Cuba economic reforms hurting the poor, experts warn

Cuba economic reforms hurting the poor, experts warn

HAVANA -- The much heralded opening of a still-limited private sector in
Cuba by President Raul Castro is being widely welcomed by Cubans who
expect the pragmatic "younger" brother of their long-time former leader
Fidel Castro to lead them out of an economic hole with its consumer
goods shortages, crumbling housing and salaries with near zero
purchasing power.

And U.S. visitors to Cuba are often astonished by what seems to be an
explosion of private enterprise and the emergence of not just a middle
class but an affluent people. However, not everyone in Cuban society is
benefiting equally as the government loosens controls.

Arturo Lopez-Levy, lecturer at the University of Denver and a Cuban
American, positively views the steps being taken.

"I would say that if there is a priority that Cuban policies and
politics should have it is economic development today, economic
development tomorrow, economic development the day after tomorrow," he
told CBS News during a recent visit to the island.

In the search for economic growth, President Raul Castro is budget
cutting, reducing the number of public employees, allowing enterprising
Cubans to become private entrepreneurs. Small mom and pop operations
have sprouted like mushrooms, adding a definite commercial feel to many
of the previously purely residential neighborhoods.
There is even a wholesale produce market operating on the outskirts of
Havana as a supplier to private restaurant owners and push cart vendors.
But there's a flip side to the opening that worries Lopez-Levy and other
observers.

"I'm very, very worried about one specific issue – the possibility that
class and race overlap in the context of a mixed economy because
whatever you might think about the previous system, it works a lot on
the basis of consensus and there was always a concern for those left
with the most difficult situation or the most disadvantages," he said.

In the old system, Lopez-Levy noted there was a safety net below which
no one fell. The safety net itself might have been lowered at certain
points such as during the economic crisis of the 1990s but it existed.
Now he sees investments are being concentrated in certain areas or
neighborhoods that traditionally have been middle or upper class and
predominantly white. These are neighborhoods where more wealth is
concentrated, where attractive homes inherited from pre-revolutionary
affluent families are easier to convert into bed & breakfasts or upscale
restaurants and where residents are more likely to receive help from
relatives with money living abroad since white exiles tend to be more
well-to-do than black ones. This, he said, resurrects pre-1959 class and
race inequalities.

Because there is a housing shortage in Cuba – 12 percent of the housing
in Havana has been officially declared structurally unsound – people
tend to live in the same place their parents and grandparents did before
them. Upward mobility in education and careers has almost never meant
that people were able to improve their living conditions.

"I have seen some neighborhoods where the, particularly rural and black
areas, where mainly black Cubans live and I think that it would be wise,
nationalistic, patriotic to think about the effect the reforms could
have on these people," he said, pointing out that these people have been
among the staunchest supporters of the revolution.

University of Havana Professor and historian Esteban Morales agrees and
he points out that "blacks came to Cuba as slaves while whites came as
colonizers" and that heritage has left a permanent mark on society
despite the revolutionary government's creation of free education and
health care for all along with other efforts to bring equality to
society. Now, the opening of the economy is not affecting all of Cuba's
11 million people equally, instead, he notes it is hitting "the poorest
sectors of the population."

In order to get the economy moving and raise productivity, the
government must take mercantile measures that are "difficult," Morales
said. Tourism and the creation of corporations have not benefited black
Cubans as much as whites, although statistics are hard to come by since
the census does not focus on race in its questionnaire.

Morales blames historic realities for this situation, noting that before
1959 "there was a very unequal system of wealth distribution." Ever
since Cuba was a colony, he notes, there also existed a "mass of poor
whites." However, Morales insists that "riches never belonged to the
black or mixed-race population." That means, he says, that "historically
there has been a poor sector of society and within that, blacks have
been the most disadvantaged."

So while he believes the current process of reforms is meant "to improve
life for everyone, to benefit all of Cuban society," it will take time
to bear fruit and in the interim will have a strongly negative impact on
those who have always faced the most difficulties to survive within
Cuban society.

There have to be efforts to get more non-white students and more males
into the university, Morales says, noting that with economic hard times,
blacks and males tend to drop out of school to get jobs. That is
something he saw happening at the end of the 1980s when the European
socialist camp collapsed and Cuba's economy went into a tail spin.

Something similar is happening now with public sector workers barely
getting by on their wages and the cost of living rising as government
subsidies for food and other basic products disappear as part of the
reforms to make the economy more efficient and to stop it from running
in the red. As a result the gap between the "haves" and the "have-nots"
is growing wider and becoming more visible and it looks like things
could get worse before they get better.

Source: "Cuba economic reforms hurting the poor, experts warn - CBS
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