After thirty years, the revolution faces a decisive choice
THE THIRTIETH anniversary of the Cuban revolution was celebrated in January. In the context of a critical economic situation aggravated by the restrictions of Soviet economic aid, this is a time for balance sheets. The consequences of
Gorbachev's foreign policy for Cuba, and still more for Nicaragua, are grave for the revolutionary processes in these countries.
S INCE THE beginning of the
1980s, the Cuban revolution has faced a serious economic and financial crisis. This has led Fidel Castro to make a turn in political and economic policy known as "the rectification process of negative tendencies."
On the economic front, the 1980s have been marked by many difficulties:
• The drop in sugar prices and the reduction in sugar production (due to an exceptional drought). These external factors caused a substantial drop in Cuba's income. Because of uncertainties about future production of natural sugar stemming from the development of artificial sweeteners, it is impossible to look forward to increased resources in the medium term, and this has a depressing effect on prospects for economic growth.
• This situation has been worsened by the deteriorating terms of trade with industrialized countries, which have led to a dramatic drop in imports. According to the Cuban National Bank, Cuba lost $116.72 in hard currency income for each ton of sugar it exported to countries with market economies between the years 1983 and 1985.
• The depreciation of the dollar brought on a rise in the foreign debt in 1985. The rise in interest rates forced the Cuban National Bank to request a renegotiation of the debt in 1982, 1984, 1985, 1986 and 1987.
• The withdrawal of Western credit after 1981-82 resulted in a temporary halt of the repayments.
• In addition, the repayments on the Soviet debt fell due in 1986, and Soviet subsidies were reduced. The price paid for sugar fell in 1986. The profits from oil exports (thanks to the energy savings made) evaporated with the fall in prices. And
JEANNETTE HABEL these losses have not been compensated for by an increase in the amount of oil exported. All indications are that Soviet aid has decreased.
Most serious economic crisis for 30 years
This economic conjuncture is very difficult - one of the most serious, if not the most serious, for thirty years. And this problem has been compounded by a new international situation. At the beginning of the 1980s, after the victory of the Nicaraguan revolution and the revolutionary upsurge in El Salvador, the Reagan government stepped up preparations for intervention in the region, including in relation to Cuba. This led the Castro government to change completely its defense policy after the 1983 military intervention in Grenada. The appointment of Gorbachev to the leadership of the CPSU in 1985 led to important changes in Soviet-Cuban relations as regards economic aid and international policy.
It was in this context in 1986 that doubts were expressed about the economic policy adopted by the first congress of the Cuban Communist Party in 1975. The System of Leadership and Economic Planning (SDPE) - which emphasized the importance of money-market relations, the need for economic reforms (legalization of private activity, particularly in agriculture), priority to material incentives, and the increasingly hierarchical wage structure -was challenged, and those responsible for implementing these measures were fired The economic reforms were severely criticized, and legalized private operations were forbidden, particularly the free peas-
CUBA ant markets.
It is undeniable that the implementation of the economic reforms in the framework of the SPE encouraged the growth of corruption, privileges and social inequalities. Insufficient investment in social services, particularly housing, and the downgrading of the health and education services contributed to undermining social gains. Egalitarianism, which has been the strength of the Cuban revolution, was put in doubt. The process of bureaucratization worsened. In a context of scarcity, privileges increased, thereby undermining collective solidarity against imperialism.
The far-reaching nature of the austerity measures taken to deal with the crisis heightened the risks of a gulf opening between the leadership and the masses. This was particularly the case as the leading team's paternalist and rigidly hierarchical style of leadership ran up against the demands of the better educated newer generations — intellectuals, the university milieu, artistic circles, some radicalized sections of women and especially the youth.
### Revitalizing the mass organizations
Castro recognized the danger in this situation. So, with the rectification process, he started an overall economic, political and ideological reorientation, which includes a balance sheet of relations with the Soviet Union since the start of the revolution.
He first sought to revitalize the mass organizations. But the limits of the People's Power bodies must be recognized. They are now more than ever restricted to local and municipal management tasks that make it 19 impossible for them to overcome the disor-
CUBA ganization prevailing in the enterprises, a disorganization that is only partly linked to the scarcity caused by the fall in imports.
The trade unions participate in the efforts made to reorganize and rationalize the labor force and increase productivity. They play an active role in exposing management's mistakes and abuses by the managers. But their task above all is, as Fidel said, "to help the managers to manage better" without isolating themselves from the masses.
### Critical spirit most developed among youth
The youth organizations face pressure from the new generations. The Communist youth (JC) journal reflects the discussions going on about the content of education, cultural problems, as well as inadequate discussion. This is where the changes are the most noticeable, and the critical spirit the most developed. But the JC's influence in political life remains limited.
However, the fundamental political mechanisms for the exercise of power are not being challenged, although they seem more than ever before to be an obstacle to economic growth and to the consolidation
The conception of a monolithic single party no longer corresponds to the sociocultural needs of many sectors of Cuban society. The mando unico (single command) and the functioning of the leadership team, as well as Fidel's exorbitant power, are arousing irritation. For the first time criticisms are being expressed, even if the legitimacy and the popularity of the Castro leadership are not being called into
But in the last year the leadership has taken important political liberalization measures. Many political prisoners have been released (obviously we are not talking about those imprisoned for revolutionary activities, who are also considered as political prisoners by the rightwing press, but about those imprisoned for that were regarded as "enemy propaganda"); the Penal Code has been changed in the direction of decriminalizing minor infractions and, on the other hand, laws against corruption have been strengthened. The press is echoing popular criticism more, but this remains extremely limited. On the other hand there is greater tolerance and openness on the artistic front.
On the ideological level the leadership is involved in an overall rethinking, drawing on past experiences and the problems of transition in the specific conditions of the Cuban revolution. This reflection also includes Nicaragua and the discussion underway in the different Latin American revolutionary organizations over an analysis of the crisis of socialism. The Gorba20 thieving chev experiment obviously affects this International Vlewpoint #159 • March 20, 1989
The Castro leadership has chosen to take an opposite tack to that of the Soviet Union by essentially opposing market reforms. But its margins for maneuver are limited by the existence of a pro-Gorbachev current within the apparatus. This current is sufficiently strong to have forced Castro to postpone the Third Congress to December 1986 and, in fact, to go around the Party Congress by launching the rectification campaign between two sessions.
The Soviet leadership, which in the past was never able to rely on the support of significant sectors to champion its interests, has a chance for the first time of getting a favorable response, even when economic aid has been reduced and differences in international policy are showing up clearly.
As for foreign debt, the Gorbachev leadership came out for repayment by third world countries just as Castro demanded that it be cancelled. With respect to Central America, Moscow has limited its aid for Nicaragua, and arms deliveries have been reduced. In general, the revolutionary process is not one of the main concerns of the Soviet leadership. Cuban influence in the third world, which was an asset for the Soviet bureaucracy, is today of lesser
Turn to Latin American governments
The Castro leadership has reacted by turning even more towards Latin American governments, where it has obtained major diplomatic successes. The isolation imposed by imperialism has been breached.
While support to the revolutionary processes in Central America remains complete, there has been a noticeable change in policy towards the continent. The confusion between positions taken by the party and state diplomacy gives rise to an approach fraught with ambiguities - such as Castro's visit to Mexico for Salinas de Gortari's inauguration, which legitimated the PRI's electoral fraud (see IV 157). And the anti-imperialist potential of the Latin American bourgeoisies is often over-
The withdrawal of Cuban troops from Angola should facilitate such diplomatic rapprochements. Nevertheless, without new revolutionary victories in Latin America that would bring about a change in the political relationship of forces in the short term, the Cuban revolution cannot hope to find a solution to the serious economic difficulties it faces from the bourgeois Latin American governments. So once again it will have to compromise with the Soviet
But this time the Cuban revolution is in a particularly dangerous situation:
• The present economic difficulties are serious and there is no short-term solution, as Castro himself recognizes.
• Neither integration into Comecon [Soviet-led trade bloc] nor specializing in sugar production have produced a more balanced economic development. On the contrary, dependence on the Soviet Union has been increased.
• Within Cuba the phenomena of corruption have worsened, and the process of bureaucratization has prospered in the shadow of the market reforms.
• In Central America, the revolutionary process is continuing, but at the price of serious difficulties in Nicaragua and of a heroic war in El Salvador at terrible human coSt.
Traditionally, the Castro leadership has maintained a balance between supporting the masses and national liberation struggles, on the one hand, and its integration into Comecon and its links with the USSR, on the other. This balance is achieved through a paternalistic relationship with the masses, in the framework of a single party subordinated LO Castro's personal initiatives.
Today the Castro group is torn. One choice it has is to follow the Gorbachev line and speed up the reforms. But this would create disaffection among the masses and would severely weaken the Cuban revolution, with nothing in return and without any future guarantee from the USSR. On the other hand, it could pursue a more egalitarian orientation, increasing social services but on the basis of voluntarism and exemplarism. But this would not be enough to resolve the serious economic problems, even if it could temporarily reunite the masses behind Fidel. This would not keep the discontented (layers deprived of advantages such the private peasants, certain sections of the apparatus, indeed a certain layer of intellectuals) from being susceptible to Gorbachev-type arguments along the lines that economic liberalism equals politi-
Political and social democracy
In these conditions, the only way to ensure that the economic crisis does not lead to a major political crisis lies in implementing political and social democracy, as opposed to the single party and appeals to voluntarism. This is the only way of stimulating the workers' economic consciousness."
The political zigzags and the repeated economic failures can in time provoke skepticism and wear away the confidence of the masses. The charismatic leadership of Fidel Castro cannot replace organized mass
Considering the dangers that hang over the revolution we must support everything that goes in the direction of a more egalitarian social course, of a struggle against bureaucracy and privileges, of independent expression by the masses and freedom of political discussion, as well as of aid to the development of other revolutionary movements in Latin America. *
Cuba's rectification process
A PTER the initial fiery speeches,
marked by virulent criticisms of the economic market reforms and capitalist mechanisms and by the ending of private activities, came a phase of reorganization and rationalization
The Cuban leadership is seeking a middie ground, one that avoids both the pitfalls of bureaucratic planning and the quicksands of market reforms. The accent is being put on economic development, particular industrial development: *This is not the time to consider consumerism, we have to think about development, which will permit consumption on a more solid, the December 11, 1988, issue of Granma.
Absolute priority is being given to investments, particularly those that will generate hard currency, or save it. Although all of the ramifications of the rectification have not yet been made clear, some major indications of the policy pursued do exist.
First, the rectification has tended, in this context, to reduce the importance of the material incentives that were introduced under the System of Leadership and Economic Planning (SPE). Then, in order to exceed the plan, the manager would set working targets at an artificial level. Bonuses were often higher than wages. But, for all that, production did not increase.
From now on, people will have to work harder, while often earning less. So it is hardly surprising that, as a Granma commentator stressed, "perhaps the most difficult aspect of the rectification is trying to convince workers whose wages were too high, owing to outdated norms or wrong criteria, to give them up." (September 18,
Second, the workforce is being rationalized and reorganized. The numbers of administrative staff are being cut, but reduction of workers in production is occurring in a more general way, and could affect 30% to 40% of the workforce.
"Put the best people in charge"
Excess workers from one factory are reemployed elsewhere, possibly in the microbrigades, subject to the condition that they accept the job they are offered. This is not being accomplished without conflicts, particularly among younger people who are more aware of the qualifications they have acquired, qualifications that are often higher than needed for the jobs they are offered.
Third, to combat absenteeism and lack of discipline at the workplace, as well as in-
ANNOUNCED in 1986 between sessions of the
Third Congress of the Cuban Communist Party, the "rectification process"
has entered a new stage.
### JEANNETTE HABEL stability and the excessive mobility of some workers, smaller work teams are being put into place, and furnished with tools and raw materials. In the micro-brigades or the "workers' contingents" made up of multi-skilled vanguard workers, the slogan is "Put the best people in charge."
Planning mechanisms to be simplified
Monitoring productivity is easier. It is done by the workers, who themselves organize their production, work out their plans, manage their accounts and wages. Saving resources and increasing production can sometimes result in large bonuses in the form of higher wages or housing allotments for example, to all except those workers who have not "earned" it. These advantages, in wages or in kind, are distributed under the auspices and supervision of the Cuban CP.
Fourth, the planning mechanisms are going to be simplified, and a certain economic decentralization is underway? Administrative structures between production and distribution will either be eliminated or
The ministry of basic industry in Cuba, which is responsible for many sectors of production, has announced a reform intended to "de-bureaucratize" its structures. The administrative personnel in the central offices will be cut by 60%, and most of the from bureaucratic organs into the hands of the factory management.?
Finally, the autonomy of enterprises could be strengthened, given the Comecon reform. In its forty-third extraordinary session in October 1987, this body defined some special programs concerning cooperation between the European Comecon countries and Cuba and Vietnam. Above all, from then on, organization of economic relations could take place at three levels: inter-state, inter-sector, or between the factories themselves: "Direct economic links between enterprises should become the major lever, assuring the success of spe-
CUBA cialization and co-production." 4
It is hard to believe that this will not have repercussions on the Cuban economy, which, like it or not, will have to adjust to direct dealings with newly autonomous Soviet firms that are unlikely to accept financial losses in their exchanges with Cuba
After criticizing mixed firms, Fidel Castro has just announced that such enterprises would be developed not only in the tourist industry but in other export sectors as well in order to take advantage of the technology, raw materials, and openings provided by investors. But these measures, like their consequences in terms of growing wage differentials, threaten to conflict with the egalitarian themes pushed by Fidel in his speeches of recent months
For example, the contracts drawn up with Spanish businessmen for building and running hotels and restaurants authorize the hiring and firing of workers on the basis of their on-the-job record. Fidel's strategy seems to be a combination of improving the planning system, based on decentralization and greater autonomy, and a growing reliance on voluntarism. This mixture of measures seems to be being reflected on the political level by a kind of ideological radicalism, going hand in hand with a greater pragmatism on the economic one.
"Colossal bureaucratic incompetence"
In fact, according to this assumption, the Castroist leadership has worked out an economic approach more compatible with the Soviet outlook than it might first appear, while taking into account the differences in the levels of development of the two countries. The appeal for volunteer work and references to Che can be used by one section of the apparatus to coat the austerity pill so the workers will swallow it, without challenging the "colossal bureaucratic incompetence" (in the words of the writer Gabriel García Márquez) that is one of the root causes of the current crisis.
The difficulties of daily life, the worsening of working conditions or of public transportation caused by the reduction of imports, and especially the lack of spare parts, have had their effect on the level of 1. According to Suarez Vega, a member of the Central Committee. Die Zeit, October 28, 1988. 2. Peter Gey, Crisis of reform in socialist economies, Westview Press, 1987. 3. Granma, November 27, 1988. 4. Nouvelle revue internationale, V. Medvedev, "La coopération socialiste," p.44. 5. International Herald Tribune, January 12, 1989. 6. H. Brezinski, "Cuba's economic ties with the Soviet
Union and the CMEA in the mid-eighties," August 21
CUBA mass mobilization. Discontent is evident. The official statements themselves reflect the problems in the distribution of basic necessities.
Lines outside of stores start forming at dawn. The elimination of free peasant markets got rid of the source of huge private gain for peasants, but that did not solve the problems of supply. Public transport is even more run-down. Repairs are more difficult than ever, and breakdowns more frequent. Speculation is growing, and there have been police operations and raids against speculators that have gotten big play in the Cuban press.
Indiscipline and social malaise persist
A more worrying phenomenon is that examples of work "indiscipline" are multiplying. The adoption of the economic reform in 1975 and its application over ten years were supposed to increase workers' motivation and discipline. Now the number of cases of alleged work indiscipline has gone from 9,988 in 1975 to 25,572 in 1985.? These involve all sorts of infractions, including violations of collective arrangements between administrators, worker intermediaries, and so on about subjects ranging from wages to targets and
The putting into practice of the rectification process in 1986 had as one notable goal to change this situation, for which the SDPE and its accompanying inequalities and corruption were held responsible. However, even if, according to the Political Bureau of the CCP, "some exemplary ponder electives this sad leadie this same leading body states that "instances of worker indiscipline and social malaise persist, some anti-social elements are trying to challenge order and discipline." On December 11, 1988, Fidel Castro once again pointed to "social rowdiness and delinquency, negative manifestations which have reached an alarming level over the last few months."
The alarm signal was pulled in November, with an unprecedented incident - a fire in the Havana central telephone exchange that paralyzed all telephone lines in the capital. According to Granma, this was sabotage by one of the telephone operators, who deliberately set fire to the installation "to get back at the administration, from which she had received written censure on two occasions for leaving her post." 9 The fact that this story was published in the international edition of the paper shows the gravity of the situation.
Social malaise and workers' unease at growing difficulties on the job and in daily life are pointed up clearly here, and it is doubtless not coincidental that on the occasion of the thirtieth anniversary of the revolution, only two months after this incident, 22 the minister of labor and social security i decided to rehabilitate workers who had International Viewpoint #159 • March 20, 1989 been punished by disciplinary notices in their files" 1° (punishments for indiscipline at work can range from entering a written citation in a file to being fired.)
The rehabilitation applied to those workers who had received censure but subsequently maintained a positive attitude at work, the condemnation nevertheless remaining in files. The sabotage of the central telephone exchange by a woman who had been cited twice for leaving her post (no one knows why she left it) certainly led to this decision by the minister of labor. Even though this is a limited measure, it testifies to the care the authorities are taking, in these hard times, not to increase disciplinary measures against workers, who are often faced problems in the organization of their production.
The social contradictions inherent in the ambiguities of the rectification today were shown up after the third meeting, led by Fidel Castro, of productive and service industries in Havana, in mid-1988. This gathering focused the rectification on the problem of costs, of profitability of firms, on the organization of labor and on wages — in other words, on the need to raise the
Who will pay for the crisis?
For the first time, the Cuban government recognized an unemployment level of 6%, instead of 3.4% in 1981. Of course, the Castroist leadership did not try to cover up the severity of the economic crisis and its enduring character, which were confirmed once again during the last National Assembly of People's Power: "the situation in 1986 did not improve in 1987, but got worse, and it has worsened still more in 1988. In the years to come, economic investments must have absolute priority, particularly those which will either save or bring in hard currency."
How will the masses respond in these hard times? Who will pay for the crisis? What is the social goal of the rectification? Many questions are still open. The Cuban masses' potential for mobilization may still be great enough to resist scarcity and the wearing effects of daily life. But this is on condition that the sacrifices are shared
This means pursuing the rectification in the socially egalitarian direction originally proclaimed, through reducing privileges, a serious anti-bureaucratic struggle in the political arena, and democratization of political life, not only for the leading groups but for all of the masses.