Tuesday, April 1, 2008

"Prohibitions" biting the dust

A few things stand out about the removal of the “excessive prohibitions” by Raul Castro: easing customs regulations last year and allowing Cubans to receive shipments of car parts and video equipment from abroad; allowing Cubans to contract for cell phones; allowing Cubans to stay in Cuban hotels; allowing sales of computers and DVD players.

  • These measures will increase public welfare – for those Cubans who can participate in them.

  • Over time, these measures will erode the myth that no Cubans have substantial disposable hard currency income. For example, many Cubans already have cell phones, and have managed to pay ETECSA’s high rates. Fewer can afford hotel stays, unless hotels lower their rates for Cubans, a step that could certainly be taken, profitably, in the July-August low season.

  • They represent progress on human rights, although the degree is debatable, and it’s also debatable to what degree hotels and phones and computers are the priority of the average Cuban. But if “tourism apartheid” has been a perennial (and legitimate) element of the human rights indictment against the Cuban government, its elimination has to be counted as progress. In this Herald article, Rep. Ileana Ros-Lehtinen nonetheless calls the measure “pathetic.” What will be the reaction if Cuba eliminates the tarjeta blanca, the requirement to receive an exit permit to emigrate or to travel abroad?

  • These measures – with the exception of the changed customs regulations – cost the government nothing, and are likely to increase revenues to government enterprises.

  • The measures allow Cubans to make broader use of the purchasing power they have, but they do nothing to increase purchasing power by generating new jobs or higher income. Hopefully, something is being cooked up on that score that extends beyond the agriculture sector, where some initial moves are under way.

  • The hotel, DVD, cell phone, and computer measures will increase communication, the flow of information, contact with foreigners, and demand for connection to the Internet. In the past, factors such as these have stopped good ideas dead in their tracks.

  • Another difference from the past: Fidel’s philosophy in these matters seemed to be that if everyone could not afford it, then no one would be allowed to have it. That hyper-egalitarian thinking has gone out the window.

22 comments:

CUBA ED said...

Nobody can deny that these changes are in the right direction. However, the "axis of evil" of Cuba's economic problems is the double exchange rate. Until this is eliminated, it will remain hard for the average Cuban to improve his livelihood.

CUBAWATCHER said...

My guess is that the dual currency system will be history by the end of this year. I don't think Raul and Co. can avoid it.

Again however, none of these changes mean the end of the regime however.

But hell, let's keep chipping away at Fidelismo until it is no more!

Anonymous said...

Rep. Ileana Ros-Lehtinen is the "pathetic".. and a real jerk..Not to mention kind of red-necky, in that Miami kind of way.

Anonymous said...

Ileana Ros-Lehtinen sees her future (and that of the Castro nephews) going directy into the dumper.
She could not phantom that Raul would actually gather some good will from the Cuban people (however small) and that her "colonization" dreams of riding on a white horse down El Malecon are just not going to happen. As Cuba (Raul) changes the most draconian of the rules imposed by Fidel it is going to be very difficult for the USA goverment to keep avoiding the Cuba cause by just stringing 50 years of promises. At one point the nations of the world will ask the USA why do you not trade with Cuba and they will not have a good answer." Because we want the Florida vote" is just not going to fly.
What is left? inspection of jails for political prisioners and "free" elections (something akin to Chavez's farse ) Raul can pull that off in 2 months and most likely will win even without any cheating.

It just did not work for the Miamians, did it ? Now let's get ready for an economic catastrophy in SoFl, Bahamas, Mexico, Las Vegas and every other place which picked up all the revenue Cuba lost in '59
The Spaniards have not been loosing 1 million a day for giggles. 17 hotels in Cuba and one in the USA???? I'd say the Melia chain did know what side of the bread will eventually get buttered.

Manuel A.Tellechea said...

What you call the "disposable" income of Cubans on the island is actually the disposable income of Cuban exiles, whose remittances will allow them to buy those hitherto prohibited "luxury" items which Raúl and his coterie of military-industrial robber barons will sell them at mark-ups of 100-5000%

This is like taking a homeless man from the Bowery (if there are any of those anymore), setting him down on Fifth Avenue with two-bits to his name and telling him that the world is his oyster.

What would his only choice be?

To beg.

The only difference is that George Bush wouldn't come at the end of the day to cheat him of his quarters.

Phil Peters said...

Yes, the potential consumers of these goods include people who get remittances from abroad.

But they are not the only ones with hard currency to spend. There are artists, taxi drivers, families that rent rooms in their homes, and other entrepreneurs, plus the employees of foreign companies who earn a few hundred a month in hard currency (and who complained recently when those earnings were made subject to income tax).

Mambi_Watch said...

Phil,

Your comments carry optimism which is very refreshing. Here in Miami, on Radio Mambi, and on Spanish-language television, all one hears is the negative side.

While the pessimists do have very good arguments, an honest balance should be made by also assessing the positive aspects which you argue boldly.

Kudos.

Manuel A.Tellechea said...

Phil:

"The potential consumers of these goods include people who get remittances from abroad"

These goods will be consumed principally and almost exclusively by people who receive remittances from relatives abroad.

So, in effect, it is Cuban exiles who have been granted the right to buy high-priced items for their relatives at the company store where the worthless script paid to them is not accepted, and where, of course, they have no credit.

Phil Peters said...

Manuel, I'm sure they would be delighted to have your money, and I'm sure they thought of it before they made the decision. But if you think that remittances are the only source of hard currency purchasing power among Cubans, you are missing something.

Anonymous said...

I think Manuel is talking about real Cubans, not the ones you meet with Peters

Anonymous said...

I think Manuel then is not talking about Cubans in Miama and the false historic "exile" bc they certainly are NOT real cubans.

Exiles are this in-between.. they are not cubans (the ones who haven't been back in 40 years)... i mean many of them even look different.. they are certainly uglier than cubans living in Cuba..

Go to Cuba, you will see, average cubans living in Cuba (the Real ones) are much more attractive than the "historic exilio"= who are generally paler and fatter like that congresswoman - how ugly and scary looking

Phil Peters said...

I think we are going off the rails here.

Anonymous said...

Anonymous 10:31 p.m.,

That is exactly the same sort of rhetoric that Fidel and co. have used for years to attempt to sew hatred and separate families. It is in fact, something that most Cubans reject outright. The fact that you would say such a callous, hideous things speaks volumes and only proves the fact that you've never been to the island, never spoken to us, never engaged us.

Right now in Cuba, barriers are coming down - granted, the token gestures by Raul don't do much at all regarding the island's ultimate problem but, Cuba is finally starting to change for the better. Then folks such as yourself come along and attempt to belittle positive change. It is disheartening to say the least.

The changes being implemented will allow information to be disseminated more easily throughout the island - and through that action, will spark real, substantive change. This is a positive day for the Cuban people and I expect more changes to come in the near future (the abolishment of the dual currency system and greater access to the internet in private homes).

-Anatasio

Alex said...

Phil, I have to side with Manuel here. While there are Cubans that have access to hard currency other than remittances, artists, taxi drivers and room-renters aren't a significant part of the population.

Like in almost every Cuba discussion, absolutism muddles the issue. But I think we can agree that the measures are significant only for a small art of the population and hence they are symbolic. I also note they have a significant propaganda value, especially the elimination of tourism apartheid. Raul has gotten a lot of good PR for somthing that costs him nothing.

I agree with you that hopefully something more wide raching is cooking.

Phil Peters said...

Alex, I'm happy to discuss what I actually wrote. I am not sure how to react when I write one thing, and readers react as if I wrote something else.

nonee moose said...

Phil, at the risk of defending certain parts of US-Cuba policy which I don't personally agree with...

The measures are more than symbolic, yes. They pose no great risk to the regime, and thereofre no great sacrifice of control, given the fact that few if any of the Cuban people can avail themselves of the benefits. So where does the non-symbolic aspect of the measures lie? In that the most tangible probable result of the measures will be to cause a spike of profits into the regime enrichment machine. It creates yet another stream by which to siphon hard currency from the underground economy, which cannot be legitimately valuated, to the "overground" economy, which can. What is the long-term reason for this? Well, how else would you put a price on the privatization of the Cuban economy? Any foreign investment in the domestic market (as opposed to the foreign/tourist market) has to show documentation that will pass muster in the capital markets. Write it down. That is the final money shot in the exit strategy for the regime.

I believe that any talk of hardliners belittling the measures fails to contextualize the attitude. How would any accurate assessment from the historics not sound less than enthusiastic? Even an optimistic post like this is compelled to admit the emeasures are not really going to do much, that, in optimist parlance, they are a step in the right direction. Frankly, the only reason you can make that statement in that tenor is because someone else is saying it is nowhere near enough. We can quarrel with the speculative motivations behind the rhetoric or even its choice of words, but in this instance at least, the rhetoric is a valid line of attack.

Alex said...

Phil, I guess I missed the "no" in "no Cubans have substantial hard currency income". Yes, some Cubans have disposable income and they will buy a DVD or a computer.

To rite something and then see it misunderstood or taken into a different path or challenged is part of the discussion though.

theCardinal said...

All this is nice but essentially window-dressing. It is a brilliant move by Raul on two fronts- it plays well internationally (maybe even at home) and it short-circuits the black market.

A real change of direction would be resolving the currency crisis and on a humanitarian level granting exit visas to those that already have visas to come to the US. They lose nothing with the latter and it would be a huge symbolic gesture that the US would not be able to ignore.

CUBA ED said...

Somebody has lost track of something here. Is anyone really in favor of keeping Cubans out of tourism facilities? Or from having a cell phone? Should not those changes have happened? Is anyone confused about why precisely it was those changes that were put into effect?

The PCC is aiming to stay, and it figures that in order to do so it's going to have to eliminate the restrictions that bother the Cuban people the most. Now they can go to a hotel and spend a CUC on an ice cream on a little kid's birthday.

Raul is going to get the parents' vote.

Manuel A.Tellechea said...

Cuba Ed:

Neither Fidel nor Raúl got "the parents' vote."

Nor the grandfathers' vote.

Nor anybody's vote.

That's the primordial problem.

KillCastro said...

Anonymous said...
Ileana Ros-Lehtinen sees her future (and that of the Castro nephews) going directy into the dumper.
She could not phantom that Raul would actually gather some good will from the Cuban people....

When you steal a whole post from somebody elses blog the LEAST you could do is to admit (someplace) you did not write it. No need to state whence it came but man, you know certain protocols DO apply!
Geez !

Charlie Bravo said...

To the same anonymous KillCastro is referring to:
Needless to say, thanks for reading KillCastro and metabolizing that greatly our ideas. No need to say that you read that on KillCastro, but at least you could have said "as two crazy kooks on the internets say: yada, yada, yada". We've been saying that for a couple of years, already, and every single day that passes makes it into a more tangible reality.
I know, I know, you also cheated in school.