The obstinacy of a crumbling Castroism

Meaningless economic “readjustments” will be remembered, not as the initiators of the rejuvenation of the Cuban economy, but rather, as the final rattles of one of the few remaining relics of communism

During the life of a dictatorship, there are times at which the instinct of survival pushes its leaders to carry out a profound reform of the manner in which it operates. This often happens when the despot who set it up passes away or, by the force of health or age, is about to do so.

The reform process is not free of uncertainties since nothing and no one can possibly guarantee the ruling clique that the people will not seize the occasion to push for a full-fledged regime change and for the instauration of a democratic system. This is the reason why dictatorships avoid carrying out such an exercise until the circumstances (economic malaise, people’s mobilization and/or international pressure) make it impossible to continue to procrastinate.

China is a conspicuous example of a dictatorship that managed to survive to the demise of its founder. It did so by undertaking a radical change in the economic domain, putting in place a centralized, State capitalism (labelled “market socialism”) under the un-Marxian slogan “To get rich is glorious”, while keeping at the same time the political rigidity typical of totalitarian systems.

How long the Chinese model will last is anybody’s guess. Social and regional inequalities are approaching explosive levels. The economy shows signs of entering stagflation. And unlike what occurs in democratic societies, in China the political rigidity doesn’t allow public discontent to be channelled through free press and through elections offering competing policy options.

The Chinese leadership is not unaware of the fragility of the country’s growth model. The Prime Minister himself, Wen Jiabao, declared in 2007 that the model was “unstable, unbalanced, uncoordinated and ultimately unsustainable”.

In the meantime, however, that regime stands afoot, the reason being – it ought to be emphasized – the fact that it abandoned Marx’s economic dogma.

Another relevant experience relates to a country with a much lighter weight in world affairs: Nicaragua.

There you have a ruler, Daniel Ortega, who doesn’t hide his friendship with more than one of the world’s most unsavoury dictators; who has the nerve to join Hugo Chávez and Fidel Castro in coming to the defence of a murderer like Muammar Gaddafi; who resorts to unconstitutional and fraudulent stratagems so as to remain in power.

There you have, in other words, a ruler with many murky things in his pouch, but who has been careful not to pursue a foolish economic policy.

Notwithstanding his anticapitalist rhetoric, Ortega seems not to have forgotten the disaster that the socialist, sandinista experiment of the 1980s turned out to be for Nicaragua’s economy. Now he prefers to create a policy environment acceptable to private investment – both foreign and domestic – and propitious to enhancing the international competitiveness of the country’s manufactured goods.

Little wonder that the IMF – an institution portrayed as a “tool of the Empire” by the leftist circles to which Ortega belongs – has accorded Nicaragua a label of good economic conduct on more than one occasion.

It should not, therefore, be ruled out that the fans of Marx, Chávez and Castro, the very ones who today are thrilled at the electoral victory of their sandinista ally, may tomorrow decide to accuse him of being a “renegade”.

The examples of China and Nicaragua help to measure the formidable length of the road that Cuba needs to walk before being able to rid herself of its regime’s ideological aberrations.

The Castro brothers know that a true, meaningful reform cannot be put off forever. Either the Cuban economy takes off, or else the entire regime will collapse.

The problem is, the new “guidelines for socio-economic policy”, announced by Raul Castro earlier this year, are too narrow in scope for them to rescue the Cuban economy from the disaster where it finds itself today.

Indeed, it is not by announcing trifles such as allowing the buying and selling of cars, or increasing the number of tables authorized in home restaurants (“paladares”), or allowing a less than timid privatization of the housing sector and of barber shops, that Cuba is going to reach growth rates comparable to those of China or levels of international competitiveness similar to the ones that Nicaragua is attaining.

Nor will foreign capital rush into Cuba as long as one learns, not without stupefaction, that representatives of foreign firms may be subjected to judicial harassments for merely having distributed bonuses to their employees aimed at compensating for miserable wages – prescribed by the government – that pay for little more than a single taxi ride.

No government wishing to stimulate the performance and competitiveness of its country’s economy would impose penal obstacles to those kinds of financial incentives.

The truth of the matter is that the Castro brothers are badly placed to introduce the fundamental, market-oriented reforms that the Cuban economy so desperately needs. Doing so would be tantamount to recognising that they have led the economy up a blind alley; that the recipes of socialism, and nothing else, are the real cause of the privations that the Cuban people have had to endure for more than half a century.

An admission of failure of that magnitude could shake the loyalties and confidence of the middle ranks of the regime and, consequently, incite rebellion within it. So, the Castro brothers prefer to keep blithering and to announce meaningless economic “readjustments”.

And it is because they are meaningless that such “guidelines” are bound to join the long list of economic fiascos of the Cuban regime, a list that counts, among other things, the destruction of the sugar industry in the early 60s, the failure of the 10-million sugar crop of 1969/1970 and the “process of rectification of mistakes” announced by Fidel Castro in April 1986.

The “guidelines” will thus be referred to in the books of history, not as the initiators of the rejuvenation of the Cuban economy, but rather, as the final rattles of one of the few remaining relics of communism.

Fabio Rafael Fiallo is a Dominican-born economist and author and a retired official of the United Nations Conference on Trade and Development (UNCTAD). This article is due to be published in Spanish in ‘Diario de Cuba’