Making Cooperatives Work in Cuba

Pedro Campos

Workers of a construction cooperative.

HAVANA TIMES — In recent days, Cuba’s official and alternative press have been publishing different articles* on the new cooperatives emerging outside the agricultural and livestock sector, showing how these organizations – now growing at breakneck speed – stumble upon the inconsistencies of the regulations and norms approved to date under the “reform process” at every step.

These articles point out the restrictions that already-established cooperatives face and the many obstacles that workers who seek to set up this type of business organization encounter.

They mention that no few of the country’s self-employed feel encouraged to form cooperatives because of a number of tax-related advantages and because they lead to greater profits in general.

In many places, these forms of free labor association have solved many of the problems State companies were unable to overcome, and there are areas where they have even set a new standard, such as the repair of mobile phones, computers and devices related to new information technologies.

By the looks of it, the “cooperative fever” is gradually spreading, despite all of the hurdles Cuba’s bureaucracy places in its path.

Reality is proving right one of the enemies of freely associated labor. A Vice-Minister of Culture surnamed Rojas, prevented my participation at a youth conference dealing with the Internet, telling the organizers something along the lines of: “we have to prevent the spread of self-management ideas because they are as addictive as cocaine.”

The most common obstacles faced are the long, bureaucratic procedures that the approval of new cooperatives involves (a process which occasionally concludes with the denial of authorization); the absence of a wholesale market where these associations of free workers can find raw materials and supplies at prices lower than those offered by State retailers; the difficulties involved in importing these supplies and in exporting the products of the cooperatives, and the countless norms restricting interaction with the State’s business sector, the largest economic sector in the country.

Flower growing cooperative sales stand. Foto:

A practice that could become the worst enemy of cooperativism in Cuba in the long run, leading workers to reject these associations, is the regulated way in which State companies (or tawdry kiosks, to be more precise) in financial crises are turned into “cooperatives”, assembled by the State by renting out locales and equipment to their former employees, cooperatives that come into being under imposed directives, tax burdens and utterly discouraging debts.

Something that isn’t mentioned much is the fact no effective credit policy aimed at fostering the growth of cooperatives through State support is in place, or that cooperatives have little freedom to secure financing through other channels.

In any event, we must acknowledge that the government’s approval of this limited law for non-agricultural cooperatives has been the most important step towards the socialization of Cuba’s economy taken since the system of sugar-cane cooperatives was established in 1960, on the land expropriated from large, foreign capitalist companies. These cooperatives were transformed into “people’s farms” two years later, turning a 120,000 cooperative members into salaried workers once again and spawning the subsequent disasters that the sowing and harvesting of sugar cane continue to experience in the country.

I have said many times that the current, centralized system of government and the economy inherited from the old form of neo-Stalinist “socialism” must be overcome through unhindered progress towards the democratization and socialization of politics and the economy, to allow for the existence of other forms of production suited to this transition process and full freedom of expression and association, needed to defend the diverse interests of society democratically and peacefully.

Like many others, I believe that the socialist forms of production par excellence are self-managed forms of free association, associations that would prevail not through imposition from above, but because of their productiveness, humanism and environmental awareness.

Nevertheless, I have always believed we must take advantage of and push forward all of the opportunities offered us by the limited and slow “reform” process, in order to impel free labor associations and other types of labor, particularly cooperatives and self-employment which, as a general rule, do not rely on the exploitation of salaried labor.

A taxi-bus cooperative. Photo:

In this connection, we have been proposing the creation of a National Institute for the Development of Cooperatives, or an institution with a different name, made up of a number of experts on these issues who can make decisions and direct funds to develop Cuba’s fledgling cooperative movement, as well as find practical solutions to the problems this movement may find along the way.

This institute could later become an effective instrument to channel future foreign donations made to cooperatives and to act as a liaison with international cooperative markets that can nourish and facilitate exchange between Cuban cooperatives and the foreign goods and capitals market. It could also help organize and assist members of cooperatives in securing whatever benefits Cuba’s new foreign investment law could afford them.

Small and mid-scale private capitalist enterprises are currently growing exponentially on the island as the State works to bolster direct and indirect foreign capitalist investment in our economy, threatening to make domestic and foreign private capitalism the dominant form of production in Cuba in a few years’ time.

In view of this, creating an independent institution capable of promoting and securing continuous improvements to the legislation in effect and with a view to offering practical, concrete and effective solutions to the problems faced by cooperatives, is today more urgent than ever.

If the Cuban State were capable of impelling such an initiative, it would be deserving of congratulations. Those of us who defend the expansion of cooperatives in Cuba could also take steps to set up an NGO made up of Cuban experts on the subject, economists, jurists, historians, sociologists and others, and then seek State recognition and international support for our work.

* Some articles describing concrete situations that reveal the problems mentioned:

Cuba’s Cooperatives “Without Papers”
Cooperativas no agropecuarias: de una experiencia a una novedad en Cuba.
Cuban Co-ops: Legitimate Children or Bastards?
Reviewing Cuba’s “Experiment” with Non-agricultural Cooperatives
Cuba Food Industry Cooperatives Feel Betrayed

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7 thoughts on “Making Cooperatives Work in Cuba

  • Mr. Goodrich, your penultimate paragraph is correct and fairly assesses the position in Cuba. Remove the “If” and for “your boss” read the Castro regime.

  • I’m also in favour of cooperatives as a way forward. However, its worth looking at what happened in Yugoslavia. It didn’t matter whether busineses were state owned, private or cooperative, they all got forced into bankruptcy and bought up through liquidation.

  • I think that Cooperatives are one of the ways Cubans can advance more rapidly with a much more democratic way for the participants to improve their own destiny and also show others how the collective effort and decisionmaking can benefit everyone in the long run. Rather than a group to govern or oversee them, I think they need a group to try to be an interface between them and by talking to the sympathetic elements in the government try to push for changes to resolve specific problems of material supply or regulations etc. that may be impeeding their more rapid progress. Is there no way that you Pedro, with your contacts and influence can persuede as many of these people as you can to advance this concept? Now is not the time to give up. Everyone should be trying to convince Cubans to advance this concept. Wasn’t there a regulation released recently by the Government on the requirements for Cooperatives in regard to banking and loans etc?

  • Griff,
    Let’s see what shakes out AFTER the U.S. economic war on Cuba ends.
    It would seem that the GOC and more importantly the PCC would have little objections to cooperative operations since they do not involve capitalist exploitation of workers-this not possible when there is a bottom-up one-man/one -vote democratic set up.
    What they would fear as bureaucrats and Leninists ( elite/ cadre-led ) is the loss of power IF indeed, that is their mindset and not one that has an evolution to bottom-up democratic forms as exemplified by the still on-the-books Poder Popular which is a superbly electoral form ON PAPER .
    I have no idea of what that post-embargo transition will entail but as a democrat, I hope for the effective implementation of Poder Popular as the electoral form and democratic socialism as the economic form .
    It is axiomatic that you cannot have a democratic society where you have totalitarian capitalism as an economic form .
    If your boss is your absolute ruler, can fire you at will, can pay you the minimum and less than you think fair, etc , you live 8 hours a day in a totalitarian system that corrupts your sense of democracy AND YOU DON”T EVEN KNOW IT .
    In short……we seem to agree that democracy both in the economy and in the electoral form is desirable and that respective totalitarian systems are not .
    Am I correct ?

  • It comes down to petty bureaucrats having to give up micro management practices. Cooperatives would be fully consistent with the aims of the revolution while over coming the central fault of soviet central control economics. What the micro managers need to get is that these cooperatives need oxygen to survive.

  • Wow! Again I find myself in (almost) complete agreement with you. The growth of truly independent autonomous cooperatives in Cuba would be a definite boost for democracy in Cuba. Sadly, the Castro government can’t quite seem to let go of its totalitarian ways and insists on controlling everything,

  • I am certainly one of the most vociferous proponents of cooperatives since my anarchist belief set is centered on the bottom-up democratic way cooperatives operate .
    And for that reason I would be very skeptical of any board or commission set up OVER those cooperatives since that sets up a hierarchy which is open to government/PCC pressures which would be then ordered by any such board or commission on the cooperatives it manages or controls.
    If its democratic decision making could somehow be assured or if its advice were only advice and not orders from above and it was a board that would just be advisory , then fine but the tendency is to gather power in such organizations and that must be avoided to preserve the democratic nature of cooperatives.

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