Following Andrew Goldberg’s interview with Fidel in the Atlantic where Castro was quoted as saying the Cuban economy doesn’t work anymore, comes this news of the state cutting 500,000 “redundant” jobs and allowing the expansion of worker cooperatives and private business. Even the Cuban Workers Confederation, the only legal trade union, got in on the act, stating
“Our state cannot and should not continue supporting businesses, production entities and services with inflated payrolls, and losses that hurt our economy are ultimately counterproductive, creating bad habits and distorting worker conduct.”
The change in party line, until recently committed to full employment, sounds much like something an American CEO would say or what most Democratic/Republican candidates mouth on a regular basis. Or perhaps, from a bygone era, the volte-face of a Stalinist union (which, I suppose, the CWC is). Still, this isn’t much different a policy than what we’ve seen happen in China or Vietnam: the bureaucrats slash public jobs and privatize businesses, then use their political connections to buy up the most efficient state industry. The Cuban CP will clearly maintain political control, like its counterparts in Asia.
This has a significant impact because Cuba was “our” communist nation, the only one in the Western Hemisphere, and because it has withstood a fifty-year economic embargo from the United States. We loved to hate Fidel, and even after the USSR collapsed 19 years ago the Cubans bravely soldiered on without the privatization of state industries as in China and Vietnam. Cuba has been seen as a model for nationalist and independence movements in Latin America especially, so of course the press would see this announcement as a waving of the white flag – our greatest hemispheric enemy announcing that “communism” doesn’t work.
The reality of the issue is, as always, more complex. Soviet subsidies accounted for $4-$6 billion annually until 1991, a not insignificant amount of the island’s $65 billion GDP. The US embargo has hamstrung the economy, as it impacts not just American businesses but also potentially foreign businesses which trade in Cuba and also wish to sell in the United States. It’s roundly condemned by the United Nations – but of course the United States ignores the UN except when it benefits Washington. There’s a case to be made, however, that the embargo has kept the Fidel regime in power, and from making these cuts to services years ago. A burgeoning trade with the US might have empowered a section of the bureaucracy to embrace capitalism far earlier and become a nascent bourgeoisie.
Cuba is also an island nation that we can at best classify as being included in the world’s economic periphery, albeit at the top. Peripheral nations are mainly raw material/agricultural exporters, or the site of factories relocated from the core (“First World) of the world economy. Cuba’s strategy was much like that of other Stalinist nations over the last 70-80 years: to take a mostly agricultural country and industrialize it, raising living standards for the masses. This was typically done with a mercantalist strategy of the government dominating imports and exports (which also prevented the rise of an independent capitalist export sector). In the USSR this was called the “government monopoly on foreign trade” and was the subject of heavy debate in the 1920s. Still, it was a modern, post-capitalist version of 19th century debates in the US and Germany over high tariffs in order to protect domestic industry, except this time the industry was state-owned (ostensibly collectively) and undergoing “primitive socialist accumulation” to catch up to the more advanced capitalist nations. Industry was built in order to reach a quantity of good produced (mostly industrial, not consumer) and employ the population – not necessarily efficiently. The legacy, and irony, of Stalinism, is that where it dominated it modernized and trained the economy, built infrastructure, and educated a workforce better than capitalism did for the rest of the post-colonial world, to the degree that businesses now site in Vietnam and China instead of other, poorer locales.
What should we expect from a peripheral nation’s economy when it is embargoed by the world’s economic hegemon and mostly cut off from outside investment for half a century? Clearly, even in the best of circumstances, other small Caribbean and Latin American nations have not really been able to lift their citizens out of grinding poverty – and that was almost never the goal of any government in Latin America outside of Cuba; they were, rather, happy enough to let a few get wealthy while the country was exploited by international corporations. Cuba has fared better than most, with a high literacy rate and a very educated population, model organic farms and a political system independent of US control. Still, there never was chance to build “socialism in one country” even in the USSR, let alone Cuba.
Cuba is facing a harsh economic reality, and the one-party dictatorship and bureaucracy that runs the island has only a few choices, none of them good. It can open up major parts of its economy to private influence, something the announcement is clearly leading towards, let the better-placed bureaucrats cash-in, while the Cuban Communist Party retains political control. This is the China/Vietnam model. It can stagger on as it has, isolated and poor. North Korea is our best remaining example of this course.
Or, it could democratize the political system while turning over the control of the economy to the working class and people of Cuba – something which is not bloody likely. This is what the old Trotskyist sects call a “political revolution” by the working class, but I think it would require a thoroughgoing revolt against the entire modern bureaucratic way-of-life to succeed, and would not immediately increase the standard of living for working-class Cubans. It might, in fact, get worse as they reassess the real economic situation, assign people jobs and create cooperatives that scrounge over the remaining resources. They would need to “spread the revolution” in the old parlance of Marxism, or at least have another large benefactor (none would likely be forthcoming).
Raul, Fidel, and their coterie are anything but stupid, and they’re going to maintain their grip on power until forced out. There are few choices for them short of relinquishing control to the workers (fat chance) or dissolving and turning government over to a nascent bourgeoisie (I think they’ve studied the USSR too well to let this happen). So we’re probably left with these abysmal cuts in social services until something happens. Perhaps the decay of the last bastions of the “Old Left” will allow for a new, non-hierarchical left to emerge.