Wednesday, December 31, 2008

Cuban Revolution Survives Economic Crisis; Still a Challenge to Market Orthodoxy
by Harry Targ

Summer, 1999

The Cuban revolutionary government, challenged by the United States for forty years still survives in a post-cold war international system. The scruffy band of guerrilla fighters, led by Fidel Castro and Che Guevara, came to power in 1959, dethroning long-time dictator and U.S. client Fulgencia Batista.

From the beginning the United States engaged in sabotage, external attacks, an economic blockade, ending diplomatic relations, and prohibiting U.S. tourists from traveling to the island, all to undermine the regime and generate enough opposition to the Castro forces to overthrow it. Despite well publicized policy "changes" in recent weeks, the Clinton Administration is still committed to the overthrow of the Cuban revolution. But why?


Primarily, the Cuban political and economic system remains committed to its own brand of national autonomy and socialism. The Cuban state continues to provide free health care and education, a basic rationed diet of food to all Cubans, almost free housing, and free and low cost cultural attractions to all Cubans. Racism, and more recently sexism and homophobia, has been significantly reduced in Cuban society. And, even in the face of sabotage and covert operations against the island nation, political democratization at the local, regional, and national levels has been increasing.

Even while Cuba's articulated autonomous, communitarian, egalitarian, socialist principles are not fully achieved, the island nation 90 miles from the United States represents a challenge to what Clinton supporters call "market democracies." For the United States, all nations must cut back government programs, end supports for the disadvantaged, sell off profitable and efficient state-owned enterprises and "let the market" manage peoples’ lives. For the Cubans, "the magic of the marketplace" would mean giving up national autonomy to the 250 multinational corporations and banks that dominate the global economy, the end to free health services and education, and the dramatic shift in the distribution of the wealth of the country from the vast majority to tiny minorities (including Miami Cubans who would return to claim properties their families left over 40 years ago). In short Cuba remains an alternative model of social, political, and economic development for poor countries in Latin America, Africa, and Asia. This the U.S. seeks to challenge.


How is Cuba surviving the radical changes in the world and its own economy since the collapse of the Soviet Union in 1991? The collapse of the Socialist Bloc led to deep economic crisis for Cuba. Between 1991 and 1994, the Cuban gross domestic product declined by 35%, imports dropped by 75%, oil imports declined by half, and caloric intake dropped from roughly 2800 to 1735 per day. The impacts of the 40-year U.S. economic embargo in this context became all the more costly to Cuba (1997 estimates say the embargo cost the Cuban economy $800 billion just for that year alone).

The Cubans were forced to adapt to the collapse of socialism and the complete global capitulation to "marketplace" global capitalism. In 1994-95 a series of new laws were put in place to facilitate economic recovery. They included the legalization of the dollar in local transactions, shifting agriculture from state farms to agricultural cooperatives owned by groups of farmers, the opening of private agricultural markets for the sale of surplus produce, the legalization of small business enterprises run by families, and the legalization and expansion of foreign investment, particularly to encourage joint venture investments with foreign companies. (Only U.S. investors have been excluded, not by the Cuban government but by the United States government).
As to economic strategy, the Cubans committed themselves to rebuilding their tourist industry, expanding their innovative pharmaceutical and biotechnology industries for export, maintenance and enhancement of traditional exports such as nickel, sugar, tobacco, and citrus, increasing research and development of energy resources, and encouraging small enterprises as an alternative to the black market.

By 1998, Cuba had joint venture agreements with 340 foreign companies, oil and gas production had risen, tourism had earned upwards of $2 billion per year, and tourist and housing construction on the island had grown markedly.

The Cuban economy has made significant advances since the depths of the economic crisis in 1993-94 (caloric intake on a daily basis is up to 2,400 from the desperate 1,735 figure and the vital health and education systems survive even in weakened form) but life remains hard for most Cubans. Many must work two jobs. Those with access to dollars live easier lives than those that do not (maybe half the population) creating a modest but potentially destabilizing system of economic stratification.

Tourism has created boom times but also prostitution, ugly commercialism, overcrowding, and some unsavory cultural penetration by those from European, North American, and Latin American societies.

However, while Cuba has been forced to make significant changes in economic policy to relink with the capitalist global economy, it remains committed to the original goals of the revolution-healthy, well-fed, educated citizens- and sees the state as playing a significant role in maintaining and enhancing these goals. Hence, Cuba continues as a challenge to the dominant market orthodoxy that is sweeping the world and continues to the present, in word and deed, the vision of altruistic women and men of all races struggling together to achieve a better world for all.