Is Cuba Doing Business with the “Good” Capitalists?
Rogelio Manuel Diaz Moreno
HAVANA TIMES — After demonizing foreign investment for many years, the Cuban government opened its doors to it with an enthusiasm worthy of better causes.
Not that the financial resources available worldwide are necessarily a negative force, but the indiscriminate embrace of international capitalism has been one of the most powerful forces pushing towards the restoration of “normal” capitalism here in recent years.
The Observatorio Critico collective has not ceased to report on the opacity and authoritarianism that has characterized this process, and about its social, economic and political consequences.
I recall a tit-for-tat we had some years back with a pro-government journalist, who criticized us for this. At the time, I was concerned about our government’s contacts with Brazil’s corporate giant Odebrecht. This transnational conglomerate, we should remember, has secured management rights over Cuba’s 5 de septiembre sugar refinery, broad facilities in the Mariel Special Economic Development Zone and who knows how many more properties and investments. For the journalist, there was nothing wrong with this, as Brazilians were “different sorts” of capitalists: good people who were coming over to lend us a helping hand, in contrast to other, “bad” capitalists that went around the world in search of anything they could make a killing on.
Well, a few days ago, Odebrecht made headlines as yet another corruption scandal, of the sort that have been making a splash in Brazil of late. Our press has been very discrete with respect to how Dilma Rousseff’s government and her neo-liberal policy have become discredited and about the accusations and protests that have surrounded her party and government. Consequently, it hasn’t said a word about the arrest of the conglomerate’s president, Marcelo Odebrecht.
In an article published by the Mexican newspaper La Jornada on June 19, I came across some details. Odebrecht, which employs around 200,000 people and has operations in 21 countries, had been in the sights of Brazil’s Comptroller General for some time for allegedly being part of a construction company cartel implicated in different acts of corruption, bribery, overbilling and others. In Brazil, the newspaper underscores, the rich are considered to be above the law, so the imprisonment Marcelo Odebrecht has been quite a story.
Curiously, a few days before, the web-site Cubacontemporanea published a cheerful article celebrating the work of this corporation in different sectors in Cuba.
These facts confirm our misgivings for the umpteenth time. Our government rubs elbows with corporate capitalists, the true sharks of the modern world, behind the backs of working Cubans. Cuba’s working class has no say in these negotiations, where veritable and massive transactions in sovereignty, material and human resources are made with transnational capital. Our bureaucracy gets along well with foreign magnates, and corruption finds plenty of space to settle in.
In the end, the workers are the ones who suffer the consequences. There, in Brazil, it is perhaps the impoverished residents of a favela who suffer Odebrecht’s exploitation; here, it may be those who live in a poor tenement and endure extortion by a local, blood-sucking intermediary that has been absorbed by the foreign company. The feeling of alienation with respect to the production process and the country’s wealth is reinforced and the conception of individualism and personal profit as signs of prosperity is encouraged.
While the vices of those foreign capitalists end up blowing up in their faces publicly over there, after those around them decide that they can’t simply get away with everything, here, a cloak of merciful silence solves the whole problem. We can’t have nosey people prying and looking into who made the deals with them here and how they were treated, how they actually decided what they could offer – could they have obtained some kind of “gift”? Heaven knows – or perhaps Marcelo Odebrecht.
Labor exploitation is a very serious problem. The American left would be horrified to learn that confiscation of CEO pay would also include their pay as well under the Cuba model.
The problem goes beyond the basic unfairness of taking an ordinary worker wages. It goes to the lack of production that a 95% + effective tax rate compels as human incentive drops off. Cuba is wisely adopting reforms that introduces incentive. The pursuit of economic equality is a thing of the past. Now it’s about controlling disparity, a much lower and achievable standard.
The big problem for reformers is how to transition state workers and others living off a stipend on to earned salaries. The whole economy will be more efficient once earnings have a relationship to contribution to productive activity.
Coruption is wide if you do business in ::: Latin America – Africa – Middle East.
Canadian companies are also involved.
http://www.huffingtonpost.ca/news/snc-lavalin-corruption/
But remember Gordon that Melia and Iberostar accept “their” employees being paid by the regime at regime rates and they pay the regime a multiple of those rates. For example a Canadian company pays the regime $9,000 per employee per year and the regime pays the employee $300 per year. You may admire such “very well respected companies”, but others would describe them as being party to rank exploitation. However, without them the regime would collapse. They have to be very careful not to make additional payments to “their” staff or to hold Christmas parties and give gifts to them. Doing so can result in trial (non-public) for “corruption” and for example a sentence of fourteen years for a Canadian businessman – Tokmakjian and the seizure of his business. As agent in Cuba for Hyundai, he was a threat to the regime monopoly which enables them to charge for example, $85,000 for a 6 year old Peugeot compact or for new Peugeot 508 $262,000 – five times the price in the UK. Iberostar is in partnership with Gaesa the military holding company controlled by the son-in-law of one Raul Castro Ruz. The charge for a one night stay at their much vaunted hotel in Trinidad de Cuba almost exactly equates with the annual salary of a Cuban schoolteacher at $360. you can have supper for an additional $30!
It is an absurd proposition that the Raul Castro regime will be taken advantage of by “capitalist”. The opposite is more likely. Cuba needs all the capital investment it can secure.
Melia Internation – Iberostar are very well respected Spanish companies and operate + – 40 resorts / hotels in Cuba.
Gordon Robinson Port Alberni B.C.
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