Posted on Wednesday, 08.04.10
Cuba's quick fix
OUR OPINION: cf,gtm Small changes won't halt Cuban economy's free fall
It's amazing that the Castro brothers have any free hands left, what
with having used so many fingers to plug the gushing dike that is Cuba's
Their most recent stopper came Sunday, when Raúl Castro announced
another contradictory economic salvation: allowing more private
enterprise. There are an estimated one million excess workers in Cuba,
and the government needs them off its bloated redundant workforce.
Cubans have long made ends meet with what they euphemistically call “by
the left'' — illegal capitalism.
The Cuban government is getting in on the game by relaxing prohibitions
on business licenses. This will allow the Castros to squeeze workers
again by charging income and sales taxes on previously under-the-table
transactions working Cubans rely on.
This may be a welcome change for the self-employed who long for extra
cash without dodging the state police. But it's not enough to save a
woefully mismanaged central economy that does not have enough currency
It's a step back to the mid 1990s, when more than 200,000 small
businesses operated on the island. That leap toward capitalism to save
communism fell short, and small business owners had the rug yanked from
under them when the economy improved.
Two years into Raúl Castro's drive to reform agriculture, that industry
shrank 13 percent.
High hopes dashed
Even as he announces the pursuit to be less paternalistic and offer
fewer services, his cabinet is more cautious. Economy Minister Marino
Murillo should be taken at his word: “There shouldn't be any talk of
reforms. Central planning will continue to rule.''
Castro stepped into his brother's shoes exactly four years ago amid high
hopes that he would make bold changes. The novelty of the DVD players
and cellphones he permitted has worn off, just as the buzz of new beauty
parlors, taxi permits and other forms of self employment will wane if
the government doesn't do a lot more to raise the quality of life,
instead of merely padding government coffers.
Fidel Castro's recent appearances don't instill confidence. By popping
up everywhere from TV shows to the aquarium, he is letting his little
brother know that brash moves do not go unnoticed, and eager
anticipation of meaningful change is premature.