored, senator flake to be on your freedom to travel bill. i think one of the things that is so important is opening cuba up to travel there couldn't be better ambassadors than our citizens going to cuba and visiting and showing what we're all about in terms of democracy and human rights and those kinds of very very important values. i want to say i support this policy of normalization. i think we're turning the page on a failed policy that's been going on since the early 1960s. we're moving to empowering the cuban people empowering cuban entrepreneurs entrepreneurs. i welcome this chapter of normalized relations. it was mentioned earlier and you

were asked several questions, i appreciate you both being here and your hard work over the years in this area about the private sector. i have looked for reports on what's happening down there and i think it's fascinating in terms of the dramatic growth in the private sector. a 2013 brookings report -- now probably more because that's an old report -- is looking at close to a million classified as private sector. you have 500,000 legally registered as self-employed and another 570,000 farmers who own or lease private plots looking solo or in cooperatives and i think as mentioned in your testimony there's an organic sector that's also working there, organic farming and organic marketing. in addition to that, there's another estimated from this report 600,000 to a million who

are labelled private sector but they are considered illegal buy the cuban government and so there's also a sector there that's growing. so you have these two large i think that's what, when we travel down there, when we engage down there when our commerce is -- these are the folks that we're helping. these are the folks that we're helping grow. these are the folks that we're empowering, and i think that's a very very good thing. now, this -- one of the areas that i think is critically important -- and is increasing our agriculture interaction with cuba -- so i am also proud to be on senator -- in addition to senator flake, senator hide camp has a bill to increase sales, i'm on that. and this week i'm introducing the cuba digital and

communications advancement act, also known as the cuba data act, with senator flake, senator durbin. the goal of the legislation is very simple. give u.s. telecommunications companies the opening and certainty they need to inrest and help cuba open to the world, and give the cubans the tools they need to engage in the 21st century economy. share information and communicate more efficiently with each other and the world. secretary jacobson, both you and the president emphasized access to internet is a cornerstone to the new cuba policy. for those who have not been to cuba it's one of the least wired countries in the western hemisphere. things we take for granted, such as e-mail on phone, basically nonexistent in cuba. what are the major challenges cubans are facing to access the internet and what can u.s. companies and the congress do to

open up cuba to the global internet? >> thank you, senator. thanks so much for your interest in this and the conversations we've had. i think obviously a huge part of the obstacles to the cuban people right now are sheer access to internet connected devices, whether it's computers or whether it's, you know, smartphones. when they are access, that access is expensive, it's also prohibitive, even when the cost came down for the public to access internet it was still extremely expensive. for most cubans it was a half month's wage. what we're talking about -- and then there is a question of whether everything is accessible once you get on the web and whether there are things that are blocked. so there are huge challenges for the average cuban. i think there is a combination

of reasons for that, but the cuban government fundamentally has to make decisions and we obviously want to encourage in every way possible that information and access to the internet be made easier, cheaper, you know, available, and open for the cuban people. that will take a variety of decisions by the government that we're encouraging them to take by encouraging american businesses to have those conversations with them and these are the means to do so. >> the goal, as i think you said in your testimony, madam secretary, of the cuban government is to have internet access for 50% of its population by 2020. so they have stated this goal, we're trying to move there. this is the goal that u.n. has made for developing countries around the world. is this goal achievable by cuba? if the united states telecom

companies were allowed to invest in cuba, how long would it take to completely wire the island? >> that's a great question, senator. i'm not the best of tech experts but i will tell you that the tech companies that i speak to had conversations either with cuba or about cuba believe it is absolutely possible. and in terms of how long it would take a lot depends on what the cubans decide to do what kind of infrastructure they put in. >> thank you very much for those answers. mr. chairman, just a final comment, i know that all of the things that have been mentioned here that are problems, that we don't agree with, problems as challenges in cuba, we just have different goals to try to go those things changed. and as the last note, i'd like to express my support for the extradition of charlie hill. extradition of criminals, i think, is an important part of any normal relations between

countries, charlie hill, who allegedly murdered a new mexico state police officer and hijacked a plane must be brought to justice, and i know the state department shares this objective, and i hope we can continue to make it a priority until we get it done. thank you. my sense is there may be additional questions, and i'll defer my time for others who may wish to ask additional questions. senator rubio? >> thank you. a couple points i wanted to touch on. this internet thing is important. i've talked about it extensively in the past. as i listen to the conversation there's a perception the reason why there's no internet infrastructure in cuba is because the u.s. hasn't gone into build. the cuban government had a joint venture with an italian company for years. by the way, the telecom industry in cuba is run by the cuban government and it's a holding held by the holding company run by the son-in-law of raul

castro. the bottom line virtually every telecom company in the world -- there are dozens of advance the companies in world not in the territory of the united states -- have had access to the cuban market and they have not been allowed to build out or have dropped out of joint ventures. the fact that american infrastructure will be allowed to come in does not mean the cubans will allow it. here's why, they don't want the cuban people to have access to the internet. china they have the great fire wall. they have access to internet in china. there's all sorts of infrastructure. china has both nationally owned and private companies in china offer telecommunication infrastructure but the people do not have access because the government places filters upon it. this is a government that won't allow you to bring certain books on to the island. a government won't allow you to read certain newspapers on the island. this idea that they are going to somehow allow at&t and verizon to say, yes, come in, build all of this infrastructure, unfetterred access to the cuban

people, as absurd. they cannot survive an internet opening. so we can pass all of the laws we want, the cuban government is still going to place filters and you still have to work through their telecommunications company in a joint venture in order to build infrastructure on the island. as far as travel is concerned, i think airbnb, fantastic, they're building this up. the point, number one, even private operators on the island, bed and breakfast, whatever you call them, still pay an exorbitant fee to the government for the right to provide that service. they gamed that system to get their hands on money. that being said the vast majority of people that travel to cuba will not be staying at one of these facilities. they will be staying at segregated tourist destinations where tourists are brought in, experience that facility, and and then leave. and the money's going to the cuban military. i've heard discussion about vietnam, china. look, we have full travel to

china and vietnam, they're not any more democratic than they were when all of this started. so i think it proves my point, economic openings do not lead to political openings by evidence of china and vietnam. the point about the cuban military, in addition to the fact that the castro regime stole 6,000 properties owned by u.s. citizens or companies of which zero dollars have been compensated this is the cuban military that has four, four senior officials, three senior officials indicted, for the murder of four floridians, indicted in u.s. courts. that's the cuban military. this is the cuban military helping smuggle heavy weapons to north korea without consequence. they were caught, no u.n. sanctions, no u.s. sanctions. this is not just the cuban military. this is a cuban military that uses access to funds to carry out the sort of grotesque activity. when we talk about travel to cuba, business with cuba, let's

be very clear. we're not doing business with the cuban people. you may eat at a home somewhere, but this is still a very small part of their economy for the vast and enormous majority of americans that travel there, and that includes congressional codells, journalists, everyday american citizens you will stay in a government-run facility, every dollar will wind up in the hands of the cuban military that sponsors terrorism by smuggling arms to north korea, and cuban military that uses every access it it has to funds to enrich themselves and repress the cuban people. so there is no economic opening to cuba. there is an economic opening to the cuban military-run holding company. >> thank you. senator cardin? >> let me briefly, then i'll yield to senator menendez, in regards to some response here, 2 million cell phone users in cuba.

when i was in china they do block full access to the internet, although the u.s. embassy site on air quality is one of the most frequently visited sites by china nationals, the only reliable information they can get about air quality. our engagement will bring faster connectivity and more quality connectivity to the people of cuba, i'm convinced of than the technology is there, senator rubio points out. it's a matter of making it available and the people of cuba will demand that. and let me just also point out in regards to the libertat act. it provides forlysining authority by the administration which is common in these types of legislation. there are certain authorities who are included in the act. i look forward to a robust discussion in the committee. chairman, i would yield the time to senator menendez.