In an ideal world, where politicians are actually concerned about and rewarded for the quality of their work, the Cuban embargo would have been scrapped years ago as an unmitigated policy failure. In fact, it has strengthened Castro's hold by giving him something to conveniently blame Cuba's economic problems on, besides his own mismanagement.
The only reason why it does live on is that it makes for good politics. The Cuban-American vote holds a great deal of sway in Florida, one of the biggest sources of congressional seats and electoral college votes. President Bush needs no explanation of Florida's political importance -- it's something he understands very well.
Some pressure has been building from the business community. Thousands of Americans (at risk of prosecution) go to Cuba every year via Canada and Mexico, and stay at Canadian- or European-owned resorts, leaving the U.S. tourism industry hungry to get in on the action. The U.S. agribusiness community is also interested in investing in Cuba, with or without Castro, as are the fast-food chains, rumoured to have already picked out potential locations. However, neither Holiday Inn, Cargill nor McDonald's can pack the Cuban exiles' political punch.
Unfortunately, as bad a policy as the embargo might be, I suspect Castro will turn out to be Cuba's equivalent of Spain's Francisco Franco: he will hold on to power until his natural death, followed by a transition to democracy after a few shaky years.