Cuban Reforms Won’t Improve Living Standards, says study

HAVANA TIMES — The current economic reforms being implemented by Cuban President Raul Castro will be insufficient to raise the living standards of the island’s people, according to a study released on Monday in Havana by the local Catholic magazine Espacio Laical.

According to Cuban-born economist Mauricio de Miranda, writing in the issue titled “Cuba: Towards a Development Strategy for the Beginning of the Century,” the island needs to open more to the market, change its monetary system and acquire a new legal framework to establish clear and transparent rules.

“The urgency of institutional reforms is crucial,” said De Miranda, who proposes issuing new commercial and labor codes, as well as new laws relating to taxes, banking, housing and foreign investment, and making transactions more flexible, reported the AFP.

De Miranda, a university professor in Colombia, added his views to those of five other Cuban-born economists in this book being promoted on the online edition of the magazine.

3 thoughts on “Cuban Reforms Won’t Improve Living Standards, says study

  • Just to note an elephant in the room – joining China and Vietnam as a “globally competitive exporter of industrial and agricultural goods”, exported mainly to the US, is not an option under the ongoing insane US embargo. Yet another of its damning effects.

  • As long as the Castro “Government” has a dual monetary system and is not transparent about its economic numbers it will fail! Cuba is not China nor Vietnam, its Cuba!

    UNIVERSITY OF PENNSYLVANIA WHARTON SCHOOL REPORT :Can Raul Castro’s Reforms Create a New Cuba? -November 22, 2011

    At first glance, say experts, Raul Castro seems to modeling his country’s future after China and Vietnam, whose one-party, nominally communist governments have managed to maintain power for decades while also emerging as globally competitive exporters of industrial and agricultural goods. Look deeper, however, and it is apparent that Raul’s approach won’t turn Cuba into a miniature of those two much larger Asian communist countries, experts say. The key problem for Cuba is that Raul’s reforms are not nearly as deep or thorough as those enacted by communist governments in China and Vietnam. In Cuba, “they are going in the right direction, but the issue is whether the reforms are profound enough or fast enough to meet the difficult crisis,” says Carmelo Mesa Lago, emeritus professor of economics at the University of Pittsburgh, whose new book on the Cuban economy is scheduled to be published in Spain and the U.S. in 2012.

    Mesa Lago notes that in China and Vietnam, local farmers have been allowed to lease from the government the land that they work on for an indefinite time period; Chinese and Vietnamese farmers have been encouraged to care for that land as if it were their own. In Cuba, contracts to lease plots of land are valid for only 25 years. “After 25 years, that contract may or may not be renewed by the government, and the land may be seized by the Cuban state for social needs,” Mesa Lago notes. That’s particularly troubling because “a lot of land in Cuba has been taken over by the notorious marabou plant,” says Adrian E. Tschoegl, a management lecturer and senior fellow at Wharton. It often takes two years just to clear marabou-infested land, Tschoegl adds, so a 25-year lease is effectively cut.


  • Well, I haven’t read the study, but the line that Cuba “needs to open more to the market, change its monetary system and acquire a new legal framework to establish clear and transparent rules” seems to jibe with our Cooperative Republic Movement’s idea of workable socialism.

    The Cuban political leadership could provide itself a reality check for its basic “perfection of the socialist model” by realizing that what is needed in Cuba is also needed in the United States and other capitalist countries. That is, what would work best in Cuba for raising the living standards of the people is precisely what would work best in all countries.

    The problem seems to be that they are flopping around without a correct transformationary theory to guide them, and so their programmatic tweaks cannot get at the roots of their nation’s problems.

    A good example of this is the need for a different, socially-dynamic banking, credit and money system. And yet, by clinging to the idea that the state must own and control banking, credit and money creation, means that the financial system cannot be re-designed and begin to play a proper role in building the socialist bridge.

    This financial system problem is one that we are wrestling with in the US. It is also one that socialists around the world need to wrestle with and come to terms with. How should a socialist, truly transformationary financial system be designed? If we can’t answer this, either in Cuba or any other country, we are spinning our wheels.

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