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Posted June 13, 2008 by publisher in Castro's Cuba

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Raul Castro’s decision to abolish the sacrosanct principle of equal pay for all is another small step along that trickiest and most treacherous of paths for a communist regime – how to liberalize and streamline a centrally planned system without losing control and destroying it. That Fidel’s younger brother is determined to change Cuba is beyond doubt. The move to pay higher salaries and bonuses for better workers and managers follows several other reforms. Whether they work – or merely hasten the demise of one of the world’s very few remaining communist states – is another matter.

Without doubt, Havana would like to emulate the Chinese model, where market reforms have created a vibrant economy and a flourishing middle class, but where the party retains absolute political control. Structurally, however, Cuba – whose economy is dominated by industry, not agriculture, and where popular frustration with decades of stagnation is tangible – far more closely resembles the former Soviet Union and its east European satellites, where attempts at reform from within failed dismally. Mr Castro’s actions thus far have been tinkerings compared with the revolution of perestroika and glasnost unleashed by Mikhail Gorbachev. But, as he is surely well aware, in the late 1980s the Soviet Union got the worst of both worlds – at least from the point of view of its rulers.

Gorbachev’s reforms broke the party’s monopoly of political power, but also made the economy even more of a mess. By combining superficial market reforms with a refusal to challenge the entrenched bureaucracy, perestroika merely made an already inefficient and corrupt system even worse.

Like Gorbachev, Mr Castro swears fealty to the principles of “socialism”. But the Soviet experience offers another worrying precedent. The collapse of communism there was in part brought about by the communications and information revolution. Back then the advent of fax machines, photocopiers and computers helped break the Kremlin’s grip on information. In today’s far more interconnected world, greater access to the internet and mobile phones could have the same effect in Cuba.

Undoubtedly, Mr Castro’s strategy has a foreign policy dimension. The days of draconian US economic sanctions against the island may well be numbered – especially if Barack Obama becomes president. The current reforms would make it easier for Washington to lift sanctions. They would also make it easier for the regime in Havana to adjust to a world in which it is no longer a pariah.

Even so, Cuba must learn from the mistakes of eastern Europe. It must reform boldly and without delay, refusing to subsidize failing companies. It must have a fair and transparent method of privatization, and overhauled regulatory and legal systems.

  1. Follow up post #1 added on June 13, 2008 by nacho with 111 total posts

    Very interesting article. The same British paper included this other article about this matter.

    Is it really the end of communism?

    There have been wage differences in Cuba since the 70s.  I cannot recall a single doctor on the same salary level than the street sweepers.

    How deep will this “reform” run? Doctors and teacher do not really “produce” and with the decrepit state of the healthcare and education systems in Cuba, how will they get the salary boost?

    What’s the view from Cuba? Has anyone heard anything from Cubans in Cuba?

    I have emailed the original article in Granma to friends in Cuba. None of them read it and learned about it from me, that’s 21 people that were not aware of this “reform” and its possible consequences

  2. Follow up post #2 added on June 13, 2008 by bernie with 199 total posts

    A friend of I know told me that he spent some time at a spa called Elguea.
    There they had 2 doctors who were being paid 150.00 per. month, the nurse which there were many were being paid 50.00 per month, the other staff people were paid 20.00 to 25.00 per month.  This he related to me back in the year 2002.

  3. Follow up post #3 added on June 16, 2008 by abh with 244 total posts

    Before reading this article I commented on a previous one, just wanted to say the same thing here, that I agree with the 2nd paragraph of this article when it says that Raul wants to enact economic reform but keep power solidified within the communist party.  I think this is clear.  They are definitely on a slippery slope, but they’ve been on it for awhile and it probably won’t make a huge difference right away.  It is symbolically important though and will undoubtedly have a long term impact.

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