The True, the False & the Right Questions on Cuba’s Economy

A Cuban market

By Julio Carranza (Progreso Semanal)

HAVANA TIMES – A friend has proposed that a meeting be held with Cuban economists, persons committed and professional, to discuss, in depth, the problem of inflation. It’s a good idea because truthfully, and said with all humility, explanations being given and measures that are taken in this regard do not assume, and even less, go to the causes of this prolonged and very dangerous situation. The evidence? The problem persists, and it’s only getting worse.

It is said that “We have to produce more.” Of course we have to produce more! But the correct question for an economist and for the economy would be: How do we produce more? And that leads to the critical and core area where the correct answer is still very far away. That is, I insist, we need a deep, comprehensive and socialist reform of the economy, beginning with the reform of the state company, which does not mean it can’t be a state (public) entity, but so that it stops being inefficient and with it all the rest of the relationships, actors and dimensions of the economy, that is, integral. The economy, in our society, is the whole and not just one of its parts. It is a complex system, and that is how it should be treated. We have written extensively about this, available and ignored are the texts and proposals of many economists.

At the same time, we need a comprehensive anti-inflationary program: on the supply side, on the demand side and with a correct exchange rate, as well as rules and fiscal policy, which take the economy out of the monetary and exchange rate chaos in which it finds itself today after the “ordering” of the economy.

It is true that the blockade is genocidal, does us a lot of damage and must be permanently denounced. And I agree that there is a critical situation in the world economy with consequences for Cuba. And that the illegalities we face here at home do harm and must be faced… Of course. But that these scourges totally explain and essentially determine the problems, insufficiencies and inefficiencies of the Cuban economy? That is false.

There is a lot that can be done, and progress can still be made, despite all the adversities and aggressions suffered by the nation. To change those external adversities does not always depend on the country. But the restructuring [of the economy], well, quickly and comprehensively in the right sense does depend on the country.

One must act on reality, not on the fiction to which a non-objectified reference to the situation gives rise. It is the numbers, the data, which must define the story and from there to the transformation.

Time, also, is a critical variable.


*Julio Carranza is a PhD in economics

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