What does a Soft Landing in Cuba look like?

Self employed merchant.  Photo: Juan Suarez
Self employed merchant. Photo: Juan Suarez

By Dawn Gable

HAVANA TIMES — Last week economist Richard Feinberg presented his latest monograph Soft Landing in Cuba? Emerging Entrepreneurs and Middle Classes (62 pages) published by the Brookings Institution, a think-tank in Washington, D.C., that looks at Cuba’s changing economic landscape in terms of the emergence of an entrepreneurial class. Feinberg demonstrates: “the old narrative —that Fidel and Raul Castro had to pass from the scene before real change could occur — has been discredited.”

The text is packed with surprising data, for those interested in facts, and colorful anecdotes, for those who only vicariously know Cuba due to the U.S. prohibition on travel. As expected, it offers both the Cuban and the U.S. government recommendations for ensuring that Cuba experiences a “soft landing.”

The reader is encouraged to dive right into the report, rather than rely on me to insufficiently summarize it.

I prefer to use my few lines to reckon a guess at the definition of soft landing in this text (which I believe is, in general, the most commonly expressed definition and aspiration for Cuba). From my reading, the landing strip is located in the palm of the invisible hand of the capitalist market.

soft-landing-graph 1It is a Cuban economy that integrates weak State owned enterprises, with cooperatives, private enterprise, and international conglomerate participation and that encourages immense wealth accumulation, class stratification, worker exploitation, mass consumption and meager taxes to ensure some basic standards. That is, more “normal.

Feinberg presents practical steps for reaching this goal and a thoughtful look at where the process currently stands. He shows that the transformation is more advanced than one might think both objectively, with a 1% layer forming at the top, and in the attitudes of some Cubans, quoting one youth as saying, “we are no longer communists but consumerists.”  Warning: social, ethical, or environmental implications of such a transformation, and how these might be mitigated, receive only an obligatory one- sentence mention toward the end.

Images of the emerging economic order are vividly drawn throughout the report. In one chapter, it is noted that the monthly salary of a server at a private restaurant may be covered by the sale of one meal, presumably leaving enormous profits to the owner.

While that owner pays taxes, due to the mainly cash economy and uncomputerized state apparatus, revenues are grossly underreported and hence taxes are equally underpaid. It is not surprising then to find cuentapropistas complaining about the taxman hassling them about their books or even looking for bribes.

But how, on the same paltry state salary as other Cubans, did these new entrepreneurs acquire their start-up costs, which ranged from $7-36,000 USD among those in the report’s small sample?

soft-landing-graph-2Nearly half of those surveyed had relied on unearned foreign capital. The rest had sold possessions or saved compensation earned in hard currency from tips and missions abroad in Venezuela for example (in contrast to the story told by the right-wing exiles who claim that Cubans providing services in Venezuela are slave labor).

So far, there are still some reigns on wealth accumulation.  For example, it is only legal to own two houses (when a festering complaint in Cuba is the lack of sufficient housing). But there is hope for Feinberg’s recommendation that the Cuban government reduce disincentives to business expansion. It is found in the recent legalization of landlords, who can now rent space to entrepreneurs who aspire to reach beyond their personal real estate.

Just imagine it. A restaurant, that pays its server a monthly salary equivalent to the sale of one meal, could multiply across the island. With the proliferating profits, the restaurateur may eventually enjoy some influence on government decision-making, perhaps even regarding tax laws, labor protections and environmental regulations. Hmmmm… sounds vaguely familiar…

Paladar Tranvia.  Figure 4.2
Paladar Tranvia. Figure 4.2

The possible scenario makes imperative another recommendation, that is, to legalize professional self-employment, because that server will still be making more money than professionals in the state sector. Surely professionals have the right to join the newly-formed class of stuff collectors, and even sneak past the servant class a bit. Of course there must be stuff available to collect. Ooooooo, perhaps a Walmart!

However, not all those surveyed have such aspirations. Some, Feinberg explains, have only “primitive” household accumulation in mind. That is, they are content with supplementing their income in order to modestly improve their standard of living. Barbaric!

Some even continue to display a stubborn sense of “solidarity and community” as illustrated by the construction cooperative “Armando Mestre Martinez,” named after a martyr of the Revolution and chaired by a “National Hero of the Republic of Cuba,” which offers discounts to clients in Santiago de Cuba with less capacity to pay.

Some might say that I have wasted too much time on the “inside Cuba” details and, as a USian, I should have focused on the report’s recommendations for the U.S. government.

soft-landing-graph-3In a nutshell, Feinberg recommends that the U.S. abandon regime-change fantasies and instead take a suite of measures to support, encourage, influence and participate in building a prosperous and powerful non-state sector. He specifically leaves out any economic interaction with the State and even suggests a system for verifying that exchange is only taking place with private businesses. His suggestions are pragmatic, possible, and within the paradigm of most relevant decision-makers, making the report relevant and presumably impactful.

But preclude the establishment of a Walmart in Cuba as that would require Cuban government involvement…sorry.

In fact, some may see the recommendations as just a change in tack…using credits, trade, and trinkets to foster a hand-picked, wealthy, in-country ally-class. Hey, if you can’t beat ’em at Giron, if you can’t beat ’em with starvation, if you can’t beat ’em with ideas, well, then, buy just enough of them. It’s hard to imagine the Cuban government interpreting it any other way.

Nevertheless, people around the world have shouted, in more than a dozen languages, one much simpler and sane recommendation: END THE EMBARGO.


20 thoughts on “What does a Soft Landing in Cuba look like?

  • November 20, 2013 at 8:07 pm
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    You should not even think about engaging me in debates over religion.
    Think about this: Humanity is at least 100,000 years old.
    This would mean that your god waited some 98,000 years before deciding to intervene .
    Your omniscient and omnipotent god decided that the best way to do this would be a human sacrifice in the primitive Middle East . How did that work out ?
    At the same time that Christ was killed for our sins, primitive tribes ( they were all primitive tribes) had the custom of annually figuratively loading the sins on the back of a goat which was then driven out into the desert to die of hunger and thirst . The tribe was thereby relieved of their sins for the past year.
    The Christians went the goat killers one better and sacrificed not just a goat and not just a human but the son of God such was the power of their god.
    And btw, since humankind’s evolution from the ancestor we humans share with the chimpanzees , we have had over one thousand gods.
    Each in its turn and in its time was as valid as the god you now have and each in his turn was discarded as bullshit .
    As Christopher Hitchens put it we are now down to one god which brings us ever closer to the actual number.
    Faith is making a virtue of not thinking.

  • November 19, 2013 at 12:59 pm
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    It is said that there are no atheists in foxholes. I wish that God present you with a “foxhole” to expose your atheist views to test. I choose not to criticize your lack of belief. You should likewise resist criticizing those who believe. You criticize America and our form of government yet willingly accept the freedoms and benefits that come from it. Look up the word “hypocrite” and judge if it applies to you.

  • November 18, 2013 at 9:30 am
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    Again, the U.S. form of government is an oligarchy and not a democracy, nor even a representative democracy as the founders intended.
    The U.S system is not at all flawed .
    The control of our top elected officials through legal bribery is both deliberate and entirely effective in negating any chance for a democratic society.
    That control by “an unelected dictatorship of money” which works behind the scenes to veto any elected official who might seek to change the foreign or domestic priorities of the imperial U.S. regime ” (Herman and Patterson is a complete stranglehold on government and a complete dismissal of the wants and needs of the public.
    That so many agree with you is not surprising given the corporate ownership and control of the media .
    You have internalized the lies or found them to be merely flaws in an otherwise marvelous system that you had no part in designing or in establishing the priorities.
    You love totalitarian systems such as capitalism and oligarchies and have the need to justify them.
    “Thank God…..” ?
    That belief in fictitious deities ties in nicely with your belief in a fictitious democracy and the need obey things without question.
    Belief in God is belief in just another human-created totalitarian system .
    Evidently you can’t get enough of either fantasy or
    totalitarian forms.
    Evidently you can’t get

  • November 16, 2013 at 11:34 am
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    Keep it simple John. As a declared anarchist, there is no convincing you that the American form of democracy, while flawed, is still worth fighting to maintain and improve. Your problem is obvious. If I don’t agree with you, you believe it is because I am “blindingly naïve” or worse. Thank God there are more people who believe as I do and less who share your views.

  • November 15, 2013 at 4:33 pm
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    Please define political reforms for me as you understand the term to mean in the context of the embargo .
    Raul has said that he will be stepping down before his term has expired.
    I do hope you do not mean the adoption of a U.S -type of electoral system .

  • November 15, 2013 at 4:29 pm
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    The United States is a purported republic and not a democracy.
    It is supposed to be a representative democracy but the influx of unlimited campaign funding from the very wealthy guarantees the election of the candidates with the most of that donated money and in the election of a government by and for the wealthy .
    It is not the exception who wins this way, it is the hard and fast rule.
    It’s an oligarchy and for you to claim otherwise is either blindingly naive or an article of blind faith in the lies of state.

  • November 15, 2013 at 4:07 pm
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    Griffin,
    You have a great many things in your post with which I disagree but will deal with the most egregious of the fictions you posted.
    The U.S. is ostensibly a republic: a representative democracy under which we the electorate choose our representatives in government to handle the business of the state and country while we go about our daily business.
    That may well have been the intent of the founding fathers but it in no way reflects the reality of the unelected dictatorship of money which that government has become today.
    It takes a billion plus dollars to compete in a national presidential campaign . No candidate has that kind of money and no one can raise that kind of money from the common people . The bulk of that billion plus that each of the candidates of the two major parties receives comes from very wealthy donors .
    Those very wealthy let it be known who they suppprt in the primaries and those with the most campaign funds nearly always win . Therefore, each of the two major parties must accept those candidates pre-selected by big money or lose in the big election.
    You, me , your neighbor, my neighbor all of us and NONE of us has any say in the selection of the people for whom we are ALLOWED to vote.
    In a real democracy, we the people would have some say in who those nominees are but every one, unless an independent, has been preeselected by the party and /or the wealthy who finance particular campaigns.

    That is an oligarchy .
    It is not a democracy under any definition of the term.

    Obama is center right. Romney is center-right and Mormon crazy to boot . It is commonly noted that Obama is Bush-Lite because he follows the same policies as George and it’s true.
    They are ALL center right as is the U.S. public .

    They are the cattle voting for the meat company’s choice of executioner and doing so with all assurance that the executioner has the cattle’s best interests at heart.

    Think of it this way:
    The Republicans are the wolves.
    The Democrats are the foxes.
    You’re the rabbit.
    Each have equal, votes

    You’re all voting on whether to have a vegetarian diet .

    You are not dealing with reality

  • November 15, 2013 at 9:17 am
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    I read the entire 62 page article and found it very informative. I believe that Dawn Gable’s summation was generally on point. The glaring exception was the author’s unfortunate choice to end the summation with the phrase (in caps) “END THE EMBARGO”. This one inflammatory phrase incited 12 comments here focused on the embargo, the Cuban government, and the US government but not on the information contained in Feinberg’s Brookings Institution excellent article.

    I must also disagree with Gable’s summation: “In a nutshell, Feinberg recommends that the U.S. abandon regime-change fantasies and instead take a suite of measures ………” The bulk of the conclusions in Feinberg’s study are related to the Cuban government’s need to be accommodative of private enterprise growth and the role of the US government to be a distant second.

    I do strongly agree with Gable’s suggestion that one read the article. Do not debate here what is not contained in Feinberg’s excellent article..

  • November 14, 2013 at 5:26 pm
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    You assume that I did not read the book introduction
    that you referenced. I read it but I do not agree. The ‘facts’ presented and
    the preconditions assumed are misconstrued if not false. Don’t be so demagogic
    that you assume that if a person does not share your views, they must be less
    informed or ideologically-blinded. While Obama and Romney share substantial
    numbers of donors, it is the donors they do NOT share that define their
    differences. The American political system is certainly not perfect but it has
    remained free of internal civil war for more than 150 years which alone is a
    tribute to the peaceful transfer of power symbolizing our democracy. We are the
    oldest constitutional democracy in the world and despite recent economic crises
    remain the only world superpower. Our positive contributions to the advances in
    medicine, technology, and science in the last 50 years is unmatched in the
    world. It is your right to sit back and criticize and backbite but don’t expect me
    to join you.

  • November 14, 2013 at 10:16 am
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    No viable form of government is perfect. Each form has it’s limitations. Anarchism is lovely theory, but it never has nor ever will be a viable form for any national government.

    The form of government in the USA is not simply a “democracy”. It is a constitutional republic, which includes free and democratic elections of public officials and legislative propositions. The rights of the people are declared “self-evident”, not granted to them by the government. You may not like who the people elect, and it is a shame so few people turn out to vote, but nobody is forcing them to stay home on election day. Not voting is in fact, also a vote.

    Canada, like the UK, is a constitutional monarchy, which includes fee and democratic elections of public officials to parliament which is both representative and responsible to the people.

    Cuba has a constitution, yet the government routinely violates it. The people have no rights or freedoms, except for those which are granted by the government, and which are just as readily denied. Cuba holds elections, but these events are not free. There is only one legal political party. The Communist Party of Cuba controls who can run for office, such that no opposition is ever allowed to exist. Government officials are never held responsible to the people, but are occasionally purged by higher government officials.

    Recently, the leader of the Canadian Liberal Party, Justin Trudeau, was asked which country he most admires. He answered, that he admires China and their “basic dictatorship” which gives them the power to act decisively. That little slip revealed much about the mindset of the modern progressive politician: “Give me the power to force my will on you!” Realizing after the fact that he had perhaps said something controversial, Mr Trudeau then attempted to project his lust for power onto the Prime Minister, saying, “Stephen Harper must dream at night about having that kind of power!”

    That little anecdote illustrates well why a constitutional republic, or monarchy, with multi-party electoral democracy, is the best, or least bad, form of government. Although fools may sometimes get elected, they will eventually be held responsible to the voters who will toss the bums out.

  • November 14, 2013 at 9:48 am
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    And you should really try not to be such a condescending ass, John.

    I have read about the economic reforms. They are extremely limited and highly constrained by the State. At the same time General Raul Castro has emphatically and repeatedly pointed out that while his economic reforms will continue, there will never be any political reforms in Cuba. In case you missed that nuance I will repeat it for you:

    NO. POLITICAL. REFORMS. EVER!

  • November 14, 2013 at 8:37 am
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    For someone who does nothing but extol the virtues of capitalism and the U.S. government’s foreign policies , you are not on the side of democracy and obviously love totalitarian systems .
    The fact that the same people who finance Obama also finance Romney clearly points to control of the choice of candidates by the oligarchs : the wealthy few.
    You seem to think that the huge sumes that are donated are done so for the good of democracy when the reality is that these donations are legal bribes which totally control the votes passed by these bribed officials in favor of the wealthy few.
    That is oligarchy and not democracy as you would imagine it to be..
    You did not take my suggestion to read the introduction to “Killing Hope ” as expected since the truths found there would be intolerable to your existing beliefs in the lies of the U.S. government as regards foreign policy .
    It is the nature of those on the moron right to simultaneously ignore the ttruth and retreat ever deeper into the fantasies they already believe.
    When facts are too indigestible, ideological thought kicks in for you.
    If you can even imagine that the well over 75 interventions since 1950 have been mainly for the benefit and not to the detriment of the countries involved , you’re simply not dealing with reality.
    The fact that you refuse to look at the evidence I suggested, is evidence enough of the ideological blinders you wear.

  • November 13, 2013 at 11:00 am
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    Made-up terms like “economic democracy” are little more than mental masturbation and should not be confused with intellectual integrity. I live in the real world where getting a campaign message out to 300 million Americans is expensive. Choosing not to vote is a right in a democracy. Low voter turnout does not imply a lack of majority support for government. You would do yourself a favor to review your high-school civics texts. Alleged and confirmed US interventions in “poor third world countries” are nearly always in cooperation with the representatives of an oppressed majority of the people of that country. There are very few “honest brokers” in world politics. The US, as expected, seeks its own self-interest in its foreign policy agenda. What country does not do the same thing? The difference is that the US is simply better at it.

  • November 13, 2013 at 9:10 am
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    Griffin,
    You should really try reading about the reforms that have been put in place by the Cuban government since Fidel stepped down .
    Although these stories can’t be found in the U.S.media that you rely on for your news, there are a few places where these things can be readily found.
    Here’s a real good one at which you should spend time reading and learning what you so obviously don’t know .
    http://www.havanatimes.org

  • November 13, 2013 at 9:06 am
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    Moses,
    If you’d go to the “Killing Hope” website and read the introduction and a few of rthe free chapter’s you’d see that the U.S. was never about democracy and least of just in the past few years.
    As regards Cuba and the revolution, it has always been about restoring capitalism which is certainly a totalitarian form.
    A “restoration” to a European form would mean a restoration to capitalism with the same social ameliorations as in wealthy Europe which ease the effects of capitalist generated poverty.
    Of course you well know that no poor country can have both capitalism and sufficient social programs to ease the effects of capitalism on the poor.
    Every Latin American country that has attempted social f reforms such as land redistribution and grass-roots political power has had those attempts quashed by the United States.
    “Killing Hope” lists just 53 of the post-WWII U.S. interventions into the internal affairs of other weaker nations and there are at least twenty more and all this continues.
    Again, you misrepresent my views as saying I support the Castros.
    As an anarchist, I oppose all governments such as those in Cuba and the U.S. because they are Leninist:: rule from the top down, are inevitably self-preserving, corrupt and ultimately totalitarian.
    You, as a supporter of both capitalism and the U.S totalitarian oligarchy should have no beef with the lack of democracy in Cuba and certainly you have no solid ground from which to speak on the need for democracy in Cuba .
    Democracy literally translates as rule of the people which in practical terms means rule of the majority.
    YOu’d be hard ut to claim that the U.S. is a democracy since the winning party in the last election got about 28% of the vote.
    Half the electorate never votes and slightly lmore than half of the remaining half which does vote elects the choice of the wealthy who pay the billion dollars required to win a presidential election .
    Your posts read like high-school level civics texts but then that’s just how foolish you have to write to be a paid shill for imperialism.
    You have no shame and no intellectual integrity.

  • November 13, 2013 at 7:31 am
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    According to the Spanish media, ABC, President Obama assured Cuban dissidents Soler and Fariñas that he would not remove the embargo against the Castro Kingdom because such a change in policy would simply “provide oxygen” for the repressive regime.

    Raul Castro has stated clearly there will be no political reforms in Cuba. Ever. Until that attitude changes, it will be impossible to lift the US embargo.

  • November 12, 2013 at 4:45 pm
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    The US seeks to RESTORE DEMOCRACY in Cuba. This does NOT mean we expect tiny Cuba to mirror the economic system we enjoy in the US. On the contrary, it is understood that Cuba will evolve to some form of democratic socialism as is common throughout northern Europe. America’s historical pushback against communism is not because of the economic structure which identifies the list of failed communist states that have come and gone in recent history. Our fight against communism is that this form of government has always existed in totalitarian and non-democratic systems. Our past support of dictatorships has come as a result of a policy of “lesser among evils”. We supported a tyrant because a worse tyrant was waiting in the wings without that support. There was no love of Pinochet in Chile for example. However, we knew that if he did not hold power, a non-democratic and more anti-American regime would take his place. American interests trump ideology. Cuba will be democratic one day. They will likely maintain universal health care and education. Hopefully, little else from the failed Castro-era will be continued. You will wake up one day and realize that betting on the Castros was a lost cause.

  • November 12, 2013 at 1:48 pm
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    I have been to Cuba82 times on research and things are changing – Big Time – Si !!!

  • November 12, 2013 at 11:15 am
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    USA/Cuba Embargo=Terrorism American Style

  • November 12, 2013 at 8:38 am
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    The purpose of the U.S. embargo was always to prevent the success of a socialist economy which would act as a good example to other weak,poor nations in thrall to imperialist neo-colonialization .
    This has been at the center of U.S. foreign policy since at least the combined U.S/European 1918 invasion of the new Soviet Union .
    The U.S has supported just about every dictatorship that has supported capitalism and economic exploitation by imperial nations AND which have acted in an anti-socialist manner . Colombia is a perfect example in today’s world, Batista a perfect example of what was 50 years ago and these types permeate U.S. foreign policy for the past 100 years.
    That policy continues today and the embargo is descendant from those historical examples .
    Want a brief introduction to thies reality? Try reading the introduction to the book ” “Killing Hope” at the eponymous website.
    The reintroduction of feral capitalism to Cuba would ensure the end of the U.S. embargo and any hope for economic democracy in Cuba.
    Fortunately , it appears that the Cuban people , having learned from history, are not willing to repeat it.
    It is a pity that so many are completely in the dark as to the real U.S foreign policy objectives , real history and real purpose of the embargo .
    In fact, if you hear anyone speaking about the “restoration of democracy” as being the reason for the embargo, one of two things are true: they do not know what they are talking about or they are speaking lies of omission.

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