Blog > News Analyses > Cuba Libre: The Liberalization of a Socialist Country |
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| Introduction |
 On November 10, 2011, one of the most significant economic reforms took place in Cuba, the long standing communist country. For the first time in 50 years, Cuban people were allowed to buy and sell property as the country broke from its long tradition of socialist housing. This is a major step in a long list of reforms that have been enacted since Raul Castro took control as Cuba’s president in 2008.1 As the country liberalizes to join the globalized world, a major question lingers on. The final step holding back full integration in the world economy remains the embargo imposed by the United States. Given the liberal style reforms, many wonder whether or not it is still relevant and necessary for the two countries to remain disengaged. Reforms in Cuba Ever since the Cuban Revolution of 1959, all property officially belonged to the state. As a result, many buildings fell into disarray, as citizens felt little need to invest in improving something that did not officially belong to them. “Previously, the only kind of property transactions that Cubans were allowed to make were ‘permuta(s)’ – a complicated bartering system, which while legal, often included illegal payments made under the table.”2 Now, the major reforms created an entirely new market in the country, where buyers and sellers actually set prices and exchange property. Some scholars have gone so far as to refer to this as the beginnings of a capitalist revolution. Pedro Freyre, a professor at Columbia Law School, states+ that, “This is the foundation, this is how you build capitalism, by allowing the free trade of property.”3 While this may be a rather extreme assumption, it is still significant given the other reforms that have also been taking place. Another major reform is the “new credit system…that will offer loans to small-business owners, independent farmers, and other citizens.”4 Loans will be offered especially to construction companies that will see their business bolstered by the new property laws. Arturo Lopez-Levy, a Cuban economist, states that, “The new credit policy is another step toward the configuration of a mixed economy integrating state and non-state sectors in a common national market.”5 |
 Earlier in the year, Castro also liberalized the car trade. Just like with real estate, Cuban citizens can now buy and sell cars, which will hopefully bring an inflow of new vehicles to update the 1960s style cars that are common across the country.6 Finally, on December 1, 2011, major agricultural reforms were enacted as farmers were given the ability to sell their products directly to hotels and restaurants. Before, there was a complex system of middlemen that not only increased the price for the consumer, but also took money out of the producers’ pockets. Officials are hoping that this will also increase the quality of food at major tourist destinations, since tourism is a major part of the Cuban economy.7 Still More to be Done While the Cuban government is clearly taking the right steps to improve their economy, there are still some major flaws with the system that need to be addressed. The most significant of these are the reported human rights abuses and the arresting of foreign businessmen. “Since July Cuba has arrested several foreign managers, and closed three such ventures.”8 A major issue with the system is the fact that foreign managers want to pay market wages, and cannot given the strict socialist system. Therefore, corruption ensues and the government considers this to be “law-breaking.” “There have been at least six corruption probes targeting foreign companies over the past two years, sending 52 foreigners to jail and expelling more than 150 business owners and operators.”9 While Castro’s overall goal is to prevent corruption in the economy, the result is quite different. Instead, foreign firms will be less willing to invest in Cuba. If Cuba wants foreign investment to continue to bolster its economy, the government needs to avoid practices that will prevent these companies from succeeding, and provide disincentives for doing business in the country. In addition, Cuba also needs to aim to make these new reforms without the guises of socialism. For example, the new property law still has some stringent aspects that prevent it from actually being a purely capitalist reform. “Owners will be limited to two homes (a residence and a vacation property) and financing must go through Cuba’s Central Bank, which will charge fees, which have not been determined. And a tax of 8 percent will be split by the buyer and seller.” 10 These restrictions show the lack of government commitment to fully liberalize the economy, and its desire to remain as close to communism as possible. The need for reform in Cuba has become increasingly clear. While many of the reforms the country is making are helping, more measures are needed to fully integrate Cuba into the world economy. Brazil has offered support to attain this goal, by helping Cuba raises its export volume and reduces imports.11 However, it is clear that many more major reforms are needed to improve relations at home and abroad, and create a more stable hemisphere. Reactions for the future Reform in Cuba cannot be expected to take place overnight. After 50 years of socialist rule, gradual reforms are necessary to ensure that the economy does not completely collapse under the weight of the market. Regardless, a major obstacle to the integration of Cuba into the world economy remains the enduring US embargo against the country. For years, this policy has been hurting both the Cuban people and the relationship between the two countries. The Center for Democracy in the Americas released a report specifically stating that the US should remove Cuba from the U.S. State Department list of State Sponsors of Terrorism and offer support for Havana’s economic liberalization program.”12 These actions have clearly had a negative impact on the Cuban people and economy. In addition, there is no clear indication that Cuba even deserves to be on this list. Instead, the US should reengage with Cuba, and help the country along the path to liberalization. The continued aggressive stance towards the island has had a dramatically negative impact on US political clout in the region. The rise of regional organizations that do not include the US, such as Unasur and CELAC, clearly demonstrates the disdain for US policy towards Latin America.13 By reengaging with Cuba, the US would be able to show to the hemisphere that it is no longer trying to control the other states using a bully approach, and instead is willing to work together to create a more integrated region. 1 Tham, Raymond. “Cuba’s Gradual Revolution: Will Capitalist-Style Reforms Save the Socialist Nation?” Economy Watch. November 22, 2011. 2 Ibid. 3 Cave, Damien. “Cuba to Allow Buying and Selling of Property, With Few Restrictions.” The New York Times. November 3, 2011. 4 Orsi, Peter. “Cuba unveils new loan program.” Miami Herald. November 21, 2011. 5 Ibid. 6 “Cuba Liberalizes Used Car Trade.” Latin American Herald Tribune. 7 “Cuba to allow farmers to sell directly to hotels.”. BBC. November 21, 2011 8 “Business in Cuba: A Risky Venture.” The Economist. November 12, 2011. 9 Russell, Mark. “As Cuba Opens Up, Castro Hits Corruption.” Newser. November 20, 2011. 10 Cave, Damien. “Cuba to Allow Buying and Selling of Property, With Few Restrictions.” The New York Times. November 3, 2011. 11 “Brazil Wants Cuba to Update its Economic Model.” Latin American Herald Tribune. 12 “US Urged to Support Reforms in Cuba.” Latin American Herald Tribune. 13 James, Ian. “Chavez touts new Latin America, Caribbean Bloc.” Associated Press. December 1, 2011. * Picture of Cuban Flags in Havana: http://www.flickr.com/photos/missmass/570666807/ * Picture of car in Cuba: http://www.flickr.com/photos/melissa_photos/8306909/ |
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Well ‘if’ this Havana Journal is factual this ratvlieely recent headline of their’s makes oranges look like the least of their problems: State run newspaper Granma reported that Cuba will close at least one hundred “inefficient” government run farms and move approximately 40,000 government workers to other jobs. Agriculture Minister Ulises Rosales made the announcement at a meeting of the National Association of Small Farmers in Santa Clara Villa Clara.He claimed that the farms are unsustainable in the current economy. Cuba imports about eighty percent of the food consumed by its eleven million people at an annual cost of several billion dollars…
Ape, this remains me of the agmurent often heard in the days of the Cold War, i.e., there wasn’t really much difference between the USA and the USSR. But just ask anyone who actually lived behind the iron curtain to get a corrective on that fallacy. Of course all governments try to control or at least influence their citizens, but to imply there is little difference between western liberal democracies and one party states is to completely misunderstand the nature (and methods) of the latter. Sure, in the US you have to endure Fox, the Moral Majority, and the Shock Jocks. But not only do you have many alternative viewpoints, you can speak openly against any of them, in the street or through a blog, etc. If you don’t like US foreign policy, you’ll find plenty of people who’ll openly agree with you. In one-party states, the small details’ are indeed different. When you don’t like the prevailing message, and say so publicly (even in email because Yahoo and Google will rat you out), it’s not societal pressure that you need to worry about, it’s testicular pressure. It’s not the tedium of having to turn off Fox, it’s the tedium of working as slave labour in a remote region. And it’s not the pain in the ass of having to listen to Rush L on Radio, it’s the pain in the back of the head from a bullet, the cost of which your family will receive a bill for. The devil really is in the details.
No surprise. The Ukraine was the bdkarbaseet of Europe. Then, the Soviets got their hands on agriculture.A handful of “economic plans” later, by 1964, the Soviet Union was importing the majority of its food.
Look Adamo, all governments atptemt to control their population one way or another. That is especially the case with those big and powerful countries that have pretensions on the world’s throne . Sometimes, there’s very little end-result difference in how that control is disseminated. In China it is done more directly through explicit political directives and the state apparatus, and in the U.S. it is done more in subtle ways, through the pervasive cultural and sociological myths that are traditionally ingrained in every fabric of the society. In China you have police and soldiers installing the fear, in the U.S. you have media (Fox News, Clear Channel ), conservative think-tanks and conservative religious institutions installing that fear.Despite the fact that the average american individual undoubtedly enjoys more everyday personal freedom than his Chinese counterpart, that is only until he or she decides to threatens the society order (which is about on par what the issue in China is). In that case the individual and/or group of individuals and their messagse/actions are dealt with ruthlessly through one or more societal remedies available at their disposal. (job firing, public smear campaign, imprisonment, murder )So even though small details are indeed different, the bigger picture and the bottom line is always the same whether you’re in China or the U.S.
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