The Cuban Revolution 2.0: Cuba’s road to sufficiency and stability…

Cuba has been one of the longest communist dictatorships on the face of the Earth. Sixty years into the same dialect of equality and socialism, with an ever so changing world, will the Cuban Revolution survive in a world where markets, investment, and capital are dominant? Although Cuba has long valued socialist ideals, principles, and economics, it has been opening itself to susceptible economic reforms to sustain its socialist system. These reforms may have relieved some of the underdevelopment in the country, but drastic changes need to be enforced to guarantee continuity. For Cuba to relieve the immense poverty, underdevelopment, and economic detain it must open itself to freer markets, less government regulation, and incorporate itself into the dominantly liberal international market order.

 During the 90’s Cuba went through “The Special Period” where scarcity was prevalent. This period was due to the collapse of communism in Eastern Europe. Cuba depended densely on the Soviet Union since it provided Cuba with many of the necessary resources for production. When the collapse occurred, Cuba was left isolated with no other country to lean on, it could also not quite rely upon itself for adequacy in the production of goods and services that issued an aftermath that heavily affected the lives of ordinary Cubans, the government, and the Revolution.

“The Special Period had taken an enormous toll. Increasing inequality, decreasing access to health care and a good education, and a growing culture of individualism and a declining sense of communal solidarity had eroded distinctive aspects of the Cuban Revolution.” (Brenner, Kirk, Leogrande pp. 3-4). Since Cuba was not dependent on an influential or wealthy country anymore the consequence of this invalidate the triumphs, goals, and achievements of the Revolution.

Cuba relieved some of its economic crisis when Hugo Chavez came to power—Venezuela, once the richest country in Latin America, was now a close ally and trading partner; China and Russia also became trading partners, but this enough would not contrast the significance the Soviet Union had on Cuba.

The Castro brothers and the components of the Communist Party of Cuba had to rethink their strategy to secure the survival of the Revolution. Fidel Castro resigned in 2006, his brother, Raul, was now in command as President of the Republic of Cuba. This transition of power was fundamental, as the authors argue it was the most beneficial thing to happen to Cuba since the Constitution of 1976. Raul knew more than his brother, he insisted that the antiquated reasoning of the past should be obliviated, he proceeded to drive Cuba to domestic and international exposure.

“…announced it would lease fallow land to private farmers, reduce restrictions on the free market sales of produce, and raise the prices it paid to farmers to produce… In 2007 and 2008, the government also began to issue licenses that allowed drivers to use private cars as taxis, and it lifted the ban on selling computers, DVD players, and cell phones and permitted Cubans to pay for services—such as hotel rooms, food in tourist hotels, or rental cars—with Cuban convertible currency. Economist Jorge Mario Sánchez aptly observed that the economic changes “pointed in the right direction but were insufficient to deal with the roots of dysfunctionality.” (Brenner, Kirk, Leogrand p. 7) 

            Fidel warned that the idea that socialism constructed with capitalist methods was one of the great historical errors, and that was precisely what Raul was trying to do. The economic renovation program that focused on expanding private enterprise, allowing greater sway of market forces, boosting productivity with wage incentives, and attracting foreign investment are all capitalistic methods. The authors argue that Cuba could potentially maintain its one-party rule and the centrally planned economy as long if it keeps developing plentiful economic policies. This is contradictory because not only do largely planned economies fail to be sustainable, they also never truly prosper in the international market. If Cuba wanted to maintain itself as a long-standing communist regime it could not possibly move towards capitalist methods, that is why the government advanced to enforce crude regulations on businesses and made all the independent workers such as taxi drivers work through the state—thus increasing state bureaucracy. “Ever higher taxes, an ever-in­creasing bureaucracy, an ever more absolutist state power, a paralysis of local initiative, a growing reli­ance on a central authority that started with some aspects of a welfare state and ended in full-fledged totalitarianism, with such features as prescribing occupa­tions and fixing wages and prices—such was the unhappy story of Rome’s Decline and Fall.” (Chamberlin, 1963)

If both Raul Castro and now President Miguel Diaz-Canel both concur to lead the path to a more open Cuba where bureaucracy and corruption are reduced, attract foreign capital, and for Cubans to play a greater part in the domestic economy to ultimately better the current situation on the island—why do they proceed to anesthetize their domestic market? It has been previously demonstrated that Cuba cannot keep depending on foreign ally governments to sustain themselves as they’ve done in the past with the Soviet Union and recently Venezuela; both led to the same thing: uncertainty and insufficiency. For Diaz-Canel and Raul Castro to guarantee amelioration, extreme changes ideologically, politically, and economically need to take effect.

First, in dictatorships advancements in the political, social, and economic ambiance hardly ever occur, second, if you want an overall freer market there has to be less government regulation and intervention for people to thrive—planned economies are enemies to entrepreneurs, businesses, and innovation, and third democracies tend to thrive better economically. Unless you’re China. China, unlike Cuba, has never openly demonstrated to wanting to better Chinese society. Although China’s economic boom is largely due to its openness and reforms, China’s definition of capitalism favors governmental elites with strict government regulations politically and economically, it’s one of the countries with the highest wage inequality and governmental services, such as healthcare, are of poor quality. Indeed, China does not practice either communism or socialism. For politics and economic to coexist blissfully, both have to adhere similarly in terms of significance, practice, and appliance.

“It is widely believed that politics and economics are separated and largely unconnected. The thesis of this chapter is that such view is a delusion, that there is an intimate connection between economics and politics, that only certain combination of political and economic arrangements are possible, and that in particular, a socialist society cannot also be democratic, in the sense of guaranteeing individual freedom.” (Friedman, p.8). If a country, such as the case of Cuba, wants people to thrive and harness more wealth, their model of “market socialism” is not going to endeavor. This model consists of wanting economic growth with high levels of government restrictions and regulations to avoid the rise of a socioeconomic wealth class.

 “One key feature that stands out is the recognition that the Cuban model’s sustainability depends directly on achieving greater development, which in turn is tightly linked to economic growth.” (Brenner, Kirk, Leogrande p. 44). The “cuentapropistas” are individuals who form part of the private sector in Cuba and are allowed to manage restaurants (also known as “paladares”) to Airbnb. The cuentapropistas in Cuba pay an array of taxes, which include a sales tax, taxes for the labor force, personal income, and social security. It can be assumed, as there is no available data, that the cuentapropistas pay an overwhelming part of total personal income taxes the government collects. To put it in perspective this amount is almost equivalent to what was spent on community projects and personal services in 2016. That same year harsh regulations were imposed and cuentapropistas diminished from 504,000 to 496,000. The GDP in 2016 averaged only to 0.5%. In 2019, Cuba redacted a new constitution that elevated to a certain extent economic and individual rights, but as data shows not much has changed, although there have been some improvements.

As stated above, political and economic freedom are interconnected; one cannot exist without the other. For countries to grow economically, maintain social programs such as healthcare and education there must be respect to property rights, individualism, and entrepreneurship. For example, Nordic countries were economic successes before they built a welfare state. The Nordic countries respect private business and are overall in the top spots on the Economic Freedom Index. The abundance of small businesses has increased tax revenues to help support governmental programs. If Diaz- Canel and Raul Castro’s compromise is to keep maintaining these governmental services while also improving the quality of the services, they might have to take a look at the Nordic countries. “Communist rule is changing, but not enough. Despite leadership shifts and constitutional revisions, state controls continue to stifle the economy.” (Bandow, 2018).  

The 21st century has brought the world at a point where it has been more interconnected. Where countries depend on each other for production, alliances, and even safety. In this century ideology has not been a barrier for countries to interact and depend on each other. Cuba’s foreign policy has consisted since 1959 to completely ally with countries who share ideological beliefs such as Bolivia, Brazil, and Venezuela (respectively), and even influence them politically. As these countries have voted out left-political, Cuba has been losing allies in the region who once had a strong influence over. The EU has recently resumed diplomatic and economic relations after their plan to isolate the Cuban government in the ’70s. This interaction has been limited because Cuba has denied moving forward from ideological blockades that have limited them to only associate themselves with a country that is alike. “For its part, the EU came to realize that it lacked the influence to pressure Cuba into making any of what it considered meaningful reforms.” (Brenner, Kirk, Leogrande p. 62) Raul Castro’s economic change has strengthened Cuba-EU relation, but this international relation has not alleviated the domestic problems of the island or formally integrated itself into the international market. As countries become wealthier the demand for freedom increases. Countries such as South Korea, Taiwan, and Chile have evolved into healthier democratic states and past Soviet satellite states have also transitioned into democratic market-orientated states. For countries to be a high-growth state or continue to be a high-growth state, such as China, they would have to play within the international economic order—financially, economically, and politically this would pressure for political and economic reforms. The Cuban government has widely depended on similar ideological countries for resources. This dependency has brought instability starting with the failed USSR and now Venezuela. The political crisis in Venezuela affected Cuba greatly, it brought shortages in oil, medicine, and food, in the present time Cuba’s largest trading partner is China but has history demonstrated this ideological dependency is destined for failure.

Authors Philip Brenner, John M. Kirk, and William M. Leogrande all agree that the changes implemented in Cuba have alleviated greatly the situation. They argue that Cuba’s position would better greatly if the United States lifted the embargo. Although I agree that the economic embargo has not accomplished what was expected to, this alone would not suffice. What brought my attention towards this book is that the international community has a blind eye when it comes to Cuba. In a not so distant past, the world was against the Cuban dictatorship and wanted to see its collapse. Due to the reforms and changes, it’s not seen through those same eyes. There have been no real changes that could even start healing sixty years of insufficiency not only domestically but as an international participant. The discourse of the current international political economy consists of a globalized interconnected world that establishes rules, although not explicitly, in this order, countries who are democratic, market-driven, respect private property and individual freedoms, tend to do perform better in the international arena. Countries as rational actors want to survive, to survive they need to play by the rules of the international system. In today’s global economy the antiquate institutions, political and economic structures Cuba possesses are destined to fail. For Cuba to sustain itself, perform well in the international political-economic order, and deliver the necessary responses for the wellness of Cuban society it has to go through a radical and revolutionary change.

Bibliography

Brenner, Philip, et al. Cuba at the Crossroads. Rowman & Littlefield, 2020

Bhargava, Shatakshi, et al. “Failure of Centrally-Planned Economies.” Vskills Blog, 23 Feb. 2015, www.vskills.in/certification/blog/failure-of-centrally-planned-economies/.

Chamberlin, William Henry. “Bureaucracy Kills: A Lesson from Rome: William Henry Chamberlin.” FEE Freeman Article, Foundation for Economic Education, 1 Jan. 1963, fee.org/articles/bureaucracy-kills-a-lesson-from-rome/.

Ci, Jiwei. “Without Democracy, China Will Rise No Farther.” Foreign Affairs, Foreign Affairs Magazine, 19 Nov. 2019, www.foreignaffairs.com/articles/china/2019-10-04/without-democracy-china-will-rise-no-farther.

“Democracy Is Good for Business.” Freedom House, freedomhouse.org/article/democracy-good-business.

Friedman, Milton, et al. Capitalism and Freedom. The University of Chicago Press, 2020.

“It’s Time for a Policy Change on Cuba.” Cato Institute, 7 Dec. 2018, www.cato.org/publications/commentary/its-time-policy-change-cuba.

“Rich China, Poor China.” Cato Institute, 3 Apr. 2020, www.cato.org/publications/commentary/rich-china-poor-china.

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