A Soft — And Prosperous — Landing For Cubans Is In The U.S.'s Interest

A Soft — And Prosperous — Landing For Cubans Is In The U.S.'s Interest
By TIM PADGETT

There are two basic realities about Cuba's communist dictatorship that
U.S. policy, and the anti-Castro hardliners that shape it, prefer to
ignore. The first is that the Castro brothers will almost certainly die
in power. The second is that market-oriented economic reforms, albeit
tentative, are as much a part of Cuba's landscape today as 1956 Chevrolets.

Anyone who's serious about helping Cuba make the post-Castro transition
to a capitalist democracy will get serious about those facts. Which
means it would behoove Washington to focus less on pushing Fidel and
Raúl into the Caribbean and more on "nudging a pro-market system as
forward as possible" onto the island, says Richard Feinberg, author of a
comprehensive new Brookings Institution report on Cuba's precarious changes.

WLRN.org was given an advance look at Feinberg's study, "Soft Landing in
Cuba? Emerging Entrepreneurs and Middle Classes," which will be released
on Friday. Based on a year's worth of on-the-ground research and dozens
of interviews with Cubans moving from socialism to start-ups, it's one
of the more vivid pictures to date of a threadbare economy that's as
antique as those Chevrolets, but which may be reaching for the
21st century. Well, at least the 20th.

Readers should take away two core conclusions, Feinberg told me. One is
that "Cuba is changing dramatically and becoming more entrepreneurial
every day." But the other is that "orthodox communist foes" of a more
hybrid, socialist-capitalist economy, a la China, "keep battling to
maintain the status quo." That makes it all the more imperative that the
U.S. help bolster reformists and "strengthen market forces" there, he says.

Feinberg, a senior fellow at the Brookings' Latin America Initiative,
says that's not necessarily a call to eliminate the U.S.'s 51-year-old
trade embargo against Cuba. "It does mean," he says, "a relaxation of
economic sanctions" that the Cuban-American caucus on Capitol Hill
continues to guard as jealously as it does votes in Little Havana.

"Soft Landing" paints a schizophrenic picture of Cuba's budding business
scene. On the one hand, Feinberg writes, it's obvious that Cuban leader
Raúl Castro's recent reforms – which include letting Cubans buy and sell
private property like cars and houses, and his plan to unify Cuba's two
disparate currencies – "have opened exciting opportunities for aspiring
entrepreneurs."

He estimates 40 percent of Cuba's five million workers are now
self-employed or otherwise active in the fledgling private sector. And
he even sees more Cubans entering a middle class, although in
cash-strapped Cuba that's a relative term.

But their frustrations, Feinberg notes, are as long as Fidel Castro's
beard. For starters: scant sources of capital and credit, even though he
reports it can take as much as $36,000 to launch an enterprise like a
bed-and-breakfast – in a country where the usual monthly salary is $20 a
month. Add to that a heavy tax burden and a ban on access to the
wholesale supplies (only state-run firms can buy them) that every
business needs.

And on top of the hindrance comes harassment: "Disturbing stories,"
Feinberg writes, "of crippling fines and imprisonment for minor
offenses, cancelation of licenses and confiscation of assets, are
commonplace." Cuban entrepreneurs "purposely restrain their growth so as
not to capture the attention of the authorities."

Cuban business owners complain via code: tapping their shoulders with
two fingers, "to signal military stripes and unaccountable, overbearing
authority."

So this is not a document written by a naïve Castro apologist. Feinberg
told me he's as aware as anyone what an absurdly contradictory move it
was this month for the government to shut down private movie theaters
because they gave dilapidated state-run cinemas too much competition.

But "Soft Landing" nonetheless makes a strong case that in spite of the
lingering communist obstructions – or precisely because of them – the
U.S. needs to do more to throw Cuban entrepreneurs a lifeline.

Some of Feinberg's recommendations are questionable -- such as giving a
role to USAID, a U.S. foreign aid agency that Havana believes is out to
topple the government. But it's hard to argue that Washington should
find ways to "fill the capital gap" in Cuba.

To Feinberg, that means letting U.S. firms do business with "independent
entrepreneurs in Cuba" and provide the financial and technical
assistance Raúl can't (or won't) give them. Feinberg acknowledges that
would require a means of certifying that U.S. companies are doing
business with private and not state-run Cuban enterprises.

It would also require Raúl's consent – and Feinberg insists the U.S.
call his bluff. Castro, he writes, "would have difficulty explaining to
[Cubans] why [he] had refused to authorize a weakening of U.S. economic
sanctions." His refusal would, in other words, all but prove that the
Castros prefer that the U.S. embargo stay in place as a scapegoat for
Cuba's dismal economic failures.

Feinberg, a professor of international political economy at the
University of California-San Diego, says it's time Cuba admits what
communist China has – that "getting rich and prosperous is a good
thing." And it's time Washington realizes, he adds, that helping Cubans
get there "is in the U.S.'s interest."

Tim Padgett is WLRN's Americas editor. You can read more of his Latin
America coverage here.

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