HAVANA, Cuba — Let
there be no doubt: Cuba’s Communist Party has declared the island’s socialist
system “irrevocable.”
But the nod to
market principles at the core of President Raul Castro’s economic reforms has
brought a new degree of ideological ambiguity to Cuba, leaving many to wonder
just what model, exactly, the island is really following.
With Cuban
authorities seeming ready to embrace new forms of private enterprise but not
liberal democracy, the comparisons inevitably point to China and Vietnam. In
those countries, a one-party, authoritarian political system has endured thanks
to a dynamic, globalized economy that delivers steady growth.
The 81-year-old
Castro made a rare trip abroad to visit China and Vietnam in July, adding to
speculation that Cuba is eager to adopt the development model charted by Asia’s
business-friendly communists.
But Cuba doesn’t
even come close to emulating those countries, said University of Havana
economist Julio Diaz Vazquez, who was educated in the Soviet Union and now
studies contemporary China and Vietnam.
In Cuba, “there is
an acknowledgment that we have to fix the basic structure of our economy,” said
Diaz Vazquez. “But the mentality of the old model is still present: How do we
keep [entrepreneurs] under control?”
Three years after
Castro announced the reforms — “updates” is the official euphemism — Cuba has
taken significant steps toward creating a larger role for private business.
Nearly 400,000
Cubans now possess self-employment licenses that allow them to work
independently. The government has attempted to boost food production by leasing
nearly 3 million acres of state-owned land to private farmers and independent
cooperatives on a no-cost, long-term basis. Thousands of little snack bars and
restaurants have transformed the physical appearance of Cuba’s cities and
towns. Cubans can buy and sell their homes and apartments for the first time in
a half-century.
All of these
measures, and others, have brought significant change and subtle shifts in the
way Cubans perceive their opportunities and their relationship to the
government.
But in other,
fundamental ways, Cuba’s Communist Party leaders and the massive government
bureaucracy below them remain stuck in the Soviet-era dogmas that China and
Vietnam disposed of decades ago.
The main
difference, according economists like Diaz Vazquez, is that China and Vietnam
follow a high-productivity model in which the state encourages, rather than
impedes, the country’s entrepreneurs and professionals. Torrents of foreign
investment and booming exports have made those countries global economic
players, raising living standards and providing political stability. While the state
steps in to moderate the inequalities that result, it does not view individual
prosperity with suspicion.
In contrast, Cuban
authorities are a long way from endorsing the Deng Xiaoping maxim “to get rich
is glorious.” Making money in Cuba is still essentially viewed as a crime, as
some hapless entrepreneurs have recently discovered.
Raul Castro’s
reforms, Diaz Vazquez said, continue to be weighed down by an old model that
keeps entrepreneurs on a tight leash and says: “You can start a business, but I
can take it away from you at any time.”
Some 78 percent of
the Cuban labor force is still employed by the state. Workers struggle to
survive on salaries that average $20 a month and fall far short of providing
for their basic needs. Many turn to stealing from their workplaces or selling
goods in Cuba’s vast black market, activities that the government wants to
curtail by moving workers off state payrolls.
Cuban officials say
their goal is to create millions of new jobs in private businesses and
cooperatives, referred to on the island as the “non-state” sector. Last year 22
percent of Cubans held non-government jobs, up from 16 percent in 2010,
according to the island's national statistics office.
But to date Cubans
who go to work for themselves must choose from 181 occupations, an
astoundingly-circumscribed list that includes jobs like palm-tree trimmer,
birthday clown, mule-driver, knife-sharpener and funeral flower-arranger.
Such a list would
probably be laughed at today just as much by the market socialists in China or
Vietnam as it would be in places like Miami or Mexico City.
For Cubans who
might want to start a software company, architectural firm or manufacture
tractor parts, the only way to do so is leave. And so many of the island’s best
and brightest go abroad.
Three years into
the reform process, the kinds of small businesses now permitted in Cuba do not
leverage the skills of educated professionals, or allow them to work on their
own. And there is no discernible recognition that manufacturing and most forms
of commerce are more efficient in private hands, despite China and Vietnam’s
achievements, not to mention decades of ample evidence in Cuba to the contrary.
New start-up
businesses in Cuba still can’t import supplies or equipment directly from
abroad. They continue to face elaborate bureaucratic obstacles to the most
trivial operational needs, like banking services and advertising. Investment
capital from foreign partners can only come in secret.
Such barriers have
deep roots in the Cuban economic model that dates back to the 1960s and has
long equated socialist “perfection” with maximum state control. Such thinking
has measured success according to the degree to which private property can be
eliminated and administered by the state.
That model has been
failing in Cuba for decades, but it’s only under Raul Castro that the
government has begun to openly acknowledge that abysmal economic output cannot
sustain the health and educational systems that are held up as the crowning
achievements Fidel Castro’s 1959 revolution.
But Cuba continues
moving slowly, even as Castro insists the changes will come “without hurry but
without pause.”
While Cuba’s
octogenarian leaders may not have time on their side, they do have Hugo Chavez.
The Venezuelan president provides the island with billions in hard currency and
two-thirds of Cuba’s energy needs, lessening the need for urgent change.
Chavez claims to
have beaten cancer with Cuba’s help, and he’s also beating rival presidential candidate
Henrique Capriles in most polls.
With Chavez’s
continued financial backing, Cuba’s leaders may see little need to embrace the
Chinese model, and stick with their tropical one for as long as possible.
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