Revolution in retreat

S P E C I A L R E P O R T

C U B AMarch 24th 2012

Cuba.indd 1 07/03/2012 13:48

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WHEN ON JULY 31st 2006 Cuban state television broadcast a terse state­ment from Fidel Castro to say that he had to undergo emergency surgeryand was temporarily handing over to his brother, Raúl (pictured belowwith Fidel, left), it felt like the end of an era. The man who had dominatedevery aspect of life on the island for almost half a century seemed to beon his way out. In the event Fidel survived, and nothing appeared tochange. Even so, that July evening marked the start of a slow but irrevers­ible dismantling of communism (o�cially, �socialism�) in one of the tinyhandful of countries in which it survived into the 21st century.

Raúl Castro, who formally took over as Cuba’s president in Febru­ary 2008 and as �rst secretary of the Communist Party in April 2011, is try­ing to revive the island’s moribund economy by transferring a substan­

tial chunk of it from state toprivate hands, with profound so­cial and political implications. Hehas abolished a few of the manypetty restrictions that pervadeCubans’ lives. He has also freedaround 130 political prisoners.His government has signed theUN covenants on human rights,something his brother had jibbedat for three decades. Repressionhas become less brutal, thoughtwo prisoners have died on hun­ger strikes. Cubans grumble farmore openly than they used to,and academic debate has be­come a bit freer. But calls for de­mocracy and free elections arestill silenced. The CommunistParty remains the only legal polit­ical party in Cuba. And Raúl Cas­tro has repeatedly dashed thehopes of many Cubans that the

hated exit visa, which makes it hard (and for some, impossible) to leavethe country, will be scrapped.

The economic reforms, set out in 313 �guidelines� approved by aCommunist Party congress in April 2011, are being implemented slowlyand with great caution. That is because they face stubborn resistancefrom within the party and the bureaucracy. Indeed, the leadership shunsthe word �reform�, let alone �transition�. Those terms are contaminatedby the collapse of the Soviet Union, an event that still traumatises Cuba’sleaders. O�cially, the changes are described as an �updating� in which�non­state actors� and �co­operatives� will be promoted. But whateverthe language, this means an emerging private sector.

The new president often says his aim is to �make socialism sustain­able and irreversible�. The economy will continue to be based on plan­ning, not the market, and �the concentration of property� will be prohib­ited, Raúl Castro insisted in a speech to the National Assembly inDecember 2010. He is careful not to contradict his elder brother openly:his every speech contains several reverential quotes from Fidel, who de­spite his semi­retirement is consulted about big decisions. (For brevityand clarity this report will refer to each Castro brother by his �rst name.)

Fidel’s frail and ghostly presence in his compound in Siboney, a

Revolution in retreat

Under Raúl Castro, Cuba has begun the journey towardscapitalism. But it will take a decade and a big political battle tocomplete, writes Michael Reid

A C K N O W L E D G M E N T S

CONTENT S

Apart from those mentioned in the

text, the author would like to thank

the following people for their help in

preparing this report:

Marc Frank, Julia Sweig, Hal Klepak,

Susanne Gratius, Emily Morris,

Bertrand de la Grange, Ivan Do­

campo of the Cuban Embassy in

London, Alberto Ibargüen and

Sergio Bendixen in Miami, and a

number of people in Cuba who must

remain anonymous. It is more than

usually important to stress that

none of the above bears any

responsibility for the views ex­

pressed in the report.

A list of sources is at

Economist.com/specialreports

An audio interview with

the author is at

Economist.com/audiovideo/specialreports

5 InequalityThe deal’s o�

6 PopulationHasta la vista, baby

7 The economyEdging towards capitalism

9 PoliticsGrandmother’s footsteps

10 Cuban­AmericansThe Miami mirror

12 After the CastrosThe biological factor

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The Economist March 24th 2012 1

Pinardel Río

Matanzas

SiboneyMiramar

El CacahualLa SaludMariel

Havana

Cienfuegos

Santa Clara

Bay of PigsISLA DE LA

JUVENTUD

PINAR DEL RÍO

A R T E M I S A

HAVANA

MAYABEQUEM A T A N Z A S

CIENFUEGOS

V I L L AC L A R A

SANCTISPÍRITUS

C I E G OD E Á V I L A

Ciegode Ávila

Gol fo de

Batabanó

SanctiSpíritus

KEY FIGURES

GDP: 2011 - $120bn*

Exports†: 2010 - $5bn

Imports†: 2010 - $11bn

Population: 2011 - 11.2m

*At purchasing-power parity†Goods only

Source: Economist Intelligence Unit

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1No longer special

Sources: Economist Intelligence Unit; UNDP; UNPD; World Bank *Estimates †Or latest available

15

10

5

0

5

10

15

+

–

1989 95 2000 05 10 15

GDP, % change on previous year* 2011†

Current-account balance, % of GDP

F’CAST

Dominican Cuba Chile Rep. Mexico

Gross fixed 10.5 21.8 16.9 20.6investment,% of GDP*

Life 79.3 79.3 73.8 77.2expectancy at birth, years

GDP per 5.4 13.7 5.8 10.0person*,$’000, current

Avg. years 9.9 9.7 7.2 8.5 schooling,adults*

Infant 5.0 6.8 21.6 14.1mortality,per 1,000 live births

leafy enclave of mansions on Havana’s western outskirts,doubtless checks the speed of reform. But he no longer controlsthe levers of power and rarely comments on domestic politics.

This special report will argue that whatever the intentionsof Cuba’s Communist leaders, they will �nd it impossible to pre­vent their island from moving to some form of capitalism. Whatis harder to predict is whether they will remain in control of theprocess of change, or whether it will lead to democracy.

No turning back this time

When the Soviet Union collapsed in 1991, many outsidersbelieved that communism in Cuba was doomed. Massive Sovietsubsidies and military aid for Cuba had o�set the economic em­bargo imposed by the United States in 1960. By the 1970s they hadalso brought stability after Fidel had all but bankrupted the is­land by his manic shifts from forced industrialisation back to ex­aggerated reliance on sugar, the economy’s mainstay since colo­nial days. The overnight withdrawal of Soviet subsidies andtrade links caused Cuba’s economy to contract by 35% between1989 and 1993 (see chart 1).

In response, Fidel declared a national emergency, dubbed�The Special Period in Peacetime�. He opened the island to for­eign investment and mass tourism and legalised small familybusinesses and the use of the dollar. But then he found a newbenefactor in Venezuela’s Hugo Chávez, who began to provideCuba with cheap oil. A big chunk of that is o�cially counted as aswap of oil for the services of some 20,000 Cuban doctors,sports instructors and security advisers working in Venezuela.China, too, emerged as a new source of credit.

Thus bolstered, Fidel reversed course again. Many familybusinesses, as well as some foreign ventures, were shut down;the dollar ceased to be legal tender in 2004. The ageing leader

launched �the Battle of Ideas�, sendingout armies of youths as ill­trained teachersand social workers.

This time, Raúl has insisted, there will be noturning back: the reforms will happen sin prisa, perosin pausa (slowly but steadily). But Raúl is no liberal. Heand Ernesto �Che� Guevara, the Argentine adventurer who diedin Bolivia in 1967, were the orthodox Marxists among the leadersof Fidel’s Rebel Army, the ragtag band of bearded guerrillas whotoppled the corrupt, American­backed dictatorship of FulgencioBatista. As defence minister from 1959 to 2008, Raúl set up andled Cuba’s formidable armed forces.

When Raúl took over from Fidel, he moved slowly at �rst,amid factional �ghting. To general surprise, the men who lost outin 2009 were Carlos Lage, who had run the economy since theSpecial Period and was seen as a reformer, and Felipe PérezRoque, the young foreign minister. They were denounced forhaving criticised the Castros (Mr Lage was caught on tape de­scribing the leadership as �living fossils�) and for having beencorrupted by power. Instead, José Ramón Machado Ventura, an81­year­old Stalinist, was named as Raúl’s deputy.

But Raúl also quietly discarded nearly all of Fidel’s minis­ters and key aides. Their replacements are mostly army o�cers.Rafael Hernández, an academic who edits Temas, a quarterlyjournal attached to the culture ministry, points out that many ofthem are engineers by profession.

Fidel ruled Cuba through the unbridled exercise of his mas­sive ego. He centralised all power in his own hands, imposedUtopian egalitarianism and performed frequent policy swerves.By all accounts, Raúl is more modest, by nature a delegator andteam­builder, more interested in getting things done than mak­ing speeches. When he took over in 2006 he put an end to the4am meetings his brother loved. He is the Sancho Panza to Fidel’sDon Quijote (they even look the parts).

Raúl seems to be acutely conscious that Cuban commu­nism is living on borrowed time. The economy is grossly unpro­ductive. Venezuelan aid in 2008 was o�set by devastating hurri­canes and the knock­on e�ects of the global �nancial crisis onCuba’s tourism and trade. The country is running down its capi­tal, but living standards remain frugal. Its famed social servicesare no longer a�ordable. The population is shrinking. Mr Chá­vez, its Venezuelan patron, is being treated for cancer and faces aclose election in October. And the Cuban leadership is geronto­cratic: Fidel is 85, Raúl is 80 and the average age of the Politburo isover 70. The históricos, as those who fought in the revolution areknown, are dying o�. With Mr Lage gone, they have no visiblesuccessors. Raúl’s opportunity to institutionalise the system hascome very late in the day. �We either rectify things, or we run outof time to carry on skirting the abyss [and] we sink,� he warnedin his December 2010 speech. 7

The Economist March 24th 2012 3

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S i e r r a M a e s t r a

LasTunas Holguín

Bayamo

GuantánamoSantiago

de Cuba

Guantánamo Bay(to US)

C A M A G Ü E Y

LAS TUNAS

G R A N M A

H O L G U Í N

SANT IAGODE CUBA

G U A N T Á N A M O

Camagüey

U N I T E D S T A T E S

FLORIDA

PUERTO RICO(to US)

Miami

C U B A HAITI

Havana

MEXICO

BELIZE

HONDURASGUATEMALA V E N E Z U E L A

DOMINICANREPUBLIC

A T L A N T I C

O C E A N

G u l f o f

M e x i c o

C a r i b b e a n S e a

NewOrleans

JAMAICA

BA

HA M A S

Florida Straits

500 km

JUST OUTSIDE SANTA CLARA, a city in central Cuba, in ahotel that was once a Communist Party hospitality centre, a

trio of musicians entertains a large group of German tourists.The trio belts out �Hasta Siempre, Comandante�, an anthem toChe Guevara, whose capture of an armoured train at Santa Claraprompted the collapse of the Batista dictatorship. �I wouldn’tsing this song for an audience of young Cubans. But it has inter­national resonance,� explains one of the trio.

Then they strike up �Chan Chan� from the Buena Vista So­cial Club. That music is associated with the Batista years, con­signing its elderly practitioners to neglect under communism un­til Ry Cooder, an American, turned them into internationalsuperstars in the late 1990s. In a confusion the government hashappily exploited, they have become incongruous icons of theCuban revolutionary myth.

That myth has been extraordinarily potent and durable.Along with Caribbean beaches and cheap rum, it draws touriststo Cuba (2.7m last year, a record). It has led the Latin Americanand European left to treat the Cuban dictatorship with indul­gence. Soviet communism and its eastern European satellitesnever held any romantic appeal. Cuba was di�erent. Two thingsof substance have sustained the myth�and the Castros’ rule.First, even as he turned his country into a Soviet client, Fidel Cas­

tro managed to embody Cuban nationalism, as the David defy­ing the American Goliath and its economic embargo. In the threedecades from 1898 the United States all but ran Cuba, havingousted Spain. By the 1950s American businesses owned large,though diminishing, chunks of the island’s economy. Thatbrought resentment and economic distortions, but also invest­ment and progress: in 1959 Cuba was one of the leading �ve LatinAmerican countries on a range of socio­economic indicators.Life expectancy was close to that of the United States and it hadmore doctors per person than Britain and France. But around athird of the population lived in severe poverty.

The second substantial achievement was that even as heexpropriated almost all private property, Fidel poured resourcesinto social programmes that reached from cradle to grave, pro­viding free world­class health care and education as well as freepensions and funerals. Child malnutrition and adult illiteracywere eliminated. Life expectancy and many other social indica­tors rose above those of the United States. Every Cuban house­hold had (and still has) a ration book (or libreta) entitling it to amonthly supply of food and other staples, provided at nominalcost. Many other services were (and are) similarly subsidised.

Compared with the rest of Latin America, Cuba seemed to beachieving greater racial and sexual equality.

Fidel’s de�ance of the United States and Cuba’s socialachievements under his rule found many admirers abroad.

They also secured the more or less enthusiastic support for theregime of a majority of Cubans. The deal was that Fidel wouldgive them security and meet their basic needs, and in return theywould surrender their liberty. Many of those who rejected thatdeal emigrated, often with o�cial encouragement. Others werejailed, often in appalling conditions, by Fidel’s police state.

The wages of poverty

That deal began to break down in the Special Period. WhenSoviet subsidies suddenly dried up, Cuba’s �scal de�cit soared,to a peak of 33% of GDP. The government covered the gap byprinting money, which stoked in�ation. In real terms the averagewage has dropped to just 25% of its value in 1989. A survey in Ha­vana in 2000 found that 20% of the population was poor (de­�ned as �at risk of being unable to satisfy their basic needs�); thenational �gure now is almost certainly higher.

Social services have su�ered, too. According to a paper byCarmelo Mesa Lago, a Cuban economist at the University ofPittsburgh, and Pavel Vidal, an economist at Havana University’sCentre for the Study of the Cuban Economy (CEEC), in 1989 Cubaoutranked every other Latin American country in all social indi­cators except housing. But between 1989 and 1993 social spend­ing per head was slashed by 78% in real terms. It has since recov­ered somewhat, but the paternalistic state is fraying.

Hurricane damage in 2008 added to an already acute hous­ing shortage. Contrary to the myth, Cuba now has some shantytowns. Just o� the main avenue in Miramar, a plush part of Ha­vana studded with foreign embassies and homes of senior partyo�cials, stands El Romerio, an enclave of tightly packed huts ofcorrugated iron and wood. On a Saturday afternoon its mainlyblack residents play dominos in the narrow, rutted streets. De­cades of migration to the capital from the poorer east haveturned the century­old houses of central Havana into over­crowded slums. In January four young people died after a housecollapsed. People still live in the crumbling house next door.

Transport has long been scarce. There are only 600,000cars on the island, with an average age of 15 years, and half ofthem belong to the state. A new �eet of Chinese buses helped,but Cuba failed to include their maintenance in the contract andsome are already o� the road, according to a foreign diplomat.

Inequality

The deal’s o�

Inequalities are growing as the paternalistic state isbecoming ever less a�ordable

4 The Economist March 24th 2012

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The government also paid over the odds for the diesel generatorsthat have temporarily eased the chronic power cuts.

Cuba still stands out from its neighbours in two respects.First, its extraordinarily e�ective civil­defence system has en­sured that the frequent hurricanes rarely cause as much loss oflife as they do elsewhere in the Caribbean (or the United States).Secondly, violent crime is rare: a visitor can walk through theroughest parts of Havana with little fear. But both these achieve­ments are those of authoritarian rule.

And now health services and education are becomingharder to access and getting worse. Secondary­school enrolmentis below its 1989 peak. There is a surfeit of humanities graduatesand a shortage of agronomists and engineers. Although infantmortality has continued to fall, maternal mortality has risen.Many drugs are in short supply. Hospital patients sometimeshave to bring their own sheets. There are reports of doctors start­ing to demand payment. On a weekday morning in a village inthe inappropriately named municipality of La Salud (�health�),south of the capital, this correspondent came across an elderlywoman who had hurt her arm and was whimpering with pain,having found no doctors in attendance at two health clinics.

In 2010, 37,000 Cuban doctors and other health workerswere working in 77 countries around the world, mostly in Vene­zuela but also in Africa, the Caribbean and Central America. TheCuban government also o�ers scholarships to 20,000 Latin

Americans to study medicine�all part of its obsessive search forinternational prestige. But the main reason for the shortage ofmedical sta� is low salaries. A woman who gave her name asGrisel says she worked as a family doctor for just $23 a month,but now earns $40 a month in an improvised craft shop in Ha­vana. She has two small children. A pair of children’s shoes costs$13. As a doctor �I faced a choice of buying shoes or eating.�

Raúl Castro has taken steps to rationalise health and educa­tion services and has raised teachers’ salaries. But the crucial re­form required to make the welfare state sustainable is to switchfrom subsidising products and services indiscriminately to sub­sidising those people who need it, and Raúl has shrunk fromthat. His proposal to phase out the libreta was removed from theguidelines at the party congress.

Inequality revisited

Cuba’s growing social inequalities are symbolised by thedual currency system introduced in the Special Period. The �con­vertible peso�, or CUC, is now �xed at par to the dollar. The or­dinary Cuban peso is theoretically worth the same as the CUC,but that is an accounting �ction. In fact the peso is pegged at 24 tothe CUC. The CUC is used for foreign trade and tourism. Wagesand the prices of basic goods in the domestic economy are set inpesos. The average monthly wage is 454 pesos, or $19.

The shelves of state­owned shops selling merchandise inpesos are sparsely stocked. Many things,from white goods to processed foods, canbe bought only with CUCs, so many pro­fessionals are working in the tourist in­dustry or in foreign­owned companies.Remittances from family membersabroad have added another source of in­equality. So has a large informal economy.And now private business is doing its bit.

In all this Cuba is starting to resem­ble the rest of Latin America, but withoutpolitical liberties. The Gini coe�cient ofincome inequality (where 0 representscomplete equality and 1 complete in­equality) rose from 0.24 in the late 1980s to0.41 a decade later, according to researchquoted in Espacio Laical, a magazine pub­lished by Cuba’s Catholic church. A con�­dential later study is said to have put the�gure at 0.5, similar to the Latin Americanaverage of 0.53 in the mid­2000s.

Cuba has no visible oligarchs as yet,but it does have a number of increasinglywealthy people. They include farmers,owners of some tourist­linked businessessuch as guest houses and restaurants, andsome o�cials who pro�t from their con­tacts. The Castro brothers themselveshave always lived simply, but �Habana Li­bre�, a recently published book about thelifestyles of the city’s privileged caste ofartists and musicians, included photo­graphs of sons of Fidel and Che Guevara.

Cubans are extraordinarily resilient,adaptable people, but their frustration ispalpable. On being asked to take his pas­senger to a restaurant owned by RobertoRobaina, a former foreign minister, a taxidriver exploded: �These people spendtheir whole time stopping us from getting

CUBA IS THE only Latin American countrywhose population is falling. It is also ageingfaster than anywhere else in the region, forseveral reasons. First, Cuban women arehaving far fewer babies. The number ofchildren per woman fell from �ve in 1963 to1.9 in 1978 and to below 1.5 between 2004and 2008. Second, thanks to good healthcare very few children die in infancy, andCubans live to a ripe old age.

Third, some 30,000 Cubans a year leavethe island. Nowadays few of them risk theirlives in rafts or rubber tyres to cross theFlorida straits. Instead, they queue up for avisa. Under an agreement reached in the1990s to deter uncontrolled migration, theUnited States gives out some 20,000 visas ayear by lottery. Spain, which grants citi­zenship to the children and grandchildren ofthose who �ed the country’s civil war andthe Franco dictatorship, has handed out63,000 passports. A steady trickle of Cubansposted to Venezuela or travelling abroadchoose not to return.

So Cuba is getting older (see chart 2).�The typical Cuban family consists of twograndparents, two parents and one child,�says Jorge Mario Sánchez of CEEC. On currenttrends, by 2025 there will be almost as manypensioners as workers. Pensions are low (anaverage of $10 a month in 2008), and pen­

sioners are among the poorest in Cubansociety. But by 2008 total pension costs hadrisen to 7% of GDP.

The government introduced a pensionreform in December 2008, raising contribu­tions (introduced in the 1990s) and theretirement age (to 60 for women and 65 formen). But that will not be enough to makepensions self­�nancing, nor eliminatepensioner poverty. And those who want toemigrate are just the people the island canleast a�ord to lose. Fear of rising emigrationis the main reason why Raúl Castro saysabolishing controls on leaving the islandrequires long and careful study.

Hasta la vista, baby

The population is shrinking, ageing�and emigrating

Into the sunset

Source: Oficina Nacional de Estadísticas

Population under 15 and over 60 years old% of total

2

0

10

20

30

40

1953 70 81 95 2002 06 09

0-14 60+

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ahead, and they are helping themselves.� Resentment at the un­fair advantages enjoyed by the party elite is echoed by RobertoPérez (not his real name), a 50­year­old sports instructor living inSanta Clara: �The problem is that people who work hard andobey the law don’t get ahead. It’s those at the top who get aheadby doing business with foreigners.�

In much of Cuba it has become hard to �nd anyone under40 with a good word to say for the system. Mr Pérez’s son, ateacher, plans to leave Cuba as soon as he can. �The young peo­ple here have nothing to do. They are desperate,� says his father.That is why the economic reforms have to succeed. 7

Remembrance of things past

GISELA NICOLAS AND two of her friends wanted to set upan events­catering company, but that is not one of the 181ac­

tivities on the approved list for those who work por cuenta pro­pia (�on their own account�), so in May 2011 they opened a res­taurant called La Galeria. With 50 covers, it is a fairly ambitiousbusiness by Havana standards. They have rented a large house inVedado and hired a top chef and 13 other sta� who are paid twoto three times the average wage, plus tips. The customers aremainly foreign businesspeople and diplomats, Cuban artistsand musicians and visiting Cuban­Americans.

�This opportunity means a lot to us,� says Ms Nicolas, whoused to work for a Mexican marketing company. �But they ha­ven’t created the conditions for a pro�table business.� There are

no wholesalers in Cuba, so all supplies come from state­ownedsupermarkets or from trips abroad. Reservations are taken on MsNicolas’s mobile phone. Advertising is banned, though classi�edads in the phone book will soon be allowed.

Across Cuba small businesses are proliferating. Most are ona more modest scale than La Galeria. Fernando and OrlandisSuri, who are smallholders at El Cacahual, a hamlet south of Ha­vana, can now legally sell their fat pineapples and papaya from aroadside stall, along with other produce. Orlandis plans to rentspace on Havana’s seafront to sell fruit cocktails and juice. InSanta Clara, Mr Pérez’s wife, Yolanda, sells ice­cream from theirhome. Having paid 200 pesos for a licence and 87 pesos in social­security contributions, she earns enough �to buy salad�. Thestreets around Havana’s Parque Central heave with vendorshawking snacks and tourist trinkets. Many of them are teachers,accountants and doctors who have left their jobs for a more lu­crative, if precarious, life in the private sector.

No reason to work

This cuentapropismo is only the most visible part of RaúlCastro’s reform plan. �The fundamental issue in Cuba is produc­tion,� says Omar Everleny, a reformist economist. �Prices arehigh and wages are low because we don’t produce enough.�

Cuban statistics are incomplete, inconsistent and oftenquestionable. But in a lifetime’s detective work, Carmelo MesaLago at the University of Pittsburgh has calculated that outputper head of 15 out of 22 main agricultural and industrial productswas dramatically lower in 2007 than it had been in 1958. The big­gest growth has come in oil and gas and in nickel mining, largelythanks to investment since the 1990s by Sherritt, a Canadian�rm. But output per head of sugar, an iconic Cuban product, hasdropped to an eighth of its level in 1958 and 1989. Capital invest­ment has collapsed. Raúl Castro has repeatedly lamented thatCuba imported around 80% of the food it consumed between2007 and 2009, at a cost of over $1.7 billion a year.

The American embargo is an irritant, but the economy’scentral failing is that Fidel’s paternalist state did away with anyincentive to work, or any sanction for not doing so. So most Cu­bans do not work very hard at their o�cial jobs. People standaround chatting or conduct long telephone conversations withtheir mothers. They also routinely pilfer supplies from theirworkplace: that is what keeps the informal economy going.

The global �nancial crisis in 2007­08 also took its toll. Tour­ists stayed away, the oil price plunged, and with it Venezuelanaid. Hurricane damage meant more food imports, just whenworld food prices were rising and those of nickel, now Cuba’smain export, were plunging. All this coincided with the politicalin�ghting in which Mr Lage was ousted, during which �all �nan­cial and budgetary discipline was blown away�, according to aforeign businessman. Having repeatedly defaulted on its foreigndebt, Cuba has little access to credit. Instead of devaluing theCUC, which would have pushed up in�ation, in January 2009the government seized about $1 billion in hard­currency bal­ances held by state­owned enterprises (SOEs) and foreign jointventures. It did not �nish paying them back until December 2011.

The guidelines approved by the party congress containmeasures to raise production and exports, cut import demandand make the state �nancially sustainable. This involves, �rst,turning over idle state land to private farmers; second, makingthe state more productive by transferring surplus workers to theprivate sector or to co­ops; and third, lifting some of the manyprohibitions that restrict Cuban lives, and granting much moreautonomy to the 3,700 SOEs.

The grip of the state on Cuban farming has been disastrous.State farms of various kinds hold 75% of Cuba’s 6.7m hectares of

The economy

Edging towardscapitalism

Why reforms are slow and di�cult

6 The Economist March 24th 2012

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agricultural land. In 2007 some 45% of thiswas lying idle, much of it overrun by ma­rabú, a tenacious weed. Cuba is the onlycountry in Latin America where killing acow is a crime (and eating beef a rare luxu­ry). That has not stopped the cattle herddeclining from 7m in 1967 to 4m in 2011.

In 2008 Raúl allowed private farm­ers and co­ops to lease idle state land forten years. By December last year 1.4mhectares had been handed out. The gov­ernment has now agreed to extend thelease­period to up to 25 years, allow farmbuildings to be put up and pay for any im­provements if the leases are not renewed.

Credit and technical assistance alsoremain scarce, says Armando Nova ofCEEC. Farmers su�er in the grip of Acopio,the state marketing organisation. It is themonopoly supplier of inputs such asseeds, fertiliser and equipment and wasthe sole purchaser of the farms’ output,but its monopoly is being dented. Farmerscan now sell surplus production of all but17 basic crops themselves. Under a pilotprogramme in Artemisa and Mayabequeprovinces, near Havana, new co­ops willtake over many of Acopio’s functions.

The reformers want to see Acopio go.More surprisingly, so does Joaquín InfanteUgarte at the National Association ofEconomists and Accountants (ANEC): �It’salways been a disaster. We should put abomb under it.� But in around 100 of Cuba’s 168 municipalitiesthe economy is based on farming, so Acopio is a big source ofpower and perks for party hacks, and its future is the subject ofan intense political battle. That makes farmers nervous. A yearago the 30 or so farmers in the Antonio Maceo co­op in Maya­beque leased extra land, got a loan and planted bananas, citrusand beans. The administrator says output is up, but �it will taketime to see a real di�erence.� And with that he clammed up.

O�cial data suggest that output of many crops fell last year;the price of food rose by 20%. That may be partly because farm­ers are bypassing the o�cial channels. Granma, the o�cial�andonly�daily newspaper, reported in January that a spontaneous,self­organised and regulated wholesale market in farm productshas sprung up in Havana. That looks like the future.

Letting go is hard to do

Reducing the state’s share of the economy has been evenmore contested. Raúl originally said the government would layo� 500,000 workers by March 2011 and a total of 1.1m by 2014.That timetable has slipped by several years because the govern­ment has been reluctant to allow su�ciently attractive alterna­tives for workers to give up the security (and the pilfering oppor­tunities) of a state job. But including voluntary lay­o�s and plansto turn many state service jobs into co­ops (as has already hap­pened with small barber’s shops, beauty parlours and a few taxidrivers), some 35­40% of the workforce of 4.1m should end up inthe private sector by 2015, reckons Mr Everleny.

By October 2011, he says, some 338,000 people had request­ed a business licence, 60% of whom were not leaving state jobs,suggesting that they were simply legalising a previous informalactivity. As happens to small businesses the world over, manyfail in the �rst year. Few of the cuentapropistas have Ms Nicolas’s

business experience. Many clearly �nd it hard to distinguish rev­enue from pro�t. ANEC is organising training courses. But thegovernment has stalled an attempt by the Catholic church to setup an embryonic business school.

If cuentapropismo is not to be a recipe for poverty, the gov­ernment will have to ease the rules. Mr Everleny wants to seeprivate professional­service �rms being established: architects,engineers, even doctors. Already the taxes levied on the newbusinesses have been cut, but they are still designed to produce�bonsai companies�, in the words of Oscar Espinosa Chepe, adissident economist.

Lack of credit is another obstacle. Start­up capital for newbusinesses comes mainly from remittances. In a pilot scheme thegovernment approved $3.6m in credits in January, nearly all forhouse improvements. As for deregulation, Raúl has taken somesimple and popular steps, lifting bans on Cubans using touristhotels and owning mobile phones and computers, and last yearallowing them to buy and sell houses and cars.

But reforming SOEs is far more complicated. They havebeen told to introduce performance­related pay. The boldest stepwas last year’s abolition of the sugar ministry. In principle, SOEsthat lose money will be merged or turned over to their workersas co­ops. But a planned bankruptcy law is still pending. So is theelimination of subsidies and the introduction of market pricing.Mr Ugarte of ANEC thinks much of this will happen this year,along with a new law to introduce corporate income tax.

The pace of change has picked up since the party congressset up a commission with 90 sta� under Marino Murillo, a Polit­buro member and former economy minister, to push throughthe reforms, says Jorge Mario Sánchez at CEEC. �By 2015 therewon’t be the socialist economy of the 1990s, nor the same soci­ety.� But there are several gaps.

For one, the government seems undecided what to doabout foreign investment, a key element in the rapid growth inVietnam and China. It has cancelled some of the joint ventures ithad signed (often in haste) during the Special Period, and suchnew agreements as it is entering are almost exclusively withcompanies from Venezuela, China and Brazil. Odebrecht, a Bra­zilian conglomerate, has reached an agreement under which itwill run a large sugar mill in Cienfuegos for ten years. Many for­eign companies are keen to invest in Cuba but are put o� by thegovernment’s insistence on keeping a majority stake and its his­tory of arbitrary policy change.

O�cials worry that foreign investment brings corruption.Raúl has launched an anti­corruption drive with the creation of

Raúl seescorruptionaspoliticallyincendiaryat a time ofrisinginequality

The Economist March 24th 2012 7

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a powerful new auditor­general’s o�ce. Several hundred Cubano�cials, some very senior, have been jailed, as have three for­eigners. Raúl rightly sees corruption as politically incendiary at atime of rising inequality. But he is tackling the symptoms ratherthan the cause. �People who were making $20 a month were ne­gotiating contracts worth $10m,� says a foreign diplomat.

The guidelines involve only microeconomic reforms.Raúl’s macroeconomic recipe has so far been limited to austerity:he has managed to trim the �scal and current­account de�cits.The trickiest reform of all will be unifying the two currencies, bydevaluing the CUC and revaluing the peso. It would help if Cubawere a member of the IMF and the World Bank and had access tointernational credit, but so far the government has shown no in­terest in joining. Mr Vidal of CEEC points out that for devaluationto provide a stimulus, rather than just generating in�ation, theeconomy would have to be far more �exible. That will require apolitical battle. 7

THE ONLY CUBAN apart from the Castro brothers whomthe rest of the world might have heard of is Yoani Sánchez

(pictured). In 2007 she began a blog, �Generation Y�, in whichshe mixes political commentary with observations about dailylife. Now 36, a philologist and writer of maturing skill, she has afortnightly column in Spain’s El País and has won numerousjournalism prizes abroad. She expresses a new kind of opposi­tion in Cuba, one that the government �nds hard to handle.

The regime has long sought to control access to the internet.In this, as in many things, it has been helped by the economicembargo, which prevents American companies from hookingthe island up to the many undersea �bre­optic cables in the Ca­ribbean. Instead, Cuba has an infuriatingly slow narrow­bandconnection from a Russian satellite. According to the nationalstatistics o�ce, at the end of 2010 there were 724,000 computerson the island, giving 1.8m users access to a state­run intranet. The434,000 who could connect to the internet were mainly profes­sionals using it at their workplace.

Ms Sánchez, who built her �rst com­puter herself, began posting her blog us­ing the internet at tourist hotels. She andher husband and fellow­blogger, ReinaldoEscobar, insist that they are journalists,not political activists, and plan to launchan online newspaper aimed at cuentapro­pistas. Nevertheless, the attention she getsabroad irritates the government. She hasbeen denounced on television as a�cyber­terrorist�, and has repeatedly beendenied an exit visa. She is insulted andthreatened by pro­regime bloggers whoshe says are state­security agents in dis­guise. �But the international visibility ofsocial networks protects me a lot,� sheadds. She reports anything untoward onTwitter, where she has 200,000 followers

(mainly abroad), and on SMS messages within Cuba.Raúl’s decision to let Cubans buy mobile phones and com­

puters has probably had more impact than he or anyone else ex­pected. Uno�cial estimates now put the number of mobilephones on the island at 1.8m. Antonio José Ponte, a Cuban writerwho has lived in exile in Madrid since 2006, says they are used totake video and photos of police beatings of opposition activists.These images are transmitted to Miami television stations,which broadcast them, and then sent back to the island on mem­ory sticks, CDs and DVDs.

Communications are priced to discourage their use. In San­ta Clara a young man queues to use his e­mail account at the posto�ce for $1.50 an hour. There are private internet connections,but they cost even more, he says. He has a memory stick in hispocket. He and his friends trade �lms and music.

The authorities wage a constant campaign against clandes­tine satellite­television connections. In 2009 Alan Gross, anAmerican working for the American government, was arrestedfor illegally handing out satellite phones and internet equip­ment; last year he was jailed for 15 years.

Information technology has opened a crack in the Cubanmonolith, but it is a small one. Within Cuba, Ms Sánchez is rela­tively unknown. No serious observer thinks a �Cuban spring� isaround the corner. A survey of 190 Cubans conducted for Free­dom House, a Washington­based advocacy group, found thatover 90% of them had access only to government media.

The government has acted ruthlessly to crush dissent.When in 2002 activists gathered the 10,000 signatures needed toask the National Assembly to debate their request for multi­party elections, the regime responded with a counter­referen­dum in which 8m citizens were persuaded to vote for a constitu­tional amendment to declare socialism �irrevocable�. A year lat­er many of those activists were among 75 opposition membersgiven long sentences in show trials.

The small, still voices of dissent

The traditional dissident groups on the island are small, fac­tion­ridden and heavily in�ltrated by state security. Some are op­portunists and have been easy for the regime to caricature asagents of the United States. But some are very brave people whohave faced constant harassment. Mr Espinosa Chepe and hiswife, Miriam Leiva, live in a small, dark Havana �at, piled highwith books. He says that state security occupies a �at on the next�oor as a listening post. He was one of those jailed in 2003. In2010 Raúl released the 52 who remained in prison.

Mr Ponte concludes that �change can’t come from the op­position� because of its isolation and division. In the short termchange can come only from the Communist Party itself. Whatchance is there of that?

On the last Thursday in January around 150 people arecrowded into a community centre in El Cerro, a working­classdistrict of Havana, for a discussion about �citizen participationin local government�. The audience is a mixture of academicsand locals, many of them party members. The event is one of aregular series of public debates organised by Temas, Rafael Her­nández’s journal. The three speakers all complain that top­downcentralism has crushed local initiative. Of the score of audiencemembers who intervene, most agree. �Will our political class beprepared to cede power to our districts and town halls?� asks

Politics

Grandmother’sfootstepsWith no sign of a Cuban spring, change will have tocome from within the party

Raúl’s decision to let Cubans buy mobile phones andcomputers has probably had more impact than he oranyone else expected

8 The Economist March 24th 2012

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one. Not once in two hours has Fidel Castro been mentioned.Mr Hernández believes that the economic reforms have

far­reaching political implications. If they are to work, there willhave to be decentralisation, the rule of law and a reduction in thepower of the state. To achieve this, the party will have to changeits ways. At a closed party conference held on January 28th and29th, Raúl Castro reiterated his calls for a separation betweenparty and government.

That will not be easy to achieve. Cuba’s 1976 constitutionde�nes the Communist Party as the �directing force of societyand the state�. It has 800,000 members, and another 700,000 inits youth wing. The party bureaucracy has been accustomed toexercising power at all levels in a top­down fashion. It is opaque,secretive and illiberal.

Much of the resistance to change can be explained by bu­reaucratic inertia and the fear of loss of power and the perks thatgo with it. Many who feel that they have devoted their lives tothe revolution are embittered by the idea that the reforms areopening up a route to acquiring money�and eventually power�outside the party. Ideology may also play a part. Mr MachadoVentura and Ramiro Valdés, the next two in the hierarchy of the14­member Politburo after Raúl, are both tough Stalinists.

At the 2011congress Raúl admitted that the party had failedto promote a new generation of leaders. He has started to workon that. As well as Mr Murillo and Adal Yzquierdo, the economyminister, who are both technocrats, the congress appointed twoyounger political leaders to the Politburo: Miguel Díaz­Canel, theminister of higher education, and Mercedes López Acea, theparty secretary for Havana. The council of state and the councilof ministers now include more women and more black Cubansthan ever before. The average age of the powerful provincialparty chiefs is 44.

There is no political opening in Cuba yet, but there are oneor two cultural chinks of light. Books are still being censored, buta few more critical ones are being published, along with �lmsand art works. On the other hand La Rotilla, an annual alterna­tive­music festival that attracted thousands of young people,was cancelled last year after the government tried to take it over.

Church and state

The most intriguing political development is the growingrole of the Catholic church. Raúl has chosen to use it as an inter­mediary to engage with Cuban society. He holds regular talkswith the Catholic cardinal of Havana, Jaime Ortega, which aremirrored at lower levels. The church is urging the government togrant individuals more socio­economic freedoms, says OrlandoMárquez, the cardinal’s spokesman. It also argues for the recogni­tion of freedoms of expression and organisation. But it is cau­tious�its critics say timid�in pushing these ideas.

Cuba is not Poland, where the church led the opposition tocommunism in an overwhelmingly Catholic country. Althougharound 60% of Cubans are baptised as Catholics, only 5% arepractising, says Mr Márquez. Santería, a syncretic Afro­Cuban re­ligion, has more adherents. But the government has gradually re­laxed curbs on church activities. Its growing educational e�ortsare uno�cial but mostly tolerated. Last year, for the �rst timesince the revolution, the image of the Virgin of La Cobre was pa­raded around the island to vast crowds. On March 26th PopeBenedict is due to visit Cuba, as his predecessor did in 1998.

Some Cuban exiles say that Raúl has cleverly co­opted thechurch. That is too simplistic. What the church is providing is ameeting place in which conversations between the party andsome of its opponents and critics can take place. But to �nd theCastros’ strongest�and most impotent�opponents, you have tocross the short straits that separate Havana from Miami. 7

AS AFTERNOON TURNS to evening in Máximo GómezPark, named for a hero of the independence war against

Spain, some three dozen mainly elderly men and a scattering ofwomen play dominoes, banging the tiles down on the ceramictable tops. This timeless scene could be anywhere in Cuba. Infact it is on Calle Ocho, a stretch of SW8th Street in Miami, in theheart of what is known as Little Havana. With its cigar stores, Cu­ban restaurants, and memorial to those killed in the failed at­tempt to invade the country at the Bay of Pigs in 1961, Calle Ochoremains the spiritual home of exiled Cuba. But much of it hascome to look like any street in gritty urban America, with its pay­day loan shops and cheap supermarkets. Nowadays Little Ha­vana is full of Central Americans; most Cubans have long sincemoved up and out.

In the �rst 15 years after the revolution half a million Cu­bans arrived in Miami. A few were Batista’s henchmen �eeingvengeance; the vast majority were business and professionalpeople whose property was threatened with seizure or who sim­ply did not want to live under communism. Thanks to generousfederal assimilation aid and to their own entrepreneurial drive,they turned Miami from a sleepy tourist resort into a dynamicbusiness hub. A small minority engaged in violence, notably theterrorist bombing of a Cuban civilian aeroplane over Barbadosthat killed 73 people in 1976.

More signi�cantly, they built one of the most powerful po­litical machines in American history, dedicated to overthrowingthe Castros through the economic embargo imposed from 1960.Three of the four congressional districts in Miami are held by Cu­

Cuban­Americans

The Miami mirror

Cubans on the other side of the water are slowlychanging too

The Economist March 24th 2012 9

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ban­American Republicans, as is one of Florida’s Senate seats.(Robert Menendez, a Democrat, sits in the Senate for New Jersey,now home to some 85,000 Cuban­Americans.)

That political machine explains why America has not es­tablished normal relations with Cuba, as it has done with Chinaand, since 1995, with Vietnam (with which it was at war two de­cades earlier). �It’s a policy based on revenge. It sells well, but ithas nothing to do with what’s going on in Cuba,� says Joe Garcia,a former hardliner who has twice run and lost as a Democraticcandidate for the House of Representatives in Miami.

The embargo gives the United States leverage, counters Lin­coln Diaz Balart, who spent 18 years in the House before handinghis district over to his younger brother. He envisages bargaining�access to the US and its billions in mass tourism, investmentand credit� for the legalising of political parties and the libera­tion of political prisoners. Mr Diaz Balart, who has been unableto visit Cuba since 1959, insists that Raúl’s reforms are �window­dressing�the only change is an increase in repression.�

Over the decades there have been tactical shifts in Ameri­can policy. Jimmy Carter re­established partial diplomatic ties.Under Bill Clinton, America began to o�er aid to dissidents butalso liberalised some travel. After Cuba responded to a provoca­tive campaign of over�ights by exiles by shooting down twolight aircraft in international airspace, killing their four crew,Congress in 1996 approved a law known as Helms­Burton,which attempted to extend the embargo to foreign companiesand barred the administration from supporting Cuba’s return tothe IMF. Perhaps most importantly, it stripped the White Houseof the power to end the Cuban embargo. Only Congress can nowlift it completely, and only when both Castros are out of o�ceand free elections on the way.

George Bush junior tried to increase the pressure on theCastros, curbing travel and remittances to the island by Cuban­Americans and instructing the US Interests Section in Havana too�er more aid to dissidents. That merely gave Fidel cover to crackdown on them. Barack Obama has returned to some of the poli­cies adopted by Messrs Carter and Clinton. He has removed allrestrictions on travel and remittances by Cuban­Americans; al­

lowed any American to send up to $2,000 a year to Cuban citi­zens; and authorised more direct �ights and travel by religiousand educational groups.

The State Department also began regular talks with Cubano�cials. Progress halted when Cuba arrested Mr Gross. TheObama administration beat back an attempt in Congress in De­cember to overturn its easing measures, but shows no sign ofwanting to open up further.

Neither does Cuba. In 2009 Raúl appointed Bruno Rodrí­guez, an inept hardliner, as his foreign minister. The economiccosts of the embargo to Cuba�higher shipping charges, short­ages of some medicines and components, tourist revenue for­gone�are far outweighed by its political bene�t to the regime. Ithas allowed the Castros to maintain a siege mentality.

Even so, the United States and Cuba co­operate smoothlyon practical issues, such as hurricane monitoring, coastguardmatters, anti­drug work and patrolling the perimeter of theGuantánamo naval base. And the embargo has sprung leaks: inthe past few years the United States has sold Cuba food worth upto $960m a year (though it insists on settlement in cash).

Worms no more

Mr Obama’s policies re�ect the changing nature of the Cu­ban­American population in south Florida as much as develop­ments on the island. Some 400,000 of that population, now to­talling 1.2m, have arrived since 1980, often as economic migrantsrather than political exiles. They retain close ties with the island.In the check­in queue at Miami airport for one of the eight dailycharter �ights to Havana, almost everybody is carting two orthree huge bags �lled with gifts or goods to sell. �There’s been amove to a border economy,� says Carlos Saladrigas, a Miamibusinessman. That has been welcomed by Raúl, who has saidthat Cuban­Americans should no longer be despised as gusanos(�worms�), Fidel’s term for them, but seen as part of the nation.

Mr Saladrigas believes the changes in American policyshould go much further. In 2001, together with other Cuban­American businessmen, he set up the Cuba Study Group to chal­lenge the embargo. �In business we know that if a strategy hasn’tworked for 53 years, you change it,� he says.

Roots of Hope, a group set up by Cuban­American univer­sity students, has also taken advantage of Mr Obama’s mea­sures. Its aim is �to help Cuba’s youth to empower themselves�,says Tony Jimenez, one of its founders. Its members collect sec­ond­hand mobile phones to give to young people on the island.

Yet the evolution of the Cuban­American community hasnot been matched by political change. That is mainly becauseolder Cuban­Americans vote in large numbers, and for thecause. Their children, and more recent arrivals, are less likely tovote and care more about their life in the United States.

Anyone who publicly questions the embargo has to bebrave. �For years there’s been a genuine fear of speaking out inMiami,� says Mr Saladrigas. �I know people who’ve dissentedand lost their jobs or had to close their shops.� But the pressure islessening. In 2007 Neli Santamaria began organising discussionsabout Cuba policy at her café on Calle Ocho. �Ten or 20 years agoI would have been bombed,� she says. Now she just gets slan­dered on the internet. Several prominent businessmen make itclear they would invest in Cuba if the embargo was lifted.

There is an eerie similarity to the ranting insults that passfor debate on each side of the Florida Straits. Perhaps that is notsurprising. As Mr Saladrigas notes wryly, �one of the things I’velearned on my trips to Cuba is that they’re just like us: stubborn,proud, even arrogant.� To the outsider, observing politicalchange in the two Cubas resembles watching a tortoise race inwhich neither reptile has strayed far from the starting line. 7

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10 The Economist March 24th 2012

CUBA

CLIMB INTO ONE of those stately 1950s Plymouth sedansat Havana’s Plaza de San Francisco and head west, and you

take a journey through Cuban history. The splendid stonechurches, palaces and town houses of Old Havana are testamentto four centuries in which Cuba was Spain’s �ever­faithful isle�,its most durable American colony. Drive along the wave­sweptMalecón, and you will glimpse the cupola of the now­shutteredCapitolio, built in reverent imitation of the Capitol building inWashington, DC. Carry on to Miramar and you come upon thevast compound once occupied by the Soviet embassy.

Having been a Spanish possession, an American neo­colo­ny and then a Soviet client, �for the �rst time in its history�or atleast since 1510�the island is really on its own,� wrote HughThomas, a British historian, in 2001. That seemed true then. Cu­ban o�cials would refute it now, pointing out that they have se­cured normal relations with the whole of Latin America and aclose alliance with four of its countries, as well as in�uence in Af­rica and ties with rising China.

Havana has 181 foreign embassies, more than Madrid, evenif most are small posts whose diplomats down their mojitos andstruggle to build close relationships with Cuban o�cials. Aboveall Cuba now has Venezuela’s Mr Chávez. Yet he is a contingentasset: his aid will last only as long as his grip on power.

Might o�shore oil bring relief? At the end of January theScarabeo 9, a deepwater rig built in Asia to get around the Ameri­can embargo, appeared on the horizon o� Miramar. In the nextfew weeks its operator, Spain’s Repsol, will announce whetheror not it has found oil in commercial quantities. But even if it has,the oil will be costly and di�cult to extract.

Carry on westward in that sturdy Plymouth, and in 45 min­utes you come to the scru�y town of Mariel, overrun with bicy­cle­rickshaws and best known as the site of a boatlift in 1980when 125,000 people left the island. Outside the town, Brazil’sOdebrecht is building a deepwater port and a container terminalfor the giant ships that will soon traverse a widened Panama Ca­nal. The new port complex, to be operated by Singapore Ports,will be a �special development zone� with factories producing

for export. Much of the $975mfor the infrastructure comesfrom Brazil’s National Develop­ment Bank.

Mariel is likely to be an im­portant part of Cuba’s future asa capitalist country. Brazil, likeChina, Spain and Canada, is in­vesting on market terms. WhenBrazil’s president, Dilma Rous­se�, visited Cuba in Februaryshe refrained from public criti­cism of its human­rights record.O�cials in Brasília insist that,just like the United States, theywould like to see political free­dom on the island, but they goabout it di�erently.

The imperative of change

There is no obvious alter­native to Raúl’s reforms. But thepaternalist state produced an in­fantilised society, and as it re­treats popular anger could easi­ly mount unless living stan­dards rise. The other clinchingargument for change is whatCubans call �the biological fac­tor�. Given his age, Raúl seemsunlikely to stay in charge formore than another �ve years or so. Cubans were in awe of Fidel.They are less so of Raúl, and may not be at all of his successor.

Who might that be? Mr Ponte, in Madrid, fears a dynastictemptation. Although Fidel largely kept his children out of sight,Raúl’s son, Alejandro, acts as his national security adviser; hisdaughter, Mariela, is a prominent campaigner for gay rights; andone of his sons­in­law, Colonel Luis Alberto Rodríguez, runs partof the armed forces’ business empire. But none of the three is onthe Central Committee, let alone the Politburo. The chances arethat the next leader will come from among current or recent pro­vincial party secretaries, like Ms López Acea or Mr Díaz­Canel.

What is the destination of change? The reformist econo­mists think that Cuba should move towards market socialism aspractised in Vietnam or China, but others dismiss the parallel,citing cultural and geographical di�erences. Cuba could look formodels closer to home. Fidel was determined to turn his islandinto a world power. �While Fidel’s obsession was the world,Raúl’s is Cuba,� a foreign diplomat observes. Geographically,Cuba is a declining part of a rising Latin America. It has severalbig assets, including its highly educated workforce and, poten­tially, the capital of its diaspora. The high­tech industries of CostaRica, the tigerish dynamism of Panama and the social democra­cy of Brazil all o�er things that Cuba could emulate.

There are less attractive political models, near and far. Forexample, it is not hard to imagine a Cuban Vladimir Putin emerg­ing from the army or the security services. A somewhat less badscenario, envisaged nearly 20 years ago by Jorge Domínguez, aCuban­born political scientist at Harvard, would see Cuban pol­itics start to resemble Mexico’s under the long rule of the Institu­tional Revolutionary Party. The Communist Party would estab­lish a loyal opposition of quasi­autonomous parties, hold a fairlyfree election which it would probably win, and use that to nego­tiate with the United States. But then again the Cuban peoplemight have other ideas. 7

After the Castros

The biological factor

Who and what will follow Raúl?

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Given hisage, Raúlseemsunlikely tostay incharge formore thananother �veyears or so

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