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xx Cuba After Castro: Legacies, Challenges, and Impediments Moreover, an emphasis would have to be placed on promoting economic efficiency, thereby reversing the Revolution’s old commitment to full employment. Thus far, the Castro regime has refused to take either step. Whether a weaker, successor government can reverse course remains to be seen. Cuba’s Ever-Failing Economy Cuba’s economy, never in good shape, is now approaching a critical juncture. To stem the economic free fall after 1989, the Castro government opened the economy to foreign investors and rebuilt the tourist industry in order to recapture hard currency. For a while, these and other modest reforms helped stop the hemorrhaging, but by 2002 new signs indicated that the economy was slowing again. Indeed, unless Castro defies all expectations by further altering course, he will displace onto his heirs the task of making the systemic changes Cuba needs before it can achieve the sustained economic growth that can help legitimize a post-Castro government. It will thus be left to a new government to raise labor productivity and stem corruption in both the state and society. And the new government will be faced with the equally formidable tasks of overturning the command economy, ceding a measure of control to a revitalized private sector, and transforming the island’s distorted industrial structure. An Unproductive Labor Force Among the key factors affecting the prospects for revitalizing the economy is Cuba’s highly educated but low-productivity labor force. The low productivity has been exacerbated by the declining state of Cuba’s capital stock, its shortage of investment capital, and its lack of raw materials. But the Castro regime’s policies regarding full employment and wages have also played a role. The commitment to full employment transformed open unemployment into rampant underemployment prior to 1989, when Soviet economic support was available, and then worsened it during the Special Period, when the economy was at its lowest ebb. Thus, despite the closure of 45 percent of
Executive Summary xxi the island’s most inefficient sugar mills in 2002, the Castro regime has kept the displaced workers on the state payroll. Setting wages according to a national pay schedule has further compounded the problem of low productivity by divorcing workers’ wages from their productivity—a policy that has motivated poor work habits and created disincentives for maximizing production among the labor force. The new regime will thus be faced with a long-term task of motivating workers anew through market incentives. A Repressed and Deformed Private Sector Another impediment is the weakness of the small, deformed private sector that will be left from the Castro era. The regime has resisted the development of a healthy private sector, mainly because of Fidel’s ideological commitment to socialism and his obsession with his place in history, but also because of other political calculations. His regime is determined to prevent the rise of a middle class that may challenge its power, and to constrain the growth of income equalities that may undermine regime support among state employees, Party workers, military and security personnel, and pensioners, many of whom must subsist on peso-denominated incomes. Bowing to necessity in 1993, the regime legalized selfemployment in micro-enterprises to generate trades, crafts, and services that the state was no longer able to supply and to provide new employment opportunities. By 1997, the number of microenterprises had grown to more than 200,000. But when the economy showed signs of recovery, and the self-employed showed that they were enjoying substantial dollar incomes, the regime actively discouraged further growth of the fledgling private sector by erecting new obstacles. By 2001, the number of micro-enterprises dropped to an estimated 150,000. In addition, the private sector has become increasingly deformed. The absence of a private distribution system has led to the widespread pilfering of state stores and to the buying of stolen supplies on the black market. Moreover, as a result of 40-plus years of communism, the labor force lacks the kinds of trained managers, accountants, auditors, bankers, insurers, etc., that a robust market economy requires.
Page 1 and 2: CHILDREN AND ADOLESCENTS CIVIL JUST
Page 3 and 4: CUBA AFTER CASTRO Legacies, Challen
Page 5 and 6: Preface Cuba is nearing the end of
Page 7: The RAND Corporation Quality Assura
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Page 13 and 14: Executive Summary Cuba’s economy
Page 15 and 16: Executive Summary xiii trate, contr
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Page 27: Acknowledgments The authors wish to
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44 Cuba After Castro: Legacies, Cha
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CHAPTER FOUR Cuba’s Racial Divide
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The Elusive Subject of Race in Cast
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Cuba’s Racial Divide 51 new, more
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Cuba’s Racial Divide 53 Blas Roca
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Cuba’s Racial Divide 55 emphasizi
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Cuba’s Racial Divide 57 holding o
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Cuba’s Racial Divide 59 compiled
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Cuba’s Racial Divide 61 • None
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Cuba’s Racial Divide 63 to ignore
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Cuba’s Racial Divide 65 region co
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Part II: The Structural Challenges
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The Structural Challenges Ahead 69
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CHAPTER FIVE Cuba’s Changing Demo
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Cuba’s Changing Demographic Struc
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CHAPTER SEVEN The Need for Industri
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The Need for Industrial Restructuri
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CHAPTER EIGHT Conclusion Both Fidel
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Conclusion 107 the majority of the
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Conclusion 109 1988) were unsustain
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Conclusion 111 would seem to be in
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Conclusion 113 As the experience in
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Conclusion 115 First, the governmen
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Conclusion 117 gime will be unwilli
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Conclusion 119 China. Still, the Un
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122 Cuba After Castro: Legacies, Ch
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