The changes in Cuba

Points
of View                                                                         Read Spanish Version

The
changes in Cuba

What
follows is a condensed transcription of the program Points of View
broadcast last week by Radio Progreso Alternativa, with the
participation of professor and attorney Ramón de la Cruz
Ochoa, former Prosecutor of the Republic of Cuba and chairman of the
Commission on Constitutional and Legal Affairs of the National
Assembly of the People’s Power (ANPP), and economist Omar Everleny
Pérez, deputy director of the Center for Studies of the Cuban
Economy (CEEC). The program’s host was Manuel Alberto Ramy, Havana
correspondent of Radio Progreso Alternativa; the moderator was Dr.
Jesús Arboleya.

Jesús
Arboleya:
Today’s topic is the results of the meeting of the National Assembly
of the People’s Power, held on Feb. 24. I would like to evaluate the
outcome of this Assembly, how it resembles the previous ones and how
it differs from them, and how we can analyze the impact on Cuba of
its results. I begin by asking Ramón de la Cruz for his
opinion.

Ramón
de la Cruz Ochoa:
You ask how this Assembly differs from the previous ones and how it
differs from them. From a formal point of view, it’s exactly the same
as the others. Since the 1976 Constitution, the National Assembly has
been the State’s supreme body of power. It has a permanent
organization known as the Council of State, formed by the President,
the First Vice President, the other vice presidents and members of
the Council of State.

How
does it differ? In the fact that the supreme leader of the
Revolution, Commander-in-Chief Fidel Castro Ruz is no longer
President of the Council of State. Some in the media say that he was
President of the Council of State for 50 or 40-some years. Not so.
You well know that the first president Cuba had after the 1959
revolution was Manuel Urrutia Lleó, who resigned in the first
few months of 1959. Later, Osvaldo Dorticós Torrado was
appointed President of the Republic of Cuba and he served for more
than 10 years. In 1976, when a new constitutional formula was
instituted in the Council of State, Fidel Castro was named President
of the Council of State.

The
other important difference is that the Council of State was
instituted after a process of discussion of the most pressing
problems in Cuban reality, after those problems were debated in
thousands and thousands of assemblies throughout the country, where
the people expressed their points of view. I am puzzled, because the
[U.S.] Department of State always says that the first thing Cuba
needs to do before engaging in dialogue with the United States is to
engage in dialogue with its own people.

Well,
last year and so far this year, this country has truly seen an
example of dialogue between the power and the people, something I
have not seen in any other country in the world. A dialogue has been
ongoing here for a long time now, and this last exercise — after
Raúl’s speech — was a full, radical and I would say very
important dialogue between the government and the people.

Arboleya:
What’s novel about this Assembly is that it was the culmination of a
process of discussion that has not yet ended, because the Assembly
itself announced future discussions. The climactic moment in this
Assembly was Raúl’s speech. That speech had two fundamental
ingredients: a political ingredient that confirmed some of the
political theories that have existed throughout the revolutionary
process, and an economic ingredient that was particularly anticipated
because that’s the site of most possible changes. I would like to ask
Omar Everleny to what degree Raúl’s speech satisfies these
processes of discussion within Cuban society, what measures seem to
be most important or more representative in this process, and how
does he see the future in relation with all this?

Everleny
Pérez:
Raúl’s Feb. 24 speech is consistent with his basic speech
about the entire process, which he delivered on July 26. His [July]
speech presented specific positions, specific expectations. Among the
outstanding points were the need for structural changes in the
economy, the topic of wages, the topic of changing the means of
commercialization, particularly in agriculture. On Feb. 24, he
stressed again those points, voicing arguments amassed after a huge
process in which more than a million proposals were collected, all of
them aimed at making deep economic reforms, because a deep economic
reform is to make wages play their role. I cannot tell you that steps
have already been taken, but there has been a lot of discussion, a
lot of expectation. A process of expectation created by the
government itself and, above all, on the street. Everybody talks
about change, about wages, and these are interesting things because,
for the first time in Cuba, people are talking about concrete things.

I
am optimistic. In circles close to the government, particularly among
us economists, there is talk of a coming devaluation, an end to the
dual currency. These attitudes reflect the reality. What’s clear is
that the processes must be made gradually, because (to me) what’s
essential is not finances. Finances express a reality. In a first
stage, the measures must relaunch the productive forces, in other
words, must generate production, services, because a monetary reform
established at this moment would not solve the problem, if there
aren’t enough products to deal with the economic situation that began
during the "special period" and worsened thereafter.

It
was a trend that began in the late 1980s. Monetary liquidity was
increasing. The big problem began in 1994. Clearly, there was an
element of inequality that was unknown prior to the 1990s, and the
State acknowledges that it exists and is trying to reduce that
inequality through the word "salary" — and salary means
working people. Therefore, people expect that [higher] salaries will
really have a motivating effect on the economic system, and I think
they will. [The raise] has to be gradual, but time is an important
element because there isn’t much time left. Raúl himself, on
Feb. 24, said it will happen short-term.

I
think important institutional transformations will take place this
year. Talk on the street is about the merger of ministries. It’s
essential that everyone realize that we’re talking about ministries
that deal with food provision, with agriculture. There’s a lot of
speculation but it has a logical basis, because it is directed at all
the shortages that are important to the population, particularly the
topic of food. On the subject of transportation, we have seen a major
improvement in the past several weeks. In March 2008 we could hear
comments about how transportation is improving. There is a plan; this
year, 760 new buses should be running in Havana City. Right now, only
460 new buses are running. The plan is to add 400 new buses in the
next several years. People are starting to be more optimistic about
these things.

The
topic of salaries has to come up soon, but the most pressing issue is
reforming agriculture. There are many proposals, there is much
distribution of land.

Arboleya:
From the constitutional point of view, once a new legislature is
established in the National Assembly, the Assembly elects the Council
of Ministers, along with the Council of State. That was done in 1976
but, as I understand it, was not done in subsequent assemblies,
allowing the Council of State to elect it (as a practical step)
during the course of each period. This Assembly was especially
careful to state that the Council of Ministers would be restructured,
not only through a change of name but also in the way Cuban society
would be managed. Ramón, what impact do you see here? What is
the exact role of the Council of Ministers, how is it important? Why
is it important that it be decided upon during this Assembly?

De
la Cruz Ochoa:
The Constitution says that the Council of State appoints the Council
of Ministers. However, the law and the legal rules are not like
arithmetic, where 2 plus 2 makes 4. They are always subject to
interpretation. For a while, the interpretation was that the Council
of Ministers was appointed in a practically tacit manner, during any
period that had a new Council of Government, a Council of State. Now,
the decision as been made (and I think it’s very important) that the
National Assembly must be in charge of appointing the new Council of
Ministers.

The
Council of Ministers is simply the country’s government, the
executive branch that is in power, and the government is the Council
of Ministers. In other words, the Council of State is not a
government body; the Council of State is a permanent body that
represents the supreme power of the State and, as such, has
legislative and other powers. But it is not the government. That is
the role of the Council of Ministers.

The
Council of Ministers is a very important body because it has to
execute all the policies forwarded to it by the National Assembly,
through the Council of State and the [Communist] Party, which in Cuba
has constitutional rank. The Council of Ministers is the Executive
branch in our country and I think that the Assembly took a very
important step when it stated that it should appoint it, as proposed
by the President of the Council of State and Ministers, Raúl
Castro. He understood the designation not as an appointment of new
ministers or endorsement of the incumbents but as a reorganization of
the government, and this is within the agenda of changes being
discussed nationwide.

Arboleya:
Many times the structures are changed when people cannot change other
things, and it looks like change but it isn’t. From an economist’s
viewpoint, what can result from this change in administrative
structure?

Everleny:
The change in structure is not necessarily the change in a ministry,
the merger of ministries. The change in structure is related to the
way in which each ministry operates. For example, the
commercialization of agriculture is a change of structure. If you
remove the collection equipment, or the way the collection [of
foodstuffs] used to work, you are making an important structural
change. This has been verified in practice in the dairy sector. There
are things that really must change from the way they used to be done.
We must go from a very strong centralization, which exists at this
moment, to decentralization. That, too, is a change in structure
because it is a change in the way to operate.

What
has been announced is to have a lighter government up top,
particularly elements with a lot more decentralization, and let the
essential weight remain at the bottom. The problem in Cuba is the
productive base, not so much the upper organization, because we could
reorganize the state apparatus, but it may retain the same faculties
as the previous one. There’s no structural change either, in other
words, if a ministry joins another ministry but continues to function
in the same manner, dictating to the final producer all the steps it
has to take, we haven’t changed the structure.

There’s
an element that isn’t quite a brake but that is a major hindrance.
It’s the high centralization that exists in economic decisions. The
fact that the Central Bank of Cuba decides the volume of importation,
the volume of each production has slowed down the [economic] process,
and some specific cases of this have been brought to the Assembly.
I’m not talking about things that are not verified, such as the
Central Bank deciding how much money is needed to finance an
enterprise. That was necessary some time ago, given the
disorganization that existed in the State.

But
I don’t think that a bank should perform the duties of an enterprise,
because if it does, who needs an entrepreneur who is told what to
produce, when he can buy the raw materials, when to sell them, in
what market to sell them? Then there’ll be no entrepreneurs in Cuba,
and I think that the essential base of a socialist system is the
socialist enterprise. We have to give [entrepreneurs] the powers they
need; we musn’t throw out the baby with the bath water, as was done
in the past, because of the great disorganization that existed.

The
tone of Raúl’s speech leans to that side. A lot of people knew
what was wrong with commercialization. Yet, it was left to Raúl
to say: "Do an investigation of the dairy industry." Many
reports said that the milk-collection techniques did not encourage
the producer. We can think that all these structural changes will be
beneficial, and I repeat: structural changes are not just the merger
of ministries. They go far beyond. They are changes in the way those
ministries operated.

Arboleya:
For sure, Ramón has some opinion about that topic.

De
la Cruz Ochoa:
Not in the same direction. When someone talks about structural
changes and how a government will be redesigned, I think of a very
important aspect that was clearly indicated in the constitutional
reform of 1992 and still is not fixed in reality. To me, it’s an
essential topic. A ministry must be an instrument that directs the
economic policy set by the country at a specific moment and
supervises the execution of that policy. However, it must not manage
enterprises, in other words, we have to reach a situation where there
is a separation between government and enterprise. State-run
enterprises (which may have different legal shapes) are one thing;
government is something else. The government has to be the
government.

If
you assign the ministries to run little grocery stores and manage
small enterprises, you’ll need many large ministries with a lot of
government employees. However, if you have a ministry that proposes
to the government the policies needed for each sector, so the
government may approve them and later supervise their execution, you
may need a highly specialized ministry but it won’t be a large
ministry because the entrepreneurial activity (which calls for a
large number of people) will be performed by the enterprises, not the
ministries. That’s the way to a structural reform of the ministries.

Arboleya:
In this program, we have heard the word "change"
constantly. However, if we look at what the foreign press has
reported on events in Cuba and in this Assembly, we see that the
press reports that the changes do not exist. Where should we look to
accurately evaluate the changes that are coming to the Cuban reality?

De
la Cruz Ochoa:
Firstly, we have to pay attention to events and the reality in this
country. There is a level of discussion and polemics that I had never
seen before, and it is an important change. People are speaking out
and expressing their problems without any fear. The other day, a
journalist said that he had interviewed a person on the street and
the person said that he was very happy with the improvements in
public transportation and that "now I can arrive at my workplace
and say what I think quite openly." That’s an important change.

There’s
a level of polemics in the country because people speak out. There
are no Biblical truths. Everything is open to discussion, because
people listen to others. Raúl was the first one to open the
door to discussion, allowing people to express their opinions. And
that’s the first important change in the country in recent time.
There’s a level of polemics, of sincerity, as people state the
reality of their lives, that is very important. In addition, the
people’s culture, the nation’s culture is changing and we are opening
ourselves to a more polemicist, more contradictory culture, with a
diversity of opinions and criteria. That’s the marrow of the changes
in Cuba, regardless of the measures taken.

Arboleya:
Everleny, to what degree is that reflected in the academic world, the
world of professionals? Are you contributing to his debate in an
effective manner?

Everleny:
What’s happening right now is a debate. It is premature to evaluate
if Cuban society is changing. The Assembly opened less than a month
ago; everything is being reorganized. I see the change in the
debates, in the proposals, in the fact that people venture to say,
"This will be the first step, that will be the second." We
see that in only 15 days comments have been made that have a very
strong basis: there will be an opening in hard-currency stores for
products that have been restricted — prohibited, in the past —
especially products that use electricity. This topic can be read two
ways. First, you can buy the products; second, the economy must be
improving because there is a productive backup (particularly in
electricity supply) for all that.

Another
measure being discussed a lot right now is the rate of [currency]
exchange. People also talk a lot about immigration. This week there
is an important conference in Cuba to analyze that topic, but I’m not
going to go into that. However, we cannot say that — one month after
the Assembly — concrete steps have been taken. As someone said,
changes will be gradual. A good moment to analyze the events in Cuban
society would be one year from now, at least. But we already see
concrete changes in agriculture, in the fact that it will open.
Producers now can buy the work tools they need at the CIMEX Corp.
stores — picks, shovels, seeds, fertilizers. This is in response to
the payment in being given to dairy farmers, who are getting a few
cents more [in convertible currency] for each liter of milk they
produce.

The
academic world is offering many proposals that are not new; what
happens is that they’re only now being articulated at the Center for
Studies of the Cuban Economy. We think that financial reform must
begin in the second semester, after measures have been approved to
stimulate specific productions, because financial reform without the
backing of production could leave us right where we are. If a
financial reform is to occur, it would mean reducing prices for
hard-currency products, which would increase [the consumer’s]
purchasing ability.

The
nominal salary is a variant that is not as effective as the value of
the real salary, in other words, it’s not a question of earning 800
or 1,000 pesos but to give today’s salary a greater purchasing power.
That is solved with a simple measure: eliminating (or reducing) the
tax paid on the hard-currency products that are in great demand. At
the CEEC, we are debating what would happen if we eliminate the
ration book; we hold that, yes, the ration book is something that
could be eliminated. But then we go from the subsidy of products to
the subsidy of persons, by identifying the people whose salaries
would not allow them to pay for the basic food basket they used to
get free. For example, if rice is sold today for 25 cents and the
price goes to 4 pesos, the increase would be 3.75 pesos. Therefore,
we would have to pay those people — through Social Security or
through their salaries — 3.75 additional pesos. We’d have to make
adjustments, and that takes time, because we’d have to identify
[individual people.]

What
is clear is that the price of products is not a complex issue. We are
talking about 190 pesos, which the State subsidizes. Well, pay those
people an additional 190 pesos. At the end, there’s an adjustment,
made in a lineal form. Primarily, it’s a proposal intended to improve
our productive level and to make our project more sustainable and
credible.

Arboleya:
Ramy, I would like to know how the foreign press has evaluated this
Assembly process, what are we contributing to that understanding,
what do they see that we don’t know?

Ramy:
You’re talking about a topic I’m familiar with, but I’m not going to
refer to the foreign press stationed in Cuba. I’ll refer to how the
bulk of the foreign press has looked at the topic of Cuba. Evidently,
they’ve done so from the outside, in other words, with total
ignorance of the reality of Cuba, of the feelings of Cuban society,
of the desires and viewpoints of Cuban society.

It
is not the same to observe a phenomenon from the inside, and the
evolution of a phenomenon from a legal and economic viewpoint, as to
watch it from the outside. From the outside, the only way they would
accept a change is if a political transition took place the way it’s
understood in the United States or in Europe. In other words, they
see it as a change in terms of political pluralism.

However,
they miss a fundamental point that was made by De la Cruz Ochoa, and
that’s the free discussion by people. We are talking about something
essential, the plurality of opinions within the system, to improve
the system. This has been manipulated, even in the case of the young
man from the UCI who said "I’m saying this from a revolutionary
perspective, for more socialism, I want to make it very clear."
Some people interpreted that as his way to cover his rear, but they
don’t understand that a 20-year-old man doesn’t cover his rear, he
says what he thinks, even if it’s confrontational. I think [the media
coverage] focused the incident from the wrong perspective, based on
the wishes of the countries that are interested in somehow
controlling the evolution of Cuba’s dynamics.

Arboleya:
Well, I thank my colleagues Ramón de la Cruz and Omar Everleny
for being here with us in this program. If anything has been made
clear is the fact that we Cubans argue a lot and have very diverse
opinions and remain alive — and that, from the point of view of many
people, is almost an impossibility. We’re pleased to say good-bye to
you for now.