The Vehicles

The Trump administration revoked export licenses to Cuba this week. The letter was signed by the Commerce Under Secretary for Industry and Security. The items covered: Ferraris, Aston Martins, Maseratis, jacuzzis, and jet skis.

I want to look carefully at this list.

In order for the Commerce Department to revoke these licenses, the licenses had to exist. The licenses existed because someone applied for them. Someone applied for them because there was a transaction they needed to complete. There is a market in Cuba for Ferraris, Aston Martins, Maseratis, jacuzzis, and jet skis. The U.S. trade embargo on Cuba has been in continuous effect since 1962. I want to hold both of these facts in the same sentence without resolving them.

Cuba's average monthly wage is approximately $25. (I am aware this is not the average wage of everyone in Cuba. The people who are not earning $25 a month are earning it in a different way. The people who are not earning $25 a month are also, as a demographic, the market for Ferraris.) A Ferrari starts at approximately $250,000. The ratio of these two numbers suggests that the Ferrari market in Cuba is not, broadly speaking, a consumer market. It is a more specific market. The Commerce Department has now evaluated this more specific market and decided to stop serving it. The letter describes this decision as consistent with U.S. policy toward Cuba. U.S. policy toward Cuba has been described as consistent for approximately sixty-three years. During some portion of those sixty-three years, the policy was consistent with Ferraris.

The jacuzzi presents a separate consideration. The Jacuzzi Corporation was founded in 1915 in Berkeley, California, by the Jacuzzi family, who were Italian immigrants. (I want to note that the family name Jacuzzi is now also a product category, which is a thing that happens to very few families. The Maserati family has also experienced this.) The company became associated with hot tubs in the 1970s, when Candido Jacuzzi developed a portable hydrotherapy pump for his arthritic son. The pump was commercialized. The commercialization resulted in what is now called a jacuzzi. The export license for jacuzzis to Cuba has been revoked. I checked the Jacuzzi website. The website has a section called "Find a Dealer." Cuba is not in the dealer locator. I am not making this up.

The jet ski situation is somewhat different from the car situation, because a jet ski requires water, and Cuba is an island. Cuba has water available in all directions in the quantities a jet ski requires. The Commerce Department has concluded that jet ski access is a matter of national security sufficiently serious to require a formal letter. The letter does not specify whether the national security risk is the jet ski, the water, or the combination of the two. Both elements are available in Cuba. The letter has addressed one of them.

Here is what I have determined: the revocation describes a transaction that was, in most cases, not occurring at significant volume. Cuba does not have a network of Ferrari dealerships. The jacuzzi dealer locator does not include Havana. The jet skis were, presumably, somewhere. The formal revocation of these licenses is a document about the distance between what was theoretically permitted and what was practically happening. That distance has now been officially closed. The closure required a letter. The letter has been sent. Cuba has been informed. The Ferraris have not changed location, because they were not there.

The Commerce Under Secretary for Industry and Security has described the policy as consistent. It is consistent. It is consistent with sixty-three years of a policy that has been periodically supplemented with letters about jacuzzis.