3703. Chris Hedges Report with John Mearsheirmer: Is Iran Becoming Another 'Forever War'?

 

3702. The Founders Never Meant the U..S. To Be a Democracy

By Doug Henwood, Jacobin, July 1, 2026

The structures of governance bequeathed to us by the founding generation provided an ideal environment for a plutocracy to develop and run wild, largely insulated from popular power.

One of the great contradictions of American life is that we think of ourselves as a democracy, a model for the world, but one with a profoundly rich elite that exercises enormous influence over politics. Although we often feel (correctly) that democracy is eroding in the United States, we shouldn’t forget that, despite our image, our state was never designed to be a democracy. Our situation, in which an insanely rich oligarchy is nudging aside the last remnants of popular power, emerges from the governmental structures that James Madison and his fellow Founders intended. It was no accident, as the vulgar Marxists used to say, that our first president was one of the richest guys in the newborn country.

Madison, born into the Virginia slave-holding planter elite, made plain in the Federalist Papers, the essays he coauthored with Alexander Hamilton and John Jay to secure ratification of the new Constitution, that the system he helped design was meant to protect the few against the many. In the most famous of these essays, Federalist No. 10, he argued that economic inequality did not arise from exploitation or inherited privilege but from natural differences in human talent.

Madison took the logical next step from this understanding: he rejected democracy outright. A pure democracy would be “incompatible with personal security or the rights of property.” Instead he argued for a republic governed by elected representatives, which would “refine and enlarge the public views, by passing them through the medium of a chosen body of citizens, whose wisdom may best discern the true interest of their country.” The aim would be to guard against “a rage for paper money, for an abolition of debts, for an equal division of property, or for any other improper or wicked project.” For Madison and the other Framers, the danger to be guarded against was not the power of economic elites — which is the class they came from — but the threat to those elites posed by the mob.

The Declaration of Independence, largely written by Thomas Jefferson in his elegant prose style, provides something of an alternative documentary tradition in American politics, full of language about human equality and freedom, locating the legitimate source of sovereignty in the people. But freedom and sovereignty came with exceptions, since, like the Constitution, it was written by a plutocrat. Jefferson himself, for all his lovely words, owned six hundred slaves in his lifetime, six times as many as Madison. The last of the twenty-seven listed grievances leveled against King George III in the Declaration was his encouragement of slave rebellions and Indian attacks on the colonists: “He has excited domestic insurrections amongst us, and has endeavored to bring on the inhabitants of our frontiers, the merciless Indian Savages, whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.”

As Aziz Rana argues in his splendid book The Constitutional Bind, there has long been a tension in American life between the two documents — the Declaration as a charter of liberty, equality, and popular sovereignty, and the Constitution as one organizing a system of governance designed to limit popular power and protect the wealth and status of elites. As flawed as it is, the Declaration can be rhetorically useful.

That system of governance devised by Madison et al. takes several approaches to limiting popular power. Among the most odious is the Senate, initially elected not by popular vote but by state legislatures. As the Senate itself says on its website:

"To the framers themselves, Madison explained that the Senate would be a “necessary fence” against the “fickleness and passion” that tended to influence the attitudes of the general public and members of the House of Representatives. George Washington is said to have told Jefferson that the framers had created the Senate to “cool” House legislation just as a saucer was used to cool hot tea."

The masses, being incorrigible hotheads, need a straitjacket.

Another antidemocratic mechanism is the Electoral College, designed to place a barrier of representation between the presidency and the crowd. As the late Supreme Court justice Antonin Scalia correctly put it in the infamous Bush v. Gore decision in 2000, citing Article II of the Constitution, “The individual citizen has no federal constitutional right to vote for electors for the President of the United States unless and until the state legislature chooses a statewide election as the means to implement its power to appoint members of the electoral college.” Since our federal system grants such enormous power to the states — a structure initially intended to protect the interests of the slaveholding South — small, conservative jurisdictions have enormous weight in choosing presidents. This is, again, no accident; it would have been pleasing to Jefferson, the celebrated advocate of popular sovereignty, who thought rural areas were awash in virtue and cities “pestilential.”

On top of those constitutional mechanisms came judicial review, the power of the courts (the Supreme Court in particular) to overrule laws passed by an elected Congress. This right was not specifically granted in the document; in the 1803 case Marbury v. Madison, the Supreme Court famously granted itself judicial review, a power it used only sparingly at first but eventually with more frequency and fervor. It has mostly employed that power in antidemocratic fashion. After Marbury, the court didn’t invoke the power to overrule until the Dred Scot case in 1857, which denied black Americans citizenship and included the famous declaration that they have “no rights which the white man was bound to respect.” Aside from a brief period from the mid-1950s through the mid-1970s, when it issued multiple decisions expanding social rights, the Supreme Court has mostly been a force for reaction, protecting the propertied. The gush of money that has taken over our political system was enabled by two decisions in particular, Buckley v. Valeo in 1976, which declared political contributions a form of speech and therefore protected by the First Amendment, and Citizens United v. FEC in 2010, which held that corporate political spending could not be restricted, also on free speech grounds.

All these structures of governance provided an ideal environment for a plutocracy to develop and run wild, largely insulated from popular power — or, more precisely, plutocracies, because, as the Italian theorist Vilfredo Pareto said, they “circulate,” coming and going over time. History is, in Pareto’s phrase, “a graveyard of aristocracies.” They rise, rule, grow decadent (“They decay not in numbers only. They decay also in quality”), and fall, to be replaced by a new set of rulers, who repeat the process.

The contributors to Ruling America, a collection of essays edited by Steve Fraser and Gary Gerstle, focus on nine incarnations of the nation’s elite, from colonial times to the right-wing counterrevolution of the 1970s and ’80s. The early American ruling classes were weak, divided by regional and economic interests. It wasn’t until the end of the Civil War that a truly national ruling class could emerge. In the late nineteenth century, the Northeastern WASP elite came into prominence, and as the century turned, it domesticated the rough-edged robber barons and created an order centered on large corporations and financial interests. That particular formation hit a wall with the 1929 Wall Street crash and the Great Depression that followed, but it soon reemerged as the masters of the American Golden Age — the planners of the post–World War II order, with all the institutions that made it possible, like NATO and the International Monetary Fund. Domestically, the elites had mostly made peace with the New Deal; unions and rising real wages were largely, if grudgingly, accepted by the employing class as the price of stability.

But that order began to unravel in the 1970s with rising inflation, falling corporate profits, the loss of the Vietnam War, and growing insolence among both the newly independent former European colonies and our own working class. Meanwhile, new fortunes, many of them based in the South and the West, came to challenge the formerly dominant Eastern Establishment. Those new fortunes represented fresh poles not only of wealth but of political influence, and they began funding a right-wing backlash to the old Northeastern establishment via think tanks and new factions within the Republican Party.

Those forces grew in the 1980s with Ronald Reagan’s administration and the subsequent transformation of the Republican Party into an increasingly reactionary formation. The old Republican Party was the major vehicle of the Northeastern WASP establishment, exemplified by the Rockefeller brothers — David, head of Chase Bank, and Nelson, governor of New York and later vice president. But they were replaced by uncompromising reactionaries with lots of funding, energy, and foul ideas.

Over time, the new guys only grew more rabid and reactionary. Under Donald Trump’s second administration, they achieved their greatest triumph in the Project 2025 agenda, crafted by the same Heritage Foundation that helped shape key parts of the Reagan program, which now looks almost mild by comparison. Despite that continuity, one new innovation is the starring role of elites from tech, a sector that was once heavily Clintonian Democrat and is now dominated by ghoulish characters like Elon Musk and lesser celebrities like Peter Thiel and Alex Karp, chair and CEO, respectively, of the data and espionage firm Palantir. Palantir and Musk’s SpaceX look to be in the process of becoming de facto branches of the US government, developing weaponry and vast surveillance files on us (Palantir) and launching rockets into space for NASA (SpaceX). Their politics are a repellent hybrid of libertarianism (of the “cut food stamps and let capitalists do whatever they want” sort), surveillance, and warmaking. It is perhaps our worst ruling elite since the slavocracy.

Yet despite their power as of this moment, they’re not fully established as a proper ruling class just yet. They lack broad legitimacy — in fact, the tech elite is deeply unpopular across the political spectrum, and Trump himself has some of the lowest approval ratings in the history of polling. Their strategy, as Nikhil Pal Singh argues, is “dominance without hegemony”; true hegemony requires some degree of popular consent. Instead Trump’s crew is deploying force, both at home and abroad. That, as Clyde Barrow noted recently in Jacobin, is a sign of terminal weakness in a ruling order. Add the fact that this crew is deeply incompetent, and you can start suspecting they’re vulnerable.

Savor that weakness. As dark as the moment seems — and it is dark — you can summon some hope. I’ve spent most of this piece on all the structural obstacles to popular power that are engineered into the American political system. But it is far from completely undemocratic. Let us use its democratic residues to make their crisis our opportunity.

3701. State Council of Cuba Approves New Decree-Laws as Part of Implementing Economic and Social Transformations

 By Cuban Parliament, Granma, July 16, 2026

Cuban Parliament, photo: Granma

The decree-laws "On the Cuban State Business System" and "Amendment to Decree-Law No. 76 on Agricultural Cooperatives" were approved in the extraordinary session of the State Council held as part of the process of implementing economic and social transformations.

The decree-laws "On the Cuban State Business System" and "Amendment to Decree-Law No. 76 on Agricultural Cooperatives" were approved in the extraordinary session of the State Council held as part of the process of implementing economic and social transformations, which was chaired by the President of this body, Esteban Lazo Hernández.

During the meeting, it was reported that, based on the implementation of the economic and social transformations analyzed by the Political Bureau, the Extraordinary Plenum of the Central Committee of the Party, the National Assembly of People's Power, and the Council of Ministers, it is necessary to update the regulatory framework governing the Cuban state-owned enterprise system.

The first of the approved decree-laws seeks to regulate the general principles of organization and operation of the state-owned enterprise system for its transformation and development under the leadership of the National Institute of State-Owned Enterprise Assets.

"It addresses 16 of the 17 transformations corresponding to Thematic Area 1: Transformations in the management model of economic actors, related to the Socialist State Enterprise; as well as facilitating the implementation of 12 transformations from other areas," stated Roberto Ricardo Marrero, president of the National Institute of State-Owned Enterprise Assets.

Meanwhile, Yovana Vega Mato, an executive at the Ministry of Economy and Planning, added that this legislation constitutes the platform that enables the state-owned enterprise system, under the leadership of the National Institute of State Business Assets, to exercise all its powers and carry out all the mandated transformations, which are articulated with a set of legal norms currently being drafted.

In the debate, Esteban Lazo highlighted the relevance of the decree-law "On the Cuban State-Owned Enterprise System," which reaffirms the socialist state-owned enterprise as the main actor in the national economy, as well as contributing to expanding the powers that comprise the autonomy of the state-owned enterprise, unleashing its productive forces, and defining corporate social responsibility.

For its part, the decree-law "Amending Decree-Law No. 76 on Agricultural Cooperatives" regulates the constitution, organization, integration, and operation of these cooperatives, based on the necessary update of this regulatory provision in accordance with economic and social transformations.

Both decree-laws will be published in the Official Gazette of the Republic for public awareness.

The extraordinary session of the Council of State also delved into how this body will contribute, through its constitutional powers, particularly in legislative and oversight matters, to the implementation of economic and social transformations. These transformations aim to further refine our socialist construction process and contribute to the nation's economic growth and social development.

3700. Cuba Adopts Wide-Ranging Free-Market Reforms: An Assessment

By Kamran Nayeri, July 11, 2026

A supermarket in Havana. Cuba has a severe affordability problem. 

In this essay, I will discuss the recently announced wide-ranging free market reforms in Cuba. Miguel Mario Diaz Canel (June 18, 2026), the First Secretary of the Central Committee of the Communist Party of Cuba (Partido Comunista de Cuba, PCC) and the President of Cuba, has claimed they will “advance the defense of socialism, to support and expand social justice, and to create economic wealth and distribute it equitably.”

I will argue that, if implemented, these reforms will vastly expand and solidify Cuba's status as a capitalist economy, with a capitalistically functioning labor market and a capital market to facilitate the growth of capitalist enterprises and ongoing capitalist accumulation and deepen the Cuban economy’s integration into the capitalist world economy.

Diaz Canel frames the reforms in the context of the current aggressive U.S. administration's tightening of the embargo, including an oil blockade. However, these reforms are indeed in continuity with market reforms that began after the collapse of the Soviet Union in 1991, which have already created a stratified society of haves and have-nots in Cuba.

Take, for example, the labor market. Between 1976 and roughly the 2010s, the Cuban state largely assumed that private hiring of wage labor would inevitably recreate capitalist class relations and therefore should be minimized. The 2019 Constitution implicitly adopts a different premise: private employers can exist within socialism, provided that the state retains command over the strategic sectors of the economy and regulates private accumulation.

Let me detail this change in the PCC leadership's ideology.  Article 14 of the 1976 Constitution (retained after the 1992 amendments), which stated that the socialist economic system was based on socialist ownership of the fundamental means of production and that it "eliminates the exploitation of man by man" (suprime la explotación del hombre por el hombre).

In practice, self-employment (trabajo por cuenta propia) was either prohibited or allowed only in a very limited number of occupations. Even as self-employment expanded during the Special Period in the 1990s, hiring wage labor remained highly restricted because employing workers for profit was generally regarded as "exploitation.

Beginning with Raúl Castro's reforms after 2010, the government changed course. In 2010–2011, Cuba authorized many categories of self-employment to hire employees. The 2014 Labor Code established legal rules governing employment relationships between private employers and hired workers. This represented a significant departure from previous practice. This created a constitutional tension: the Constitution still declared that exploitation had been abolished, yet the law now permitted private individuals to employ wage labor. As the Cuban constitutional scholar Hugo Azcuy and later commentators observed, this was difficult to reconcile with the constitutional language. The 2019 Constitution resolved much of this ambiguity by explicitly recognizing private property as one of several legitimate forms of property; recognizing the role of the market alongside socialist planning; and no longer treating all private hiring as inherently unconstitutional, while still affirming that the state opposes exploitation and seeks social justice. As a result, private firms, cooperatives, and self-employed entrepreneurs can legally hire workers under state regulation. This constitutional evolution is one of the clearest indicators of Cuba's gradual shift from a nearly exclusive state-employment model toward a mixed state-private enterprise economy.

As Hope Bastian (2018, p. 46), a supporter of the Cuban revolution who was a professor at San Geronimo College, University of Havana, wrote:

“In recent years, the number of Cubans who have acquired citizenship of other countries has increased. Some of them send their children to private foreign schools in Havana, like the Spanish School, French School, Russian School, and the International School that only admits students with foreign passports. The minimum tuition for these schools ranges from $12,000 to $14,000 a year.

“To appreciate the depth of income inequality in Cuba today, we must remember that the monthly minimum wage in Cuba is 2,100 pesos, the average salary is 4,000 pesos, and the maximum monthly pension is 1548 pesos. Converting these figures to dollars using the exchange rate at the time of this writing, the monthly minimum wage is $88, the average monthly salary is $168, and the maximum monthly pension is $64. Cubans who send their children to private foreign schools in Havana, and the bulk of the Cuban people, belong to different social classes.

“To appreciate the depth of income inequality in Cuba today, we must remember that the monthly minimum wage is 2,100 pesos, the average salary is 4,000 pesos, and the maximum monthly pension is 1,548 pesos. Converting these figures to dollars at the exchange rate as of this writing, the monthly minimum wage is $88, the average monthly salary is $168, and the maximum monthly pension is $64. Cubans who send their children to private foreign schools in Havana, and the bulk of the Cuban people, belong to different social classes.”

Class divisions in Cuba have deepened since. In a revealing article, Boobbyer (June 24, 2026) argues that the problem of food access for Cubans today is not a supply issue but rather the relatively high prices of food relative to the wages Cuban working people earn.  She gives an example of a college graduate, Tania Rodríguez, whose monthly income working at a foreign-managed hotel was a mere 6,000 CUP (US$10) [CUP is convertible pesos to dollars as of this writing—ed.] When she turned to the government for work she was offered a job in a hospital for $5 a month, which she declined.

“Later, cleaning work at a beach hotel emerged, but it meant sleeping on-site—not possible with elderly parents and a young child. Rodríguez cooks on her patio with charcoal—a 20-liter bottle of gas on the black market is unaffordable at 60,000 pesos (US$90). She’s emotional as she relates how she sells clothes, shoes, sheets of wood lying around the house; she’s contemplating selling a fridge and water tank to buy food. ‘We are going downhill without any brakes,’ she says. She credits her family’s survival to a friend, a Canadian tourist she met years ago, who tops up her bank card.” (ibid.)

The question now is: how would further liberalization of the Cuban economy help the Cuban working people facing such a dire situation? How could it “support socialism”? If liberalization of the Cuban economy is good medicine, why has the Cuban economy declined so much over the past four decades despite ongoing market liberalization following the collapse of the Soviet Union?

Intensified US aggression

The decades-old imperialist aggression against the 1959 revolution and the regime that ensued from it has intensified after the Trump administration’s military intervention in Venezuela, abducting its president, Nicolas Maduro, and his wife on January 3, 2026.  The surprisingly easy reversal of what the Venezuela regime and its supporters, including the Cuban government, called the Bolivarian Revolution, and bringing its government under Washington's control, also ended the oil shipments to Cuba.  Today’s New York Times has a front-page article describing how Marco Rubio, U.S. Secretary of State, is running Venezuela from his office in Washington. On 29 January 2026, Trump declared a purported national emergency and authorized tariffs on any country exporting oil to Cuba.  

Senior U.S. officials have indicated that the goal of these policies is to bring about political and economic liberalization in Cuba, including the potential removal of President Díaz-Canel from power. “‘Cuba has an economy that doesn’t work and a political and governmental system that can’t fix it. So, they have to change dramatically,’ said U.S. Secretary of State Marco Rubio on March 17. ‘They’ve got some big decisions to make over there.’” (Council on Foreign Relations, March 31, 2026).

On May 20, 2026, the Justice Department indicted Raúl Castro, the former defense minister of Cuba, the former First Secretary of the Central Committee of the Communist Party, and the former president of Cuba, on murder and conspiracy in the deaths of four Brothers to the Rescue in 1996. The leader of Brothers to the Rescue was a former CIA operative, and the group campaigned for the overthrow of the Cuban government. Raul Castro was charged along with five others in the case, threatening U.S. intervention in Cuba to abduct them (Nayeri, May 30, 2026).

Meanwhile, the capitalist press revealed secret negotiations between the United States and Cuba, which the Cuban government later acknowledged. (McDonnell et.al., March 13, 2026).

On June 12, 2026, Miguel Díaz-Canel, First Secretary of the Central Committee of the Communist Party and President of Cuba, announced that the government would introduce a broad package of structural economic reforms.  On June 17, 2026, the Extraordinary Plenary Session of the Central Committee of the Communist Party was held at the Palace of the Revolution, where it approved the measures. On June 18, 2026, the reforms were formally adopted by the National Assembly of People's Power. Prime Minister Manuel Marrero Cruz unveiled 176 reform measures, representing the most extensive liberalization of the Cuban economy.

The reform package is organized into 23 critical areas. Among the most significant measures are the following.  Creating much greater scope for the development of the capital market through greater autonomy to state enterprises so they can set salaries and prices based on market conditions, and the removal of the 100-employee cap on businesses; permission for individuals to own multiple private businesses; the scrapping of the requirement for foreign investors to partner with state-owned companies; and the ability for domestic and foreign investors — including Cubans residing abroad — to acquire stakes in state enterprises. The reforms also include allowing private banks, freer foreign trade, opening real estate to private ownership and investment, and investment by Cubans living abroad and foreign entities.

The reforms also further extend the creation of a capitalist labor market by abandoning the socialized welfare state program, including discontinuing the universal state-provided basic goods basket — the libreta — which has been in place since 1962, and replacing it with targeted subsidies for a much smaller subpopulation deemed needy by the state, and privatizing the state-owned old age homes.  In brief, socialized welfare programs will be dismantled or reduced to a targeted subpopulation deemed needy by the state.

Taken together, these free-market reforms will create private or semi-private markets for production and consumption, abandoning one of the cornerstones of Cuba’s socialized economy.  

The leadership of the PCC looks to China and Vietnam as models, which they call “market socialism.” However, both China and Vietnam have economies that include major capitalist features: Most employment is now outside the traditional state sector, private businesses operate for profit and hire wage labor, domestic and foreign capital invest extensively, and markets determine wages and most prices, competition, bankruptcy, and profit play central roles in allocating resources, both countries are deeply integrated into global capitalism through trade, investment, and manufacturing. By these criteria, many economists describe them as capitalist economies, albeit with unusually large state sectors.

Official explanations for the reforms

Diaz-Cancel (June 18, 2026) framed these reforms in the context of unprecedented aggression by the United States government, including its oil blockade and ideological and political offensive, which he said have sown confusion among the Cuban people. He has argued that Trump aims to generate mass protests to set a pretext for military intervention in Cuba (June 6, 2026). Analysts predict the Cuban economy will shrink in 2026.  According to the Economic Commission for Latin America and the Caribbean (ECLAC), Cuba ranks last among 27 countries in Latin America and the Caribbean in terms of macroeconomic management, and economist Elías Amor estimates Cuba's GDP is expected to drop by 6.5% this year, marking the most significant decline in the region (Mendosa, 2026).

The leadership of the PCC has presented these reforms as progressive in terms of maintaining “socialism.” 

I will discuss below why their arguments regarding the reforms' progressive nature to “support socialism” are questionable.

Prime Minister Marrero, who has been in office since 2019, told the National Assembly of People’s Power that the measures recognize that the market is “an instrument for the efficient allocation of resources.” This claim represents a major theoretical and ideological shift in the island’s economic model since the 1959 revolution, as I will discuss below.

Marrero, a leader of the Communist Party, does not mention that the claim that the market is “the instrument for the efficient allocation of resources” is contrary to the Marxist view and has always been advanced by bourgeois economists since Adam Smith, but since the latter part of the 1800s by Neoclassical, and in the 1940s by Friedrich Hayek and Austrian economists and for the capitalist economy!  Indeed, it was Hayek, an opponent of socialism and central planning, who, in The Road to Serfdom (1944), warned of the danger of tyranny that inevitably results from government control of economic decisions.[1]

It is also the claim disputed by no other than John Maynard Keynes (1936) in The General Theory of Employment, Interest and Money.[2]

Marrero also seems unfamiliar with Marx’s labor theory of value (Law of Value) in his magnum opus Capital.  Did not Marx explain in Volume Two of Capital that crises of underconsumption/over production and disproportionality between Department 1 (capital goods) and Department 2 (consumer goods) will occur in capitalist economies? Did not Marx outline the secular, longer-cycle crisis caused by the tendency of the average rate of profit to fall in Volume 3 of Capital?  Do capitalist economies not experience cyclical crises and longer, deeper depressions, such as those in the 1930s and, more recently, the Great Recession of 2008-11?

More surprisingly, nobody in the Central Committee of the PCC or in the National Assembly of People’s Power raised any objection to Marrero's uncritical support for the capitalist market as the best regulator for the Cuban economy, which the PCC leadership claims will support “socialism!”

Miguel Mario Díaz-Canel similarly offered the following explanation for the reforms adopted.  

“The transformations we are proposing are intended to advance the defense of socialism, to support and expand social justice, and to create economic wealth and distribute it equitably. Without wealth, there is nothing to distribute; we would be speaking of social justice in the abstract. Social justice as conceived by the Revolution—with its humanistic mission to help the most disadvantaged, generally through free welfare programs and projects—does not cost the people anything, but it does cost the State. And to carry it out, to deepen it, to sustain it, and to maintain it, the State needs wealth—and we must produce that wealth ourselves. If there is no wealth, there is no social justice, and everything else is a fairy tale—everything else is a fairy tale! Either we produce under these conditions, create wealth, and then distribute it with social justice and equity—not egalitarianism. That is the challenge!

“We need to unleash the productive forces, to have more production rather than more restrictions, because it has been proven that control without supply merely drives operations into the informal market.”

Thus, Diaz Canel claims that the free-market reforms will “advance the defense of socialism, to support and expand social justice, and to create economic wealth and distribute it equitably!” However, it is hard to believe that allowing the formation of a new class of capitalists, protected by law, will protect “socialism,” or that wealth created capitalistically can be distributed equitably. Did not Marx argue that capitalist economies tend to concentrate and centralize capital in fewer hands? Is it not true that in Western countries today, income inequality is a major problem, and that affordability is a concern, especially in countries where less-regulated markets are the norm, such as the United States?

In both China and Vietnam, the models the PCC aims to follow have brought growing income inequality. In China, the Gini coefficient[3], a common measure of income inequality, has shown fluctuations, indicating rising inequality, particularly between urban and rural areas. Recent data suggests a Gini coefficient around 0.47, reflecting substantial disparities. Similarly, Vietnam has experienced increasing income inequality, with a Gini coefficient estimated at approximately 0.35. This reflects a growing divide, especially in urban versus rural income levels.

What is called Market Socialism in China and Vietnam is a market economy overseen by the Communist Party. However, China's success in modernizing and industrializing has not been replicated in Vietnam, and, in each case, appeasing U.S. imperialism has been necessary to allow foreign direct investment and export-led industrialization.

Does the PCC likewise aim to appease Washington to ensure its proposed reforms could work? As a New York Times article discussing the reforms wrote, “the Cuban government has a serious credibility problem, experts say. Officials have announced economic changes before, only to pull them back without explanation. Cuba lacks the rule of law and a separation of powers and often fails to pay its bills. It’s a notoriously risky business environment.” (Robles and Adams, June 24, 2026).

The problem of low labor productivity

Diaz Canel admits that Cuba faces a problem with increasing labor productivity and that socialism without increasing wealth is impossible.  Thus, Diaz-Cancel admits that Cuba has not created sufficient wealth to develop socialism 65 years after Fidel Castro declared socialism the goal of the Cuban revolution. The question for Diaz-Cancel and PCC leadership is why they have been unable to increase labor productivity to create more wealth to support the transition to socialism.

The Great Debate (1963-65) and after

Diaz Canel and no one else in PCC leadership seems to recall the relevance of the Great Debate of 1963-65 in Cuba, which was conducted publicly and involved internationally renowned Marxist theoreticians like Ernest Mandel and Charles Bettheheim.  On the Cuban side, the principal contributions came from Ernesto Che Guevara and leaders of the Partido Socialista Popular (PSP), the pro-Moscow party. Following the lead of the Soviet Union, PSP leaders argued that the transition to socialism must rely on material incentives, proposing the Soviet Auto-Finance System (AFS), in which firms financed their investments by borrowing from banks at interest. This is now the position of PCC leadership in proposing free-market reforms, allegedly to support socialism.

A central participant was Che Guevara, who served as president of the National Bank and, from 1961-65, as head of the Department of Industrialization and Minister of Industries. Guevara opened the debate by publishing an article in the first issue of Our Industry, the Ministry of Industry's magazine, criticizing the Soviet Union's view of socialist development.  In opposition to the Soviet Auto-Finance System (AFS), in which firms financed their investments by borrowing from banks at interest, Guevara proposed what he later called the Budgetary Finance System (BFS), in which enterprises are financed by the state budget (for details see Nayeri, May 1, 2024). 

The Auto-Finance System relied on a fundamental revision of Marx's theory by Stalin (1951), who asserted that the law of value can and must be used for the transition to socialism. This position mirrors Eduard Bernstein's (1899) revisionism, which held that the law of value would enable a peaceful transition to socialism through reforms to the capitalist system.

This view was later “theorized” in the Manual of Political Economy, published by the Economics Institute of the Academy of Sciences of the U.S.S.R., 1954.

Guevara’s critique of “socialism” in the Soviet Union and Eastern Europe was summarized by Yaffe;

“While the Soviets and the Czechs claimed to have passed this first stage [socialism], in Guevara’s view, that was objectively false because of the continued existence of private property in both countries. The mistake, said Guevara, was that a new political economy had not yet been completed, nor had the process been studied. Consequently, the workings of the USSR had been presented as the presumed laws of socialist society (Yaffe, 2009, p. 236, emphasis added)."

In November 1960, Guevara led a two-month trade mission to the Soviet Union, East Germany, Czechoslovakia, China, and North Korea. While in the Soviet Union, he visited a model factory. He remarked to the members of his delegation: “This is a capitalist factory like those in Cuba before nationalization” (Thaibo II 1997, p. 387). He also told them, “The Soviet Union was going down a blind alley economically and was dominated by bureaucracy (ibid.). At the same time, Guevara believed that the Soviet Union and the Soviet Bloc were “socialist.”

What is not generally known is that Guevara’s view of the Soviet Union and Eastern European countries was diametrically opposed to Fidel Castro’s. In 2006, Castro still believed that the Soviet Union and Eastern Europe were socialist and superior to the capitalist West (Nayeri, April 19, 2024).  There was no searching discussion of the collapse of the Soviet Union in the PCC. The official view was that it was caused by a leadership mistake and by imperialist intervention. 

Following the formation of the Communist Party in 1965, the former leaders of the PSP took key leadership roles in the government and the PCC. In 1972, Cuba joined COMECON, and the Soviet Model was officially adopted in 1975. 

At the party's third congress in 1986, Fidel Castro admitted that the Soviet model Cuba followed had resulted in corruption and the demoralization of workers. He called the Soviet Union model "worse than capitalism." The same Congress called for a return to Guevara's theory of transition to socialism, but nothing came of it.

The following year, Carlos Tablada's book on Guevara's theory of the transition to socialism was published and won the Casa de las Américas Prize. By 1991, the Soviet Union had collapsed, and Cuba sank into an economic depression. The PCC adopted market liberalization policies during what they called the Special Period in the Time of Peace. Initially, as deemed an emergency to return to the vision prescribed by the 1986 congress, the slide toward a capitalist economy has continued ever since. The current reforms signify a major step toward solidifying this direction by developing a legally sanctioned capitalist labor and capital markets and opening the Cuban economy to the dynamics of the capitalist world economy. This is the road of former “socialist” states elsewhere in the world (I set aside North Korea, which most socialists do not consider a socialist).

Marx’s vision of the socialist revolution

Before I close this essay, it is important to recall Marx and Engels in  The Communist Manifesto (1848) envisioned socialism as a process in which the proletariat as a class will “wrest by degrees all capital from the bourgeoisie” to “centralize all instruments of production in the hands of the [workers’] state,” which it controls and uses them to increase the total of productive forces as rapidly as possible.” The workers’ state will abolish property on land property and nationalize the property of those who flee the revolution or revolt against it. Other enterprises will be gradually transferred to the workers’ state. The goal is a producers’ association in which “the free development of each is the condition for the free development of all.” Thus, socialist democracy and individual freedom are the cornerstones of a socialist revolution.

For Marx, progressive steps taken in the capitalist society, such as progressive taxation, nationalization of enterprises and industries preferably under workers’ control, social welfare, socialized health care, free universal education, free cultural venues, humanization of work through labor legislation and workers’ control, help prepare for the transition to socialism.

In the workers’ state, the professional army will be replaced by a working people’s militia; measures will be taken to achieve equality for the underprivileged and eventually equality of conditions of life for everyone.

Key to this process are the self-organization and self-activity of the working people to wither away all forms of alienation, subordination, and exploitation (Marx 1844, 1864; Fromm, 1961; Draper, 1971).

In Critique of the Gotha Program (1875), Marx envisions a lower and a higher phase of communism. The lower phase begins with the conquest of state power by the proletariat (not by a vanguard such as the party or a guerrilla movement). At the same time, the emerging society still lacks its economic foundation. The higher stage of communism begins with the disappearance of the “enslaving subordination of the individual to the division of labor.” In this stage, goods and services are distributed according to the bourgeois principle of “to each according to his/her contribution.” When such division of labor and “the antithesis between mental and physical labor” disappear, then goods and services will be distributed according to the socialist principle of “to each according to his/her need.” Most socialists have identified the first stage of communism as socialism.

That is how Marx envisioned the transition of the bourgeois society after a successful socialist revolution led by the proletariat toward socialism.

Marx anticipated that the socialist revolution would begin in Western Europe, then the most industrially advanced region of the world. As we know, Marx’s prediction did not materialize in good measure because of the rise of labor aristocracy and bureaucracy that benefited from the status quo.

Instead, the newly formed and relatively small proletariat in Russia's predominantly peasant society came to power in the October 1917 revolution. The seizure of power by the soviets of workers’, peasants’, and soldiers’ deputies led by the Bolshevik Party opened the way to the socialist revolution.

The leadership of the PCC holds that Cuba is socialist. It is instructive that Lenin described the Soviet Republic as state capitalist in several contexts between 1918 and 1922.[4]

The Russian revolutions of 1917 were made by the soviets, in the case of the October Revolution, led by the Bolshevik Party. Soviets were elective political organizations that evolved rapidly from organs of revolutionary democracy into organs of state power and local governments (Smirnov, 1997, in Acton, Cherniaev, and Rosenberg eds., 1997, pp. 429-456).

The Cuban revolution of 1959 was a national democratic revolution, not a socialist one, led by Fidel Castro’s July 26 Movement and backed largely by the Cuban peasantry. The working class, with small sections organized in unions led by the Stalinist PSP, joined the revolution when victory over Batista was almost at hand.  As a triumphant movement led by Fidel Castro attempted to implement its program presented in his courtroom defense speech, published as “History Will Absolve Me (1953), they were forced to nationalize landholding and capitalist enterprise, some of which were owned by U.S. companies. The U.S. imperialist hostility began with cutting off trade with Cuba and imposing the embargo that was tightened over the years, resulting in the Bay of Pigs invasion on April 17, 1961, by Cuban counterrevolutionaries armed by the U.S. government and their defeat in 48 hours.  On May 1, 1961, Fidel Castro announced the socialist direction of the revolution in recognition of the new ties Cuba was forging with the Soviet Union and Eastern Europe.  

However, Cuba never experienced a socialist revolution in Marx’s sense, led by the proletariat and its self-organization and self-mobilization. The revolution has remained a national democratic revolution, led eventually by the Communist Party of Cuba established in 1965.

That is why the PCC leadership always refers to “Revolution” with the capital “R” referring to the leadership of it beginning with Fidel Castro.  Castro himself mistook Stalinism of the PSP as “Marxism-Leninism,” believing the Soviet Union under Stalin was socialist. In 2006, in his interview with the Spanish Ignacio Ramont, Editor-in-Chief of Le Monde Diplomatique, Castro asks himself: "…What is Marxism? What is socialism?" He then replies: "They have no clear definition (Castro & Ramonet, 2006, p. 389)."

I have argued that the Cuban revolution, as well as all other successful revolutions led by Stalinist parties since the October 1917 revolution in Russia, China, Vietnam, North Korea, and Yugoslavia, have been national democratic revolutions resulting in one-party states that aimed to secure independence, economic development, and industrialization. These leaders have used “socialism” as a mobilizing vision to motivate the working people to engage in their programs and policies. They also provided to varying degrees “socialist” welfare measures for the same reason.

However, there are three ways to ensure working people participate in such plans: through the market (as in capitalist countries), through the state (which the Stalinist leadership has done, including forced collectivization under Stalin), or through socialist democracy. Ernest Mandel, in a four-hour meeting with Che Guevara, tried to convince him of the absolute need for socialist democracy. Che Guevara was not moved (Toussaint, January 12, 2024). That remained the most crucial weakness in his theory of transition to socialism (Nayeri, July 3, 2011).

Since its inception in 1965, the PCC has used the Stalinist theory of transition to socialism, using both the state bureaucracy and market forces to organize the Cuban economy and society. However, it has never attempted to provide space for self-organization and self-mobilization of the Cuban working people. From its inception, the PCC was organized after the Stalinist model with no room for the formation of political tendencies or, if necessary, temporary factions. The current reforms focus on market liberalizations, but the PCC leadership would not allow the development of socialist democracy. It is only the power of the working people that can resist imperialism and forge a society and economy that could lead in the direction of socialism.   

References:

Acton, Edward, Vladimir Iu. Cherniaev and William G. Rosenberg. Political Companion to the Russian Revolution 1914-1921. Fidel Castro: A Spoken Autobiography. 2006.

Bastian, Hope. Everyday Adjustments in Havana: Economic Reforms, Mobility, and Emerging Inequalities. 2018.

Boobbyer, Clare. “In Cuba, There’s No Food Shortage; It’s a Wage Shortage. People Can’t Afford to Get Food.”adventure.com, June 24, 2026.

Castro, Fidel, and Ignacio Ramonet.  

Council on Foreign Relations. “Trump’s ‘Maximum Pressure’ Campaign on Cuba, Explained.” March 31, 2026.

Díaz-Canel Bermúdez, Miguel Mario. “Cuba's President Miguel Mario Díaz-Canel: "Reality Demands Urgent and Necessary Changes." Granma International, June 18, 2026.

Draper, Hal. “The Principle of Self-Emancipation in Marx and Engels.” Socialist Register. 1971.

Duroc, Dionys. “Cuba Just Approved Its Most Sweeping Economic Reforms Since 1959 — And Called Them Socialism.” Sociedad, June 22, 26.

Fromm, Erich. Marx’s Concept of Man. 1961.

Martínez Hernández, Leticia. “Council of Ministers Outlines Roadmap for Implementing Approved Economic and Social Reforms”. Granma International, July 1, 2026.

McDonnell, Patrick J., Kate Linthicum, and Ana Ceballos. “Cuba, Reeling from Oil Crisis, Acknowledges Talks with Trump.” The Los Angeles Times, “March 13, 2026.

Marx, Karl. Economic and Philosophic Manuscripts of 1844. 1844.

_________. Critique of the Gotha Program. 1875.

_______ . The General Rules of the International Workingmen’s Association. October 1864.

Marx, Karl, and Frederick Engels. The Communist Manifesto. 1848.

Mendosa, Samantha. “Cuba's Economic Challenges: GDP Predicted to Plummet by 6.5% in 2026,” CubaHeadlines. April 30, 2026.

Nayeri, Kamran.  “Socialism and the Market: Methodological Issues in Economic Calculations Debate,” Critique, December, 2004.  

____________. “Book Review: Che Guevara: The Economics of Revolution.” Journal of the History of Economic Thought. Republished in Our Place in the World: A Journal of Ecosocialism, July 3, 2011.

____________. Whose Planet? Essays on Ecocentric Socialism. 2023.

____________. “The Political Thoughts of Fidel Castro.” Our Place in the World: A Journal of Ecosocialism. April 19, 2024.

____________. “The Economic and Political Thoughts of Ernesto Che Guevara.” The Bullet, May 20024.

____________. “Systematic Crisis of Cuban Economy and Society.” Our Place in the World: A Journal of Ecosocialism. August 11, 2024.

____________. “The Cuban Revolution and Other Socialist Revolutions of the Twentieth.”  Century: A Reassessment.” Our Place in the World: A Journal of Ecosocialism. October 16, 2024.

____________. "End the U.S. Blockade of Cuba and Threats of Military Intervention NOW!" Our Place in the World: A Journal of Ecosocialism." Our Place in the World: A Journal of Ecosocialism. May 30, 2026. 

Robles, Frances, and David C. Adams. “Under U.S. Pressure, Cuba Rushes Drastic Economic Overhaul.” June 24, 2026.

Rodriguez, Andrea. “Cuba Pushes Through Sweeping Free-Market Reforms in Biggest Economic Shift Since the Revolution.” Associated Press. June 19, 2026.

Rubin, I. I. Essays on Marx’s Theory of Value. 1928/1972.

Silverman, Bertram. Man and Socialism in Cuba: The Great Debate. 1971.

Stalin, Joseph. The Problems of Socialism in the USSR. 1951.

The Rio Times. “Cuba Approves Its Biggest Economic Overhaul Since the Revolution.” June 20, 2026.

Toussaint, Eric. “Ernest Mandel, Revolutionary Cuba and Che Guevara.” CounterPunch, January 12, 2024

Yaffe, Helen. Che Guevara: The Economics of Revolution. 2009.

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[1] I have disputed the claim that central planning is, by its nature, doomed to fail. See Nayeri, 2004.

[2] Keynes argued that the classical claim called Say’s Law that supply creates its own demand does not always hold; he further argued that total spending in the economy (aggregate demand) drives economic activity, not just supply. Keynes also argued that if businesses and consumers lose confidence, they cut spending simultaneously creating a shortage of demand, hence an unemployment and over-production crisis. Thus, the market is not an efficient allocator of resources. He also argued wages and prices are sticky (they do not readily change to accommodate market changes necessary for efficient resource allocation.  Market choices are not driven by perfect, rational calculations, but by "animal spirits"—waves of human emotion, optimism, and pessimism (the animal spirit). In times of deep uncertainty, investors hoard cash rather than putting it into productive investments. This hoarding behavior misallocates capital and starves the economy of necessary economic activity. Finally, Keynes argued that during severe crises, interest rates can drop near zero, yet businesses and consumers still refuse to borrow or spend. In this "liquidity trap," private markets completely fail to stimulate demand or allocate resources effectively.

[3] The Gini coefficient measures inequality on a scale from 0 to 1, where higher values indicate higher inequality. This can sometimes be shown as a percentage from 0 to 100%, called the “Gini Index.” A value of 0 indicates perfect equality: everyone has the same income. A value of 1 indicates perfect inequality, where one person receives all the income, and everyone else receives nothing.

[4] "The Immediate Tasks of the Soviet Government" (April 1918), "Left-Wing Childishness and the Petty-Bourgeois Mentality" (May 1918),  “The Tax in Kind” (1921), and “Political Report to the Eleventh Party Congress” (March 1922). 

3699. How Marco Rubio Is Running Venezuela From Afar

By Tyler Pager and Anatoly Kurmanaev, The New York Times, July 11, 2026

Secretary of State Marco Rubio with President Trump at the White House in March. Credit...
Photo: Eric Lee for The New York Times

President Trump was sitting in the Oval Office earlier this year with Secretary of State Marco Rubio when an idea came to him.

Maybe he should dispatch Mr. Rubio permanently to Caracas, the Venezuelan capital, where U.S. commandos had carried out the proudest foreign policy achievement of Mr. Trump’s second term: the capture of Nicolás Maduro, the country’s president.

Mr. Rubio could be the next leader of Venezuela, Mr. Trump suggested. And while the president’s aides say he was joking — and that he frequently teases Mr. Rubio about an overseas assignment — the fact is that Mr. Rubio does not need to move to Caracas.

He already runs Venezuela from Washington.

In the six months since U.S. forces blew open Mr. Maduro’s bedroom door and snatched him in the dead of night, Mr. Rubio has become the de facto viceroy of Venezuela, holding sway over a sovereign nation in a way that no American official has since L. Paul Bremer III arrived in Baghdad in 2003 to run U.S.-occupied Iraq.

Mr. Rubio now effectively controls Venezuela’s finances, the distribution of its natural resources and its government, according to interviews with more than a dozen officials and people close to both governments in Washington and Caracas, who provided details about his involvement in steering the country’s policies. Many spoke on condition of anonymity to describe private interactions and internal discussions.

While he has not visited Venezuela in person since the U.S. took over, the Secretary of State is deeply involved in the country’s day-to-day operations, keeping in close contact with Delcy Rodríguez, who was Mr. Maduro’s vice president and now leads her country on an acting basis, with the imprimatur of the United States. The two exchange messages in Spanish on WhatsApp, trading gossip, birthday greetings, and selfies.

Despite the banter, the relationship between Mr. Rubio and Ms. Rodríguez is far from a partnership. It is a manifestation of Trump-era American power, in which the winner takes all regardless of sovereignty and international law.

The Venezuelan government did not respond to a request for comment. The Trump administration did not address detailed questions about Mr. Rubio’s authority in Venezuela. Mr. Rubio has downplayed his role, and largely avoids discussing his work. He declined multiple requests for an interview.

Tommy Pigott, a State Department spokesman, said in a statement that “with renewed cooperation and sound economic stewardship, Venezuela can re-emerge as a stable, prosperous partner whose citizens benefit from its vast natural wealth and strengthened ties with the United States.”

The direct control over Venezuela’s public revenues, in particular, distinguishes Washington’s influence there from most other countries beholden to its military and financial might.

The U.S. Treasury receives the revenue from most of Venezuela’s exports, then disburses it gradually to Venezuela through the country’s private banks, a relationship akin to parents handing out allowances to children. Mr. Rubio and his team set the conditions on what that money can be spent on, and by whom.

This system has allowed Mr. Rubio to stop Venezuela’s most egregious corruption schemes. And it brings some benefits to the Venezuelan government, which uses the effective protection of the U.S. Treasury to receive revenues without being hounded by the numerous creditors seeking repayment of billions in unpaid debt.

But the arrangement has also given Mr. Rubio immense leverage over Ms. Rodríguez, who depends on the money to pay workers and prop up the national currency.

He also oversees the application of U.S. sanctions on Venezuela, deciding who gets to do business in the country and how. He has worked to reshape the oil sector and boosted the access of U.S. companies. For her part, Ms. Rodríguez runs important government appointments by him, such as the minister of defense.

Since two earthquakes struck Venezuela last month, Mr. Rubio has sought to bolster the country’s interim government. The United States has sent 900 military personnel to Venezuela, committed nearly $400 million in aid and delivered crates of cash to the Venezuelan government.

The earthquakes have complicated Mr. Rubio’s stated mission to return Venezuela to democracy (“It’s a setback in that regard,” Mr. Rubio acknowledged last month). But the country’s ability to recover is critical to Mr. Trump’s ultimate goal: securing Venezuelan oil for U.S. interests.

 

The arrangement is deeply unusual, unfolding 80 years after the United States relinquished its last sizable formal colony, the Philippines.

But Mr. Trump has made clear he wants to return to an era of American expansionism, musing about taking control of Greenland, Canada and the Panama Canal.

He has found the most success in Venezuela. But there are risks.

Mr. Trump’s critics accuse the United States of siphoning Venezuela’s resources and propping up an authoritarian government by leaving Mr. Maduro’s henchmen largely in place. The arrangement also entangles the United States in the fortunes of a deeply unpopular, unelected regime facing increasingly restless clamor for political change.

“Secretary Rubio said that we are not at war with Venezuela,” Representative Sean Casten, Democrat of Illinois, said to Treasury Secretary Scott Bessent during a congressional hearing in February. What authority, Mr. Casten asked, did the United States have to control Venezuelan assets?

Mr. Bessent told Mr. Casten that he would get back to him.

Mr. Rubio’s hard-nosed realpolitik in Venezuela is a sharp departure for a man who spent his career fashioning himself as a champion for democracy in Latin America. He has said his goal is an eventual democratic transition.

The outcome of the Venezuela foray could shape Mr. Rubio’s political future as Mr. Trump considers his successor.

In the early hours of Jan. 3, shortly after Mr. Maduro was captured, Mr. Rubio reached Ms. Rodríguez by phone. Speaking in Spanish, Mr. Rubio told her that she had a choice between working with the United States or witnessing a broader attack targeting Venezuela’s infrastructure, military bases and senior officials.

After some negotiation, Ms. Rodríguez agreed.

She told Mr. Rubio that “she’s essentially willing to do what we think is necessary to make Venezuela great again,” according to Mr. Trump. The president said the United States would “run the country” until there was a “safe, proper and judicious transition” of power.

Days later, Mr. Trump told The New York Times in an interview that he expected the United States to run Venezuela for years.

At the center of the fulcrum is Mr. Rubio, dubbed by other officials as “viceroy,” the title given to the powerful governors who ruled the Spanish empire until Venezuela and most of its other provinces rebelled and won independence in the early 19th century.

As Ms. Rodríguez started to set up her government, Mr. Rubio weighed in on key personnel decisions, and encouraged her to purge Mr. Maduro’s family and business partners. She followed through.

Most Venezuelans expressed relief at Mr. Maduro’s downfall only to watch in disbelief as the Trump administration struck an alliance with most of his chief enforcers. Inflation has fallen but remains the world’s highest, and the country’s currency keeps losing value. Millions are clamoring for new elections, putting pressure on Mr. Rubio to move beyond economic deals and bring political change. Investors are nervous about putting capital into a system that could crumble at any moment.

Before the earthquakes, Ms. Rodríguez had been asking Mr. Rubio for more financial autonomy and the scrapping of economic sanctions, to reduce the domestic pressure on her government.

Mr. Rubio has been sympathetic to her arguments, but the U.S. government has not released control.

Mr. Rubio’s work with Ms. Rodríguez has provoked grumbling among some career U.S. diplomats, Venezuelan Americans and Mr. Trump’s allies, who bristle at the idea that Mr. Maduro’s chief lieutenant is in power.

Mr. Rubio and other officials have dismissed those concerns, pointing to how Ms. Rodríguez has followed nearly every order the administration has made, especially those related to the country’s finances. Venezuela sells much of its oil through two oil trading companies, Trafigura and Vitol, in an arrangement set up by the Trump administration.

Mr. Rubio has largely eclipsed Chris Wright, the energy secretary, in opening up Venezuela’s oil industry to foreign investment, the cornerstone of Mr. Trump’s vision for the country. He has prioritized the arrival of new American companies at the expense of European oil producers who were already working in the country.

Ben Dietderich, a spokesman for Mr. Wright, said the secretary has worked closely with Mr. Rubio, and has spoken regularly with energy industry leaders and Ms. Rodríguez.

Washington’s grip on Venezuela’s economy extends beyond the oil revenues. Mr. Rubio’s team drafts the licenses that provide companies who want to do business in Venezuela with exemptions from sanctions. Mr. Rubio has warned Ms. Rodríguez’s government to abstain from business with U.S. adversaries. Following Mr. Maduro’s downfall, for example, Venezuela’s state oil company has quietly taken over the operations of the oil projects that it co-owns with Russia’s state-run Rosneft. Rosneft did not respond to request for comment.

The Trump administration has also successfully pressured Ms. Rodríguez to turn over Venezuelans who have crossed the Justice Department. At the behest of the United States, Ms. Rodríguez’s government in February detained Alex Saab, the billionaire friend and business partner of Mr. Maduro, and approved his extradition to the United States, after stripping him of his Venezuelan passport.

 

Some officials believe the Justice Department wants to use Mr. Saab to strengthen the case against Mr. Maduro, who has been charged with various drug trafficking crimes.

 

And in June, the Rodríguez government helped the United States kill a criminal boss with longstanding ties to Venezuelan officials, according to several people familiar with the operation.

U.S. forces used the intelligence provided by Ms. Rodríguez’s officials to kill Niño Guerrero, one of the leaders of the gang Tren de Aragua, in a missile strike in a remote area of southern Venezuela. It was the first military collaboration between the two countries in decades. The Venezuelan government later recovered the gang leader’s body and passed it to the United States.

The Trump administration has accused Tren de Aragua of working with Mr. Maduro to flood the United States with drugs and illegal migrants, even though U.S. intelligence agencies last year assessed that Mr. Maduro did not control the gang. 

The Trump administration even exerts control over Ms. Rodríguez’s public appearances and statements. In May, Mr. Rubio announced that Ms. Rodríguez would travel to India before the Venezuelan government mentioned it, surprising Venezuelan officials and foreign diplomats.

 

When the Fox News anchor Bret Baier contacted Ms. Rodríguez about participating in an interview, she told him that Mr. Trump would have to approve. Mr. Trump loved that Ms. Rodríguez was deferring to him, and has repeatedly recounted the story to others when they ask about her, according to multiple people familiar with his comments.

When the United States attacked Iran, Yvan Gil, Venezuela’s foreign minister, issued a soft condemnation of the aggression against Venezuela’s longtime ally.

The Trump administration communicated to Ms. Rodríguez that the post should be taken down, and warned her not to publicly support its adversaries again. Mr. Gil deleted the post hours after posting it.

In effect, it was an admission that Venezuela no longer set its foreign policy.

Mr. Gil did not respond to a request for comment.

 

Mr. Rubio was asleep in Bahrain last month when he was awakened by a call from the White House Situation Room. Two massive earthquakes had hit Venezuela, and early images were grim. Entire neighborhoods were flattened, and scores of people were missing.

Shortly after, Mr. Rubio spoke to Ms. Rodríguez, promising the full assistance of the United States. American rescue teams were on the ground two days later. Mr. Rubio has described the administration’s plans for Venezuela in three phases: recover the economy, stabilize the country and transition it to democracy.

Before the earthquakes, U.S. officials said they were in the second phase, working to open up Venezuela to international investment. To further that goal, senior Trump administration officials have traveled to Venezuela to meet their counterparts and strike new energy and mining deals.

The resulting announcements, however, have mostly been optimistic outlines of potential investments.

In March, Doug Burgum, the interior secretary, visited Venezuela and met with Ms. Rodríguez at the Presidential Palace. During the visit, Mr. Rubio texted her to ask how the meeting was going. Ms. Rodríguez said it was going well, and sent a selfie with Mr. Burgum.

But the meeting was overshadowed by damaging news. Reuters reported that day that the Justice Department was quietly building a legal case against Ms. Rodríguez.

Ms. Rodríguez’s administration was shocked, and sought clarification from the White House. To allay Ms. Rodríguez’s concerns, Todd Blanche, then the deputy attorney general, called the report “completely FALSE.”

But the Venezuelan government sought further assurances. So the next day Mr. Rubio texted Mr. Rodríguez the link to a social media post from the U.S. president.

“Delcy Rodríguez, who is the President of Venezuela, is doing a great job, and working with U.S. Representatives very well,” Mr. Trump wrote. Ms. Rodríguez was pleased, and wanted to thank Mr. Trump with a post of her own. But first, she shared the draft with Mr. Rubio. She posted it after receiving his approval.

Before Mr. Maduro’s capture, U.S. prosecutors had been looking into many Venezuelan officials, including Ms. Rodríguez, though it is unclear if those efforts have revealed evidence of crimes. The Associated Press reported in May that the Trump administration told prosecutors to stop investigating Ms. Rodríguez.

The success of the efforts to bring stability to Venezuela, the second phase of Mr. Rubio’s plan, largely hinges on foreign investment. But investors are cautious. The oil sector is degraded and corrupt, and Ms. Rodríguez’s grip on power in uncertain. The earthquakes have delayed the negotiations for new oil contracts.

Mr. Trump appears unworried. He has repeatedly suggested that Venezuela could become the 51st state.

Who may lead the country on a more permanent basis is still deeply uncertain. María Corina Machado, the exiled opposition leader, remains the country’s most popular politician. But she has sworn enemies among Venezuela’s security and military officials, leading Mr. Rubio to bypass her and settle on Ms. Rodríguez as the country’s handpicked leader.

Once a staunch supporter of Ms. Machado, Mr. Rubio has distanced himself from her in recent months. The cooling relationship between the Trump administration and Ms. Machado became an open breach after the earthquakes. U.S. officials have refused to help her return to Venezuela out of fear of stoking unrest.

The time frame for the final phase of Mr. Rubio’s Venezuela plan, the free elections, remains undefined. When The Times asked Ms. Rodríguez in May when she would hold elections, she said, “I don’t know. Sometime.”

Political analysts say that Ms. Rodríguez may be trying to run out the clock on the Trump presidency, hoping that the pressure to hold the vote would fade under his successor.

For now, the question of when an election would be held is not in her hands. It is in Mr. Rubio’s.