comments_image Comments

Cuba Moves Toward Privatization by Big U.S. Businesses; Cuban Workers Stand To Lose Almost Everything

Foreign direct investment exacerbates labor abuses. The only recourse for workers at foreign companies is the very state union that suppresses the right to organize.

On the list of America’s most-hated leaders, Fidel Castro gets the award for longevity. Outlasting ten U.S. presidents, from Eisenhower through George W. Bush, Castro has managed to maintain his high ranking for over five decades. Though the 84-year-old ex-president of Cuba is unlikely to drop off the list during his lifetime, the persistent image of Cuba as communist dystopia may be on the verge of changing -- that is, if the dreams of American big business come true.

The emerging vision of Cuba as a corporate utopia has become especially prominent since September 15, the day Fidel’s brother and current president, Raul Castro, announced that Cuba will cut 500,000 state jobs over the next year as part of a larger program of economic reform. Currently, the state employs 95 percent of Cuba’s 5.1 million workers. The new policy is designed to privatize Cuba’s workforce and encourage the growth of small business. Approximately half the laid-off workers, or 250,000 people, will be issued licenses for self-employment in a wide range of sectors, from transportation and construction to agriculture and retail. Until now, the private sector has been restricted to a narrow range of activities, including barbershops, beauty salons, and restaurants, all of which the state keeps under strict surveillance. In the wake of the global economic downturn and the disastrous hurricanes of 2008, underground businesses and remittances from relatives in the United States have kept many Cubans afloat.

This move toward privatization is not altogether new. Since 1959, Cuba has gone through periodic cycles of economic reform and consolidation. After the dissolution of the Soviet Union, which drastically reduced Cuba’s subsidy-dependent budget, the government declared the Periodo Especial and relaxed restrictions on private businesses only to tighten them again within a decade. Since he assumed office in 2006, Raul Castro has promised to reform Cuba’s centralized economy. “ At times, he has sounded more like Margaret Thatcher than Karl Marx, stressing the need for Cubans to improve their work ethic, efficiency, and productivity,” notes Cuba expert Julia Sweig. Some economic reforms, especially in the agricultural sector, have already been implemented, allowing small farmers to sell directly to the public and keep their profits. Critics have argued that past reforms have been insufficient and ultimately insignificant. The latest reform has not met the same skepticism. Whether or not they support the plan, most analysts agree that it represents the biggest overhaul of Cuba’s economy since the revolution.

Tea Partiers Tout Fidel

The news of this “seismic shift” in Cuba’s economy has made a particular splash in the United States, with experts and pundits on all sides weighing in on the issue. Of course, U.S.-Cuba relations have long been an important element in American domestic politics. Since Castro assumed power in 1959, Cuban exiles, anti-communists, and conservatives of all stripes have made opposition to the regime a hot-button election issue. In recent years, however, fierce opponents of the Castro regime have lost ground. In 2008, Obama won the state of Florida, despite his promise to loosen travel and trade restrictions between the United States and its neighbor 90 miles south of Key West. Nationally, 10 percent more Cuban-Americans voted Democratic in 2008 than they did in 2004.

The newest economic reform plan has put Cuba back on the table during this election season. But the old script has changed, and with Cuba’s economy, the political alliances appear to be shifting. Politics creates strange bedfellows, but this adage doesn’t quite capture the irony of conservatives playing footsie under the sheets with none other than Fidel, el comandante himself.

See more stories tagged with: