Editorial 38. March-April-2014
THE REFORMS DO NOT IMPROVE THE EVERYDAY LIFE: ACCELERATION AND DEPTH ARE NECESSARY WITH THE UTMOST SPEED
Every democratic government has a limited time to show, trough its administration, results that improve the life quality of citizens.
The Cuban government headed by General Raúl Castro (2006-20014) has had eight years to achieve this aim. However, reality shows us that the everyday life of the Cuban people is harder and more expensive with more shortages and poverty.
The slow and superficial reforms are not enough even to alleviate the everyday struggle for survival. The gap between the ones who have more and the ones who have less is bigger and bigger. In eight years the prospects of the reforms have been channelled into the reduction of the public expense and the search for efficiency but the essence of the economic model and the apathy in the minds of the majority remain intact.
It is necessary that the reforms in Cuba go from the surface to the core of the model, from slowness to diligence, from political obstinacy to economic laws, from inefficiency to real creation of wealth; from the zigzag movements and the twists and turns to respected legality and coherence which inspire the very citizens and the foreign investment with confidence.
Social shortages without free enterprise
According to the eminent economist, professor Carmelo Mesa Lago, in his presentation at the Third Catholic Social Week of the Miami Archdiocese held in February 2014:
- 1.“The economic structural reforms by Raúl are necessary and they are directed toward the market.
- 2.But many of them, though rational, have adverse social results.
- 3.The cost of social services has been reduced.
- 4.The layoffs of redundant workers have not fulfilled the goals because the expansion of the private sector has been poor and the open unemployment has increased.
- 5.The measures to increase the salary seem to have had no effect and the real salary fell 72 %.
- 6.A great part of high-cost gratuitousness has been eliminated but this has worsened the social situation.
- 7.Health expenses are the most reduced and the access to health service and its quality have deteriorated.
- 8.Inefficient educative programs have been shut and registration for key careers has bettered.
- 9.The reform of pensions didn’t reduce the deficit covered by the State and the real pension fell 50%.
- 10.In spite of positive measures housing construction fell and the deficit increased.
- 11. Social assistance is a key requirement to palliate the effects of the reforms but it has been reduced.
- 12. It is necessary to create a minimum net of social protection that should protect the vulnerable population against adverse social effects of the reforms”.
Here is a qualified and balanced assessment. Our opinion is that the outcome has been the implementation of some measures of adjustment without the corresponding liberation of the blockade to private property, free enterprise and a Law of Investment that should allow the necessary change into an open, efficient and participatory economic model.
We all know that wealth cannot be redistributed if wealth is not created, that is, goods and services in competition in order to improve the life quality of citizens. The implemented Economic and Social Guidelines cut down on things but liberate nothing. They diminish public expenses but they don’t create free and efficient enterprises.
We still are in a timbiriche (1) economy
The proposals should be directed to free the productive forces; all of the productive forces and not only the smallest and medieval services.
We have to say it clearly:
-As long as there is a “List of Permits” for timbiriches, the productive forces and the creativity of Cubans will not be released. That is the greatest embargo that our economy endures and it is in the hands of the Government to lift it already.
- As long as there is not a Law of Property that should guarantee the enterprising Cubans not to endure confiscation, closure, pressure by “inspectors” and countermeasures, Cuba will not have responsible owners because what belongs to “all” does not have serious responsible people. That law should give security to the ones who undertake a business and to all kind of property: personal, private business, cooperative, mixed. The embargo on property is another one that is in the hands of the Cuban Government and it should be lifted already.
- As long as there is not a Law of Enterprises that should guarantee the necessary free enterprise to start the economy and to make it work, the enterprising character of Cubans is blocked behind the counter of a timbiriche or behind the steering wheel of a “taxi-almendrón” (2). That law should guarantee the big enterprise and also stimulate the small and medium enterprises (PYMES) (3) which promote a productive and supportive middle class. This is an embargo that depends on the Cuban government. It is necessary to lift this blockade already.
- As long as there is not a new Law of Investments that should guarantee the greatest Confidence-Country rate inside a legal framework respected by all and with financial seriousness on the part of the Cuban authorities and the investors, the creation of wealth in Cuba will be blocked due to the lack of capital. The Cuban community that lives in the Diaspora should have priority to invest in its own Country. That’s another embargo the Cuban government should lift already.
The order these laws are being passed is also important. We should ask ourselves: Why is a migratory law passed before the law of enterprises? Is it more important for Cubans to travel than to undertake a business freely in their own country? Why is a law of foreign investment passed before than the law of property and the law of free enterprise for Cubans? Is it fair that foreign investors arrive first and become the owners of the country before the very Cubans?
These are three laws that would truly guarantee the structural changes which would start an efficient and prosperous economic model in the first place, capable of distributing the created wealth respecting nature; this way poverty rates could drop, the no-longer existing middle class could be swelled and the real, continuous and sustainable long-term growth could be guaranteed without those big economic and financial subsidies from countries like the former USSR or Venezuela which Cuba has depended on. This kind of relationship was established with the United States in the early 20th century but the very Cuban enterprises showed with their work and sacrifice that Cuba can take charge of its economy and place itself as the first sugar exporting country in the world and in 1958 the country ascended to be the third country with the highest Gross Domestic Product (GDP) in Latin America.
Stop the “experiment” with human beings: Lift the blockade to the initiative of Cubans
What was the difference between the dependence on the United States and the dependence on the USSR-Venezuela? The answer is that during the first half of the 20th century, until 1960, private property, free enterprise and foreign investments were guaranteed by law. From the time of the creation of a State centralized economic model, efficiency disappeared, bureaucracy increased, poverty and scarcity increased, all mechanisms of creation and citizen’s empowerment were blocked and the international obligations stopped being fulfilled which led to the embargo, on one hand and on the other hand it led to economic and financial isolation. Those are the true causes of our present situation.
The 24th of February was another anniversary of the Government by Raúl Castro and it is necessary and urgent, a matter of survival and sustainability to carry out the changes the three enunciated laws would guarantee: property, free enterprise and free investments. Other laws will be necessary too but all the indications are that the third of these laws will be passed without the two first ones. It won’t work either because that will turn Cuba into a cheap-labor-force “maquiladora plant” or into an “archipelago of duty free zones” dependent on countries and private investors who will give nothing but remains to we Cubans, women and men who have economic and social rights which are violated through these measures and guidelines that combine the worst of capitalism: adjustments, unemployment, increase of inequality and poverty, with the worst of the so- called planned and centralized socialist economy which blocks the productive forces, hinders the enterprising character of Cubans and violates their economic and social rights such as the possibility to be investors and part of those enterprises and their own enterprises.
The priority should be for Cubans and not for foreigners. Cubans shouldn’t be either in so-called job bank earning a salary which is only a part of the real wage that such foreign enterprises pay their own citizens; this is what was done at the public square in the time of slavery and savage capitalism. Is that sovereignty and patriotism? There must be something wrong.
We are quite confident about the enterprising character of Cubans, women and men. We know their true work culture when they are in charge of their lives and they can design and carry out their own life projects. We have shown it here, before and now and in the tough Diaspora, before and now, when our brothers have started over with absolutely no possessions; they have progressed and they have cooperated with the progress and development of the countries that have generously accepted them.
And if we have been able to do that in countries with different cultures, in a middle of a fierce competition and with nothing in our hands, just the solidarity of other Cubans, anyone can imagine what we will be able to do in our own country.
It is ethically unacceptable to continue blocking those talents and capacities for progress. Stop the economic and political laboratories with human beings. We Cubans have the character, the education and the eagerness to progress in order to get out of this tricky hybrid experience.
Free all the productive forces and charismas of ordinary Cubans, women and men and Cuba will see the progress and overall human development it deserves.
We are sure of that.
Pinar del Río, February 24th 2014
On the 119th Anniversary of the Independence War restarting.
(1) Timbiriche: A popular and picturesque word used in the Island to make reference to a small and precarious private business.
(2) Almendrón: An old American car from the 1950’s.
(3) PYMES: Small and medium enterprises (acronyms in Spanish).