After Fidel: Will Cuba change direction?

IS THERE anything new in Fidel's formal retirement and Raúl's formal election to the presidency?

THE ONLY thing new here is that a lot of people, including myself, expected a more dramatic succession.

It was seen as most likely that Carlos Lage, a medical doctor from the younger generation, who has been in charge of the Cuban economy for some time now, would be officially named the number two.

But that's not the way it went. José Ramón Machado Ventura was named first vice president of the council of ministers. And he's a few months older than Raúl Castro, who is 76. That was surprising and suggests that this is a very temporary measure, for obvious biological reasons.

They selected someone who is a historico--a medical doctor who was in charge of taking care of the injured during the guerrilla fighting in the Sierra Maestra. Macado Ventura is a military man and a hardliner, in charge of ideology for the Communist Party.

This suggests to me--and here, I am guessing, after the fact--that perhaps there was an agreement between Fidel and Raúl, that Fidel would resign if there was a promotion of someone he absolutely trusted, even though the arrangement may not last very long. What this means is continuity, represented by an old-timer and a hardliner.

As I've said for some time, as long as Fidel is around, Raúl won't go too far. By being around, I don't mean biologically alive, but in good enough health to meet with foreign dignitaries, as he did recently with [President Luís Inacio Lula da Silva] of Brazil. And he obviously has access to the phone.

As long as Fidel has the ability to function to that extent, Raúl won't go too far. It's a status quo succession, to a large extent.

On the other hand, there may be some measures of liberalization that Raúl is able to implement. Perhaps the biggest single issue now is agriculture. With the collapse of the sugar industry, there are huge areas of farmland that aren't being used for anything.

So the question has come up: Should it be turned over to private farmers, as in the former Stalinist states of Eastern Europe? There, as well as in Cuba, private farms have been shown to be more productive and efficient. Raúl has hinted that he may do something in that direction. That would be a very big step, and I don't know how Fidel would look at that.

HOW DOES this political change fit into the broader economic context in Cuba?

THE CUBAN government actually claimed a lower rate of growth for 2007, at 7.5 percent, than it did in 2006, when it reported 12.5 percent. Those claims for 2006 were sharply criticized.

Perhaps more relevant is that there was significant improvements in the delivery of electricity. Blackouts, frequent in the past, have almost disappeared. And with the import of buses from China, urban transportation, which is a humongous problem in Cuba, has improved--and that in turn would have an impact on the productivity of the labor force, as people are better able to get to work on time.

But a bifurcated economy continues to exist. Forty percent of Cubans have no access to dollars, and for the other 60 percent, access can vary a great deal. Some of those who have access get dollars sent by relatives from abroad, and the others mainly through the joint ventures and the tourist industry in Cuba.

Raúl has hinted at a revaluation of the Cuban currency so that people will get more dollars for their pesos. And he has already made it very clear, in his important speech on July 26, 2007, that the salaries of people are inadequate to make a living.

A substantial upward revaluation of the peso in the absence of a dramatic increase in the production of goods would leave very little to buy in a very short period of time. Right now, the dual currency acts as a very inequitable but effective form of rationing.

I ask myself how they can have a significant revaluation of the Cuban economy if there isn't a significant change in the real economy? I'm no economist, but it would seem to me that you would have immediate shortages and tremendous inflation.

There would be a new black market in dollars. There is no black market in Cuba now. You can go to a booth in Havana, and they'll give you the going rate. But in the countryside, you don't have as much access to dollars.

There are other things the government could do in this context. They could say that, sure, Cubans can go to the tourist hotels--who the hell can afford it? I'm not saying they're about to do it, but they could.

There are also a lot of complaints also about the tremendous extortion of those who want to travel outside the country. People have to have a relative in Miami send them $1,000 or so. The government could soften up on that and other areas.

But I don't see how they could move away from the dual currency without having another method of rationing.

WHAT SECTORS of the economy are doing well?

THE NICKEL industry is doing well, and so is tobacco, which is much less important.

Sugar is doing slightly better than the previous year, but it is really terrible. The last harvest didn't grow enough to honor Cuba's contracts with foreign firms; they had to import sugar to meet the commitments they had made. The harvest was somewhat over 1 million tons, compared to 5 to 7 million tons in good years in the past, and the failed "10 million ton" harvest in 1970.

The question is what is happening with tourism. They had a slight decline from the previous year, but the figures aren't in on the current season, which ends in March-April.

HAS THE army increased its economic weight since the "special period" of the early 1990s following the collapse of the USSR?

ABSOLUTELY. THEY have a corporation called GAESA that coordinates all the army's economic activities. One of its holdings, Gaviota, is probably the single biggest tourism company in Cuba. And that's the army's own activities. In addition to that, there are people from the army running the sugar industry.

In relative terms, the army is the most efficient and best-organized institution in Cuba. Its people are being promoted now, and they're cementing that power. For example, as head of state, Raúl Castro promoted another old-timer, Major Gen. Julio Casas Regueiro, as minister of defense. Casas oversaw the "perfeccionamiento empresarial"--an efficiency drive in companies run by the military.

So the army is a major force. Then there are the managers, what I call the businessmen in uniform. They are people in the armed forces who are economic managers, even though they're in the armed forces. And there are civilians in these positions also.

So you have this milieu of people are managers and technicians who are bound to be a force in Cuba in a situation of transition.

HOW DOES Fidel Castro view these developments? Is he trying to block or contain them?

ONE INDICATION of his view was an article he wrote a few months ago attacking an article by James Petras and Robin Eastman-Abaya in the magazine Canadian Dimension--not exactly a mass circulation publication. Fidel Castro wrote a long article attacking them for being "ultra-left" and "super-revolutionaries."

In my opinion, Fidel used the article to get back at people in Cuba, including people around his brother, who were advocating some of the same things that Petras and Eastman-Abaya were proposing. For example, Petras and Eastman-Abaya implied that they would favor the importation of foreign labor to improve agricultural production.

Fidel Castro didn't refer to Petras by name, but he made it clear he was referring to the article. Why in the world would Fidel bother with this? It doesn't make any sense, unless he is using Petras as a whipping boy to get at somebody else.

My interpretation of Fidel's view is that he is for changing the absolute minimum necessary to survive. For example, in the crisis of the mid-1990s, it was clear to everybody that he had given certain concessions--for example, allowing self-employment. But as soon as things got a little better, he cracked down on this. He didn't say it in so many words, but the record is clear.

He is trying to have as much state control as possible without the state committing suicide. Another example is that they cut down on foreign investment in Cuba by restricting the number of joint ventures.

WHAT DOES Raúl Castro represent?

RAÚL REPRESENTS the introduction of elements of the Chinese and Vietnamese economic model--a turn to the free market while retaining state control.

In April 2005, he went to Shanghai and said, "Here, I found that another world is possible." This is obscene--taking over the slogan of the World Social Forum to express his admiration for the Chinese model.

Obviously, there are huge differences between Cuba and China, and the United States is an obstacle. But if Barack Obama is elected president, and he follows through on what he is hinting at--resumption of relations with Cuba--all sorts of things are conceivable. Of course, Democratic Party politicians are masters at promising things that they have no intention of carrying out.

Politically, the U.S. is unlikely to collaborate with a Vietnamese or Chinese type transition in Cuba as long as someone named Castro is heading the Cuban state. But it's possible, for example, to remove limits on Cuban-Americans' travel to Cuba.

During Bush's first term, Congress was about to pass a law that would have removed those limits on even Americans traveling to the island. That would pretty much have taken the heart out of the blockade. Bush lobbied to get it off the agenda. But it was nearly approved, because a lot of Republicans are for it.

I don't think that the capitalist class in the U.S., or any significant part of it, wants to continue the economic blockade of Cuba. Most don't care one way or another--Cuba's not that significant. It's more of a political question.

In the past, of course, it was a different ballgame, when Cuba was allied with the USSR. But since the collapse of the Soviet Union, Cuba doesn't have the importance to the U.S. ruling class that it had originally.

WHAT POLITICAL currents are likely to emerge in post-Fidel Cuba?

THERE ARE no significant forces in Cuba today that would stand for a collectivist economy under workers control--anti-capitalist and for workers' democracy.

Think of China as a parallel. There, you had the "Gang of Four" types, who stood for the old Stalinist system. In Cuba, they're called the "Taliban"--people like Felipe Pérez Roque, the former chief of staff for Castro, who is now foreign minister. Interestingly, he wasn't promoted. I think his crowd has no future as long as the army stays united, and I've seen nothing to indicate that Pérez has support within the army.

Then, there are people who are market-inclined--who are liberals. This includes the great majority of Cuban intellectuals. They aren't neoliberals, but they favor the perestroika-type market reforms that Mikhail Gorbachev tried in Russia.

There are others who want to make concessions to the market who aren't liberals. But they will be allied with the liberals in certain areas that are less politically threatening to the regime.

The market liberals and the market non-liberals may be able to cement an alliance, because the introduction of the market is bound to bring about liberalization in the social realm, but not in the political realm--which is what happened in China. It's worth noting that Temas, which is probably the principal magazine of the liberal Cuban Communists, ran an article on China that was fundamentally uncritical.

Frankly, I don't see how you can get around the issue of having foreign investment in Cuba today, or how you can get around the issue of farmers growing their own crops.

For us, those are concessions to objective economic and social reality--it's not something that we're for. But the people in Cuba who are for both socialism and democracy are very small in number. Those who are opposed to the market do so from the Stalinist point of view. And that's no good to us.