[page 21]
Can Cuba survive?
past, its heavy dependence on the ex-ESSR and were becoming increasingly open. Recognising 'SOCIALISM OR DEATH'. The slogan posted in the main streets of Havana is meant to show the determination of the Cuban regime to defend the revolution to the end, in the face of increasing international isolation and IS imperialist aggression. Throughout the island calls to resistance, to defend the gains of the revolution and for national independence, attempt to rally support behind the regime at a time of dramatic economic, political and social crisis. The political representatives of US imperial- Fidel Castro.
ism eagerly anticipate the demise of the Cuban regime. Castro came to power in 1959 after an heroic three-year guerilla campaign. With Cuban society in ferment. by the end of 1960 landlordism and capitalism had been eliminated and US influence on the island expunged. Resting on a planned economy: and on the support of the Moscow bureaucracy: the new regime was able to achieve major social advances for the Cuban masses. Land was distributed to the peasantry. A guaranteed job with a living wage. and free accessto health and education. were introduced Consequently, infant mortality tell to 10.6 per 1,000 live births, life expectanc! increased to 74 years and literacy rates rose to 96",, — levels comparable to those of the advanced capitalist These indisputable achievements, in the teeth of American opposition, were, for decades. an inspiration to the exploited and oppressed of the third world, particularly in Latin America. The survival of the Cuban regime, just a few miles from the coast of mainland America. was a constant affront to the prestige of US imperialism for over 30 years.
Today Cuba is like a beseiged fortress. In the 200 MIR Ximena Campos, a recent visitor to Cuba, examines the perspectives for the Cuban regime.
Eastern European states. with whom it undertook up to 85% of its trade, protected the island from the cycles and shocks of the world capitalist economy. the drastic falls in the prices of raw materials, the worsening terms of trade and high interest rates that crippled the majority of third world countries. The link with the former Stalinist states was also the source of important benefits through cheap credits. guaranteed markets and preferential trade prices. For decades the ex-lSSR brought Cuban sugar at three. sometimes four times. its price on the world market. It sold its oil at a price that allowed Cuba to re-export it. which became one of Cuba's main sources of foreign exchange. The collapse of Stalinism in the ex-d'SSR and eastern Europe. however. means that. from mid- 1992, all new trade has to be undertaken at world market prices and in hard currency. This is a major blow to the regime. which at the same time. is the victim of a punitive economic embargo by T'S imperialism.
The immediate effects of unfavourable international conditions had already become clear in 1986. Then, with a fall in the world market prices of sugar and oil. Cuba lost 10°% of its income from exports. It was forced to halve its imports from capitalist countries and re-introduce rationing of some key products. The situation today: however. is far more dramatic. to the extent that it puts into question the very survival of the gains of the revolution. EVEN BEFORE THE carth-shattering events in eastern Europe. Cuban society was going through a period of turmoil as criticisms against bureaucratic mismanagement and inefficiency
[page 22]
socialismo o Muerte!
the widespread popular unease, and the need to break the deadlock in the economy, the Cuban leadership launched its 'campaign of rectification of errors' in 1986, which included a period of limited public debate. At assemblies organised in factories, state farms and collectives, neighbourhoods and universities, workers voiced their concern that the economy was sinking under a huge and inefficient bureaucratic apparatus where no forms of check or control against mismanagement existed. There was open criticism at the total lack of discussion and consultation when targets were fixed or methods of production and quality of goods decided. Protests were voiced at the corruption of party and state officials.
The strongest censure came from the youth - a mood the Communist youth organisation was forced to partially reflect - who hit hard against the authoritarianism and rigidity of the regime. There were demands to democratise the methods of appointing state officials and the party's leading bodies.
Castro attended many of the assemblies and was seen to hear out the workers; he even changed his mind after a strongly argued case or two. But this is totally different to the system of workers democracy necessary for the functioning of a planned economy: Unlike under capitalism, where the 'market', although in a totally chaotic and wasteful fashion, exercises certain controls on productivity, quality and efficiency - pushing out the most incompetent sectors
through bankruptcies etc during the course of the capitalist cycle of boom and slump - a planned economy can only function efficiently and take society forward on the basis of workers' control and management. This would mean a network of decision-taking that guarantees democratic participation and control on the part of workers and consumers, dealing with the most immediate problems to the issues that determine the strategies of development. This has never existed in Cuba.
The bureaucratisation of Cuban society has its origins in the very character of the 1959 revolution. As is the case today, Castro has always leant on the masses in periods of crisis, be it against the threat of imperialist aggression or the need to take on a section of the bureaucracy. But never have the workers and peasants been drawn into the actual running of society. From the very beginnings of the revolution all decisions were left in the hands of Castro and a small group of leaders who, although enjoying enormous popular support, crystalised into a ruling elite above and out of the control of the masses. Although in the 1970s popular assemblies were set up, these organisations functioned only at local level. Even then workers were blacklisted, harassed or lost their jobs if they became too vocal in their denunciations of irregularities in the administration.
The measures taken in 1986 attempted redress some of the worse cases of corrupt and inefficiency, including a clampdown. r
A Cuban sign - 'Socialism death!'
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220 MIR Autumn Cuba
Sugar accounts for
70% of
foreign earnings the 1991-92
harvest is expected to = the lowest for decades
private sector in agriculture. But, like Gorbachev's perestroika, they couldn't attack the root cause of the crisis which was the bureaucratic system itself.
THE COLLAPSE OF its trading network, on top of the bureaucratic mismanagement of the ec. onomy, have pushed Cuba into a qualitatively different crisis. The end of subsidised prices and the introduction of trade on the basis of hard currency has forced the island to reduce its imports by 50% this year, and its fuel consumption by 60%, resulting in severe dislocation of production. This meant not only a short-fall of food and wheat but also of chemical products, including key fertilizers for agriculture, and spare parts for machinery. The drastic fall of fuel imports has led to the total shut-down of key industries and short-time work for many factories.
In 1991 GDP fell by between 25-30%, and is expected to fall by a similar proportion this year. The gravity of the situation is seen in the sugar industry which accounts for 70% of Cuba's foreign earnings. Not only has the economy lost USS2bn in sugar revenue with the ending of the preferential prices paid by the ex- USSR; but due to shortages of fuel, lubricants and spare parts essential for mechanical harresters and mills, the 1991-92 harvest is expected to be the lowest in decades. Foreign observers estimate that Cuba's export revenue for this year will cover only around 30% of its import needs, excluding oil supplies. In response, the government has called on volunteers to cut the cane manually.
In February 1990, the regime introduced the 'Special Period in Time of Peace, a plan of measures of increasing severity according to the degree of crisis. The last stage - named "Zero Option' - would put the economy on a war footing and would be reached when the island was left with no fuel supply. The measures imposed heavy reductions in the use of fuel such as the repiacement of tractors by oxen in agriculture, the use of bicycles instead of cars, reduced domestic energy consumption. street lighting etc. The plan also re-introduced rationing of over 240 items in daily use, from food to shoes and hygiene products. In an attempt to deal with serious food shortages the regime mobilized redundant factory and administrative workers, as well as students. to send them to the countryside to increase the production and distribution of fruit and vegetables.
The effects of the crisis on daily life have been dramatic. Thousands of workers have been made redundant, the transport system is collapsing and family life now revolves around getting hold of essential goods. All dairy products have been rationed as state farms can't import feed for animals. Bread has been rationed to one roll per person per day, rice to 5lbs per month
sugar to lib per month and coffee to tozs per month. Yet even then there is no guarantee of supplies. Chicken or meat have been rationed to llb per person every nine days, but supplies haven't arrived since January this year. The long hours wasted daily in queues, and the irregularities of the supplies, are forcing increasing numbers onto the black market and there are recent reports of food trains being attacked.
For the first time since the revolution children are begging in the streets, not for money but for pens and paper, as there is no paper for schools and limited supplies for newsprint. The health service, one of the prides of the revolution, has no petrol for ambulances and suffers chronic shortages of X-ray plates, cotton wool. anaesthetics and medicine.
With the introduction of the emergency plans, Castro and the Cuban regime have stepped up their propaganda against the dangers of direct US military intervention. They point to the attempts by the US congress to tighten the economic embargo. The Communist youth org anisation celebrated its anniversary this year by digging underground shelters throughout Havana, to prepare for US bombardments. Although this possibility cannot be totally excluded, it is not in this that lies the real dangers to the gains made by the masses since 1959 - but in the isolation of the revolution in a small backward economy in the context of a new world balance of forces.
THE DEFENCE OF the planned economy - and despite the gross bureaucratic deformations of the Cuban regime this has been the basis of the many historical gains of the masses in the last 30 years — does not only depend on the wishes or determination of the working masses or their leaders, but, in the final analysis. on achieving a higher technique and labour productivity than capitalism. Only by developing the productive forces to a higher degree than under capitalism could a planned economy, even on the basis of a workers' democracy, consolidate itself and resist the pressures of a capitalist world economy.
When in 1917 Lenin and Trotsky raised the perspective of the working class coming to power in Russia, they never thought that it would be possible to consolidate the workers' state in conditions of backwardness and isolation. This is why they linked the survival of the young Soviet state to the extension of the revolution to the more advanced countries of Europe.
Trotsky made clear the source of the threat to the Soviet planned economy in the late-1920s in The Draft Programme of the Communist International: "The capitalist world shows us by its export and import figures that it has other instruments of persuasion than those of military intervention. To the extent that productivity of labour and the productivity of a social system as a whole are measured on the market by the corr-
[page 24]
elation of prices, it is not so much military inter-
vention as the intervention of cheaper capital-
ist commodities that constitutes perhaps the
greatest immediate menace to Soviet econmy."
(Pp36-37)
When in 1960 Castro was confronted with
the US economic blockade, he was able to stand
up to imperialism by abolishing capitalism and
landlordism and by turning to the USSR and its
alternative trade network for support. The en-
ormous aid extended, together with the possibilities opened up by a planned economy, allowed Cuba to develop an industrial base and
make major scientific breakthroughs in areas such as biotechnology and genetic engineering.
Most of all it allowed the regime to implement a policy of wealth distribution through huge state investment in basic services that completely transformed the lives of working people. Today, the disintegration of the LSSR and the COM- ECON trade bloc forces Cuba back onto the capitalist world market. But on the basis of outdated Soviet technology, and a heavy depend-
ence on one cash crop for export, it will do so with many of the weaknesses and disadvantages of other underdeveloped countries.
In an interview in January this year, Julio Carranza, an economist from the regime, explained the meaning of the change in world relations for the island: "We are trying to find a way out of our present crisis... We have to rethink the strategy for economic development in Cuba. All the roads that were conceived up to iwo or three years ago have been overtaken by history, because of a fundamental change in the international situation. Cuba has to change her strategy for development and the first step is to re-insert ourselves in the world market on a new basis. In order to do this it is necessary to play within the laws of the world market and despite the fact that they are unjust laws and difficult for the underdeveloped world, they are the only ones that exist. There is no other market but the capitalist market..." According to Carranza their first priority was to have access to "fuel and markets that are difficult to penetrate today. In the search for these elements capital, technology and markets - Cuba has opened its doors to foreign capital so that they can help us, give us the scarce resources and become investors." (El Mercurio, 19 January: 1992)
The new strategy is already at work. In June this year at a conference for foreign investors. 125 capitalists, amongst them Kodak, Proctor and Gamble and American Express, were told that Cuba was open to foreign investment in a whole range of industries from oil exploration to pharmaceuticals. Already there are 60 joint rentures, mainly in the tourist trade, where Spanish capitalists have taken the initiative.
The capitalists were told that a typical foreign developer could recover their investment in
three-and-a-half years and that approval to set up a textile factory, for example, would only take
between 25 and 30 days. The vice-president of
the Bank of Cuba added that they would consid
er debt-equity swaps to attract foreign invest-
ment, although fresh money would have to be
part of such a deal. This is the same method
used by other Latin American countries, m'hich
have sold state assets for reductions in their foreign debt. There is now also talk of partially
lifting the present laws that limit foreign ownership to 49% ot an enterprise.
In 1991, Castro told foreign businessmen: "It is perfectly possible for the socialist system to collaborate with the capitalist system." He then went on to point out the benefits of investing in Cuba: "You can repatriate your capital with greater ease than anywhere else in the world, because repatriation of capital is automatic here... we have adopted adequate labour legislation and tax facilities that don't exist in any other country... the government wants to create a free trade zone in the island so that private foreign investors can set up export and import businesses." (El Mercurio, December 1991)
In July this year, the national assembly made changes to the constitution which indicate the new direction society is taking. The new wording refers to "the socialist ownership of the fundamental means of production" as against the previous wording of "all the means of production." Before, article 18 stated that "foreign trade is the exclusive function of the state... Now the same article reads: "The state directs and controls foreign trade. The law establishes the state institutions and authorities that are authorised to: create enterprises for foreign trade, regulate the export and import operations, and determine the persons or corporations that have a legal capacity for carrying out said export or import operations, and for concluding commercial agreements." A new article has been added stating that: "The state recog nises the ownership of mixed enterprises, economic societies, and the associations that are formed in accordance with the law...
In short, these changes signify that foreign private investment will be allowed in the state sector, that foreign private ownership is legally recognised in joint-stock companies, and that some state enterprises will be given greater autonomy to make decisions in their own sec. tor, including the right to import and export without government permission.
IN AND OF themselves the measures introduced, and the constitutional changes, would not necessarily represent a danger to the planned economy or lead to capitalist restoration in Cuba. Even a democratic workers' state would incorporate into the planned economy: particularly in its initial stages, significant elements of market relations in a period of transition to-
WIR =23
The fundamer question what economic relations predomin
tal is:
Wi ite
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24O MIR Autumn Cuba
Divisions
within the bureaucracy
will increasingly ne into the
open
wards socialism. The tundamental question would be: what economic relations will predominate! This is determined by the general direction in which society is moving
In Cuba, foreign capitalists still face important limitations and the USS+00-500m expected in foreign investment this year, most of it in tourism, still represents no more than two per cent of the island's GDP. But in the context of the new world relations, as a result of the collapse of Stalinism, these measures represent the first steps towards the undermining of the state monopoly of foreign trade - a key element in the protection of the nationalised economy from capitalist international competition - and the break up of the planned economy.
Castro is insisting that Cuba doesn't want capitalism. "Capital and capitalism are not the same," he said in June this year. "Capitalists will not be the owners of our country. The country will continue to be socialist." (Financial Times, 14 July, 1992). When saying this he reflects. not so much the wishes of the bureaucratic caste at the top of society, but the tenacious desire of the mass of working people to defend the social conquests of the revolution. Nevertheless, Cuba's economy is slowly drawing to a halt. The lack of raw materials, credit, foreign currency and investments, as well as markets, is slowly strangling the economy despite the enormous sacrifices and determination being shown by workers and peasants. At the same time. Cuba is now being pushed to compete in the world market where it is at a disadvantage with res. pect to labour productivity.
In the final analysis, unless there is a fundamental change in the international balance of forces with the coming to power of the working class in one of the advanced capitalist countries. the tendency towards the restoration of capitalism in Cuba will be strengthened and become dominant. In the context of generalised crisis, those sectors of the economy with closer links with foreign capital - and therefore access to hard currency: raw materials, markets etc will become the most dynamic sectors of the economy and, over time, will become the dominant sectors. It is here where the dangers of capitalist restoration lie. According to the Financial Times. (29 July. 1992). tourism has already become the country's largest foreign exchange earner. Biotechnolog!: along with opening up the health service to tourists, are the other two areas targetted for growth. and both are being offered to foreign capital to 'help' their development.
THE CONSEQUENCES OF this change of direction will. however, be resisted by a large section of the population including the youth who. although extremely critical of the bureaucratisation of society, are nevertheless deeply conscious of the enormous gains achieved under
the planned economy in the last 30 years. The scars of the poverty and humiliation sutfered under capitalism are still present amongst the workers and peasants, who have passed on to the next generation an awareness of the historical conquest the overthrow of capitalism and landlordism meant. Cuba's highly developed health service and education system, its guarantee of employment and a living wage, along with its pensions and childcare facilities etc, contrasts sharply with the miserable conditions of the masses in the rest of Latin America. There is a broad awareness that capitalism in Cuba would not be like Miami but more akin to the other poor south and central American states. This consciousness is different to that which existed in eastern Europe prior to the revolutions of 1989, where the masses had western European capitalism as a model, especially the 'successful' West German economy.
At the same time, there is increasing hostility to the effects of some of the concessions being made to foreign capital, especially in tourism. The existence of a parallel economy for tourists, where everything that is scarce for ordinary Cubans can be freely bought with dollars and the exclusion of the local population from the bars, restaurants, shops, and even the beaches set aside for foreign tourists — is giving birth to strong resentment against a tourist apartheid'. Prostitution and black marketeering around the big hotels of Havana, linked to the growth of the tourist trade, are leading to increased repression against ordinary youth who are for the first time being stopped in the streets by the police searching for dollars, black market goods or drugs.
Moreover, while the island is being increasingly opened up to private capital, the regime has stepped up its propaganda campaign reasserting Cuba's long struggle for national independence, stressing the need for unity against aggression at a time of national difficulties.
All these factors. plus the increasing crisis and disintegration of the ex-USSR and eastern Europe - Castro regularly points out that these societies have not resolved any of their old problems but have only added new ones as a result of their more back to capitalism - expl ains the support the regime still has amongst wide layers of workers and peasants, including the youth. Even open opponents of the regime have had to admit that, as yet, no cohesive opposition has developed and that Castro still has a strong base of popular support, unlike the leaders of the former Stalinist states in eastern Europe.
NONETHELESS, INCREASING OPPOSITION against the regime, and open divisions within the bureaucracy, will develop as the crisis worsens. These are inevitable not only because
[page 26]
of deepening hardships but because greater numbers of workers see no way out of the present situation. The older generation often says that they have lived through three periods of difficulties; under capitalism, the first years of the revolution and now. Of the three many say that this is the hardest because they cannot see a way out.
Under conditions of international isolation, with the lack of a genuine Marxist alternative that could show a way out through a revolutionary internationalist perspective, there is total confusion and a sense of hopelessness which marks a decisive difference with other periods of crisis. Although the older generation is more patient there is growing demoralisation and exhaustion. Amongst the youth, a feeling that the situation can't go on for much longer. that things have to change, predominates. Few of them, as yet, express support for capitalism in Cuba, though many want to leave for Europe and the Us.
Widening differentiations are bound to grow in the next period between those with jobs and those without, between those close to the tourist and foreign sector - with access to dollars and the black economy - and those not, exacerbating the political tensions. In this situation the already existing divisions within the burcaucracy — in respect to the speed of political reforms as well as the scale of the concessions to private capital - will increasingly come into the open.
The constitutional reforms introduced in July allow, for the first time, direct elections to the provincial and national assemblies, although the ban on opposition groups is maintained. They also however give Castro greater constitutional powers, including the right to declare a state of emergency, to head the national defense council and to take personal control of the armed forces in an emergency. At the same time the regime has organised i clampdown with the creation of 'Rapid Response Brigades'. Up to now these have been used to harass known dissident groups, even though, as yet, these have no roots or wide support amongst the masses
Although, as yet, no section of the bureaucracy has argued publicly in favour of capitalist restoration, as the economic and international pressures mount, support for such changes are bound to surface. It is probably from the most privileged layers of the bureaucracy, above all their sons and daughters who did not particip ate in the direct struggle, who see no way out for themselves under the present impasse and hope to reap some of the benefits of a change of system, that support for outright capitalism will take root.
Other sections of the bureaucracy: including Castro himself who is fighting for survival, will put up resistance to such a fundamental change For example. if under conditions of a slump in
the world economy there is a movement back towards re-nationalisation by other Latin American governments. Castro could attempt to lean on them for support, as he is attempting to do by negotiating favourable trade deals with the Chinese bureaucracy and some Arab states. There could unfold, therefore, a very turbulent process in Cuba with swings and zig-zags in government policy - from concesssions to foreign and private capital to clampdowns and movements towards re-centralization and back again — as the different pressures within society, finding their expression within the bureaucracy, battle themselves out.
In the end international factors are decisive. Cuban workers and peasants face an extremely difficult period ahead. To defend the historical conquests of the revolution it is necessary not only to overthrow the bureaucratic regime which exists now and replace it with the conscious control and management of society by the working class, but also to adopt a resolute policy of workers" internationalism.
Since the revolution, the Cuban masses have given active support to the struggles of workers and peasants in many of the countries of Africa. Asia and Latin America. The regime. however. never saw the victories of these struggles as decisive for the survival of the planned economy: upon which it rests. But it will only be possible to preserve the gains of the revolutión and lay the basis of a genuine workers' democracy: with the victory of the working class in other countries and the creation of a new sostem of economic co-operation based on the solidarity of workers' states. Here lies the hope of the Cuban masses whose struggle in the past has done much to inspire the exploited and oppressed masses of the third world. C MIR 025
Queuing in Havana - for irregular supplies.
[page 27]