Cuba today (was Soviet statistics)

Fri Aug 27 00:56:32 MDT 1999


I would like to express my appreciation for the post below,
and your other one, which I think do give a very vivid
picture of the Cuban revolution and the 'special period'. I
particularly liked your way of characterising the dual
currency situation and the metaphor of the funhouse mirror,
as well as your descriptions of revolutionary chaos. I do
have some differences with you regarding interpretation of
the facts, but I would not like to labour them. You may be
right that there is a qualitative difference between the
special period in Cuba and a capitalist stage, in which case
I was perhaps overstating the similarity between these two.
On the other hand you may yourself be overgeneralising the
Cuban situation, on the morrow of the revolutionary victory,
to all revolutions. I am not sure if this is a portrayal of,
for example, the Vietnamese and Chinese situations. (For one
thing the very close proximity of the US To Cuba is a very
specific feature.) And I hardly think that the writings of
Mao, Giap and others on the National Democratic Revolution
can be dismissed as a "marxist professor's book".  You also
ignore the very important question of the role of the Soviet
Union and the prospect of revolutions now without a Soviet
Union to 'underwrite' them. But I enjoyed your post, and I
sincerely hope you are right that Cuba today is still on
that transitionary socialist path.


>>> "Jose G. Perez" <jgperez at> 08/26 6:18 AM

    There is a world of difference between between a
socialist revolution adopting some capitalist measures and
even allowing certain investments, and a prolonged
"capitalist stage" of a revolution. The difference is

    First on the nature of "socialism," as this term has
come to be used. We should all be clear that "really
existing socialism" is, so to speak, a phenomenon of
bourgeois society, it is not as advanced a socialism as Marx
and Engels imagined, which was a world system of (at least)
the more advanced countries.

    That is why Trotsky insisted on talking about a
"worker's state" rather than a "socialist country." The
Cubans too, for a while, tended to stress they were a
society "building socialism" (rather than a socialist
society). The terminology need not concern us overmuch,
provided we understand what we're talking about. These
socialist countries exist in the midst of, and to a certain
extent even form part of, the world capitalist system. As
for applying the label "socialism" to them, I believe it is
perfectly legitimate, for socialism is precisely the
transition  from capitalism to communism, thus it's
perfectly orthodox to call societies that have embarked on
this transition "socialist."

    However, any idea of socialist "purity" is entirely
misplaced. Indeed, the very idea of socialism is precisely
impurity. Cuba's Silvio Rodríguez got it right:
    absurdo suponer que el paraiso
    es solo la igualdad las buenas leyes
    el sueño se hace a mano y sin permiso
    arando el porvenir con viejos bueyes
    viejos bueyes.

    Its absurd to think that paradise
    Is just equality and good laws.
    The dream is made by hand and without permission
    Plowing the future with good oxen
    Good oxen

    "Arando el porvenir con viejos bueyes," is precisely
what Cuba is doing. BUT -- and this is the point -- they're
plowing the future. Such capitalist measures, and even (to a
certain limited degree) the penetration of Capital itself,
are subordinate to a society where the capitalist market has
been smashed, where production takes place through an
entirely different logic. (There is, obviously, a great
tension between such a domestic economy and its insertion
into the world capitalist market. It is a real contradiction
that has been qualitatively sharpened by the demise of he
socialist block, which is exactly the premise of this

    The situation is radically different where a
working-class party seeks to administer a capitalist
society. It's not a question of plowing the future, for the
economy doesn't yet point to the future, it is still rooted
in the past. All experience shows that a victorious popular
revolution that comes to power in our epoch is inherently
unstable until and unless it smashes the internal capitalist
market. And indeed, from very early on, the logic of the
class struggle forces the revolution's leaders to take
measures that make no sense from the point of view of
capitalist economics, and in many cases tend to put the
economy, insofar as it is capitalist, into a profound

    That's because in the ongoing tussles and battles over
the division of the value produced by labor, the workers now
stand in a transformed position. Most likely, they will not
only have a union now, but also the government's armed
forces on its side (as likely as not a militia made up of
the self-same workers). The revolutionary leadership must,
of course, shape and channel the aspirations of working
people beyond immediate economic gains, but there are strict
limits to this. Even when playing the part of the fire hose,
the revolutionary government finds itself in the awkward
position on not trying to put out the fire, for if it does,
it will soon be overthrown. In many ways the easiest tactic
for the revolutionaries is the one followed by Fidel and his
comrades, who basically told the Cuban working class, hey,
why fight to take one more nickel from these s.o.b.'s, let's
take it all, and they did in fairly short order. (The
expropriation of the capitalists in Cuba was largely
completed by October, 1960, less than two years after the
seizure of power.)

    Let me be clear that above all at that moment in the
development of a revolutionary struggle, when workers have
seized political power and begun to use it to achieve not
just their own economic liberation, but the liberation of
all society, there are no schemas, formulas or recipes that
can be followed. The actual class combat itself, now being
waged openly as a political struggle by the workers, will
determine what happens and how quickly.

    But that should not obscure the logic of the situation.
I've now been privileged to live through this phase in two
revolutions, first as a child in Cuba, later as a foreign
correspondent in Nicaragua. The situation that results when
the working class takes power in a capitalist society is a
total mess. Worse, even with BOTH sides seeking a compromise
and acting in good faith, the position of each side leads it
to betray (or be perceived as betraying) its promises to the

    Once the workers seize power you still have capitalism,
but you get a totally dysfunctional capitalism. Most
capitalists are, as rapidly as they can, decapitalizing
their enterprises, liquidating their holdings, sending their
money to safe havens, refusing to invest or even buy raw
materials. Insofar as the working class isn't yet strong
enough to expropriate them, the state finds itself in the
incredibly awkward position of having to subsidize the
operation of these folks through credits and so on.
Typically the revolution will propose a compromise to the
capitalists: if they do not decapitalize, if they keep their
factories running and so on, they will be allowed to
continue functioning and even making a profit. While one or
another individual bourgeois will accept the offer, the
local capitalist class as a whole will reject it, and this
quite independently of whether they're mostly intermediaries
for imperialist companies, producers for the world market,
or strictly industrial concerns producing for the home
market, the prototypical "national" bourgeois.

    Even those capitalists who WANT to will find it
impossible to do "business as usual." Their distributors
will stop placing orders, or paying bills. Credits for
needed imports are unavailable. Input suppliers fail to make

    But Even if ALL the capitalists accept the deal, and
even if the revolution's leaders succeed in convincing
workers to limit their immediate material aspirations so as
not to make the companies unprofitable, the fact is that
society will no longer be governed by the logic of the
capitalist market and capitalist accumulation. If the
revolution is a true one, people will come before profits,
and when that happens in the real world, all deals with the
bourgeoisie are off.

    For example, suppose the revolution decides to subsidize
free milk for poor children, basic foodstuffs, medical care.
It can pay for this by taxing those who have money --the
rich-- or by printing money, which creates inflation, and
which means those who have large stocks of liquid capital
will see it eaten up by this indirect tax.

    Or the revolution faces a threatened direct or mercenary
aggression from imperialism. The workers march off to
militia practice three days a week -- on the clock. Worse, a
third of your workforce goes off to the border in a militia
unit. Are you going to cut them off from the payroll when
they're putting their lives on the line for the country? But
even if the government pays them, it makes no difference,
the money is coming from your capitalist wealth, either
directly or indirectly.

    The point is when there's a revolution, stuff happens,
and the capitalist class will be expected to pay because
they've got all the money. Worse, the whole pie of socially
produced wealth is up for grabs, and it isn't a question of
a quiet, dignified bargaining session between your lawyer
and his brother, the lawyer representing the union. It's a
mess, and one group of workers in one town forces their boss
to set up a school for all their children out of his profits
(or, what's the same, only indirectly, gets the government
to do it), tenant farmers somewhere else take over the
landowners property, poor people take over the half of the
units in your apartment building that are empty from all the
people that moved to Miami, or set up a shanty town on the
prime real estate you just spent a million dollars buying to
put up that new shopping center and the cops won't evict

    Sooner rather than later, the capitalists, at least some
of them, and perhaps very reasonably, because they were
severely impacted by one or another measure more or less by
accident, will decide to cut their losses, salvage what they
can, in other words, decapitalize, or at least insist they
not be made to pay for militia practice or the former
employee who is now the schoolteacher.

    The working people --quite logically-- perceive even the
"innocent" resistance of the capitalists to "anti-economic"
measures as sabotage, and demand that the government take
measures. In the most egregious cases, it certainly is
conscious, political sabotage by the capitalists. But even
if nothing more than self-preservation by the capitalists is
involved, the government's counter measures can only make
things worse, from the point of view of a capitalist
economy. One way or another, the government must take
control of the enterprise away from its owner. You know how
diplomats talk about "confidence building measures"? Well,
the government is faced with having to take "confidence
wrecking measures." Confidence wrecking, of course, for the

    Here you are, an honest, national bourgeois, trying to
keep up production, and every time you turn around the
government has taken over the business of another one of
your friends. You WANT to cooperate, but then again, you've
got a family and children and perhaps you'll be forced to
emigrate. Pretty soon you, too, will be decapitalizing and
trying to build a nest egg abroad.

    When Fidel took power, he had overwhelming popular
support, and even many sympathizers, contributors and
collaborators in capitalist families. Those that didn't
support him were largely unworried. Two years later ALL the
(mostly ex-) capitalists in Miami were clinking glasses on
New Year's eve to the toast of "Next Year in Cuba." Fidel,
Che and some of their closest collaborators were perhaps
conscious of the inherent logic of the situation, but the
overwhelming majority of Cuban barbudos and working people
were not. The implicit and explicit promises made to the
capitalists in countless ways that the revolution would not
go "too far" were sincerely meant, but were totally utopian.
And it was precisely the experience of seeing the
capitalists decapitalize and, in effect, sabotage the
economy that convinced working people that they ALL should
be expropriated.

    This takes place topsy turvey, with improvisation and
happenstance playing a big role. For the working people,
each intervention and expropriation only emboldens them.
More and more elements of worker's control get established
in all workplaces, whether or not the particular owner is
recalcitrant or cooperative.

    (One very small example from the Cuban revolution: the
"coletilla" or shirttail. In print journalism it has now
virtually disappeared, but in the old days, when resetting
type took time and a lot of effort, often a story would be
updated in its details with a "shirt-tail", a small
additional body of copy separated by a line from the main
body of the story and appended at the end of the story. In
1959, typesetters at Cuban newspapers started to insert
their OWN "coletillas" to particularly offensive and lying
articles, telling the truth of the matter as they say it.
Attempts to fire or discipline the typesetters were rebuffed
by the unions and the revolutionary government.

    (The most important principle to remember about
bourgeois freedom of the press is that freedom of the press
belongs to those who own one. The "coletilla" was a
devastating blow to the prerogatives of the bourgeois owners
of Cuban newspapers, even though if anything, it increased
the sales of their papers. If the revolution was going to
force them to print the communist ravings of mere
typesetters, they reasoned, they could soon be expropriated
altogether. Better to cancel that newsprint order, and just
keep the money in a bank account in Miami.)

    Now, it may be true that in the future, say, once the
U.S. goes socialist, capitalists, upon seeing the workers
coming to power, will reconcile themselves to their fate,
and, in exchange for a comfortable living, may well accept
being progressively reduced, in effect, to administrators of
what might still be technically "their" companies. This
would certainly be a much smoother way of beginning the
transition to socialism. But no revolution yet has faced
this circumstance of a capitalist class, or even a
significant section of it, willing to negotiate, so to
speak, the terms of its own surrender and liquidation as a

    That's not a situation anyone has faced yet in the real
world, and if even a small section of the capitalists refuse
to play ball, the disruption is such you HAVE to take over
their companies, and when you do, you've dynamited the very
foundation of capitalist society AND of your compact with
the rest of the bourgeoisie, the sanctity of bourgeois

    It may be possible in some Marxist professor's book, but
in the real world, with a popular revolution in power,
there's no way to get the capitalist class to "play ball"
with the exploited classes, because the fundamentally
irreconcilable nature of the interests of each side has been
brought front and center of that society's life by the
revolution. Either the masses get defeated, demoralized,
beaten back, bled to submission or betrayed, or they will
make one inroad after another against capitalists property
and privilege so that the capitalists have no choice (as
they see it) but to act in self-preservation. Once the
capitalists do that the society will be plunged into a
monster economic crisis and --barring defeat of the
revolution-- it will only deepen as long as the capitalist
market continues to dominate. Only the expropriation of the
capitalists as a class --or the defeat of the revolution--
can lay a basis for society to get out of the ditch.

    Given all this, the question naturally arises, how do
you prevent the same logic of the class struggle from
short-circuiting a strategy of using elements of capitalism,
and even capital as such, to help the revolution survive

    I've found how the Cubans have handled it to be
extremely instructive.

    First, Cuba does not allow domestic capital. For
example, self-employment is allowed, and even co-ops, but
not private employers. Yes, some of it does happen, but it
is a marginal phenomenon. Even certain performers who have
made tons of money abroad have been told that they can
invest it in New York, but not in any Cuban mixed
enterprises. These artists are good comrades who raised the
issue strictly from motives of contributing to the economy,
and as passive "investors." The policy, I was told, is
iron-clad: no Cuban resident on the island can have capital
in Cuba.

    On the face of it, the policy seems almost
anti-national. If some good, patriotic Cuban won the Lotto
and wants to use the money to move back to and invest in
Cuba, why not let him, instead of giving the investment
opportunity to some Italian company with strictly mercenary
motives? The answer is that 5 domestic Cuban capitalists are
a plague 100 times worse than 500 foreign investors, from
the point of view of building a society based on human

    Cuba already went through this experience with the
farmers markets of the early 80s, and the emergence of
peso-millionaire intermediaries. It is a fox in the chicken
coop, impossible to contain.

    Foreign capital, precisely because it is foreign, is
much easier to contain. In Cuba it is strictly
"quarantined," so to speak. And it is an interesting
quarantine, in that it seeks, above ALL,  to limit Capital
as a force within Cuban society, to keep it "foreign," to
keep it outside. And the relations of that capital with
Cuban society are all mediated by the state.

    First, Cuba has not made a fetish of the degree of
foreign versus domestic capital in the enterprise, nor of
the nationality of the top executives of a given enterprise.
On this, they are very flexible. Where they do draw a line
is the relations between these capitalists mixed enterprises
and "their" workers. They do NOT allow mixed enterprises to
hire workers directly. The Cuban state and the Cuban union
movement run what is in effect a hiring hall. They also do
not allow payment in foreign currency, which must be
converted to pesos to pay the workers. (Tips are a different
matter, but the unions have strict rules about these being
shared among all the workers of a restaurant or whatever.)

    There are very important reasons for wages being paid in
pesos. The state is actively trying to combat the creation
of a relatively privileged layer of the working class whose
station in life is tied to the foreign capitalist and his
money. The insistence on payment in pesos is an important
principle, for in a certain sense, the Cuban currency is a
currency that has ALREADY BEGUN to wither away, it is the
token that economic market Value does not rule, because the
peso in a certain sense is no longer money, not fully.

    It is common to see in the bourgeois press Cuban peso
salaries translated to dollars at the parallel market
exchange rate. "A doctor makes the equivalent of $30 a
month," for example. In doing this, the bourgeois reporters
show that they have no inkling of how Cuban society actually
works, because one of the most important things one notices
is that the peso's value is no longer a fixed quantity. Ten
pesos might be worth fifty dollars in one context and fifty
cents in another.

    Ten pesos, for example, might well be the rent or
mortgage payment of a relatively low-income family (the
amount is 10% of the family's income for a period of, if I
remember right, 20 years). Does this mean houses in Cuba are
worth next to nothing? Kind of. Housing has been
de-commodityized, new housing is not produced at all for the
market, for its exchange value, but directly for its use
value. The monetary transactions that may surround and
accompany them are mostly hangovers from the past, at most
they form a very minor part of the actual social relations
of production and use of what is produced. (At the same time
the fact that such monetary transactions exist show that
Cuba is in the midst of transitioning from capitalism to

    Next come foodstuffs and other necessities. In many
cases, these prices remain fixed where they were in 1959,
when the revolution came to power and the Cuban peso and
American dollar were interchangeable (and used that way).

    (So ingrained was this 1-1 parity that Cubans in Miami
almost invariably will speak of things costing so many
pesos, meaning dollars. Some coins also retain the name of
their pre-revolution Cuban equivalents (centavo=cent,
real=dime) while others, which had no Cuban counterpart, are
called by their American name, like the quarter. People from
other Latin American countries where their own national
"pesos" had widely varying exchange rates with the dollar
are often surprised and find it hard to adopt this
interchangeable use of peso for dollar.)

    Now, these 1959 "prices" are arbitrary and almost
symbolic, and in reality are not bourgeois prices at all,
for access to these goods at these price levels requires the
use of "la libreta", the ration book. Unlike in capitalist
society, simply having the money does not give you the
"right" to those goods. But it does mean that every Cuban
family has access to at least a good portion of the bare
necessities for a handful of pesos.

    I do not know if this has changed, but until the
mid-90s, at least, the same was true of utilities like
water, gas, electricity and telephone service. All education
and all medical care is absolutely free, and, partly to make
sure it remains this way, the government has put both these
fields off limits to foreign capital.

    The point is that, even in the midst of the great
difficulties and tremendous economic crisis of the "special
period," and the admixture of capitalist elements, Cuban
society and the Cuban economy are not ruled by the laws of
the market. What gets produced and how much gets produced
are political  decisions, as are what "price" to charge for

    In explaining this, I like to say something like that
the first hundred pesos or so of a Cuban family's income is
worth many times that number in dollars. But the next
hundred pesos are worth that same multiplier in cents, i.e.,
next to nothing. Obviously the Cuban peso is an extremely
odd economic phenomenon. In theory, as money, it should be
the very distilled essence of Value, the universal
equivalent, the mirror in which all goods see their true
worth. But the peso is a funhouse mirror, making towering
giants of some things and puny insects of others. Such a
mirror may be great entertainment, but definitely not to be
trusted when it shows you you've lost 30 pounds.

    To get back to foreign Capital, the point of payment in
pesos is to keep workers at, for example, the nickel mines
tied to the national socialist economy for their well-being,
to keep Cuban society from being split with the creation of
a labor aristocracy tied to imperialism. You could do it
otherwise, for example, taxing foreign-currency income to
recoup in this way the costs of the "social wage" everyone
receives in the form of free education, health care and so
on, or even charge such workers for these things. Those
other methods establish a more direct nexus, however,
between the Cuban worker and foreign Capital.

    I'm sorry to saddle everyone with such an overly long
post, but I think the question raised, of the difference
between socialists administering a capitalist economy, and
socialists using capitalist mechanisms and even Capital in a
socialist economy, is a very important one. And if we're to
avoid simply repeating pre-1990 formulas, I think the best
way to see that it is a difference in principle, in the
whole logic and dynamic of the class struggle, is to deal
with it at some level of detail.

    -----Original Message-----
    From: TAHIR WOOD <TWOOD at>
    To: mstainsby at <mstainsby at>;
marxism at <marxism at>
    Date: Tuesday, August 24, 1999 9:33 AM
    Subject: Cuba today (was Soviet statistics)

    >>> "Macdonald Stainsby" <mstainsby at> 08/23
    PM >>>

    This may be a purely semantic statement, but this was
    "pulling back from
    socialism". In fact, it was defending it. I see you can
    it was
    neccessary. Let us try to avoid a purist declaration,
    such an
    interpretation would have destroyed the revolution. The
    "ordinary Cubans"
    you speak of (almost a contradiction in terms!) tend to
    realise this.

    There is so much that can be said in response to this
    of argument, but I have been focussing on one
    semantic question, namely around the usage of the word
    'socialism', and especially some of the ambiguities that
    arise in connection with the debate about stages. I am
    genuinely trying to understand the 'anti-stagist'
    that have been put forward on this list and have tried
    show that there may be compelling reasons for breaking
    development of socialism up into stages, but precisely
    simply bourgeois democracy followed by proletarian
    socialism. Your post above demonstrates very
    an aspect of this. You rightly say that the current
    capitalist measures in Cuba are necessary. Or do you not
    think that entrepreneurship and the market are
    Because there is entrepreneurship and a market in in
    today (even many foreign entrepreneurs) as well as
plenty of
    street hustling. I hope that you are right about these
    trends not being irreversible, believe me. But you have
    shown quite clearly that capitalist measures can be a
way of
    saving a socialist revolution, and that this is
    by the NEP in the USSR. Is the more general debate about
    capitalist stage under the hegemony of a communist party
    really different to this? Now imagine that the Soviet
    whose existence as an ally enabled the rapid socialist
    transformation that took place in Cuba, had not existed
    the time of the Cuban revolution. Are you following me
    are you listening Louis)?. What does this say about what
    would have been possible then? Wouldn't we have seen
what we
    are only seeing now, some 40 years later, namely a
degree of
    capitalism in the service of the socialist revolutionary
    project? I think it must be only a Trotskyist education
    creates the kind of blind spot that leads to a refusal
    concede this point. But there you go, the capitalist
    measures were necessary, as you say to DEFEND the
    (socialist) revolution. Isn't there a more general point
    lurking in all this that the 'anti-stagists' won't see?
    is having to go through a kind of capitalist STAGE in
    history precisely to save the revolution, i.e. to make
    further stages of that same revolution possible, rather
    an imperialist coup. In a way, I can't think of a better
    illustration of the whole principle than this.

    But they really should have sussed out the nature of the
    Soviet Union and the way it was going a little bit
    than 1991, don't you think?


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