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Cuba’s Economic Crisis: A Historical Analysis


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Credit: Ramon Espinosa / AP


The streets of Havana echo with chants of “Libertad!” Freedom. Thousands of anti-government protestors — fueled by rising poverty, lack of access to crucial medical supplies, and food insecurity, all the result of a perceived mishandling of the COVID-19 pandemic by President Miguel Diaz-Canel — took to the streets of Cuba on July 11in what has been described as the largest Cuban protest in decades. Over 300 miles away, protestors in Little Havana, “the heart of Miami’s Cuban diaspora”, join their fellow countrymen in cries for Cuban liberation. 12-year-old Daniella Salgado, part of the group Niño’s for Cuba, says “I want them to know that we see them. We are here to help them.” Protestors from Miami gathered outside the White House and Cuban Embassy, urging President Joe Biden to help the people of Cuba in their fight against “a repressive and violent government that trades in fear and overarching oppression”, as Robert Lewis, whose grandparents fled Cuba in the 60s, describes it. Among the protestors’ calls to action: the phrase “Patria y Vida”, a song title turned protest slogan meaning “homeland and life” which has come to symbolize the Cuban liberation struggle.


Now for some important context. Cuba is an island nation in the Caribbean Sea with a population of 11.33 million, making it the most populous Caribbean country. Its capital city, Havana, contains just under 20% of Cuba’s population; Havana is a major port city, and one of the primary commercial centres of Cuba. The Communist Party of Cuba (in Spanish, Partido Comunista de Cuba, or PCC) has singularly ruled Cuba for decades, most recently under President Miguel-Diaz Caneland prime minister Manuel Marrero Cruz. The PCC was organized by Cuban political leader Fidel Castro in 1965, although organized communist activity in Cuba began earlier in 1923. Fidel Castro and the PCC have historically embraced a Marxist-Leninist socialist ideology (what that exactly means is beyond the scope of this article, but an encyclopaedic definition can be found here), and Cuba is constitutionally a one-party socialist state. A 1976 referendum led to all political power being controlled by the PCC, and in 1992, the Constitution was revised to define the PCC as the “vanguard of the Cuban nation” with the goal of advancing socialism and eventually establishing a communist state. Political dissidents are often silenced and charged with violations of the Penal Code, which punishes things like “enemy propaganda” and “illicit association.”


The humanitarian crisis unfolding in Cuba has been hyper-politicized by both sides of the right/left political spectrum. “Socialism” and “communism” are being thrown around like buzzwords to fuel anti-left sentiment, and some are using this as an opportunity to push a political ideology and cement a narrative of their construction. It’s important to recognize that what is happening in Cuba right now is not a spur-of-the-moment reaction to a sharp rise in COVID-19 cases, but rather has its origins in decades of single-party leadership and US imperialism in the form of economic sanctions and trade embargoes.


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Credit: Roberto Leon / NBC News


What is Happening in Cuba Right Now


When experts say that the ongoing anti-government protests in Cuba are unprecedented, they are not exaggerating. In an interview with Michael Martin of NPR, Lillian Guerra, a Cuban history professor at the University of Florida, explained how these protests exceed past ones in both size and organization. First, these protests are not geographically limited to population hubs like Havana and neighbouring cities; protests have sprouted up in over 50 cities and towns across the country. Second, and perhaps most importantly, these protests are one of few in the last 62 years that have not been organized by the PCC and Cuban government. Most rallies in Cuba since the 1960s have been state-orchestrated, with the government going so far as to impose consequences for those who didn’t participate in them. Guerra points out that these ongoing protests, which are illegal under Cuba’s Penal Code, demonstrate “the degree to which Cubans have reached a kind of consensus about the nature of their regime.”


Within the last year, Cuba’s gross national product dropped by 11%. Coupled with Cuba’s poor response to the pandemic (the country has, on average, 6,274 new infections and 58 coronavirus-related deaths every day), which exacerbated the country’s economic decline, this economic crisis is the country’s worst since the fall of the Soviet Union in 1991. The decline can be attributed to multiple factors, including US trade embargoes and sanctions on Cuba. In the interview, Guerra points out another possible reason — Cuba’s continued investment in hotels and tourist facilities as part of the country’s initiative to increase tourism despite the state’s apparent lack of resources. To compensate, the government increased taxes; as Guerra puts it, “[the protestors] are sick and tired of seeing small street vendors pay more in taxes… than your average foreigner.” The pandemic led to a sharp decrease in tourism to Cuba, which could partially explain the drop in GDP (in 2019, the travel and tourism sector accounted for 10.6% of Cuba’s GDP). Mismanagement aside, what caused Cuba’s lack of resources pre-pandemic? That responsibility falls squarely on the United States and the trade embargo, which will be discussed further in the next section.


Keep in mind that the Cuban government is not innocent in all of this. If you can excuse the mismanagement of the limited economic resources the state had pre-pandemic, there is still the issue of authoritarianism and silencing protestors to address. Anti-government speech is inherently politically dissident, and Cuba’s limitations on free speech are non-democratic. President Diaz-Canel’s use of state TV to characterize the protestors as “paid demonstrators” and urge counter-protests is just one example of the state encouraging clashes between demonstrators. The US may have economically destabilized Cuba (and is, in turn, responsible for its economic woes), but the situation is not being helped at all by the Cuban government, who are trying to escape any culpability while its citizens starve and face constant power outages.


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Credit: deva777@free.fr / Fotolia


US and Cuba: A Brief History


The historical relationship between Cuba and the US is long and tenuous. After the Spanish-American War, the United States gained control of Cuba in 1899 and continued to govern it by direct military administration until 1902, when Cuba ratified its Constitution and became an independent nation, albeit with some caveats (namely, the Platt Amendment). Most historians point to the Cuban Revolution of 1953-1959 as the start of antagonistic relations between the two countries. From 1952 to 1959, Fulgencio Batista ruled Cuba under a military dictatorship after first gaining power in the Cuban Revolution of 1933. Batista was an anti-communist, and his regime was supported by the US against challenges from Fidel Castro, who wanted to overthrow Batista and establish a socialist rule. On January 1, 1959, Castro successfully overthrew Batista and established Cuba as a socialist state closely aligned with the Soviet Union. 1960 saw an increase in tensions between Castro and President Dwight D. Eisenhower. Castro strengthened his relationship with the Soviet Union by establishing trade deals and increased taxes on US imports; Eisenhower responded by ceasing diplomatic relationships with Castro and establishing a near-total trade embargo on Cuba. In 1961, President John F. Kennedy executed the Bay of Pigs invasion, which was unsuccessful in its goal of overthrowing Castro, and in 1962 he announced a complete trade embargo on Cuba, which effectively blocked all trade between the two countries. Although President Obama pursued a détente with Cuba by reopening embassies and visiting the country (which no president had done in 90 years), the embargo was not lifted during his term. Later, President Trump reinstated travel and business restrictions, and his state department re-designated Cuba as a terrorist sponsor, effectively erasing the progress Obama had made.


The US trade embargo on Cuba is one of the most persistent in modern history, but it isn’t the only thing inhibiting Cuba’s economic growth. According to Marc Frank from Reuters, “Just a few years ago, foreign businesses were rushing to take a first-hand look at Cuba’s opening economy, lured by the Communist government’s market reforms… yet Donald Trump’s… ratcheting up of the U.S. trade embargo [has] poisoned the business climate.” Western banks have long been wary of transgressing US sanctions in Cuba. Trump’s reinforcement of the embargo and aggressive sanctioning of Cuban military-run companies further deterred these banks from doing business there. Perhaps one of the most debilitating policies of Trump’s Cuba strategy — the activation of Title II of the Helms-Burton Act, “which allows Americans to sue U.S. and international companies profiting from property that was nationalized or confiscated after Cuba’s 1959 Revolution.” Because of the combined effect of the embargo and sanctions, once Cuba’s growing tourist industry collapsed amid the pandemic, the government had nothing to fall back on. Then came the protests.



What Can You Do to Help


As always, educate yourself beyond the scope of this article. Foreign policy is always extremely nuanced, with many perspectives to consider. Dissecting US-Cuba relations can get especially thorny, as there are decades of history to consider and the need to make sure you aren’t relying on one-sided information. One thing I really want to emphasize is the importance of separating the Cuban people from the Cuban government and the PCC (and your views on socialism and communism in general). Try to understand the motivations behind the anti-government protests from a humanitarian point of view. Listen to and amplify Cuban voices, especially those of independent journalists on the front lines in Cuba (you can start with Yoani Sanchez and Abraham Jimenez Enoa, who are two of the many journalists reporting on the situation). Donate to Cubanos Pa’lante’s recharge campaign here to help provide Cubans with affordable internet. Attend protests and support local charities if you are able to do so. On the legislative front, the embargo on Cuba cannot be lifted without congressional authorization. In May of this year, Senators Jerry Moran (R-KS), Amy Klobuchar (D-MN), and Patrick Leahy (D-VT) introduced the Freedom to Export to Cuba Act, which would end trade restrictions and allow Cubans increased access to US goods. You can contact your legislators to voice your support or opposition to this piece of legislation specifically, or you could call them to voice your support for the people of Cuba in a broader sense.


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