Cuba’s liberal economic reforms snubbed by Washington

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On April 12, 2012, Secretary of State Hillary Clinton spoke to a White House Conference on Connecting the Americas as a prelude to the Summit of the Americas, in Cartagena.

Speaking of the fact that the Western hemisphere’s greatest successes have come with an embrace of democracies, Clinton said: “It is so important that we keep our eyes on the horizon about what is possible and continue to work toward achieving it… We’re intensifying our focus on small- and medium-sized enterprises… By building links among these businesses, we can turn them into engines of job growth and prosperity. We require more private initiatives... We have launched very open and frank dialogues… to find ways that we can be of more assistance in supporting the reform efforts that are necessary.”

Support for small businesses as catalysts of development and democracy...

Excellent! With one noticeable exception, I might add.

In Cuba—a nation whose absence from the Summit caused several Latin American leaders to say they would boycott any future Summit to which Cuba was not invited—Raúl Castro has initiated the most liberal and far-reaching social, political, and economic reforms since his elder brother Fidel turned Communist.

Top among the reforms is the legalization of sale and purchase of private property. Now that’s big! (For six decades, Cubans have only been allowed to swap housing.)

Key to Raúl’s plan is to stimulate the private economy sufficiently to absorb 1.5 million state employees and bureaucrats that Raúl says he intends to lay off. More than 400,000 Cubans have now been licensed as cuentaspropistas (self-employed) in 181 categories, from manicurists to welders.

The cuentaspropistas can now hire workers. State land is being leased for private farming and manufacturing cooperatives. And owners of paladares (private restaurants) are now investing serious money to create an entirely new level of sophistication.

The Cuban government still imposes onerous taxation and other restrictions, such as on advertising, which is more or less banned. And, ridiculously, the state-employed Havanatur guides and bus-drivers that accompany the National Geographic Expeditions 10-day ‘Cuba: Discover its People & Culture’ programs that I lead are not allowed to make reservations or take us to Havana’s sensational new paladares.

It’s a faltering process of three steps forward, two steps back. Not least because the bureaucrats themselves are, for obvious reasons, trying to throw a wrench in the reform process. Hence, don’t expect a Cuban Bill Gates or Steve Jobs to emerge anytime soon.

Yet a new breed of Cuban entrepreneurs is now emerging. You can sense a tangible change, and a new expression of hope, on the streets of Havana and other cities. And the prospect for realigning the relationship between Cuban citizens and the state seem far more promising than at any time since 1959.

You’d think the Obama administration would acknowledge the positive trends, which include loosened restrictions on the Cuban people. After all, Raúl’s reforms seem like a page from Washington’s own playbook: reduce the numbers of employees on the state payroll, support small businesses, and reduce government spending for social hand-outs (Raúl has spoken of reducing ration card allocations and ending many state subsidies entirely).

But no! This is an election year, and the administration feels itself beholden, as those before it, to avoid antagonizing the anti-Castroite Cuban American bloc in Miami, which decries the reforms as charades. What?

In referencing Cuba at the White House Conference on Connecting the Americas, Hillary Clinton spoke of the success of Cubans who had left the island for the USA. Cuban Americans, she said: “[have] already helped bring about some promising developments, especially in the economic arena. So we have to work to unleash the potential that we see in our hemisphere… And to me, that is worth everything– to lift people who have a generation or so before been mired in illiteracy and poverty into the middle class. It doesn’t get any better than that.”

Yet not a word about the promising reforms inside Cuba.

President Obama has called the reforms insufficient. On May 12, 2011, Obama stated that he “would welcome real change from the Cuban government” but that “For us to have the kind of normal relations we have with other countries, we’ve got to see significant changes from the Cuban government and we just have not seen that yet.”

Maybe we should stop moving the goalposts!

As a 2011 report (Cuba's New Resolve: Economic Reform and its Implications for US Policy) by the Center for Democracy in the Americas concluded: “We have a new opportunity to be seen by Cuba’s people and its future leaders supporting their efforts to build a new economy and to help the Cuban people lead more prosperous lives. The greatest contribution our country can make now is to demonstrate we want the reforms to succeed, because we want the Cuban people to succeed.”

Now that sounds like a page from Hillary Clinton’s own playbook.

If I heard her right, she believes that economic progress allows citizens a broader stake in civil society and helps foster democracy. Isn't that what the U.S. government and the Cuban-American bloc have been calling for all these years in Cuba?

The good news is that President Obama’s liberalization of restrictions on travel and remittances initiated in 2011 have fostered greater human contact and capital inflow at a critical moment when Cubans need both for the difficult days ahead that are sure to accompany Raúl’s reforms.

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Disclosure: I occasionally accept free or discounted travel when it coincides with my editorial goals. However, my opinion is never for sale. The opinions you see in Cuba & Costa Rica Journal are my unbiased reflection of the good, the bad, and the ugly

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