One million job cuts show crisis in Cuban model

Cuba’s announcement in September that one million jobs in the state sector are to be cut signals a speeding up of the shift away from a completely state run economy. But this does not represent a shift away from socialism—since Cuba, despite having a state-controlled economy, has never been socialist.

“The Cuban model doesn’t even work for us any more”. This is how Fidel Castro, leader of the 1959 Cuban Revolution, responded to questions in early September about the merits of exporting the Cuban economic model.

Castro later claimed to have been misinterpreted. He insisted that what he meant was that capitalism did not work. But the recently announced changes show the economic difficulties gripping Cuba.

Cuba has survived a 50-year US economic blockade of the island, but it has created enormous problems.

Tourism in Cuba has been flagging as a result of the economic crisis, and the sharp drop in commodity prices has slashed income from nickel production.

While the imperialist blockade must be opposed, the latest anti-worker cuts show that the “Cuban model” is no alternative to capitalism. 

Corruption is more pervasive than ever before and theft is becoming necessary for many Cubans to survive. Monthly government rations only cover two weeks and are no longer enough to survive on, and subsidies for basic needs are constantly being cut. Consequently, the difficulties of establishing small businesses in such economic hardship will likely induce a new wave of theft and corruption to prop up business interests.

The changes under way in Cuba today parallel the austerity measures in Europe where the ruling class is privatising entire industries while cutting back public sector wages, pensions and other entitlements. Ordinary people are made to pay for the damages incurred throughout the financial crisis.

Cuban President Raul Castro stated the Cuban government’s intention was that: “We have to erase forever the notion that Cuba is the only country in the world where it is not necessary to work”.

The Cuban state’s plan will see 500,000 state jobs cut by March, with at least 250,000 of these workers given new licenses for self-employment and another 200,000 to become co-operative workers in previously state-run businesses. What will happen to the remaining 50,000 workers is not yet clear.

The dramatic decision to shed what amounts to 20 per cent of all state jobs follows other recent measures to cut state expenditure.

Earlier reforms saw land leased in ten-year renewable contracts, in an effort to create private farmers. They paid rent on this land and had to sell most of what they produced to the state at prices set by the government. Many of these new farmers, previously urban workers, were unsuccessful because the state did little to provide basic agricultural resources and knowledge.
This experience is an indication of the difficulties posed by pushing half a million workers into self-employment and co-operatives. 

The announcement represents a significant shift from the state-owned economic model towards free market solutions to address the economic crisis crippling the island state.

However, the ruling bureaucracy’s aim is to give concessions to private enterprise while remaining firmly in control, as has happened in China. There the Communist Party has co-opted the most successful of the new private capitalists into its ranks.   

Not socialist
But it is a mistake to view the changes in Cuba as part of a transition from socialism to capitalism. This is because what exists in Cuba has never had anything to do with socialism.
Unfortunately, some on the left do hold the view that Cuba is socialist. This results from the myth that state ownership of production is all that is needed to create socialism.

Genuine socialism requires working class self-activity, and mass democratic control of society. By contrast during the Cuban Revolution of 1959, the working class played a passive role. Fidel Castro’s guerrilla force played the decisive role in seizing power, and all key government decisions are made and implemented from the top down.

While the change of regime brought material improvements to the living standards of ordinary Cubans, popular support for a revolution, and mass democratic participation in a revolution are two entirely different things. For the kind of grassroots activity capable of introducing a socialist society run by the mass of the working class, we need to look to bottom up workers’ struggles in resisting austerity measures and job cuts all around the world.

By Tony Bozdagci

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