Thursday, July 10, 2008

Drown the Castro Machine Out with Capitalism!

In May, the Castro machine labeled an 80-year-old retired waiter to be dangerous! Apparently, he still has quite a bit of fight in him: "I was born fighting!"

Here's the scoop, from

A Mercenary and Dangerous Old ManBy Leonel Alberto PĂ©rez BeletteHavana (May 2008 – Cubanet) Members of the political police harassed an 80 year old opponent in his own home to prevent him from blemishing the festivities of the first of May.Alfredo Guilleuma Rodriguez has become a "danger" for the authorities of the state. So much so that the State decided to place to two police officers and a member of the Committee of Defense of the Revolution (CDR) on his doorstep with the objective to stop him from leaving his dwelling on May Day.According to him, he was told that he would not be able to leave while the parade was being performed. In spite of their threats, the elder was not scared because he needed to leave to find something for his grandson’s breakfast. After an exchange of words, in which he was branded a mercenary, the authorities were limited to following him to where he was going. Earlier, the leader of the police sector had already notified him that he was not going to permit him to moved around freely.

Why are they so infuriated with a grandfather that still needs a cane to travel? Guilleuma Rodriguez has spent his life fighting against tyrannies and as a true revolutionary. He fought against Hatchet, then against Batista and now against the ones in charge of Cuba.

Read the rest here.

Here's my view about how to deal effectively with the Castro regime: drown them out with capitalism!The embargo has been a miserable failure. It made sense when the Soviets were there, but now it makes no sense at all. It has not helped the Cuban people, plunging them deeper into poverty, while strengthening and expanding the power of the Castro machine. Fidel Castro thrived on this, since he could always blame the country's woes on the embargo, thus emboldening him to take ever more repressive measures to secure his own power base.

Imagine, for a moment, the possibilities of ending this ineffective embargo. As more investment comes in, Castro will have less and less opportunity to blame the U.S. for the nation's economic woes. The Cuban people will be more inclined to see the Castro regime as the cause of stagnation, and so Raul Castro and his cronies will be in a more precarious situation. The U.S., by taking a "back seat," will not be seen as the meddling neighbor, letting capitalism take its course in the island. The Castro regime will seem less and less relevent, as the elder Castro's raison d'etre-conflict with los yanquis-will be out of the picture.

But don't count on this being implemented any time soon. Why not? The Miami exiles, who represent a fairly sizeable voting bloc in Florida, will not for a moment support any effort to end this ineffective embargo. No one seeking political office will even touch it.

Understandably, they are angry, having lost loved ones in overnight raids, never to be seen again.

But my people need to ask themselves honestly: How has this embargo, now 40+ years strong, ruined Castro and helped the Cuban people? Answer: On both counts, not at all. What we have ended up with is a 49-year-old Soviet-style dictatorship, with an heir apparent.

For the sake of the Cuban people, let's put an end to this farce, and help them remove this cancerous growth that is the Castro machine by...ending the embargo!!!

Let's drown the Castro machine out with capitalism!


Henry Louis Gomez said...

I used to believe like you that we could drown castro in capitalism but as I studied the issue I realized that's impossible unless some basic reforms are implemented in Cuba first.

Lowering the embargo does not mean that American corporations will be able to go into Cuba and build strip malls and McDonalds franchises willy nilly. It means that only those American corporations that the regime deems acceptable will be able to conduct joint ventures, with the Cuban state holding the majority stake (the only way foreign companies are allowed to operate in Cuba), in only the industries that the central planners allow. All of the resource allocation decisions, employment decisions, compensation for workers decisions will be made by the same people who have been making disastrous decisions in Cuba for five decades: the communists.

The entire western world except the U.S. already invests in and does business with Cuba under these rules and it has not drown castro in capitalism.

Quite the opposite, it's extended castro a lifeline because he takes foreign money, squanders it and then finds a new group of suckers to take advantage of. That's what the U.S. would become, the latest in a long line of suckers that lost their shirts in Cuba.

Now if Cuba were to REALLY implement the Chinese economic model (as opposed to toying with it) which includes private property rights, private sector companies, a market for labor (in other words an end to the economic monopoly of the state) then I would agree with you. We could flood Cuba with capitalism like we are doing with China. And the probability is that the economic freedoms would lead to greater political freedoms in Cuba faster than it's happening in China because of the nature of Cuba and Cubans and their proximity to the U.S.

In other words I agree with the idea but the conditions in Cuba have to be amenable for it. They are not currently.

Investing in Cuba today is like taking part in a poker game that you know is rigged against you. What's more it's rigged against the Cuban people. The government profits from these ventures but how much is shared with the people is completely at the discretion of the state because the state dominates 90% of the Cuban economy.

The only "trickle down" that can occur is what the communist party officials allow and to date they have never allowed enough trickle down to make a difference. The average worker in Cuba makes less than $20 a month. American corporations in Cuba won't be allowed to pay more than that. In fact they wouldn't pay the employees at all. They would (as all foreign companies) have to pay the Cuban state at a negotiated rate for workers supplied by the state's employment agency that pays the workers that $20 maximum. The difference goes to the bureaucrats and the state. It's an enabling of the regime not a destabilizing of it.

Benedictus said...

Dear Henry,


I do agree with you that this "drowning out" will not occur immediately, given the current state of this Soviet-style regime. I think the point to be made here is that once we remove the embargo, that will effectively remove any excuse the Castro regime proffers to the Cuban people. At the moment, the embargo is a useful propaganda tool, and an effective one at that.

"Lowering the embargo does not mean that American corporations will be able to go into Cuba and build strip malls and McDonalds franchises willy nilly."

Granted. But I still maintain my central point: it will remove a vital propaganda tool from the regime's war chest.

I accept that fundamental reforms need to be in place before Cuba is awash with the free market, and lifting the embargo won't bring about these results, but I own that ending the embargo will be a first step in taking ta vital propaganda tool away from the Castro regime. Companies that invest in Cuba will do so at their own risk, and the gradual reduction of investment could not be blamed on the embargo. European investors, once brimming with confidence at the possibilities of cornering the Cuban market, are beginning to see the "black hole" of doing business in Cuba, as well as Castro's long-time trading partner: the Canadians (see this article: But notice that with gradual divestment in Cuba, Castro can't play the "embargo" card with them.

I think it's time we wrench that card from his hands, so that he (or his brother Raul) can be seen by the Cuban people what he really is: a Soviet relic caught with his pants down.

Henry Louis Gomez said...

Thanks for answering my comment and listening to what I had to say. I spend a lot of time at where I am the managing editor defending the embargo. And the reason I'm still for it is that I've seen all the counter arguments and they don't hold water. That's not a slam on you. Some of the arguments are seductive, like I said as someone with a background in economics I thought we could drown castro in capitalism too but it was only upon further inspection that I realized that that it is not possible.

The "remove the excuse" argument is flawed in my opinion. Here's why. You make excuses to someone who has authority over you. A child will make an excuse to prevent being disciplined (the dog ate my homework). The assumption is that castro and company are making excuses to prevent themselves from losing power. But who are they making the excuses to? The Cuban people, the international community?

Let's start with the Cuban people. They know exactly who is to blame for Cuba's woes. And they don't have the power (or don't feel they have the power to do anything about it). That's why the life's ambition of nearly all young Cubans today is to leave. That's why up to 3 million Cubans are expected to apply for Spanish citizenship this year thanks to a new Spanish law that permits the grandchildren of Spaniards born abroad to become Spanish citizens.

The international community knows exactly why Cuba is in the state of affairs that it's in. For one thing all of eastern Europe lived it. It's not surprising that the Czechs and the Poles and the other eastern countries are the biggest supporters of Cuban liberty in Europe. The problem is that most of socialist western Europe is in the bag for fidel because of anti-Americanism.

Let's put it this way, if I know it's an excuse and you know it's an excuse and the Czechs and Poles know it's an excuse then you know the Spanish and the English and the French know it's an excuse. So lowering the embargo only legitimizes what we know is just an excuse.

The real embargo in Cuba is the one the regime has put on its own people. It embargoes information, it embargoes freedom of speech, it embargoes freedom of movement and assembly it embargoes private property rights. You don't nee to lower the embargo to know these things are going on. All you have to do is go to Miami International Airport and talk to one of the 25,000 Cubans that emigrate to the U.S. every year through the visa lottery.

The other thing is let's say we get rid of the embargo to remove the excuse. Don't you think the regime will come up with more excuses? Do you think the regime will stop vilifying the U.S.? Did you know that Cuba denounced Canada in the United Nations for violating the human rights of its indigenous people? That's Canada where Cuba gets a large part of its tourist revenue. That's Canada that is one of Cuba's most important trading partners. The propaganda machine against capitalist democracies doesn't stop just because the regime is doing business with them. These Cuban commies are a lot of things but they aren't dumb. They will have plenty of excuses as long as they are still in power.

Lastly, and I should have mentioned this earlier but here it is. Why do we have an embargo on Cuba?

The answer is that Cuba nationalized almost $2 Billion in American business assets in the early days of the Revolution. It did so without compensating the American individuals and companies that owned the assets. It's the largest such expropriation in U.S. history. In today's dollars it's more than $8 billion. The embargo is a punitive measure put in place to penalize Cuba for violating the common sense rules of international business "thou shall not steal". Now a little thing you may not know about China is that even after Nixon "opened" to China we still did not trade with that country for several years until China settled for similar expropriations in 1979. Granted it was a pennies on the dollar and China's expropriations from the 1940s were minute compared to Cuba's in the 1960s but China basically said "we get it, we're sorry, it won't happen again."

Removing the embargo without first getting a similar gesture from the Cuban government sends a signal to Cuba and other countries that it's OK to steal from Americans as long as you are belligerent enough for long enough.

As you rightly point out Cuba is crummy place to do business. The Cuban government has unilaterally shut down many small and medium joint ventures with foreign companies leaving the foreigners holding the bag on their investments. This of course happened when Hugo Chavez began to subsidize Cuba. In other words the regime never wanted to get into bed with foreign capitalists, it felt it had to in a moment of desperation. And as soon as that moment passed it was "screw them". The point is that in 49 years nothing has changed in Cuba.

It's Cuba that needs to change it's policies not the U.S.

Lastly, the U.S. is currently Cuba's largest food supplier. Did you know that? There's an exception to the embargo for food and medicine that Cuba can buy for cash up front. This whole thing about the embargo is about two things, getting American tourist dollars (tourism in Cuba is down over the last few years and American tourists flocking to a once forbidden land will pump it up) and obtain credit. Because of the embargo Cuba can't borrow from certain international entities like the IMF and World Bank. Cuba wants credit because its free money it never has to pay back. Cuba's credit rating is garbage because it never pays anyone back. This is a country that had no foreign debt in 1959. Cuba now owes more than $15 billion to various countries and that doesn't include the Soviet Era debt it owes the Russians. It's all a shell game. The next suckers: the Americans.