On Friday, August 10, in the vicinity of the headquarters of Estado de Sats, an operation was undertaken by State Security, with the participation of the police force, to prevent the public from attending the screening of the documentary Knockout, in our space: Cinema At All Costs.
It appears that the option of a repudiation rally, which they were planning and which we gained knowledge of and denounced, was changed for this operation, in which the following people (known to us, so far) were arrested and taken to different police stations:
David Canela
Bartolo Márquez
David Ávila
Rene Ramón González
Walfrido López
Eugenio Leal
Alejandro Zaldívar
All were released hours later with the exception of Eugenio who was still being held as this note was being prepared.
Others attending were denied access to the site.
——- From earlier notice of the film screening ——-
The film is a documentary by Darsi Ferrer. This material shows starkly the abandonment and helplessness suffered by many boxers, former Olympic champions, in today’s Cuba.
This morning we heard through a friend that on Thursday the workers of the Labiofam company were notified that they would participate, today, in an act of repudiation* in front of the Estado de Sats headquarters.
A few minutes ago we returned from the Fifth Station of the PNR (National Revolutionary Police), located at 7th Avenue and 62nd in Miramar, where we delivered to the Station Chief, badge number 0037, the following document and warned of the possible consequences of undertaking these acts and provocations.
Havana, August 10, 2012
Chief of the 5th unit of the PNR of Miramar
Street 7th. A and 62, Playa Municipality
Through this communication the undersigned, Antonio E. Gonzalez Rodiles, a resident of 1st Avenue. No. 4606, between 46 and 60, Miramar, Playa, I appear before you under the provisions of the Constitution in Article 63, “Every citizen has the right to lodge complaints and petitions to the authorities and to receive appropriate attention in accordance with the law,” to put before you what I relate below:
That in this day August 10, 2012, I learned of the intention to undertake what has euphemistically been called an “act of repudiation” in front of my home.
That this action appears to be motivated by the undersigned being one of the promoters of a Citizen Demand urging the Cuban government to ratify the United Nations Covenant on Civil and Political Rights and the Covenant on Economic, Social and Cultural.
That these documents were signed by the Cuban government for the people of Cuba on February 28, 2008, in New York City.
That this citizen request was made in conformance with the legal framework that the country offers, without violation of any of the rights that the nation recognizes for all.
That for over a year we have been conducting various cultural activities, lectures, artist showcases, film discussions, panels, etc., without, to date, there having been any alteration, even minimal, of the public order, which is why we believe that to undertake this alteration today, is closely tied to the UN Covenants which we already referenced.
That, under section 286.1 of the current penal code, “He who, without legitimate reason, exercises violence toward another or threats to compel that at the moment the person to do what they do not want to do, whether just or unjust, or to tolerate another person to do the same, or to prevent him from doing what the law does not prohibited, is punishable by deprivation of liberty of six months to two years or a fine of two hundred to five hundred shares.
“He who by other means, prevents another person from doing what the law does not prohibit or from exercising their rights, is punishable by imprisonment of three months to one year or a fine of one hundred to three hundred shares.”
I thought it appropriate to bring to your attention the violation of the provisions of the Act so that you can fulfill your duty to maintain order and respect for citizens’ rights within the jurisdiction of your competence.
Yours sincerely,
Antonio González-Rodiles
*Translator’s note: An “act of repudiation” is a government-organized mob which surrounds a place or person or people, screaming insults and threats, and in some cases launching physical attacks. The government media claims these are “spontaneous uprisings” of “enraged citizens” against “counter-revolutionaries”, but the participants (including school children) are frequently bussed to the site, and the same “neighbors'” faces have been photographed participating in these attacks in widely dispersed neighborhoods. Examples can be seen on video here and here.
When the funeral cortege left the chapel in Cerro with the body of the political leader Oswaldo Payá, having barely advanced a few yards, it was stopped for some twenty minutes. Something happened at the beginning of the caravan. Several people got out of the car to find out what; we feared the worse although we hoped that nothing was happening and we wanted to give a Christian burial to our dead.
While celebrating the Mass officiated by Cardinal Jaime Ortega, outside, the authorities were planning the engagement. I looked out of the door of the church, looked down the street and I could recognize the faces of the State Security agents, but there, at the end, where the Calzada del Cerro terminates, I saw an officer talking to a large group of civilians.
I remembered that it seemed very much like the operation they had every time the Ladies in White met at their headquarters: the house of their spiritual leaders, the feisty Laura Pollán. I recorded some footage of what was happening and approached as far as the camera lens would let me. In any event, I couldn’t imagine they planned something similar in the midst of that pain, that they would disrespect the family of the deceased, the Cardinal and the entire delegation of the Catholic Church, as well as the broadcasters and the international journalists covering the event.
But despite the constant proofs of the governmental abuse, we still insist on being naive, as if this attitude would save us from contagion by the all the evil that always surrounds us.
What I do know is that the partner of Antonio Rodiles, Ailer Gonzalez, with the intention of finding out what was going on, got out of the car, and, coming to the crowd, witnessed how they preyed on Fariñas and another group of opponents. She demanded their release and the police pushed her also, and forced her with beatings onto a Chinese-made Yutong bus that they’d prepared by way of a rolling jail cell. And inside there, they continued beating her.
Antonio, impatient on seeing that his partner didn’t return, went to look for her. While he was walking he heard a State Security Agent shout to another who was nearby, “Look, there goes Aleaga, let’s grab him.”Rodiles observed that Aleaga wasn’t even taking photos, just walking on the sidewalk, and he said to the “securities” to leave him alone. They looked at him and responded, “Come on, you too, you’re going.” He refuses, meanwhile seeing that Aleaga is being put in a car handcuffed. Rodiles resists their putting him into a car, finally they lay him on the backseat and two burly agents climb on top of him to immobilize him with the weight of their bodies.
Fariñas returns slap
The lawyer Vallín is in the car with me, and deducing that something happened at the beginning, we get out, and when we’re about to go to the place the procession resumed its march and we got back in the car. In the Calzado de Cerro they’ve already armed an operation of the repressive forces, we managed to see a woman with the rank of colonel waving for the caravan to continue.
They had two Yutong buses on each direction of the street that were blocking traffic. Without distinguishing the faces I could also see that there were several people inside the buses that they were hitting. Later I learned that they were Fariñas, whom they hit at that moment, which he returned with the same energy.
Ailer was in that bus; and she said the struggle was maintained for a while, that the driver took the route toward the beaches to the east of Havana. That there was a moment when they thought the bus would turn over, it looked like a swing and gave the impression that the driver lost his way, that they would be killed and she began to plead with Fariñas to stop, because he was continuing to brawl with the agents who were trying to hit him.
Fariñas looked at her and understood her fear and appeased them to please her and calm them down. It was a humane act and one of chivalry that made the difference with the government’s henchmen, who continues their insults and provocations.
Ailer handcuffed
They take her to a place that looked like a shelter or abandoned classroom, and told her to hand over the memory card of the camera. She had already secured it, taking it out of the camera and putting it in her purse. And she refuses to surrender it, warning that they themselves are violating the laws, she has been kidnapped on a public street, and they are violating her civil rights that she knows well.
But two women and a man come and push her and throw her on the floor to demobilize her and take the bag. She yells at them one day have to answer for their abuses and repressive attitudes that tarnish the name of all their families. She warns them that she has heart problems and has arrhythmia. They show their fear. Soon they take her to the outside of the Naval military hospital and tell her to exit the car. And leave her there abandoned.
Rodiles refuses to enter the cell
When they take Rodiles to the police station, Aleaga has just arrived. The “securities” continue provoking, they want him to enter a cell but they can’t make him do it despite the shoving, they have given him a lot of punches, scrapes and torn his clothes. I’m not a criminal, Rodiles tells them, I haven’t committed any crime and I am not going in any cell.
A lieutenant colonel in the police intervenes and tells the “securities” that they will allow him to talk, look, he said, I give you my word I will not let them take you to the cell, but first you have to give me your shoelaces and belt, it is mandatory; they put in the waiting room. And what about Aleaga, asks Rodiles. The officer keeps looking at him and understands it will have to be that way or he will continue his protests. Fine, he stays with you at him and know that you will have to be so or continue their protest. Okay, it stays with you, he responds. The “securities,” against their will, accept keeping them out of the cell.
The bells in the cemetery receive us
We arrived at the cemetery worried, we didn’t understand clearly what had happened. Someone said they had arrested Rodiles, Aleaga, Ailer, Fariñas, among many other dissidents. Singing, accompanied the remains of Oswaldo Payá, from the entrance to the chapel, then to his grave. That death had changed us, the living. Taught us, once again, the lack of scruples of the Cuban government. Nevertheless, we agree that Payá received the funeral honors worthy of a President. That last space I toured hugging the great Cuban poet Rafael Alcides, who, recovering from a recent hospitalization for his diabetes, had not wanted to fail to pay his respects and say a final goodbye to the brother in the struggle.
He told me that of course all of us who are fighters like Payá are aware of the risk that faces us when we defy a totalitarian government. But we know that despite risking our lives, it’s impossible to avoid our protest.
Demanding freedom in front of the police station
We were told that Aleaga and Antonio remained in detention at the 4th Police Station in Infanta. In half an hour we were there, along with a group of young fighters, Yoani Sanchez, Reinaldo Escobar and Santana (the writer), to accompany the families of those arrested who were waiting outside the station. There I found a lawyer Vallín who went inside, from time to time, to demand that at least they present the arrest warrants, which they had not yet done; he warned that they were detained there as hostages, in open violation of applicable laws.
Soon a Major of the police came to ask Vallín speak with us and to tell us to go home. By that time we were over twenty people. Vallin told us the desire of the officer after he had retired. We were laughing that the officer thought, just ask, we would retreat. At the time the Major came out again and warned us that we could not be there (we stayed right across the street from the police station). He said that in twenty minutes they would release those arrested.
So we decided to go to the facing sidewalk. The Major returned and told us we could not be there either. To facilitate the release of Antonio, we decided to retreat about fifty feet, our position was no longer right in front of the station. But those twenty minutes passed when they promised to release him; and we waited an hour. Then it occurred to someone to make “a small geographical pressure,” and we returned to the place where we were earlier, on the sidewalk right across from the station.
From there we could observe every movement. The Major returned and told us he was the Chief of the Municipality, and that it we continued there he would have to send the “forces of order” to remove us. We were already over thirty people demanding the release of our brothers. The writer Orlando Luis Pardo had come, with his girlfriend and another girl.
We told the official they we felt for him for all that he’d gone through, given that he had been patient and at all times, had turned to us with respect, but we urged him to keep his word. Reinaldo Escobar told him to put himself in our position, would he be able to abandon a comrade in these circumstances, and we didn’t even know under what condition Antonio was in, if he was beaten.
The officer tried to deny our suspicions, saying they didn’t hit him, but when we showed the wounds that had some had recently received from the repressive forces, among the other detainees Ailer, who had just joined us, the soldier chose to remain silent and, nevertheless, seemed to understand, or maybe it was our decency and sympathetic stance. Finally we told him that if he felt that he should pressure us, we were determined to accompany Antonio in the cell. They we had no objection to his doing his duty.
Then he left and never came back. After a while they released Aleaga and we applauded as he walked out in front of all their captors. But if they thought we would settle for one of two taken, they were wrong; they were left waiting to see what we would do and when they saw we would continue stationed there, they formed the idea to devise other action against us.
Half an hour later a truck of the Special Branch appeared, full of guards. Also two ambulances arrived. In one corner State Security agents in plain clothes began to meet. Ailer saw one of the ones who had beaten her and took advantage of it to tell her abusers to their faces that one day they would have to pay for such abuses. The men did not answer. They turned away and we saw them climb the stairs to shelter in the police station.
Someone phoned to say that Fariñas had been taken to his province in a police car. Soon we were approached by a “security”: a black guy six feet tall who, in order to provoke us, stationed himself very close to us. But his presumed bravery was just a show for his comrades who were watching, because Reinaldo Escobar also went to meet him, and when he passed behind him, I saw the “security’s” cowardly eyes, his six-foot body shrank, he turned to follow Reinaldo with his eyes as if he was afraid of being attacked, something Reinaldo would never do, quite the contrary, because what he did was fake a call for him to overhear, as if he were telling someone that everything was fine.
After that the provocateur also pulled out his phone and informed us we were clowns. I took mine and he heard me and I said there were no problems, that the provocation was sheer monkey business. Then the black guy quickly left, frustrated at not having received the order to beat us and take us by force, which is what he wanted.
After one o’clock in the morning, Vallín and Reinaldo spoke to the Colonel, who said he was the Head of the Station. Vallín said he had twenty-four hours to make the decision to charge the person or not, and to define the offense for which he’d be tried. The official acknowledged that was true, by law, and confirmed that ten o’clock marked the term, and then he would report back what they would do in that case, which they were now studying the decision to make. Vallín and Reinaldo made it clear that it was an agreement, and the Colonel agreed.
The elderly parents of Antonio said as long as we were there they would not leave. Then we got them to agree to let us take them home and come back and meet at ten o’clock. The couple agreed. And so we all went.
At ten o’clock the future of Antonio was decided
When I reached the police station with the attorney Vallín, already there were Antonio’s parents, his partner and some other opponents. Forced to sit in the sun on the sidewalk in front of the station, they would not let us approach, in fact no pedestrians could pass through the place. The whole street was blocked by police cars and policemen. We had to wait twenty yards from the station.
When Yoani and Reinaldo arrived, they hurried their steps to join Antonio’s parents, and police tried to stop them, but they, like experienced athletes of the opposition, managed to dodge them and sit on the wall where the elderly parents were. A police captain said they could not stay there, and Yoani and Reinaldo told them about laws and rights and the police were astonished.
All they could do was exert force, but their order was to avoid confrontation at all times. They were very close to the fateful date of celebration for the defeat of the 26th of July, and they didn’t want to tarnish it, it was bad enough with the mysterious death of Oswaldo Payá.
Immediately the Colonel came out, it was 10:10 in the morning and he should comply with the agreement. He spoke with the parents and then with Vallín, the decision was he would be released, and then we saw Antonio could out in a patrol car and greet us. The Colonel said that the prisoner would be brought to his house.
When we got to Antonio’s house he already was there and told us the abuses they committed, all the horror that his oppressors made him suffer to force him to give up; we saw his ripped clothes ragged, the bruises and scratches on his body.
We all returned to our homes knowing that Antonio, Ailer, Aleaga, Fariñas and the rest of the group were already in theirs, wanting rest, until a new warning alerts us that another injustice has been committed, and we have to once again be present for the freedom of Cuba and our brothers.
Those hours helped us to push the wall of the dictatorship that oppresses us a few inches. We know that the worst part of this difficult struggle is yet to come, that to achieve democracy we will make many sacrifices. But the good thing is that these days we confirm that, despite all the repression of the Castro regime, we worthy Cubans are ready to give ourselves for the ideals that Oswaldo Payá died for.
The recent editorial by the newspaper Granma clearly defines the mediocrity and poverty of thought of a system that now howls desperately at its approaching end. The text is an apology to the cynicism of the elite and those who serve it, who try to discredit and silence the independent voices that spring from Cuban society, and so conceal their total debacle.
It is outrageous to see that the same government and the same criminal characters who instituted the firing squads and the long sentences in subhuman conditions as a way to maintain the terror, who ordered the repudiation rallies and beatings, attaching the people’s name as the author of these abominable acts, try to present themselves before Cuba and the world as paradigms of honesty and virtue.
The country lies in ruins and they don’t care, they display not the slightest dignity. They want to stay until the last moment, at any price, even provoking civil violence, seeing their allies as mere objects for their use. Fidel Castro did it at the Moncada Barracks attack when he supposedly lost his way in Santiago de Cuba, a city he knew very well, while other assailants fought and were killed. Raúl Castro did the same thing at the battle of Marcos Sánchez, in that now distant 1958, when cowardly and shamefully he fled, leaving behind all his troops.
These two characters keep the country in ruins. A constantly rising number of Cubans are literally crushed to death in the collapses of their disastrous homes, while Castro descendants assume the right to continue to plunder the nation of its funds, without rendering an account to anyone.
Waiting to beat the mourners coming from the church after the Mass for Oswaldo Payá
They and their sidekicks claim that we Cubans destroy each other like mad dogs, trying to sell ever more dearly the disaster they have provoked in our nation, they are insatiable, they are beings who profess an utter contempt for humanity, tolerance, humility, for our land.
Those who launched a rabid mob to beat people on the morning of July 24 during the funeral of opposition leader Oswaldo Payá, are the same ones who will give the order to shoot into a defenseless crowd, the same who prefer to drown thousands and thousands in a bottomless sea, rather than accept their ignorance and decay.
Hopefully the peons who form a part of and who cooperate with this nefarious machinery will begin to understand, for the good of all, that there is no action without consequence and that the winds are beginning to blow in favor of the truth.
In less than a year the Cuban opposition has lost two of its most important leaders. On October 14 of last year life of Laura Pollán, the principal coordinator of the Ladies in White and the key figure in the release of the Black Spring prisoners, was cut short. A week ago a car crash, yet to be fully explained, claimed the life of Oswaldo Payá, founder of the Christian Liberation Movement.
These activists had great national and international recognition and their physical absence comes at a time when the dissidence is seeking new horizons. Hence, the need to analyze the scenario in which these deaths have occurred, and their potential impact on the immediate future.
On thing about which there is no doubt, is that the Cuban opposition on the Island is characterized by its peaceful nature and its renunciation of armed violence. It prefers to base its actions in political programs, documents demanding respect for Human Rights, street demonstrations, signs painted on facades, or simply open door meetings.
It behaves and manifests a much more democratic behavior than the government installed in the Plaza of the Revolution. Within the ranks of the dissidence there is a great variety of opinions with respect to possible paths and outcomes of the transition. Although some of these routes diverge, there are numerous points on which all converge. The urgent need for political, social and economic changes is the common thread that runs through civil society.
Calls to end the harassment of dissidents, arbitrary arrests and politically motivated prison sentences, form a part of this common agenda. In addition, everyone agrees that Raúl Castro’s government has exhausted its solutions to pressing national problems.
To talk or to overthrow
Although many schemes have been offered to classify the Cuban opposition, most of the studies have focused on the political leanings of the groups within it. Some analysts have established generational breaks, between the historical opposition and much younger actors. In practice, however, it is not political colors or age that differentiate most markedly the dissimilarities between dissident organizations. A key point is the legitimacy they assign to Raúl Castro’s government in their agendas and their proposals for change.
Some maintain that dialog with the authorities could possibly lead to a non-violent transition. Within this line of thinking are distinguished figures such as José Daniel Ferrer, president of the Patriotic Union of Cuba, who believes that “dialog is possible, but from a position of strength within civil society.”
Others dismiss any attempt to deal with the regime, basing their posture on the fact that it was not chosen by a vote of the people in free and direct elections. They see the Communist Party as a kidnapper of hostages with whom there should be no negotiations under any circumstances. To negotiate or to overthrow seem to be the two poles around which current opposition forces are defined.
The United States embargo also constitutes a parting of the ways that defines postures and platforms. Within the Island, many dissidents argue that economic restrictions must be maintained to strangle the government. They believe that allowing fluid trade with the United States or allowing Americans to travel to Cuba would be a source of fresh air that would strengthen the General-President. José Luis García (known as Antúnez), an opposition leader from the center of the Island is one of the main champions of this position.
The great challenge of the people
The Cuban dissidence is denied any opportunity to access the mass media. This significantly limits its ability to broadcast its proposals and political programs. Instead of allowing them even one minute in front of the microphone, Raúl Castro’s government uses television and the official press to accuse them of being “mercenaries in the pay of the Empire,” or “tiny groups of no importance.”
Human rights activist Elizardo Sánchez, opposition leader Martha Beatriz Roque, Catholic layperson Dagoberto Valdés, and the Ladies in White group have all been frequent targets of these media stonings. From different perspectives, these social actors could be key in the years to come, along with several socio-cultural projects such as Estado de Sats, directed by Antonio Rodiles, which even attracts people involved in State institutions. To support these activities with a constant dissemination of information becomes vital, hence the importance of independent journalists and alternative bloggers.
In the current scenario, Oswaldo Payá’s death raises the question of the future of the Christian Liberation Movement, which has many members throughout the Island. That this political force manages to survive the death of its founder will demonstrate the maturity of the entire Cuban opposition.
On the other hand, Raúl Castro has co-opted some of the points that made up the agenda of his political opponents. The aperture for small private businesses, the ability to buy and sell houses and cars, and the leasing of vacant land in usufruct, are all part of the measures implemented by the government in the last four years. Such a scenario obliges the opposition groups to chart new horizons and to redefine their proposals.
“Long wait” — From Yoani’s TwitPics — Waiting for State Security to Free Antonio Rodiles.“YoaniFromCuba” is an English translation of Yoani’s tweets. (Thanks Mara!)
They freed Julio Aleaga, now we are waiting for Antonio RodilesAntonio Rodiles at the time of his arrest. Taken from PenultimosDias.com
Omar Laffita: First, greetings. I have seen your programs and I want to say that the interview with El Sexto has been one of the most enjoyable. So, what type of status, be it political or migration, do you have, to be able to develop all these events marked by controversial and pro-democratic context in the very heart of the dictatorship? You must know that simple for meeting in a Central Havana site for the “literary tea,” the government released waves of oppression against the Ladies in White, by paramilitary mobs who insulted, abused and hurt the women meeting there, and which on some occasions have ended with detentions and warnings. Have some of your events been repressed in such a brutal way? Congratulations on Estado de SATS!
Thank you, Laffita, for your question and the follow-up. It’s clear that State Security has established a form of selective action where it decides how to attack each individual or project according to its profile. In our case, the pressure has been great, but using strategies other than violent repression. Estado de SATS is not the only one on this list, there are other projects that have not been attacked with the violence suffered by the Ladies in White. I want to mention the monthly issuance, for more than a year now, of the magazine “Voices,” a project coordinated by Yoani Sanchez and Orlando Luis Pardo Lazo, or the periodic guidance offered by the Cuban Law Association, directed by the attorney Wilfredo Vallin. Nor is the work undertaken by the Human Rights Commission, under the direction of Elizardo Sanchez, attacked with the same violence, to cite some examples. I think that State Security itself tries to manage this selectively to generate conflicts between the different actors, an objective in which, so far, they have not succeeded.
After the second meeting held in 2011, I was cited by State Security, using as a pretext my migration status. My position was very clear, we are going to continue doing Estado de SATS, and the only way to stop me would be with my detention. This has been my position and I will not change it. We are simply exercising a very basic right that we will not renounce voluntarily.
State Security has tried to stop us using multiple methods. In a list published in DIARIO DE CUBA last year, we listed the acts of intimidation and the threats to the working team, participants, and public who attend. In front my house, which is the space where we hold the meetings, they have permanently installed two video cameras, and one or two police cars park at the corner or in front of my house every day. Next door are the offices of the National Aquarium, which has been practically converted into an operations and surveillance post for State Security, and in the midst of all this we continue doing our work. Lately, given the visibility of the project, State Security has tried to create distrust towards us. Oddly, this work of sowing distrust is undertaken primarily from outside the Island, taking advantage of the characteristics of some individuals. Within the Island, the effort is barely perceptible. The transparency of the debates and the diversity of the guests and the public will end up frustrating this new attempt.
With respect to my legal situation, as I explained earlier, after various citations and threats they withdrew my permit to reside abroad, currently I do not possess an identity card or any identification document, but I refuse to submit any kind of paperwork in support of this arbitrary act committed in order to pressure and blackmail me.
Saavedra: Hi Rodiles, thanks for continuing to challenge the winds and tides with Estado de SATS, a truly plural project for which I feel a profound sympathy and respect. I would like to ask you if you have invited or considered inviting members of the government and its multiple official mechanisms to participate in the different debates held. In any case, who have you invited? What have been the justifications offered for not attending? It would be very good to publish this data to make citizens more aware of how little interest the members of this nearly eternal (mis)government have in subjecting their policies and decisions to debate with civil society. A second question: Do you believe that the different groups that form the current Cuban opposition act with sufficient unity in successfully confronting the fierce government machinery? What do you think is lacking to form a common front? Thank you for your time. My salutations.
Thank you very much Saavedra. Yes, we have invited people from within the official institutions. We prefer to be discreet and not publish names because we feel we should respect the individual decisions of each person and also protect them. In totalitarian Cuba, the fact alone of sitting down to talk to us is a problem, and so discretion is a fundamental element of our work. However, this fear is waning every day, we see it in the new faces that are beginning to come to the meetings, which is, undoubtedly, a great step forward.
I think from the opposition, dissidence, or activism, we don’t work to find more common spaces. We live in a critical time and we have to have a clear voice with respect to our fundamental demands as civil society. I think this time is not far off. To try to join forces would be very immature, but to achieve a certain level of consensus on different points would have a major impact within and outside the Island. There is a great consistency between the demands that come from the activists and from society in general.
Rodrigo Kunag: Rodiles, I congratulate you for the success of a project that is fostering thinking, inclusion, and depth in the new Cuba. I have several concerns that perhaps can’t be condensed into a single question, but I will try not to go on too long. One of them is that you talk about the reasons for inviting Charles Barclay to debate, while knowing that this could be the ideal subterfuge that some Taliban blogger could take advantage of to accuse you of being annexationists and receiving money from the United States. On the other hand, do you believe that the Estado de SATS sessions have resonated with the Cuban population beyond a minority with access to computers? If so do you know of intellectuals or artists who avoid getting involved with you out of fear, even though they share your line of thinking?
The invitation was motivated by the topic under discussion. Previous to this meeting we had prepared a poetry reading with the participation of the Cuban poet Juan Carlos Flores, the American poet Hank Lazer, and the American saxophonist Raffo Dewar. To these last two it was “suggested” [by State Security] the night before, that they not come to the meeting. This was the reason we organized a debate about Cuba-USA cultural and academic exchanges. For this meeting we invited a Cuban academic knowledgable on the topic and currently inside the official institutions, who turned down the invitation, as well as Charles Barclay from the United States Interest Section [the quasi-embassy in Havana], Miriam Celaya, Julio Aleago and Alexis Jardines, all well informed on the topic of the sessions, having been previously associated professionally with universities and cultural institutions. The idea was to discuss with the greatest clarity and transparency, a topic that currently generates considerable debate.
An important aspect of our project is that we don’t adjust our thinking to the dogmas and constantly break with the visions imposed by the government; we think that as free individuals we must generate our own dynamic, our own budgets, that confront the archaic discourses that have been used for so long, and one of them is the common chorus that everyone who has anything to do with the officials of the U.S. Interest Section is a mercenary in service to a foreign country. Estado de SATS reserves the right to interact with everyone and is open to everyone.
And yes, of course, there are many people within the institutions, with whom we have had long conversations and who have shown us their desire to participate, but at the same time they prefer not to expose themselves. This situation will change, we are sure, but we have to keep working seriously to be able to tear down the barrier of fear. I am confident we will manage it, no one can hold back a society’s desire for freedom.
Luis Manuel González Viltres: Hi Rodiles, I have seen a lot of your programs and really like them and have learned some things that I now see more clearly, except there is one program where I don’t share your idea and that is compensation for those Cubans whose properties were nationalized with the triumph of the Revolution. My question is: Doesn’t it seem that it would be better to start back at zero without rancor and a new democracy? We know that from this side not everything has gone well, for example the bombs Luis Posada Carriles ordered placed in Havana hotels. Thank you in advance.
Thank you Luis Manuel. I think that a process of reconstruction like that needed in our country is very complex. The fundamental point is to achieve it with the greatest possible justice. The issue of property rights and compensation has been managed successfully in many transitions and I’m confident that we can also manage it.
I don’t believe the legitimate rights of some owners — who did not obtain their property through corruption or theft — to claim compensation should be mixed with justice for those who have committed violent acts.
The legal responsibility of all those implicated in bloody events, has ended up becoming one of the principal dilemmas in many transitions. Events such as the bombing of Cubana flight 455 in 1976 and the sinking of the tugboat “13 de Marzo” are pending issues that need total clarification and assigning of legal responsibility. The crimes and violations of human beings are not appropriate and we all must be very clear that human life is sacred and the laws must be applied with total rigor to those who violate this principle.
Ariel Perez: Rodiles, forgive my frankness but I have noted a descent from the initially high academic level of your project, where you talked about Cuban problems from a universal perspective, let’s say from globalization. Aren’t you afraid that Estado de SATS is becoming simply one cathartic space among others that the dissidence has had instead of a true “think tank” as is was conceived from the start? What do you think are the strengths and weaknesses of your project?
Thank you Ariel. I don’t share your view with respect to the decline from the initial level. I think we have discussed many issues and each one has had a distinct focus. There are topics that should be more ‘grounded’ than others and this is natural. We try through all the available media to find more universal visions, but at the same time to be rooted in our context.
It’s important to mention that we have never been recognized as a traditional “think tank” based in a democratic society, in our case we live in a dictatorship and our work has a unique character. Our interest runs to being a channel of thinking and democratic action, not just a space for analysis and proposals. We are an active part of the transition, not just observers.
The principal strengths of our project are transparency and plurality. Another, our desire to live in a distinct, modern, free country. This firm desire has allowed us to grow and sustain ourselves.
The weaknesses of the project: Our difficulty in communicating freely with the exterior, free access to fast internet, the economic and technological problems, the inertia and fear that still exist in Cuba.
AnonyGY: Antonio, I would like to know your email, in case we would like to be in contact. If you don’t want to publish it, I understand. How is a program of SATS organized and prepared? I want to congratulate you on the work you and your team do, I am envious that I can’t be there with you and attend these meetings. We follow them on your videos. You are my hope for change.
Thank you. The email is estadodesats@gmail.com. Our working group is made up of a small nucleus of friends. However each meeting relies on the participation of many people who come as volunteers to help the organization and its workings. Something that is important to highlight is the level of synchronicity that exists within the most active sectors of Cuban society. Every meeting we hold has been a magnificent occasion to see how people enjoy being a part of the new spaces of freedom.
The preparation is arduous and involves many aspects that come from multiple visits to the possible guests, the script, promotion, production, to finding and installing the technical media. Right now we see a very interesting process of collaboration among distinct independent projects which helps ease the great effort required to create a space like this, however the resources continue to be key to achieving a quality outcome. This collaboration with other projects helps us overcome our fierce limitations.
Ernesto Lopez: An immense and overwhelming majority of Cubans inside and outside the Island are in harmony with the same thought, which is nothing other than the rejection of the regime. But we act like our hands are tied. In your opinion, what can bring together the conscience, the thinking and the will to action of the Cuban citizen against the status quo? Perhaps communication, free information, free expression, association, political culture… Thank you.
Thank you Ernesto. It is difficult to define… I think the main thing that has to happen is that as Cubans we feel a profound necessity to live in freedom. I feel that this awakening is already happening, you go out in the street and you see that people are losing their fear of talking and the immense majority are beginning to openly express their discontent with the system. For a long time in Cuba there has been a hypnosis that we are beginning to emerge from, there are external factors strongly affecting this and one of them as been the outbreak, still small but very effective, of the new technologies.
J. Pereira: I send you an affectionate greeting from Europe, I would like to tell you that I greatly value the work you are developing in Cuba and I wish for it to be very fruitful in changing the role of civil society on the Island. Now the questions, from my point of view (so no one need feel offended), you are in a real monster; could you explain to us how it’s possible to develop your project in this hostile environment? Is it because we really are living in a transition on the Island? How does information about the activities promoted by Estado de SATS reach ordinary Cubans? Forgive me if these are questions you’ve already answered in other places. I believe that Estado de SATS has marked a point of inflection. A big hug.
As I explained earlier, I believe that State Security has decided to use different strategies for different groups. They use this discretional character also to create conflicts, facing a reality which is less docile every day.
In our case, from the beginning we have used new technologies as a method of diffusion and at the same time protection. We don’t just put the meetings on YouTube, but we also share them on DVDs and these circulate throughout the country. We are often surprised to receive emails from different areas of the Island from people who have seen at least one or two Estado de SATS meetings and who ask about the project, how they can get more information. The visibility is greater every day, and this clearly comes at a major political cost to the repression. The new technologies are vital tools for the work of civil society.
The Free Laplander: Dear Rodiles, first of all I want to thank you and your working team for this wonderful space you have created. Why are you being so critical of the system that has not intervened with force at the meeting site? When you go out in the street, do you feel popular support, even if just in the form of a complicit smile? Have you stopped to think about how far the limits of your daring go? Do you not believe that inviting so many people and the dissidence in general to your programs could allow the infiltration of spies? In a free and democratic Cuba what profession would you like to practice? Have you considered how many changes in the Eastern European countries have gone badly so that these mistakes won’t be repeated in Cuba? Many thanks for offering me some of your valuable and limited time.
To break into a home where public debates, exhibitions, and film screenings are held and where there is not incitement to violence nor resort to personal attacks, would have a high political cost. Violence against intellectuals, artists and an public interested in these topics would be an action condemned by many. But we have never ruled out a possible action of this type, we are prepared for it, I have already responded to another question that every meeting is held under the deployment of a State Security operation in the offices of the Aquarium next door to the house, and many attendees have suffered pressure on leaving the meetings from police posted nearby. To all this is added the surveillance cameras, listening devices, and tapped fixed line and mobile phones. We hope no one decides to intervene violently because the consequences would undoubtedly be unpredictable. We know there are always “masked” State Security agents within our space, some of them very bad actors, they come, take a lot of photos, show interest and ask apparently ingenuous questions, but this doesn’t bother us. The space is open to everyone and everyone wishing to participate can do so while respecting the rules of debate. There is nothing to hide and that gives us peace of mind.
On many occasions I’ve been agreeably surprised to be recognized by people on the street in the most unlikely places, a tire repair, a farmers market, the airport, people have come up to me and with a certain complicity asked me, in whispers, aren’t you from the SATS program” And they always compliment it, offer their points of view or topics to address and ask how to get the “programs,” as they call them. These have been very nice experiences, very good, that give us feedback, satisfaction and encouragement and confirm that the expansion of our work is happening, even though, of course, we have higher expectations.
Our purpose is very clear, to be part of the process of democratization of our country and to focus our efforts on that end. To constantly reinvent ourselves is one of our premises, as is maintaining a steady pace in what we produce.
We would love to expand SATS over the the whole Island, to help create spaces that promote democratic thinking from different perspectives. Something that fascinates me about modern societies is how broad they are, showing an incredible level of complexity. At some point I found it difficult to visualize this, but once I understood it it became a guide for our work.
Politics has always interested me, since I was a child I felt attracted to these issues and as I am a lover or controversy, I felt like a fish in water. My stays in Mexico and the United States greatly expanded my perspective on the world we live in, both countries are very different and there are important lessons to learn from each of them.
Sadly, in our country the possibility of engaging in politics has been erased. However, it’s clear that a new era is opening up and politics will be a new part of our society. I am one of those who think that politicians should serve for limited periods. Societies are very dynamic now and we need time to study them in order to understand them, the exercise of politics is something that envelops us and perhaps we don’t grasp certain changes in their entire magnitude.
The way to avoid the mistakes already committed in other transitions is to study them. Every country has its characteristics and ours is behaving somewhat differently than expected.
Who would have expected that the Church hierarchy would have become an ally of the government?
The principal of a transition, as a far-reaching process, is to include a great number of actors and citizens, and only in this way can it be successful. The chances of failure are many, particularly if we start from a situation as disastrous as the one in which we are living.
But if we ground ourselves in already proven knowledge, the results won’t be long in coming. Everything will depend on how we focus and in whose hands power ends up. If the governing elite and their heirs fail to transmute, the result will be disastrous.
Ernesto Gutiérrez Tamargo: Antonio, first of all I congratulate you because within Cuba you opened a space of freedom for civil society. Questions: Do you rely on any official or quasi-official to broadcast, edit or produce Estado de SATS? What does “Estado de SATS” mean? Do you define yourself as a dissident, an opponent or anti-establishment? Do you have some political economic project to develop Cuba in the present and future? Thanks.
Your question surprises me, to support our project would undoubtedly imply an act of self-destruction. The powers-that-be will never support spaces like ours, where freedom of thought, diversity, and transition to another system are the principal proposals.
Our objective is the democratization of our country and we work on it full time devoting all of our abilities to it.
From the beginning of SATS the support has been total. The first meeting in the summer of 2010 would have been impossible without the help of Omni Zona Franca and a group of intellectuals and artists who put all their efforts into the organization. And so it will continue, the support that we rely on is that of our many friends always ready to collaborate.
I define myself as a free man who lives in a dictatorship. In this context one becomes a dissident, opponent, or whatever qualifier is implied by the rejection of an imposed and arbitrary power.
I want to participate in the reconstruction of my country, bringing my knowledge and my work. In several Analysis Forum programs I commented on my vision of a future cuba. I would like to emphasize that I see Cuba as a country of democratic institutions. I have to confess that I am an enemy of messianism and I conceive of them as part of past that urgently needs to be buried. Messianism affects societies not only at the global level but also individuals, provoking a lack of autonomy that ends up destroying individual creativity and enterprise, basic elements of any mature society.
The work to change Cuba must begin to mobilize this variety of beings and characters who feel themselves a part of this nation and understand the urgency of establishing ourselves in a globalized context. A process of reinvention that must be driven from many angles.
Waldo: What are the links between your father Antonio Rodiles and your uncle, Division General Samuel Rodiles Planas, and Estado de SATS?
My father is Manuel G. Rodiles Planes. His connection with this project is that of spectator. At all the meetings he is seated in the front row, listening with great attention to the debates and discussions.
It is obvious that Samuel Rodiles Planas has absolutely no connection with our work, nor do we maintain any personal contact.
It is no secret to anyone that the so-called Cuban Revolution has been a process marked by family divisions because of differences in thinking and political activity. My family has been no exception. The unconditional politics of a demented caudillo has been the source of unimaginably huge damage to the Cuban family and to the entire society. So many painful conflicts, so many separations and estrangements to get to the disaster we are now living, it is a great sorrow.
Ricardo Palma: Stretching generalizations — such as “we would first have to meet everyone and get to know each other well,” or “we need a consensus” — to the extent possible, I would greatly appreciate your opinion about who would be the most suitable (or better yet, the most needed) to carry out the transformations of the Cuban political system, and why. Many thanks in advance.
Thanks Ricardo. That’s a very broad question. I think that the change has to be undertaken from civil society, ensuring the widest possible participation. It would be very helpful to create many spaces that foster an open dialog about the country we want. Cubans who live outside the Island will be critical. To insert yourself into an unknown world where you have to create your life, your relationships, where you must understand a distinct dynamic, are experiences of great utility and impossible not to take advantage of.
Ana Maria: In Cuba we see a situation of intellectual debate about our reality, such as you promote, we hear a critical discourse and an analysis without rhetoric about the culture and the political life from distinct groups and representatives of society, including elements from the official intelligentsia. But they are small groups that barely fill some classrooms. And yet Cubans in general behave primitively, seem reluctant to take seriously the reality that crushes us, are more given to not taking things seriously and nonsense, than to reflection and analysis of their existential condition. They prefer to practice the double standard than to face the truth, prefer to resolve their needs in the web of corruption and theft that defy the depressing system that forces them to be criminals. They prefer to participate in the repression, rat out others, join in repudiation rallies, and display moral turpitude rather than show respect and dignity for others.
My question, then, is: Can we count on such an insensitive mass, without civic and ethical principals, to undertake some logical and rational project that must recover the values that the people don’t possess? Do you think, in the short term, as Cubans undertake a social and political transformation, it would be possible to instill ethical values, to change the herd mentality, dismantle the negative inheritance of the Castro regime, the immorality, the simulation, and promote a new social psychology, a new mentality of civic and constructive ideas? Many thanks, I admire enormously the work you do for the country and the future.
Thank you Ana. When I listen to those who support a transition led by the government elite, I wonder if they are full of demented ingenuity or an obscene cynicism.
Here is my fear of our heading toward a transition agreed to by the powers-that-be, a corrupt and rather mediocre power. If this happened we would end up in a terrible scenario in the worst third-world style.
As you argue, the major damage has been to the individual. Cuba has bled and it is very sad. However, I think there is still very valuable human capital within the Island. On the other hand, many Cubans who have escaped this nightmare are willing to collaborate in rebuilding the country, which guarantees not only the possibility of investments, but also practical knowledge.
The work we do in the development of society will depend on the recovery of ethical values lost in this long process. Post-totalitarian Cuba is an enigma for everyone, but I confess my complete optimism, especially if we move along the path of a true democracy.
I want to thank everyone who sent their questions and the friends of Diario de Cuba.
By Antonio G. Rodiles, Julio Alega, Manuel Cuesta, Wilfredo Vallín
Introduction
The centralized and planned economy is closely linked to state ownership. For a process of economic decentralization to be successful, there must be a parallel process of decentralizing property.
The Cuban government has undertaken timid reforms with the objective of restarting the economy without making fundamental transformations. The lack of integrity, the rent seeking character, and the lack of transparency are the hallmarks of these timid reforms that are clearly only in pursuit of a transmutation of power. The facts are a demonstration that one year after their implementation the impact of these reforms has been very limited. Land has been delivered to farmers in usufruct as an emergency measure to end the chronic shortage of food.[1] The result, however, has not been as expected, among other reasons because many producers are wary of an offer to work land that does not belong to them and that can be withdrawn at any time. On the other hand, for years the Cuban State has preferred to import billions of dollars worth of agricultural products, and in particular American products, instead of providing greater incentives and free markets to domestic producers.
The law governing distribution of land in usufruct allows great discretion and equally great uncertainty, as we can see reflected in some of the articles of the governing statute, Decree Law 259 [1]:
ARTICLE 6: The area to be given to each person in usufruct, be it a natural or legal person, is determined according to the potential labor force, the resources for production, the type of agricultural production for which the land will be destined, and the agricultural production capacity of the soils.
ARTICLE 14: The termination of the usufruct granted to natural persons should be for the following reasons:
c) for ongoing breach of the production contract, previously determined by specialists;
f) for acts which would defeat the purpose for which the usufruct was granted;
h) revocation for reasons of public utility or social interest, expressly declared by resolution of the Minister of Agriculture or higher levels of government.
Subsequently, the Council of Ministers also approved the sale of houses and other measures related to housing properties [2]. These measures have been well below the actual needs of Cubans because in no case do they provide the ability to generate new housing stock, which is one of the most pressing problems facing Cuban society today. Also, they have recently rented some locations in a very poor state of repair to microbusinesses.
There are great similarities between the urban and rural scenarios in our country. Havana is not full of marabou weed, but there are thousands and thousands of dilapidated properties – many are complete ruins — and large areas of unoccupied land. The State alleges lack of resources to undertake restoration and construction of the housing stock and infrastructure, but these spaces constitute a wasted frozen capital that should be handed over to Cubans as soon as possible, for its fullest use. If we add to this the vacant land nationwide, we have a large number of urban and rural properties waiting to fulfill their social function.
The process of liberalizing property use and ownership should be initiated as soon as possible, not only for idle farmland but also for urban land and properties. It is essential to end the ambiguities with respect to the character of property, because this alone generates great inefficiency and corruption; property needs real owners. While the categories of owners in usufruct and tenancies may exist, there is no reason why that should be the basis for our economic structure. The existence of a legal framework that supports private property is a necessary condition for an economy that offers real opportunities to all participants.
This article first analyzes the different methods or liberalizing property ownership that were implemented in other countries, proposes an auction program that puts frozen resources at the service of Cubans, which would be extremely helpful right now, discusses the economic environment that must accompany these transformations, and offers some conclusions.
Foreign experiences in the liberalization of property ownership and their possible application in Cuba
A process of liberalization of property ownership undoubtedly touches highly sensitive fibers of the Cuban nation, inside and outside the island, and, therefore, facts and circumstances of the past and present must be carefully analyzed to achieve a broader consensus. Although it is necessary to undertake a thorough analysis of the issue of property related to State enterprises, in this paper we focus on addressing the case of idle lands and ruined properties.
In many countries, in recent decades, there have been processes of liberalization of property ownership, some with very encouraging results, while in others corruption, nepotism and patronage predominated. In the former Soviet Union, the process of liberalizing property ownership converted many members of the old government elite and dishonest individuals into new millionaires, creating great discontent and disillusionment among the population.
It is very important to understand the problems that have appeared in previous experiences and to evaluate the best options for our case. In the Eastern European countries, and in China and Vietnam, various mechanisms were applied; among the most popular were:
1) Restitution or compensation
2) Sale to the public
3) Sale to the employees
4) Sales en masse
As a first step it is essential to create institutions and rules to govern this complex process. To restart an economy in ruins, like ours, it is essential to guarantee a system of legitimate ownership. This will not be possible if a system of restitutions or compensations to the many owners who lost their properties due to unjust confiscations is not implemented in advance.
How did the process of claims function in the Eastern European countries?
“In East Germany two million claims were filed, cluttering up the courts for years and holding up thousands of construction projects and businesses because of the uncertainty of legal claims. Some restitutions occurred in the majority of the Central European countries, particularly of land and real estate, while restitutions for medium and large businesses were avoided.” [3]
In Hungary the law did not offer restitution, and primarily used compensation through government bonds that could be used to acquire shares in state enterprises as they were sold. [4]
Poland, for example, preferred compensation over restitution. Poles living abroad were eligible for restitution or compensation in the form of state bonds only if they adopted Polish citizenship and returned to Poland permanently to administer the reclaimed businesses and/or land. [5]
Each country had its own characteristics, and in our case it is very important to evaluate the great deficit in the housing stock and the majority of the population’s lack of capital to be able to participate in the purchase process. The issue is not only to liberalize property ownership, principally ruined and underutilized properties, but that this process truly yields a clear benefit and grows the economy of the country.
The experience of other countries tells us that these sales culminate in a short period, as people realize that this will be the only way to acquire properties relatively cheaply.
Let’s analyze each of these methods of privatization in more detail and look at how they could operate in the case of Cuba.
1) Restitution or compensation
The issue of restitutions in our country is controversial and unavoidable. For years there has been great controversy surrounding the claims and devolutions of the properties to owners whose ownership predated the year 1959. Gradually, some consensus is appearing, to shed light on a sensitive and delicate point.
We can separate these claims into two groups. The first group is those properties currently occupied by families, and the second is those properties that remain in the hands of the State.
As suggested by Professor Antonio Jorge:
“The right of permanent occupation for urban residential properties should be recognized in favor of the occupants or current residents. However, the former owners, as in the cases of other property, should be compensated” [6].
Teo A. Babun similarly agrees:
“Fortunately, most expatriate groups have recognized that the return of homes or residential properties is not feasible. The discussion can be restricted to non-residential properties. Looking beyond returning the properties, this simply means that any litigation would be limited to issues concerning the validity of the claims and the value of what was lost, and the compensation, if appropriate.” [7]
The economist Oscar Espinosa Chepe recommends:
“With respect to the return of property to former owners, we believe that the Cuban reality suggests different methods. First, in the case of dwellings, we are in favor of the mass granting of property, with all the responsibilities inherent in this, to those who are either the current lease holders or the people who enjoy the use of the property today without paying rent.
“With regards to the former owners, we agree that from the moral point of view the fairest approach would be to return these properties to their former owners, but given the time that has passed and the transformations in these properties, some of which no longer in exist, the best solution would be to pay these people, which could be done with bonds that could be used to purchase legal properties.” [8]
Property on the Malecon in Havana, reduced to a facade.
For his part, the economist Jorge Sanguinetty considers:
“The restoration of property rights in Cuba has two closely related aspects, restitution or compensation of old properties to their rightful owners and the creation of new properties. Both parts of the process represent the two poles of the recreation of the private sector of the economy, which would include the opening of new businesses and privatization of the state investments created by the revolutionary government, which were never private.
“This is a highly complex problem that ideally requires good prior preparation and a large administrative and executive capacity to permit rapid resolution of outstanding claims. If this problem is not resolved, the recovery of the Cuban economy could become significantly delayed because it would not have created the right environment to attract new investment to expand the productive capacities of the country and revive its economy.
“A group of properties that presents a special challenge is that of urban real estate, especially homes that were used for rental housing or housing direct for its owners that are now occupied by other families or individual tenants. It is obvious that the transition government cannot put all these people in the street at the time when it takes over an impoverished and indebted economy, and therefore one of the solutions that could be contemplated to recognize the property rights of prior owners is to provide instruments of debt, bonds or tax exemption certificates negotiable in the financial markets.” [9]
Compensations is a very useful method through which the government can make up for the damage to many original owners. Clearly, in our country, this method cannot be implemented without delays, given the serious economic constraints in which we live. But as the Cuban economy begins to open up there will be major opportunities to realize such compensations. However, there are methods such as exemption from taxes that could be effective in some cases, particularly where the investor is a former owner stripped of their property.
2) Sales to the public
Direct selling has two basic objectives. First, to increase State revenues, which currently are strongly depressed. Second, to immediately attract investors interested in jump-starting these underutilized assets, and bringing the know-how to do it.
It’s important to appreciate that Cubans living on the Island do not possess sufficient capital to buy property at current prices. Given that at the moment when sales begin there will be a lot on offer in an environment of scarce capital, prices should not reach very high levels, enabling many citizens to become owners of new spaces.
In this situation it is essential to contemplate the issue of corruption. In the former socialist block, foreigners and other buyers with suspect capital, such as corrupt officials, organized crime and new “men of business,” had the largest sums of money to participate in such sales.
Another important issue is the efficiency of the process, because the proceeds from the sales should never report more losses than gains to the government. The valuation agency created by the German government collected DM 50 billion through sales, and spent no less than DM 243 billion in the privatization process. [3] In that case the sales were heavily concentrated in businesses in the former East Germany.
3) Sales to employees
The sale of commercial space and services to employees at preferential prices is an option that is a priori attractive. However, it can create serious problems of corruption, especially when managers or executives are associated with some group in power that allowed them to obtain these personal benefits.
From a political standpoint this variant is popular among the population. But there are also some disadvantages, as the companies often have deficient management, given that the new conditions of a market economy differ radically from those of a centrally planned economy. The property rights may become diffuse and could be usurped by the directors.
In some countries, this was an administratively quick method of sale, but on the other hand the workers and directors blocked the process.
There are different possibilities, like that applied in Russia, where 20% of the shares were given to the directors, 40% to the employees, and the other 40% sold directly. [3]
4) Sales en masse
This method is implemented through the distribution of bonds or “vouchers,” for free or for a nominal price, which can be exchanged for shares of the companies or properties sold. This allows rapid sales, not only of medium but also large-sized businesses, and offers citizens the possibility to become new owners, which was widely accepted.
This form of release facilitates a major distribution of direct sales. However, due to the dispersed ownership, obstacles appeared in the direction and management of the companies.
In countries such as the Czechoslovakia investment funds were created, which were still closely linked to the State-owned banks making null, to a large extent, the final result of the process.
This building collapse in Havana killed 3 and left one more vacant site in the capital. Source: www.hispanicallyspeakingnews.com
Proposal to release idle lands and ruined properties
Our proposal seeks to make available as soon as possible spaces that represent frozen capital and that have been reduced, for years, to mere ruins, tenements full of rubble, or vacant land covered with marabou weed. These properties should have Cubans as the main beneficiaries, principally those living on the Island, although clearly they should be part of the attraction for foreign investors. Their exploitation will allow many other sectors to receive a strong impetus from the market that would be generated.
The cornerstone of the proposal is to auction all the vacant lands, as well as dilapidated or underutilized urban properties. The auction process can be planned in three consecutive steps:
a) Sale to nationals living in the country
b) Sale to nationals not living in the country
c) Sale to foreigners
Note: This method ends up being a mix of mass and direct sales.
Let’s look at some of the practical procedures it will be necessary to define:
1) Create the appropriate committees, charged with organizing and executing this auction process.
2) Develop a clear definition of the properties to be auctioned.
3) Prepare a census of all the properties, tenements and land that may be subject to auction.
4) Publish the properties and lands with their characteristics and minimum prices.
5) Establish periods for each one of the three stages.
6) Establish a limit, for the number of properties to acquire, and their dimensions and values.
7) Publicize the date, as well as all the information related to the auctions. They will be hosted by municipalities and announced a minimum of 30 days in advance.
8) Offer a special price to all those who now hold lands under usufruct.
9) After the sale a database must be prepared with all the information regarding the sales and final price at auction. All this information should appear in physical copies as well as on the Internet.
10) The entities responsible must keep control of all the income derived from the sales and the use of these funds in their communities.
Once citizens have the title deed of the property in their possession, they can sell the property acquired if they wish. This will allow them to obtain some capital immediately, which can be reinvested or used at their convenience.
Compensation must be established for all those whose were deprived of their properties unjustly, and the most effective methods for this process must be considered, assessing the economic conditions of the country. This compensation, as suggested by some experts, could range from cash to the granting of bonds and shares.
Environment for the full operation of the process
The creation of an enabling economic environment is a key factor to ensure that the process of releasing property has the desired effect. A new system of property ownership does not, in itself, constitute a guarantee of success for such transformations. Other factors are needed to guarantee that the market mechanisms function efficiently. To mention some of them:
1) Legal framework
The first aspect that must be prioritized is the creation of a legal framework that guarantees full rights of ownership. It should create mechanisms for the quick transfer of property titles. Another aspect that should be given special attention is not to allow the process to become, in one way or another, a piñata used by influential groups, such as government officials, leaders of the Cuban Communist Party (PCC), or chiefs of the Cuban military apparatus.
Laws must also be established that guarantee a competitive market. It is important that the new entrepreneurs can fully develop the potential of the newly acquired properties.
2) Financial market
The creation of a financial market is an essential element for the development of a modern economy. It is important to create an agency charged with the sales process that displays each transaction in a transparent way, as well as the final destination of the funds received by the government.
It is necessary to begin with the granting of credits to new microenterprises. State companies should not provide soft credits, which hinder the growth of the incipient private sector. The use of soft credits could encourage alarming levels of inefficiency and corruption.
3) Infrastructure
The State must free up the issuance of licenses for manufacturing, and end its monopoly on the production of construction materials, which would ensure that the real estate sector would take off. It must end the monopoly on imports and exports and liberalize these sectors. This would allow a new market to be supplied with products lacking in the national market, materials which are indispensable to jump-start construction.
On the other hand, it is important to stress that this entire process must be undertaken with due respect for the norms of urban planning.
The liberalizing of these resources would be an initial step to begin to reverse the state of deterioration suffered by an immense number of buildings throughout the country. There is an urgent need to at least halt the advanced state of destruction of the national infrastructure. The resources acquired by the State in this sales process should be used immediately for this purpose.
4) Transparency
Transparency has become an essential element of contemporary societies. It is vital that citizens have full knowledge of and participation in a process of such transcendence as a change in the structure of ownership. Mechanisms should be created so that citizens have all the data on the properties and lands sold.
The use of new technologies is a recourse that can play a very important role in this transparency. Unlike 20 years ago, when there was no Internet, today it is possible to consult, from a private computer, all the data pertaining to governments and their institutions; this, without a doubt, greatly reduces the levels of corruption.
5) Tax system
A modern tax system is an essential element that guarantees not only that the State can receive the necessary resources to maintain its social obligations, but also that it will not put the brakes on the growth of the new entrepreneurial sector.
The taxes must be reasonable and easy to pay, and tax evasion must not become the norm. An interesting example of a tax system was implemented in Estonia after its separation from the former Soviet Union, when it adopted a uniform tax of 26%.
Conclusions
The cornerstone of any reform in our country should be the transition to a democracy and the reestablishment of all individual rights. The economic transformations should be directed to stimulate private initiative. It is essential to prevent small corporate groups from being able to exercise a monopoly on the Cuban market, which would accentuate the exhaustion and pessimism within Cuban society, risking a worsening of the grave social problems already facing us.
Every entrepreneur should be able to use the tools of a free market economy, otherwise the failure of the reforms is predestined. To think of a transformation in the style of China, in which political rights are of no importance, makes no sense in our country. Cuba should not be seen as a maquiladora – a country of off-shore factories employing low cost labor.
The new "self-employed" in Cuba. Source: www.primaveradigital.org
The economic transformations should be directed to create a new sector of micro, small, medium and large enterprises. It is unacceptable to continue to live in conditions or penury and ruin, when the country has the necessary potential to be a prosperous and thriving nation. The economy has to be immediately open to the productive sector and to make this happen the property ownership system needs to be fully implemented.
To ensure a greater distribution of wealth it is essential that Cubans hold their respective titles, which creates the possibility of granting credits among other benefits. In parallel, it is necessary to create a financing system that allows taking advantage of the process of liberalization. This, by itself, does not guarantee economic growth if the appropriate economic environment is not developed.
If Cubans do not have the opportunity to acquire these dilapidated properties, empty tenements and idle lands, we can expect that in a not-too-distant future they will be negotiated in a non-transparent way with large businesses without any bidding process. In this case we will see a vast majority of Cubans playing the role only of spectators, left completely outside the scheme of property ownership. Experiences elsewhere show that in these cases the bribery of state officials ends the legitimate yearnings of the population to possess some capital or property, to enter the new market reality, and this can lead directly to a failed transition.
The new "self-employed" in Cuba. Source:blog.mycubanstore.com/
On the other hand, the type of social dynamic that the current government is generating in the short, medium and long terms should be looked at with particular concern. The currently authorized forms of “self-employment” only allow Cubans to participate in marginal third-world-style activities such as street hawking, food preparation, kiosks selling schlock goods, and other micro-enterprises. With the exception of bed-and-breakfasts and small family restaurants – which do serve tourists, but at the margin – none of these activities link to any of the profit centers of the economy, nor are they supported by wholesale markets, and they do not have connections of any kind to global commerce, all of which remain in the hands of the State and, significantly, in the hands of the Revolutionary Armed Forces.
Furthermore, street vending and similar “professions” are an extension of the existing informal sector – i.e. black market – already overdeveloped as a survival strategy in our country. It is important to bet our future on well-developed fully established businesses that can support an entrepreneurial class and a broad tax base, rather than grow an army of tax evaders.
Thus, the current track is an extremely negative policy, designed to keep Cubans permanently at the margins of the country’s economy. Studies in other countries demonstrate the deleterious impacts of this type of economy.[10]
We should all be very aware that whatever path is followed at the current moment will generate the economic structure of our economy for years to come. We have the resources and the human capital to have a “first-world” economy, why shouldn’t we create one?
Bibliography
1) Decree Law 259. Official Gazette No. 024. 2008.
2) Decree Law 288. Extraordinary Official Gazette No. 035 of November 2, 2011.
3) Aslund, Anders. Building Capitalism. Cambridge University Press.
4) Property Compensation Law to take effect in Hungary, BNA International Business August, 1991.
5) Sariego, Jose M and Gutierrez, Nicolas J. Righting Wrongs Old Survey of Restitution Schemes for Possible Application for a Democratic Cuba to. April 2, 1989, p.1.
6) Jorge Antonio. Privatización, reconstrucción y desarrollo socioeconómico en la Cuba post-Castro (Privatization, reconstruction and economic development in post-Castro Cuba).
7) Babun, Teo A. Preliminary study of the Impact of the Privatization of State-owned Enterprises in Cuba.
8) Espinosa Chepe, Oscar. La situación actual de la economía cubana y la posible utilización de la experiencia eslovaca en el tránsito a una economía de mercado (The current situation of the Cuban economy and the possible use of the Slovak experience in the transition to a market economy).
9) Sanguinetty, Jorge. Cuba realidad y destino (Cuba reality and destiny). Editorial Universal.
10) Perez Calderon, Rebecca. Algunas consideraciones sobre el comercio informal en la Ciudad de México (Some thoughts on informal trade in Mexico City).
The "Guidelines" go on sale in Havana at a token price (even for Cubans). Photo: EFE/Alejandro Ernesto
By Antonio Rodiles
Introduction
The Sixth Congress of the Cuban Communist Party just concluded, leaving a trail of questions to be clarified. Most of the televised debates turned into semantic discussions, while a few dealt with practical mechanisms to achieve stated objectives. Listening to the speeches, which at some moments were limited exclusively to mentioning desires, I had the impression that they referred to the construction of some kind of Frankenstein, full of patches, fixes and half-measures, and not to a socio-economic system of in the 21st century. The Congress definitely fell far short of the expectations generated by the government itself.
It was surprising to observe that issues of vital importance, such as the international context, the flow of information and knowledge, Cuba’s inclusion in the global economy, internet use in our country, the role of Cubans from the diaspora in the future of the country, were completely ignored. The issue of the legal framework, which must support any economic transformation, was another of the notable absentees. The phrase “property rights” was never mentioned, nor was the immediate need to make transparent the “process of privatization” which is implicit in the economic plan.
For years in our country a process of privatization has been occurring which falls principally on specific corporate groups. These groups operate under a market system and sell their products and services in hard currency. While they lack ownership titles, they enjoy broad autonomy. However, Cuban citizens lack necessary information about these corporations and their economic dynamics. It is very important to note that in creating these corporate groups, both national and joint ventures, political loyalties have played an essential role, along with ties of family and friendship.
I think, as a first step, we have to put all these issues on the table in order to understand and discuss in great depth this moment in which we are living as a nation. Any transformation process must be undertaken with the greatest transparency and social consensus.
In this article I address the issues of property rights, privatization and the legal framework that must support transformations in the short, medium and long term. I compare the existing Constitution with the Economic and Social Policy Guidelines for the Party and the Revolution (“Guidelines”), dated April 2011 and publicly released in May of that year, in advance of the Sixth Party Congress. The 41-page Guidelines contain 313 numbered points addressing health, education, sports, culture, agriculture, industry, tourism, transport, housing and other issues.
At the end of this paper, I also look at the experiences of Vietnam, China and the former Soviet Union, and finally I offer some comments and conclusions.
Property Rights, the Constitution and the Guidelines
The Universal Declaration of Human Rights[1], to which Cuba is a signatory, speaks of property rights as a basic human right. The statement reads:
Article 17.1: Everyone has the right to own property alone as well as in association with others.
We must not forget that when we speak of property rights this implies:
1) Control of the use of the property.
2) The right to any benefit from the property, including rent.
3) The right to transfer or sell the property.
4) The right to exclude others from the use of the property.
In the case of the Cuban Constitution property rights are mentioned, but with clearly defined limitations subordinate to the socialist character.
After the fall of the Berlin Wall in the 1990s, the exact meaning of the term “socialism” was no longer clear. Traditionally, socialism is understood as: a system with a centralized and planned economy in which the State has ownership of the means of production and the common goods. In socialism “private” property has a meaning distinct from that accepted in liberal democracies, because the “owners” cannot exercise all the prerogatives mentioned above.
Due to all the changes that have taken place in our country in the last two decades, and the evident contradictions between the traditional definition of socialism and the current situation, we must ask ourselves: What does the current Cuban government mean by “socialism”? It is important to remember that it is this core concept of the Constitution in force since 2002.
The Constitution of the Republic of Cuba [2] states:
ARTICLE 14. In the Republic of Cuba rules the socialist system of economy based on the people’s socialist ownership of the fundamental means of production and on the abolition of the exploitation of man by man.
In Cuba also rules the principle of socialist distribution of “from each according to his capacity, to each according to his work.” The law establishes the provisions which guarantee the effective fulfillment of this principle.
ARTICLE 15. Socialist state property, which is the property of the entire people, comprises:
a) the lands that do not belong to small farmers or to cooperatives formed by them, the subsoil, mines, mineral, plant and animal resources in the Republic’s maritime economic area, forests, waters and means of communications;
b) the sugar mills, factories, chief means of transportation and all those enterprises, banks and facilities that have been nationalized and expropriated from the imperialist, landholders and bourgeoisie, as well as the factories, enterprises and economic facilities and scientific, social, cultural and sports centers built, fostered or purchased by the state and those to be built, fostered or purchased by the state in the future.
Property ownership may not be transferred to natural persons or legal entities, save for exceptional cases in which the partial or total transfer of an economic objective is carried out for the development of the country and does not affect the political, social and economic foundations of the state, prior to approval by the Council of Ministers or its Executive Committee.
The transfer of other property rights to state enterprises and other entities authorized to fulfill this objective will be prescribed by law.
ARTICLE 24. The state recognizes the right of citizens to inherit legal title to a place of residence and to other personal goods and chattels.
The land and other goods linked to production in the small farmers’ property may be inherited by and only be awarded to those heirs who work the land, save exceptions and as prescribed by law.
The law prescribes the cases, conditions and ways under which the goods of cooperative ownership may by inheritance.
ARTICLE 25. The expropriation of property for reasons of public benefit or social interest and with due compensation is authorized. The law establishes the method for the expropriation and the bases on which the need for and usefulness of this action is to be determined, as well as the form of compensation, taking into account the interest and the economic and social needs of the person whose property has been expropriated.
In the Guidelines [3], the issue of private enterprise and properties is addressed as follows:
General Guidelines section
The socialist planning system will continue to be the main national management tool of the national economy. Its methodology and organization and control must be modified. Economic planning will influence on the market and take into account its characteristics.
The management model recognizes and encourages socialist State-owned companies – the main national economic modality – as well as the foreign investment forms described in the law (e.g., joint ventures and international association contracts), cooperatives, small farming, usufruct, franchisement, self-employment and other economic forms that may altogether contribute to increased efficiency.
In the forms of non-State management, the concentration of property in the hands of any natural or legal person shall not be allowed.
Section on Cooperatives
25. Grade 1 cooperatives shall be established as a socialist form of joint ownership in various sectors. A cooperative is a business organization that owns its estate and represents a distinct legal person. Its members are individuals who contribute assets or labor and its purpose is to supply useful goods and services to society and its costs are covered with its own income.
26. The legal instrument that regulates the cooperatives must make sure that this organization, as form of social property, is not sold or otherwise assigned in ownership to any other cooperative or any non-State organization or any natural person.
27. A cooperative maintains contractual relations with other cooperatives, companies, State-funded entities and other non-State organizations. After satisfying its commitment with the State, the cooperative may pursue sales operations free from intermediaries and in accordance with the business activity it is authorized to perform.
28. Subject to compliance with the appropriate laws and after observance of its tax and contribution obligations, each cooperative determines the income payable to its employees and the distribution of its profits.
29. Grade 2 cooperatives shall be formed and the partners of which shall be Grade 1 cooperatives. A Grade 2 Cooperative shall represent a separate legal person that owns assets. The purpose of this cooperative is to pursue supplementary related activities or conduct operations that add value to the goods and services of its partners (such as production, service and marketing operations) or carry out joint sales and purchases for greater efficiency.
In the points above it is necessary to clarify certain aspects such as:
a) Under what criteria would the formation of new company be permitted and who would be in charge of the selection and decision process?
b) There is a strong contradiction between maintaining central planning and permitting the development of the market. What will be the practical mechanisms to implement central planning without dismantling market dynamics? Do such mechanisms exist?
c) Will a system of consultation be created, citizen directed, to review contracts with domestic and foreign business groups?
d) Is it contemplated to include investments from Cubans living outside the island among the possible investments?
e) Will the issue of confiscations from Cubans who were not corrupt and who were not large landowners — who obtained their possessions and property as their fruit of their own or their family’s labor — be addressed?
f) How will the criteria forbidding the accumulation of property be applied? Are joint venture or national corporate national groups such as Cimex, Habaguanex, Cubatabaco, Gaviota, Cupet, among others, contemplated within the restrictions regarding the accumulation of property and capital?
The constitution defines the economic dynamic in the following terms:
Article 16: The state organizes, directs and controls the economic life of the nation according to a plan that guarantees the programmed development of the country, with the purpose of strengthening the socialist system, of increasingly satisfying the material and cultural needs of society and of citizens, of promoting the flourishing of human beings and their integrity, and of serving the progress and security of the country.
The workers of all branches of the economy and of the other spheres of social life have an active and conscious participation in the elaboration and execution of the production and development plans.
Article 17: The state directly administers the goods that make up the socialist property of the entire people’s, or may create and organize enterprises and entities to administer them, whose structure, powers, functions and the system of their relations are prescribed by law.
These enterprises and entities only answer for their debts through their financial resources, within the limits prescribed by law. The state does not answer for debts incurred by the enterprises, entities and other legal bodies, and neither do these answer for those incurred by the state.
Meanwhile in the Guidelines we read:
5. Planning shall include State-owned companies, the Government funded entities, the international economic associations, and also regulate other applicable forms of non-State management. Planning shall be more objective at all levels. The new planning methods will modify economic control methods. Territorial planning shall take into consideration these transformations.
8. The increase in the powers vested upon entity managers shall be associated with their higher responsibility for efficiency, effectiveness and for their control of labor utilization, financial and material resources, coupled with the requirement on the executives to account for their decisions, actions and omissions that lead to economic damages.
Section on the Business Sector
14. The internal finances of companies shall not be intervened by any unrelated entity. This intervention shall only occur in compliance with legally established procedures.
16. Each enterprise shall control and manage its working capital and capital expenditures within the limits allowed by the plan.
17. The State-run companies and cooperatives that steadily post losses and insufficient working capital in their balance sheets or are unable to meet their obligations with their assets, or whose financial audits render negative results, shall be subject to liquidation or converted to any other form of non-State organization in compliance with the regulations on this matter.
19. Subject to observance of their commitments with the State and compliance with the existing requirements, the companies may use their after-tax profits to create funds for development, investments and incentive payments to their workers.
21. Each company and cooperative shall pay to the Municipal Administration Council with jurisdiction over its business operations, a territorial tax, that will be set centrally according to the specific characteristics of each municipality, as a contribution to local development.
Section on Cooperatives
25. Grade 1 cooperatives shall be established as a socialist form of joint ownership in various sectors. A cooperative is a business organization that owns its estate and represents a distinct legal person. Its members are individuals who contribute assets or labor and its purpose is to supply useful goods and services to society and its costs are covered with its own income.
26. The legal instrument that regulates the cooperatives must make sure that this organization, as form of social property, is not sold or otherwise assigned in ownership to any other cooperative or any non-State organization or any natural person.
27. A cooperative maintains contractual relations with other cooperatives, companies, State-funded entities and other non-State organizations. After satisfying its commitment with the State, the cooperative may pursue sales operations free from intermediaries and in accordance with the business activity it is authorized to perform.
28. Subject to compliance with the appropriate laws and after observance of its tax and contribution obligations, each cooperative determines the income payable to its employees and the distribution of its profits.
29. Grade 2 cooperatives shall be formed and the partners of which shall be Grade 1 cooperatives. A Grade 2 Cooperative shall represent a separate legal person that owns assets. The purpose of this cooperative is to pursue supplementary related activities or conduct operations that add value to the goods and services of its partners (such as production, service and marketing operations) or carry out joint sales and purchases for greater efficiency.
Territories
35. The Provincial and Municipal Administration Councils will discharge State duties and will not intervene directly in the management of any business.
36. The state functions exercised by provincial and municipal sectorial offices will be defined in relation to the functions discharged by the Central Government Bodies, and the applicable scopes of competence, links, operating rules and working methodologies of each authority will de identified.
37. The implementation of local projects by Municipal Administration Councils, in particular for food production, is a work strategy for municipal food self-reliance. Mini-industries and service centers must be promoted on the principle of financial sustainability as a key feature that must be harmoniously consistent with both the municipal goals and the objectives of the national economic plan. Upon their completion, the local projects will be managed by organizations based in the municipality.
Within the articles and the policy guidelines quoted above are apparent contradictions. For one thing, it becomes apparent that there is a need to end the process of centralization and nationalization that has produced high indicators of inefficiency in the Cuban economy. But in parallel, due to the desire of the nation’s leadership to maintain economic control, affirm that there could be a new form of central planning adapted to the new context. That is, the Guidelines speak of the need to take the market into account, but at the same time reject it. This ambiguity will create discretion in applying the law, becoming one more stimulus for corruption.
Any modern economy must have a basis in clear and transparent rules, which encourage the entrepreneurial spirit in society, and not on arbitrariness. This thesis, which is very simple, is the basis of any modern functioning society. It is essential that an atmosphere of trust and confidence exists for both domestic and foreign investments. As well explained by the Peruvian economist Hernando de Soto, there is a strong correlation between the clear establishment and enforcement of property rights, the rule of law, and efficiency in the functioning of free markets [4].
Unfortunately, in our country only select business groups, many of them associated with the Revolutionary Armed Forces (FAR) and the Ministry of the Interior (MININT), enjoy the benefits of operating under a market economy, creating monopolies that control the entire Cuban market.
In contrast, the ordinary Cuban is allowed to open only small cafes, tiny businesses almost medieval and artisan in nature, stalls selling all sorts of trinkets, to which the regime applies exorbitant taxes and a series of limitations that don’t permit any growth. In these stunted freedoms, professional services – a sector vital to any modern economy – remain excluded.
Experiences of Vietnam, China and the former Soviet Union
As a point of comparison it is very important to analyze the processes occurring in these countries with similar experiences, as they can offer us invaluable lessons.
Although the core of the changes in these countries was the liberalization of the economy coupled with the emergence of new forms of property, it is clear that the processes of privatization have been problematic. Nepotism, bribery, the lack of job guarantees for workers, violations of environmental rules, among other ills, have been common factors in the transformation processes of these countries.
At the starting point for the economic changes in these nations, collective and state property took priority. In the case of Vietnam, after reunification in 1976, the government gave itself the task of eliminating all forms of private property, an approach it corrected after facing a profound crisis. One of the first steps in the later economic reforms was to break the state monopoly on property. This occurred in 1986 when restaurants and shops were allowed to open. As early as 1995, in the admission document to the World Trade Organization, we can read:
“State-owned, collective, private individual, private capitalist, state capitalist and foreign investment property are all equal before the law. All businesses operating legally in the territory of Vietnams and/or under its laws are recognized and protected under its laws, including protection against nationalizations.” [5]
In the case of China, the privatizations began in 1979 when the collective communes were replaced by family farms.[6] Local businesses also appeared, managed by the component governments themselves. Within the latter there were different categories:
1) Private but registered as collectives, popularly called “using the red cap.”
2) Those which were authorized but had to pay a bonus to the authorities at the end of each year.
3) Those over which the authorities exercised fierce control.
The use of soft credits on the part of state-owned enterprises has been one of the common problems of the Asian giant. It’s been said that in socialism with Chinese “characteristics,” the “characteristics” have worked but not the socialism.
The case of the former Soviet Union and its controversial process of privatization also offers us an instructive example.[6] As it began the transformations toward a free market, one of the primary problems was the almost complete absence of a definition of property rights. As a consequence, there were no clear rules on the use of property and businesses, resulting in high levels of corruption. In other cases, disputes between various actors trying to make use of the same property resulted in no one’s being able to take advantage of it, and left the involved companies directionless.
At the moment of privatizations there were various protagonists involved in the process:
1) Workers
2) Managers
3) Ministries
4) Local Governments
5) Central Government
However the managers and bureaucrats within the ministries exercised a strong influence through the strategic management of the companies and were able to count on networks of connections that allowed them to take control over production and marketing.
As the process of decentralization advanced the ministries could no longer dictate the policies the companies must follow. The planned economy, the fulfillment of the plans and the assignment of resources collapsed, while the sale of products in the free market was gaining ground. The managers gained autonomy and control over what they produced, and at what prices and to whom to sell their products, the latter based principally on their personal relationships.
On the other hand, the ministries tried to maintain control over imports and exports through the issuing of licenses. This new economic design was in the hands of the Party nomenklatura, military elites, and the new oligarchs who competed for power with the old elites.
The State tried to maintain control of the most profitable sectors, only accepting privatization when it believed it would exercise control over the companies. Local governments gained power in the management of their pieces of land, exercising control over vital public services such as water and electricity, among others, which they used to exert a strong influence over firms and they began to demand their share, reaping huge benefits from the process of privatization.
One of the strategies, taking advantage of the lack of transparency, was the creation of parallel firms or cooperatives, even within a single firm. Such private firms or cooperatives bought the production at low or controlled prices and sold it according to supply and demand. This allowed the managers to garner personal earnings, and in turn to provide wage increases for the workers.
All these maneuvers were possible because of the laxity of the laws and because the local authorities colluded with the central government. The managers received funds from other businesses or commercial banks with which they could buy their own companies at low prices. In this modality, known as “spontaneous privatization,” consistent elements included bribery, the use of political and economic alliances, the use of public funds and the returning the benefits to many Party cadres.
In some cases this process was hampered by conflicts of interest between different actors. Conflicts between local governments and managers were common, because the former saw the possibility of managing these businesses from the State and taking their own profits.
Another very popular form of privatization was through the use of bonds, as conceived by the American economist Milton Friedman. This method was more common in the case of small enterprises [7] and was also known as mass privatization. The method consisted in issuing check to the population for the value of the companies; it was a quick process and achieved a more equitable distribution. However, the problem with this method was that it was impractical for the future management of the companies, because the property was dispersed and very difficult to govern. With this method it was initially possible not to divide the companies among small groups, but in some cases certain tricks to hold onto the companies were used later. Among these was to bankrupt the companies, so as to be able to buy the stock at very low prices.
Other methods of privatization were:
1) Open sales
2) Restitution
3) Settlement
All these methods had their own advantages and disadvantages corresponding to the conditions that characterized each country. But the key lesson is that whatever method is applied it must take into account a knowledge of the specific conditions of each place and there must be a basic consensus for its application. A complex process should never become a piñata that ends with the discredit of the political system and institutions.
Comments and Conclusions
As can be seen, many of the proposals contained in the Guidelines are similar to the dynamics discussed above. Some of them operate unofficially, that is they are quasi-legal, while others operate “illegally.” Thus, we have more than a few problems of corruption which have touched the senior management of companies.
As Cuban citizens, we do not have mechanisms that allow us to use our own resources, or to manage the finances of firms or companies. Despite the recently created position of Controller General of the Republic, citizens do not have access to the reports and audits of this government agency.
Specific cases remain murky and demonstrate to us the urgency of undertaking real changes that guarantee the transparent use of our resources. Notable examples include: General Acevedo, who was in charge of Civil aviation and who was charged with selling businesses cargo space on commercial airlines and pocketing the money; former Minister of the Food Industry, Alejandro Roca Iglesias, sentenced to 15 years for corruption; the Chilean businessman Max Marambio, sentenced in absentia to 20 years in prison for corruption associated with his Rio Zaza company; Pedro Alvarez, former head of the state food company Alimport who, on being investigated for corruption, sought refuge in the United States; Manuel Garcia of the cigar company Habanos, jailed for large-scale graft; and the wholesale arrest of the directors of the Moa nickel plant, among many others.
I think it is opportune and necessary to point out the mistake we make when we speak of subsidies on the part of the Cuban State. While there is no clear definition of the concept of property, the Cuban State must equitably share all of its resources. It would be an invitation to many — starting with president Raul Castro who, on multiple occasions, has referred to the State as an abstract entity, generator and provider of goods and wealth, followed by vice president Ramiro Valdes, who speaks of the Daddy State as one might speak of Santa Claus, and continue through several lower level functionaries who repeat manufactured phrases – to understand the first socialist Constitution in our country, which established the whole people as the ultimate owner of all goods and property.
If the Cuban State, with Raul Castro at the head, wants to be done with the so-called egalitarianism, it should take the first step to establish property rights in the Constitution, otherwise we will continue with a system that supports the collective use of wealth but which, in the end, allows its use and enjoyment by only a few.
I would like to pose some questions to which — as a citizen of this country with all the rights granted to me under the Constitution – I do not have answers and which show the ambiguity of socialist property.
Who knows the real budgets of the Revolutionary Armed Forces (FAR), the Ministry of the Interior (MININT) and their groups of companies?
What citizen can review the investments and earning of the Office of the Historian of the City or of the Cuban Export-Import Corporation (CIMEX)?
Where can one review the finances of the telecommunications company ETECSA?
Where are the data about the income received by Immigration from the exorbitant and unjust costs imposed on citizens?
Does anyone know the location of all gold and silver objects bought from citizens – at terribly low prices – or what the proceeds from their sale are invested in?
How much will we invest in golf courses and now will their profits be managed?
These questions and many others are in clear and urgent need of answers. Legal mechanisms also need to be created that allow us as citizens to establish legal responsibilities, from the President of the Republic to the simple public official, when there is a mishandling of our assets and resources.
In a society where there are no clearly defined property rights, the necessary transparency to manage the society’s wealth and resources is lacking. If we want to end the egalitarianism and undertake a process of privatization in any one of its variants as a necessary measure to emerge from the crisis and stimulate our economy, this must be accomplished with total transparency and within the appropriate legal framework and with the participation and consensus of Cubans.
It is also necessary to be able to examine and review, retroactively, all existing contracts, otherwise corruption will continue to grow to unimaginable levels.
The Constitution must be changed, along with the corresponding laws consistent with the real interests of the nation and the global context in which we live. The constitutional structure and respect for property rights, as well as the legal framework to support and encourage the establishment of private enterprise are necessary and indispensable elements to emerge from the profound crisis that assails us. Any transformation that takes as a priority interests other than the immediate improvement of the overall situation of the nation, will be completely insufficient and only postpone the changes which, in one form or another, must occur.
References:
1) Universal Declaration of Human Rights – English version from un.org
2) Constitución de la República de Cuba – English version from http://www.cubaverdad.net/cuban_constitution_english.htm
3) Lineamientos de la política económica y social del partido y la revolución – English version from www.cubaminrex.cu: THE GUIDELINES OF THE ECONOMIC AND SOCIAL POLICY OF THE PARTY AND THE REVOLUTION, April 18, 2011
4) De Soto, Hernando. El otro sendero.
5) WTO, Vietnam.
6) G. Rodiles, Antonio. Una rápida Mirada a las transformaciones en China.
7) Aslum, Anders. Building Capitalism. Cambridge, University Press.
The most recent editorial in the Cuban Catholic Church’s journal Lay Space (Espacio Laical) put on the table for discussion, once again, several critical points regarding the course that should be taken in the Cuban transition.
First, we have to say that we find it most interesting that the current circumstances push political actors to publicly express their positions. It becomes ever more difficult to act “behind closed doors” in an age when an information flows and is leaked so easily. This is a fact undoubtedly surprising to those accustomed to intervening from behind the scenes.
Currently there is an intense lobbying effort focused on getting the government of the United States to relax its policy toward the regime on the Island. This onslaught occurs through three different actors. The first is the Cuban government, the second is the hierarchy of the Catholic Church, and the third is made up of certain sectors of the exile. Although several analysts see this as a coincidence of interests, we think there is little coincidental about this coordinated action.
The concern of many activists over the role the church hierarchy is playing in this political chess game has been accompanied by reports in various media. These recriminations should never be taken as an intent to attack the Cuban Church, though certain groups would like them to be, but rather as a wake-up call about the role that this institution should play, and the concern that it could become hostage to some particular interests.
The editorial in Lay Space appeared not only to compensate for several missteps by members of the journal’s own editorial board, but also for the “blunders” of Cardinal Jaime Ortega on his recent trip to the United States. And we mustn’t forget that in recent days the newspaper Granma, official organ of the Communist Party, came to the defense of the prelate, discrediting his detractors and their criticisms.
The recent lobbying has a well defined profile and is targeted to political opponents to the embargo — business interests, study groups and universities — among which the Brookings Institution, the Council on Foreign Relations, Harvard University and the City University of New York stand out. Interestingly, people tied to the three sectors have passed through these same institutions, among them: Roberto Veiga, Jaime Ortega, Eusebio Leal, Arturo Lopez Levy and Carlos Saladrigas.
Within the Island we cannot ignore the exclusions coming out of the conference on Cuban migration, held behind closed doors in early May. Catholic activists excluded included Dagoberto Valdés and Oswaldo Payá, as well as the academic Juan Antonio Blanco, currently living in Miami, whom the Cuban government announced it would not allow to enter the country.
In recent days a group of American and Cuban academics, members of official institutions, have argued for the application of more flexible measures to the relations between both nations. In this scenario a new group called COFFEE has appeared, featuring Arturo López Levy, who is seen not only as a part of the Lay Space team, but who is also among those campaigning on behalf of the five Cuban spies convicted in the United States.
At the very least, the synchronization of this front – the Catholic Church, the Cuban government, and the complacent emigration – is suspect.
As Carlos Saladrigas explained at his conference recently held at the Church’s Felix Varela Center in Havana, it is virtually impossible to believe that the Obama administration will change its policy toward the Island in an election year. However, it is clear that this strategy aims to produce changes should the current president be reelected.
As we have discussed in previous articles, the ruinous state of the country and the uncertain situation of Hugo Chávez, among other adverse factors, forces the governing elite into a pressured search to resolve its transmutation, and in particular to guarantee the future of its heirs. The question is: How does Jaime Ortega fit into this plan?
In the editorial published by Lay Space there are several aspects to note. The first we consider important is the political role assigned to the Church, and the affirmation that it has played the most active role in the construction of a global vision for changes in Cuba.
What the editorial flatly ignores is that it is not the Church’s job to build an alternative for the nation, this role belongs to civil society. It is truly surprising, therefore, that this group wants to obscure the work undertaken by so many political actors for years — and their commitment to democratization on the Island — for which they’ve paid with long prison sentences and even their lives. The constant reference to the Church’s own platform as the only solution is, at the least, offensive. But that is not all. How can they say that the opposition has no national project? How can they assert that those who demand an end to the dictatorship lack legitimacy?*
Also curious is the vehemence with which the Cardinal has taken on a task that is beyond him. His role, at best, should be one of mediator, gaining the confidence and respect of the parties in conflict, and not that of a totally biased activist.
The editorial in Lay Space tries to ignore a crucial fact impossible to evade: that we have lived under a dictatorship in our country for 53 years. A dictatorship that has been driven by the same group since that distant 1959, a dictatorship that admits no renewal and that forces its replacement by a democracy.
Another of the manipulative arguments of the editorial is that related to the economic sanctions imposed against the Cuban government by the United States government. Why should we have to repudiate sanctions against a government that shows no interest in bettering the conditions of its citizens and instead spares no resources for its repressive apparatus?
Why should we have to support that the Government further increases its debt, knowing that the money will never be invested in the development of the country?
The issue of nationalism is another curious point. What sovereignty are they speaking of when the current economy has been maintained through external subsidies and we Cubans have been, and continue to be, discriminated against in our own land?
If, as stated in the editorial, at every moment the Cardinal had a worthy attitude toward injustices, why have we not heard his voice again, given the constant human rights violations on the Island? Where was he when three young men were murdered after a judicial farce, or when Orlando Zapata Tamayo, Wilfredo Soto and Wilman Villar died?
Where was his voice of denunciation during the wave of arrests during the Pope’s recent visit to our country? Where is he when they undertake daily despicable acts of repudiation in Cuba today?
We must make it clear to the authors of that text that to speak, without contortions, of the reality that we have lived and are living in Cuba is not hatred. To call those primarily responsible for the deaths of thousands of Cubans murderers is not prejudice, much less a lack of political intelligence.
Intelligence implies an accurate approach to reality, and the reality in Cuba has been and is harsh. While dialogue should be the highest priority as a path to a solution to our prolonged conflict, the truth cannot be left to one side if we want this dialogue to be credible.
Reconciliation is not incompatible with justice. Quite the opposite: for there to be reconciliation there must be justice. Mind you, not a justice that devolves into a circus, but a justice that respects the human condition of each individual. If the Church hierarchy speaks so lightly, and with a false vision of reconciliation, it should expect nothing but discredit.
The Catholic Church could be called upon to play an important role in the transition; but this will only be possible if it gains the respect and confidence of all those who seek a modern and democratic nation.
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*Translator’s note: Following is an excerpt from the Lay Space editorial referring to these points:
This effort by Cardinal Ortega has never represented an uncritical acceptance of the missteps taken by some parties in the national spectrum. Sometimes in public, sometimes in private, he has questioned the political actions of the opposition, inside and outside Cuba, that are usually characterized by criticizing, condemning and trying to annihilate, without contributing any clear and universal projects for the fate of the nation.
Because of its indisputable love for a free and sovereign Cuba, the Church cannot go along with projects that are monitored by — and often coupled with — agendas dictated outside the island, without a clear, critical distancing from the blockade against our motherland.
