AMY GOODMAN: President Obama announced Wednesday the United States will restore full diplomatic relations with Cuba for the first time in more than half a century. The historic move will include the opening of a U.S. embassy in Havana. It was reportedly facilitated by Pope Francis and the Vatican, who helped begin secret negotiations last year.

The softened relations come with a prisoner exchange. Cuba has released Alan Gross, a subcontractor for USAID—that’s the U.S. Agency for International Development. He was arrested in 2009, sentenced to 15 years for smuggling illegal technology into the country for opposition groups. Also released was a Cuban who had provided information about Cuban spy operations in the United States. Obama did not identify the prisoner by name, but Newsweek reports he’s Rolando Sarraff Trujillo, a former Cuban intelligence officer who who worked secretly for the CIA until he was arrested on espionage charges in 1995. Meanwhile, the United States freed the remaining members of the Cuban Five—Gerardo Hernández, Antonio Guerrero and Ramón Labañino. The men were arrested in the United States in 1998 and convicted of conspiracy to commit espionage. But Cuban intelligence officers say they were not spying on the United States, but rather trying to monitor violent right-wing Cuban exile groups responsible for attacks inside Cuba. President Obama outlined the exchange as the prisoners were already returning home.

PRESIDENT BARACK OBAMA: Over many months, my administration has held discussions with the Cuban government about Alan’s case and other aspects of our relationship. His Holiness Pope Francis issued a personal appeal to me and to Cuba’s President Raúl Castro, urging us to resolve Alan’s case and to address Cuba’s interest in the release of three Cuban agents who have been jailed in the United States for over 15 years.

Today, Alan returned home, reunited with his family at long last. Alan was released by the Cuban government on humanitarian grounds. Separately, in exchange for the three Cuban agents, Cuba today released one of the most important intelligence agents that the United States has ever had in Cuba, and who has been imprisoned for nearly two decades. This man, whose sacrifice has been known to only a few, provided America with the information that allowed us to arrest the network of Cuban agents that included the men transferred to Cuba today, as well as other spies in the United States. This man is now safely on our shores.

AMY GOODMAN: The deal between the United States and Cuba is a major diplomatic victory for Cuba’s President Raúl Castro, who has offered to engage in direct conversations with Obama, quote, “as equals” since he came to power in 2006 after taking over from his brother, Fidel Castro. President Castro announced the changes in his own midday address to the nation.

PRESIDENT RAÚL CASTRO: [translated] As a result of a dialogue at the highest level, which included a phone conversation I had yesterday with President Obama, we have been able to make headway in a solution of some topics of mutual interest for both nations. As Fidel promised on June 2001, when he said, “They shall return,” Gerardo, Ramón and Antonio have arrived today to our homeland. The enormous joy of their families and all of our people, who have relentlessly fought for this goal, is shared by hundreds of solidarity committees and groups, governments, parliaments, organizations, institutions and personalities who, for the last 16 years, have made tireless efforts demanding their release. We convey our deepest gratitude and commitment to all of them. President Obama’s decision deserves the respect and acknowledgment of our people.

AMY GOODMAN: News of the U.S. deal follows news that USAID tried to infiltrate Cuba’s hip-hop community in a botched plot to foment anti-government unrest. As part of the program, the agency hired Creative Associates International, a firm that also played a key role in the “Cuban Twitter” program, a fake social media program launched in another bid to undermine the Cuban government. In the hip-hop case, Creative Associates was directed to recruit young rap artists looking to make “social change.” The program ended up endangering some of the artists and their careers. On Monday, the head of USAID said he will step down in February. Rajiv Shah gave no public reason for leaving and, in a statement, said he had mixed emotions that the United States is restoring diplomatic relations with Cuba as outlined by President Obama on Wednesday.

PRESIDENT BARACK OBAMA: I’m now taking steps to place the interests of the people of both countries at the heart of our policy. First, I’ve instructed Secretary Kerry to immediately begin discussions with Cuba to re-establish diplomatic relations that have been severed since January of 1961. Going forward, the United States will re-establish an embassy in Havana, and high-ranking officials will visit Cuba. Where we can advance shared interests, we will, on issues like health, migration, counterterrorism, drug trafficking and disaster response. …

Second, I’ve instructed Secretary Kerry to review Cuba’s designation as a state sponsor of terrorism. This review will be guided by the facts and the law. …

Third, we are taking steps to increase travel, commerce and the flow of information to and from Cuba. This is fundamentally about freedom and openness, and also expresses my belief in the power of people-to-people engagement. With the changes I’m announcing today, it will be easier for Americans to travel to Cuba, and Americans will be able to use American credit and debit cards on the island. …

I believe that American businesses should not be put at a disadvantage, and that increased commerce is good for Americans and for Cubans. So we will facilitate authorized transactions between the United States and Cuba. U.S. financial institutions will be allowed to open accounts at Cuban financial institutions. And it will be easier for U.S. exporters to sell goods in Cuba.

I believe in the free flow of information. Unfortunately, our sanctions on Cuba have denied Cubans access to technology that has empowered individuals around the globe. So I’ve authorized increased telecommunications connections between the United States and Cuba. Businesses will be able to sell goods that enable Cubans to communicate with the United States and other countries.

AMY GOODMAN: Well, today we spend the hour looking at this new chapter in U.S.-Cuba relations. Here in New York, we’re joined by attorney Martin Garbus, member of the Cuban Five legal team, and Michael Ratner, who’s president emeritus of the Center for Constitutional Rights. He has written several books on Cuba, Who Killed Che?: How the CIA Got Away with Murder, and also is the co-editor of Che Guevara and the FBI: The U.S. Political Police Dossier on the Latin American Revolutionary. Joining us from Washington, D.C., is Robert Muse, an attorney, an expert in U.S. laws relating to Cuba. He was in Havana, Cuba, Wednesday when the deal was announced. His recent piece published in Americas Quarterly is “U.S. Presidential Action on Cuba: The New Normalization?” And in Havana, we go to Peter Kornbluh, director of the Cuba Documentation Project at the National Security Archive at George Washington University, co-author of the book Back Channel to Cuba: The Hidden History of Negotiations between Washington and Havana.

We welcome you all to Democracy Now! Let’s begin in Havana with Peter Kornbluh. Your response to this historic announcement by President Obama in Washington, D.C., and President Raúl Castro in Havana, Cuba, where you are right now, Peter?

PETER KORNBLUH: Well, I have a one-word response, Amy: finally. Finally, after 55 years, an element of sanity and effectiveness and modernization have arrived to the insane U.S. policy that U.S. presidents have been pursuing towards Cuba for all these years, all these decades.

As you can see from looking at me, the sun is coming up here over Havana Bay. And, you know, I really have a sense, and I think the Cubans that I’ve talked to here in the street have a sense, of a new day, a new dawn, a new beginning, as President Obama himself has said, in U.S.-Cuban relations. And, you know, there really is a sense of excitement here about the future. My taxi driver, who just brought me down to the studio to be with you, said that the taxi chauffeurs are already talking about when they’re going to be able to get a Ford van for taxis, so they can carry more people around. So, you know, expectations are high that a change of relations with the United States is going to lead to development here. He says, “You know, we’ve had a lot of politics, but you can’t eat politics.” And then, Cubans are looking at the economy and hoping that really a change in relations with the United States portends a much better development future for Cuba’s economy and for the future of this country.

AMY GOODMAN: We’re going to break and then come back to this discussion. That was Peter Kornbluh. Today he is in Havana, Cuba. This is Democracy Now! on this historic day after the announcement that for the first time in over 50 years the U.S. and Cuba will begin normalizing relations. Stay with us.