To ETECSA what belongs to ETECSA, to the government what belongs to the government
ETECSA's new pricing regulation for its services has generated significant critical reaction, and it’s no surprise.
ETECSA’s new pricing regulation for its services has generated significant critical reaction, and it’s no surprise. Sustained and expanded access to communication and information is essential to a society in the 21st century.
The decision puts a significant portion of the population out of reach of a connection that has become a fundamental part of daily life, here and everywhere, especially for highly sensitive sectors like students, but not exclusively. The limit of 360 Cuban pesos per month is insufficient for many people who rely heavily on the data service. This leaves individuals largely dependent on what is sent to them “from outside,” which is not only inadequate but also places those who have someone to request it from in a very uncomfortable position, to say the least. It exerts unwelcome pressure, impacting social conscience.
This is not just an isolated problem affecting an essential service; it is made worse by the electricity crisis, water supply limitations, food prices, transportation conditions, the state of hygiene and order in the city, unrelenting inflation, and the increasingly widespread sale of stores in USD and MLC, among other factors. Past decisions with detrimental effects, such as monetary reforms and banking, also exacerbate it.
The primary argument put forth to justify this price increase is the financial situation of the communications company (ETECSA), which is undoubtedly true. This could significantly impact the services it is supposed to provide, as well as hinder its development. However, this reality does not have a single possible answer; ETECSA is a state-owned entity that operates within a specific context and under a socialist government. The response to a situation like this, when a fundamental social service is at risk, can and should include alternative solutions, but this is only feasible as part of a specific approach to organizing the economy and implementing economic policies.
It is also true that ETECSA is a monopoly in a “centrally planned” economy—in reality, today, a “bureaucratically planned” one—and has been almost entirely state-owned for decades. Monopolies are common, especially in activities like this. The issue is not just the existence of monopolies, which should not exist, except for natural monopolies; the problem lies in the ability, or lack thereof, of the socialist state to regulate them properly and in line with social interests, even when, in some way and under certain circumstances, some fundamental activities, such as this one, must be subsidized.
To be more precise and avoid leaving things hanging, it is essential to understand that the problem in an economy like Cuba’s today is not only the existence of unjustifiable monopolies and oligopolies. The issue runs much deeper because even when various state-owned enterprises operate in the same sector, regulations, pricing, and policies are centrally established, leaving no room for competition. Consequently, the effect is akin to that of monopolies. This confusion and interference with the state functions and powers that should belong to companies represent a mess that remains unresolved.
Therefore, there is a need for business reform as part of a comprehensive economic reform. Without this, it’s more of the same, regardless of the presence of monopolies. It’s essential to state this clearly: without this process, which we have discussed extensively, there is no viable solution to Cuba’s economic problem. At times, I am astonished to see analyses that address the Cuban economy and its alternatives (often through mass media, where the debate remains highly biased and strives to impose a predetermined editorial stance at all costs) as if we were in a developed country, with strong international alliances, etc., rather than on an underdeveloped, impoverished, blockaded, and virtually isolated island. These statements are rooted in a theoretical misunderstanding that barely touches on the specific circumstances of the country at present.
This isn’t about just any reform or continuing to foster a Frankenstein’s world; it’s about doing what must be done in a well-designed and executed manner, with a sense of reality, and preserving the pillars of the national project: national sovereignty, social justice, and economic and democratic development. The solution isn’t behind us; it’s ahead, and, of course, broad discussion with the people about what should be done is essential. The consensus needed to move forward cannot be built bureaucratically or imposed; it must be achieved through the active participation of the people and clear concepts. This is one of the most important lessons from the decades of revolution we’ve already experienced: let’s remember the workers’ parliaments.
Within the logic of this reform and the new model, several aspects require change. The socialist state, through its government, must retain the ability to utilize its resources and regulations in a manner that aligns with a clearly defined horizon and follows what the people describe as their priorities. This is compatible with businesses operating as businesses: to businesses, what belongs to companies. This means functioning efficiently and profitably, whether state-owned, cooperative, or privately owned, each with its specific characteristics, with state-owned companies exercising the leadership they deserve. The government must fulfill what should be a socialist government’s responsibility: regulate, guarantee, and properly manage resources and investment policies, including various types of essential and targeted subsidies (never indiscriminately) according to priorities. Establish and guide the balance and reproduction of a necessarily diverse economy without allowing the dominance of capitalist interests to prevail. There are many examples, even in capitalist economies, where services like subways receive state subsidies due to the social (and economic) importance of those activities. Cuba has historically implemented this in sectors like health and education.
Often, the central argument for certain decisions or non-decisions is that there is no money due to the blockade, among other factors, and this is certainly true. The policy of aggression has a highly negative impact. However, the response should be to acquire what is lacking through innovative and efficient management and to utilize what is available in the most rational manner, addressing society’s priorities. For instance, it is not feasible to maintain an investment policy that favors investment in underutilized tourism infrastructure (more than 30% of the total). At the same time, food production and other priorities receive significantly reduced funding.
In a macroeconomic environment that promotes efficiency, particularly in cases like ETECSA’s where essential services are at stake, the company’s needs should be met through state subsidies, which various economic and technical approaches can support. It is unwise to place this burden directly on a weary population without options, nor can we assume that citizens abroad will cover these deficits: such an approach is neither economically nor politically sustainable. While I’m not advocating for free services, the focus should be on adjusting prices to levels that are manageable for a population that regards this service as essential. It’s also reasonable to encourage citizens to use this service as efficiently as possible and to streamline its usage in official settings, such as telephones used by government functionaries and other fee-related access benefits. From any perspective, it is inadvisable to continue placing the financial burden of adjustments on ordinary citizens.
In a case like this, there is more than one possible policy through which the government, acknowledging the importance of this service, can rescue the company by utilizing available resources more efficiently, rather than viewing it solely as a foreign currency generator that transfers its deficits onto the prices customers must pay. There are various ways to achieve this: the economic literature is replete with feasible examples. Making this possible requires a transformation of the economy’s operating model, as well as a shift in the priorities and logic of economic policy, including investment policy. This is not just about the economic efficiency of companies; it is also, fundamentally, about the social efficiency of the financial system as a whole.
It is also necessary to outline a strategy that includes key figures such as quality, expected revenue volumes in both foreign currency and CUP, necessary investments with dates, goals, and other relevant details, to address ETECSA’s current situation.
On the other hand, we believe that it was not ETECSA, but the government, that was responsible for publicly and firsthand explaining this decision—an issue whose social and political impact extends far beyond the situation of a specific company. The reference to the company having been subject to considerable embezzlement, as expressed by the entity’s head, is not surprising; this is another issue that is equally important.
The most positive outcome would be for this new moment of tension to spark a profound national reflection on our current standing and the path we should pursue, correcting what needs to be corrected and transforming everything that requires change. We’ve often stated that time is a critical variable; can anyone doubt that today?
