The Cuban People and Price Relief

Following the Communist Party Congress

By Osmel Ramirez Alvarez

HAVANA TIMES — The morning of April 22 brought us pleasant news: the price of a series of crucial products will be lowered by around 20%. In any other country, this figure could be considered highly significant and cause for nationwide celebration. But, in deformed and dysfunctional Cuba, everything works differently and I can assure you this is not at all significant. Let me explain why.

Two root problems make me say this.

First, the prices in question were so high to begin with in relation to State incomes and pensions (which is what the bulk of the population lives on) that a small reduction doesn’t really increase people’s purchasing power. A worker who earns 15 Cuban pesos in 8 hours found it very hard to buy a liter of oil at 60 pesos (around 2.40 Cuban Convertible Pesos). Now, they will find it just as difficult to pay 47.75 pesos for it. They still need to work several days to be able to afford it, or they need to steal something from their place of work, embezzle resources or come up with a business on the side during their free time. The same holds for chicken, chick peas and any of the products in question.

Second, supplies are critically unstable and, in practice, this makes it next to impossible for the neediest sectors of the population to access these products. If the government were able to guarantee a steady supply, people would be able to go buy these food products, which are extremely expensive with or without the price deduction, the day they had the money. But, as it is, you can go a thousand times to the store and not find what you’re looking for. They put one or two things on sale for a while and only resellers have the time to wait for the right moment. They hoard everything, almost always in cahoots with the clerks who earn very little and need a bribe. Then, they ride around the streets on bicycle taxis or hauling carts, selling the same products for more money.

Therefore, these measures bring no respite. That is impossible when an abnormal domestic market is in operation. To illustrate this better, here’s a personal example: some days ago, the shop where I can buy eggs they sell at 1.10 the unit received cases. It is the cheapest source of protein you can find in Cuba, but the average worker still has to work nearly an hour at a factory or at a construction site to buy a single egg. The shipment they brought to this small establishment was so large it didn’t fit inside and they left more than half of it outside. It was more than 10,000 eggs in total. This happened at more than 8 shops in different neighborhoods.

This happened at 10:30 in the morning. I headed down there at 11:00 and they weren’t selling the eggs because there was no one there to dispense them. The eggs were being looked after by a neighbor who was helping out “altruistically.” They said they would start selling them at 2:40 pm (the time they opened in the afternoon). I went at 3:30 pm, thinking there were plenty to go around and, incredibly, they had run out. It was all sold en masse. The resellers and pastry bakers hoarded all of the eggs in a few minutes. Those who sell these products also benefit more from business owners than regular customers. The result was that, a while later, I had to pay 1.50 for each egg right in front of my house, where they were reselling them.

You see this with everything. Since there is no stable of supply of anything speculation flourishes. When they start selling something and it immediately runs out, or lasts only a few days (depending on the nature of the product), and any hoarding is always profitable. The general population suffers most: the high prices are coupled with this other steep price hike.

We can also be sure these miniscule price drops are not really backed by any increase in production or by larger purchases made by the State companies that make the products in question. They are being carried out, no doubt, on the basis of the amounts that are typically sold, which will become even scarcer.

It is highway robbery to sell the people crucial products at such high prices, in hard currency or regular pesos, before or after the price reduction. The government’s inefficiency, however, is much worse, even when it comes to stealing money from people. If profits were so significant, one would assume they would always take advantage of sales all the time. But no, everything disappears frequently, owing to the endemic ills of economic planning and centralization.

This April 22, the people awoke a little happier. Such news is thrilling, without a doubt. We Cubans spend considerably more what all other people around the world do on basic food products and are still unable to eat what we want. Rather, we eat poorly. It’s natural people will be happy to see any potential improvement, after their disappointment over the recent Communist Party congress that failed to announce the changes we need.

It’s a shame that this sad reality, only a few days later, demonstrates that the prices are still hard to pay and that few of us will be lucky enough to find these products at sales points. The said saving will be left in the hands of patient speculators in search of opportunities, as working people have no time for that. As for the increased purchasing power of the Cuban peso, that’s another propagandistic fiction. These are but simple obstacles of the system that they seek to maintain forever.