Cuba in Transition: A Socialism for the 21st Century

Nicholas Partyka I Geopolitics I Analysis I June 19th, 2014

The following is Part Four of a multi-part project entitled, " A Crossroads for Socialism: Cuba in Transition ." This series of analyses, observations, and dispatches on Cuba focuses on the country's unprecedented, post-Fidel transition. With a heavy reliance on macroeconomic, geopolitical, and foreign policy analysis, Hampton contributor Nicholas Partyka seeks to pinpoint the nuanced economic, political, and social changes that are occurring on the island nation, and how these changes are impacting everyday Cubans.

Part One: Introduction

Part Two: The US Blockade of Cuba: Its Effects and Global Consequences

Part Three: When Profit-Mongering Meets a Common Good: Contrasting Societies (US and Cuba)

It is of course true that every country is always in a process of evolution, and thus always changing. It is also true that at any particular point in time, all countries have structural issues to resolve. This said, it is also true that in some eras there are certain countries whose historical development and current political situation make for very interesting periods of social, political, and economic development. These are periods where, usually due to structural crisis, many different possibilities are realizable and all feel within reach for the society in question. For observers these epochs of change and transition are fascinating. These epochs are at the same time usually periods of often intense insecurity or instability. They can be turbulent times, wherein the optimism born of feeling able build a new and better society is mixed with the sometimes mortal danger implicit in the chaotic tumult of revolutionary upheaval.

In our era there are a few countries among this group of very interesting transitional and or crisis periods in their development. Today several nations are at important crossroads, and which way they go will have regional as well as international ramifications. In this group, and perhaps first due to the scope of the potential global implications, is China. Since this series is not about China I'm not going to say anything about the Chinese experience. Other interesting nations in transition include Venezuela, Bolivia, Argentina, Turkey, Egypt, and Greece. Cuba, as an astute reader will have already surmised, belongs in this group, maybe chief among them; one will be likely to think this especially if one is interested in the fate of and hopeful for the success of socialist revolution.

Cuba is undergoing a profound period of transformation right now. In fact, during my all too brief trip there were two very important economic reforms enacted. Change is underway in Cuba, and there is much more to be done. The Cubans are not close to the end of their reform programme. There are some big changes coming up for Cuba. The path towards a more sustainable and prosperous economy is not without its difficulties. The Cubans will face significant issues both internal and external as they attempt to implement the kinds of reforms needed in Cuba.

This is a period of reform and change that is in many ways being forced on the Cubans. The loss of Soviet subsidies in the early 1990s inaugurated what the Cubans call the "Special Period in Peace Time". This necessitated doing business with only capitalist countries. At this same time the US doubled down so to speak on the blockade policy with the Helms-Burton Act. This was a blatant attempt to tighten the blockade and bring down Castro's government at a time when it was seen as very weak. This dual shock resulted in a Cuban Great Depression that in macro-economic terms was more devastating than the US Great Depression. To say things were bad in Cuba in the 1990s is of course an understatement. This was the time of Elian Gonzalez, and a large increase in the number of boat people fleeing Cuba. Due to the US media's portrayal of Cuba most people in the US have their perception of Cuba stuck in the 1990s.

The rise of Hugo Chavez in Venezuela helped Cuba's economy recover somewhat, and get back on its feet. In the middle of the decade, wrapped in many layers of secrecy, the world saw the transfer of power from Fidel to Raul Castro. This transition of leadership opened the way to the reforms necessitated by Cuba's current economic and geo-political situation. If the Cuban revolution was going to survive, let alone thrive, structural changes had to be made in Cuba's economy. The old centrally planned model that they copied from the Soviets could no longer work after the Soviet Union fell apart. It is a real testament to the resilience of the Cuban revolution, and the commitment of the Cuban people to their revolution that Cuban socialism did not fall apart the same way European socialisms from Russia to the former Yugoslavia did. Nonetheless, times and circumstances had changed for the Cubans, and if they were to survive these changes they would have to change with them.

It was a surprise to many in the US that the Cubans were going to undertake large scale reforms, reforms leading away from the centrally planned model of socialism. This perplexed some in the US foreign policy establishment because many there saw Raul Castro as the more hardline of the Castro brothers. In actual practice Raul has shown to be a pragmatic leader who seeks input on the nature and pace of the reform processes from the people. As I mentioned before, many in the US saw this process of reform as one of the Cubans abandoning socialism just like the Chinese did. And as I said before, I will say again. The process of reform under way in Cuba is not one of reforming into a capitalist country. That appears nowhere on the agenda for the Cubans in their programme of transition.

The end result of this process of transition is somewhat unclear. It does appear that the Cubans are not aiming to copy the Chinese or Vietnamese. Beginning in the 1980s the Cubans began to question how much they were copying from the Soviet Union and whether or not it was good for Cuba to do so. What we can say is that in this period of transition the Cubans are not trying to emulate anyone. They are striving to develop a uniquely Cuban brand of socialism. They seek a kind of socialism that will meet the specific needs of the Cuban people in the particular situation that defines their social reality both domestically and globally. If I had to make a prediction I would say that my best guess is that Cuba is likely to drift towards a socialist model like the one in the former Yugoslavia.

This is a model of socialism that is decentralized, that can be combined with varying degrees of worker control and ownership, and that while utilizing markets also retains a strong state to curb market abuses and carry out important long-term planning. This is in some ways like the Chinese State Capitalist model. The Cubans however, are not seeming to aim at the creation of a domestic bourgeoisie to lead national development until they can eventually be surpassed. Though inequality is rising in Cuba, to talk of a Cuban bourgeoisie - outside of Miami anyway- is overdone. Cuba's model of development, judging from the kinds of reforms that have been undertaken thus far, is based on a bottom-up development strategy. The main idea seems to be to empower citizens at the most basic levels to meet their own needs in a socially and environmentally sustainable way.

The Cuban government does want to retain control over the process of social and economic development so that it can monitor in influx of undesirable elements. For example, the government tightly regulates the tourist industry, or rather has not moved faster to be more open to tourism, because Cuba wants to avoid the reintroduction of elements it knew before the revolution. For those who pay attention it is no shock to say that many nations that have strong tourist industries also suffer a host of social problems that come with it. For example, prostitution and sex tourism, drugs, pollution, diversion of resources away from needy domestic citizens and towards luxuries for tourists, and exclusion of domestic citizens from the enjoyment of some greater or lesser part of their patrimony. Maintaining a certain quality of life for Cuban people is an overriding aim of the government, and very much an integral part of their view of their national sovereignty.

What then are the main outlines of these reforms? Let me answer that question by dividing the reforms into three categories, Social, Economic, and Political. This division is just thematic, and is used just for clarity of exposition. Lets start with the Political reforms. After Raul took over from Fidel he fired several prominent members of the government that had been appointed to their positions by Fidel. He replaced them with persons who had served for many years in the government, and who had worked their way up the ranks of the party (PCC). This move has been seen as sign that Raul is emphasizing the more meritocratic channels of the party over hand picked succession. This looks to many like a move away from the personal authority of Fidel, or even Raul for that matter, and towards investing more authority in the institutions themselves. Moreover, especially in the latest elections the racial and gendered composition of the National Assembly (ANPP) has come to be more reflective of the diversity of Cuban society. Importantly, along these same lines the average age of the top leadership is coming down, albeit slowly. Lastly, the current First Vice President Miguel Diaz Canel appears to enjoy much popular support among Cubans. He is seen as an effective politician who was able to turn around a couple of different provinces in Cuba when he was the Party chief of those provinces. These are all encouraging signs for the political future of Cuba.

Secondly, the Social reforms underway in Cuba are opening up Cuban society more to the world. As with tourism, the government does wish to keep some control over the nature and scope of Cuba's openness to the world; because the fact is that one of its closest neighbors and the world's largest economic power is openly hostile to the regime in Cuba and has been trying for decades to undermine and overthrow that regime. Until recently Cubans had to get a so-called "white paper", an exit visa, in order to leave the country. This restriction has been lifted, and Cubans have an easier time going to live and work abroad. Before Cubans could go abroad to live and work but had to return every five years or so in order to maintain Cuban citizenship and thus the right to own property in Cuba. Now this restriction has been eased and Cubans working abroad can simply pay what amounts to a tax in order to retain Cuban citizenship and the rights entailed therein.

The easing of this restriction was in some way quite needed. Cuba has a very highly educated population, and a need to generate hard currency to obtain essential imports. Very naturally then, when this restriction was lifted it became more feasible for high skill Cuban workers to go abroad and earn money. Doctors and scientists are two of Cuban most numerous and remunerative exports at present. The flip side of this domestically is that the large numbers of well educated, mostly young, Cubans leaving has resulted a large population of Cuban seniors who lack support because all their children live and work abroad.Cuba now has an aging population and the need for younger support workers to take care of them. However, these younger workers are heavily incentive to go abroad for work, usually to try to help the family through remittances. This growing Cuban diaspora has helped Cuba generate hard currency and alleviate alienation among the youth, but it has also had unintended social consequences.

On the Economic front the Cubans have undertaken an aggressive set of thoroughgoing reforms. The government began with a couple of reforms that people had been asking after for some time. Namely, they wanted an easier time changing houses, and obtaining cars. In response the government liberalized the rules on private housing transfers in an attempt to create more of a free market in housing. They also liberalized the rules for buying and selling cars. This later was specifically important because car ownership means one can go into business as a taxi driver. And it is possible, depending on whether one lives closer to places where tourists congregate, to earn a lot more money as a cab driver than one can in one's regular job. A freer housing market has allowed people to buy and sell housing more easily, thus being able to manage their assets in a way that is best for their particular situation.

Among the range of other reforms being undertaken by the government in Cuba include an increase in "self-employment" mainly in the service sector, incentivizing cooperative especially in agriculture, altering the current ration card system, increasing openness to foreign investment in the economy, and eliminating the dual currency system. These are significant reforms to the economic model that has dominated Cuba since the revolution. There has been, and likely will continue to be some resistance to some of the proposed changes. The government to its credit has listened to the people at each step in the reform process and adjusted the pace of nature of the process accordingly. Some reforms are not moving along at the pace the government would like, but they have adapted their programme on the fly so as not to case large scale disruption in people's lives as much as is possible.

Successfully enacting these reforms, and reorganizing the Cuban economy and some social welfare programs will not be easy. What experience has taught thus far is that each reform brings about unforeseen consequences that must be dealt with as they arise. But, if there is any people that can do it, I think certainly the Cubans can. If necessity is the mother of invention, then the Cubans must undoubtedly be some of the most inventive people in the world as few nations have had necessity so rigorously enforced on them. To take objective stock of what the Cuban revolution has accomplished for the Cuban people to date, and the resources they have had to achieve those results with one cannot but be impressed. One should not be able to look at this situation without feeling very optimistic about the ability of the Cuban people to find solutions to their problems. The next dispatch will focus in more detail on the nature of these reforms in the economy.

It should be emphasized that all of Cuba's historical accomplishments and current transition project have been produced from the ground up, or from zero; both expressions are apt. After the triumph of the revolution Batista and his cronies looted the nation's treasury. When Fidel and the July 26th movement took power the nation was broke. More than this, due to varying admixtures of propaganda-generated fear of the new government, guilt, and selfishness many Cubans left Cuba in the wake of the revolution's victory. Who left? Of course it was the wealthiest, those who are usually the better educated part of society who in the main chose to flee. For example, Cuba lost literally half of all of its doctors in the early days of the revolution. This kind of brain drain and capital flight provided for an inauspicious beginning to say the least.

Many Cubans who could have really helped their country a lot chose instead to flee because the regime was going to curtail their bourgeoisie privileges. For too many Cubans who left their personal wealth and status appears to have been of greater value than the independence of their nation, and the uplifting of it most neglected and oppressed members. Maybe many of them would say they are for both of those things, and very passionately so. But it also seems like as much as they are for those goals, they just don't want to pay for it with their own privileges and incomes. Add to this looting, brain drain, and capital flight the US blockade and US-sponsored terrorism and you see something of the scope of the challenges faced by the revolutionary government in forging a new society in Cuba.

As if doing this once was not enough, the Cubans have in fact done it a second time. When they lost their strong economic relationship with the Soviet Union, and the US tried to ratchet up the pressure by tightening the blockade the Cubans were plunged into a period of economic turmoil, illustratively termed a "Cuban Great Depression". Cuba has many times, and with little notice in the US, been ravaged by natural disasters as much as by US economic warfare. And yet, even with the loss of Soviet subsidies, and the increasing hostility of the US, the Cubans carried on and rebuilt. It is from being knocked back to zero in this way in the early 1990s that Cuba is currently trying to build up a new society once again. Developing a strong economic relationship with Hugo Chavez's Venezuela in the early 2000s certainly helped Cuba begin recovering, but in no way obviated the need for deep structural reform.

And the US still encourages brain drain from Cuba as it has for decades. It does so first by extremely generous immigration provision for Cubans, ones any other nationality would be extremely envious of. We have granted more generous immigrations provisions and benefits to Cubans than to victims of the conflicts in the former Yugoslavia. More than this, the US maintains a kind of poaching policy for Cuban doctors. When their terms of service are up, and this service is often performed abroad, the US targets them and they are offered a kind of deal. Easy access to the US, they can come and live there, and they'll even get a little economic help to do so. But, only on the condition that once in America they forego any practice of medicine. Come to America, and give up being a doctor is the deal we offer. This removes doctors from the field and hurts Cuba's ability to project the foreign policy it wants. It also limits the Cuban government's earnings from these doctor's services abroad. Moreover, it hurts the Cuban government in that these doctors who take the US offer, their training is now a sunk cost for the Cubans.

In the face of all the difficulties mentioned here, and in previous dispatches, Cuba and Cubans continue to struggle to building up an inclusive, participatory, democratic, and socialist society. They are working in face of a wide array of challenges to build up a new socialism, a socialism for the 21st century. This is not the same as Hugo Chavez's project of 21st century socialism; though both projects share many of the same basic moral and political values. Cuba is trying to find a way to retain the benefits of its socialism while existing in and doing business with a capitalist world. The other socialist nations that have attempted this transition have all abandoned socialism in one manner or another. The former eastern bloc nations abolished socialism, while the Chinese and Vietnamese transitioned more slowly away from socialism, and adopted versions of state capitalism. Cuba is the last socialist nation to attempt this transition, and its fate in this endeavor can either produce a new rebirth of socialism, or provide only the more fodder for post-Cold War neo-liberal triumphalism.