Jan 052015

Is this better for Cuban Socialism or Capitalist Restoration?

By John Hutton, member of Solidarity Halifax.

What is likely the most significant shift in Cuban-American relations in five decades took place today when the United States announced that it would release three Cubans from what is called the “Cuban 5” in exchange for Cuba’s release of convicted USAID contractor Alan Gross. Gross was jailed by Cuban authorities for espionage and connection to US-organized attempts to destabilize the Cuban regime. The Cuban 5 were also jailed on espionage charges, although their actual activities appear to have been counter-terrorism efforts against some of the more hardline anti-communist groups in Miami.

In addition to the prisoner swap,announcements have been made that the US will be opening an embassy in Havana, easing some restrictions on imports (Americans can get Cuban cigars again!), and the Americans will welcome Cuban officials at regional diplomatic meetings such as the upcoming Summit of the Americas. The exchange is significant because it’s success required a significant level of trust-building between the two governments,which have historically been paranoid and overheated towards each other. It marks a major shift in US policy, which has maintained a tight economic blockade against Cuba since 1961. The new model that Barack Obama is pursuing is to normalize relations, engage the Cuban government and hope that they can affect change by participating in economic life on the island. This shift should be welcomed: the American strategy of waiting for the Castros to die, followed by an anti-communist uprising like what happened in the former Soviet Union is clearly not going to happen. The merits (or lack thereof) of the sort of change the Americans want will be discussed later, but the embargo benefits nobody and anything to hasten its end is good news.

The conditions for improving US-Cuban relations are very good. Raul Castro has been implementing a series of significant reforms in Cuba, including the legalization of hundreds of forms of small businesses and enthusiastic support for foreign investment. Part of this is in recognition that the old Soviet-style approach to economics has not worked in Cuba since Soviet subsidies dried up in 1990, if the model ever worked at all.

The Cuban system is rife with contradictions. Its economy is plagued by inefficiencies and shortages. Most Cubans rely on the informal economy (aka the Black Market) to get by, as the $26/month salary is anything but adequate. All sorts of theft and fake book-keeping are normal practices in state industries as Cubans seek to resolva mi problema, as the saying goes. The chaos this causes in the Cuban economy cannot be entirely blamed on the embargo, but that too is a major issue- the embargo is estimated to have cost the island $1.1 trillion since its implementation in 1961. The political system is anything but free, pluralistic, or democratic. Yet in spite of its challenges, Cuba’s achieved impressive social goals. They have the highest doctor-per-capita ratio of any country, better literacy and infant mortality rates than the United States, an impressive 85% home ownership rate, free education to the highest levels, are world leaders in sustainable agriculture and urban farming, and it was Cuba, not any rich developed nation, receiving praise for its role infighting ebola in West Africa. Cuba will be one of the only countries to meet all millennium development goals.

As can be seen, there is much need for reform, and much worthy of preserving. So a good question to ask is:is ending the embargo good for Cuban socialism, or good for restoring US-style capitalism?

One thing is certain: the Cuban government wants an end to the embargo. With Brazilian support, Raul Castro built a massive new shipping port in Mariel as part of the creation of a “Special Economic Zone,” where Cuba’s strict conditions for market activity will be more relaxed in the hopes of attracting more foreign investment. Reading between the lines, it should be seen as preparation for an influx of trade when American ships once again sail to Cuba and Havana’s port is not big enough to process all the traffic.

Cuba’s situation is unique, as for probably the first time since the revolution it faces greater security risks internally than from the United States. The regime’s ability to grow the economy matters more than anything else for maintaining its hold on authority. Debate on how to do that is raging within the Cuban ruling class. Should they follow the Chinese model,create special economic zones everywhere and let foreigners invest in whatever they want? Should they stay true to Fidelismo and keep the state as large as possible? More likely is the Vietnamese model, where foreign investment is welcomed but expected to fulfill some social needs, differing from the less restricted Chinese model. Unfortunately, discussion of multi-party democracy remains out of bounds publicly. What the Cuban government wants to avoid is the Russian model, where opening society up too quickly led to a collapse of communism, state enterprises were privatized and a form of highly corrupt gangster capitalism took hold. Even for ardent anti-communists, avoiding the Russian model should be seen as a good thing.

The American government, for its part,wants a full restoration of pre-revolutionary Cuban capitalism. Barack Obama’s rhetoric today of promising not to be a colonizer in Latin America anymore should not be taken seriously. Obama’s change in strategy is not to become friends with Raul Castro, it is happening because he believes that market forces will be more effective at increasing American influence on the island, with their highest goal still being regime change. These are new tactics, not new values.

In negotiating today’s prisoner swap,the Cubans and Americans have finished their first lesson in how to dance with each other. The full act has yet to be played out, and each will have many risks of stumbling along the way. Obama will have difficulty deepening his strategy, as a Republican-controlled congress is not likely to repeal the embargo (or enact any rational policies on Cuba, for that matter). Cuba, for its part, will need to find ways to create socially useful channels for dissent, which will inevitably increase as more capitalism brings more inequality. Measures to protect its impressive social services from the worst aspects of capitalism will also be necessary; education and healthcare are far more precious than iPhones. Cuba would benefit from legalizing independent trade unions, which would build workers power against a re-emerging capitalist class. Most post-communist regimes have been plagued by communist bureaucrats suddenly becoming capitalist managers of privatized state enterprises, and this is what needs to be watched for. Independent trade unions, an inherently socialist thing, could be appealing to some sections of the Cuban regime, and could ensure that dissent comes from Cuban workers and the left (with an interest in strong social services) rather than just a profit-minded business class.

The United States has a chance to improve ties with Cuba in 2015, starting with the Summit of the Americas. Cuba has an impressive operation in West Africa to fight ebola, and American assistance there could be an excellent opportunity to build ties and do good work together internationally.

The first few steps of the new salsa dance have been made, but a much longer act remains to be performed.


Note: Articles published by Solidarity Halifax members do not necessarily reflect positions held by the organization.



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