WHERE DOES CUBA STAND?

Enrique A. Baloyra

January 14, 1994
*******

The views expressed in this report are those of the author

and do not necessarily reflect the official policy or position of

the Department of the Army, the Department of Defense, or the

U.S. Government. This report is approved for public release;

distribution is unlimited.

*******

Comments pertaining to this report are invited and should be

forwarded to: Director, Strategic Studies Institute, U.S. Army

War College, Carlisle Barracks, PA 17013-5050.
FOREWORD

The crisis of the Cuban revolution has once again raised a

number of security issues for the United States, along with

important questions about the effectiveness and wisdom of the

three- decade-old U.S. policy of containment and punishment. Many

observers believe that the Castro regime is in its final hour,

and that its passing may be accompanied by massive bloodshed and

a new wave of refugees to southern Florida.

Given the potential explosiveness of the Cuban crisis and

the possibility that it might lead to U.S. military involvement,

it would seem appropriate to take a closer look at the Cuban

situation. In particular, we need a better understanding of those

forces promoting both political stability and instability. In

this report, the distinguished Latin American scholar Enrique

Baloyra argues that Castro's current policy of "re-equilibration"

is unlikely to succeed and that his options will increasingly

boil down to two choices: One, he can deepen the process of

government-led reform, or, two, he can continue the current

policy, with growing chances of violence and turmoil. Baloyra

suggests that since the former might jeopardize his hegemonic

position, the latter is the more probable option. The future, in

short, is likely to be grim.

This report is an expanded and refined version of an earlier

paper that was presented at an SSI roundtable on "Cuba and the

Future," held at the U.S. Army War College. That session was

organized by Dr. Donald E. Schulz and funded by the U.S. Army War

College Strategic Outreach Program under the leadership of

Colonel John D. Auger.

The Strategic Studies Institute is pleased to publish this

report as a contribution to understanding events in this

important region.

JOHN W. MOUNTCASTLE

Colonel, U.S. Army

Director, Strategic Studies Institute
BIOGRAPHICAL SKETCH OF THE AUTHOR

ENRIQUE A. BALOYRA is a Professor of Political Science and former

Dean of the Graduate School at the University of Miami. He has

published widely on Central America and the Caribbean Basin. His

best known book is El Salvador in Transition and his most recent

is an edited volume which he organized with James A. Morris,

Conflict and Change in Cuba (1993).
WHERE DOES CUBA STAND?

A Riddle.

Is Cuba different? Ever since the fall of the Berlin wall in

November 1989, and particularly since the disintegration of the

Soviet Union in summer 1991, predictions about the imminent

collapse of the Castro regime have been more frequent.1 Scholars

and qualified analysts agree that the regime confronts its worst

crisis ever and that it can not possibly escape it unscathed.2 By

this they do not mean that the regime will inevitably fall, only

that to avoid more catastrophic alternatives, including

widespread violence or outright civil war, the historic

revolutionary leadership must innovate considerably more than it

has ever been willing to. Indeed, it appeared that to prevent a

complete national collapse that would destroy the regime, the

leadership had already introduced changes that it would normally

have refused to even consider.

If the Cuban leadership is acting under duress, why have we

not witnessed more dramatic developments? If social and economic

conditions are so harsh and growing worse, why have people not

gone into the street to march and protest? Why are we yet to

witness domestic political opposition effectively challenging the

regime? Why have the leaders in the so-called left-wing of the

Cuban Communist Party refrained from expressing their criticisms

and disagreements in public? Why have the armed forces apparently

remained loyal? Is Cuba unique?3

Some could argue that the Cuban system of domination is so

perfect, so omnipresent and so omnipotent that, as many of the

characters in the plays of Vaclav Havel claimed, "There is no

alternative but to submit." Others would claim that the regime

still enjoys a fair amount of foundational legitimacy and that

the government is firmly in control of the situation and capable

of experimenting with ad hoc strategies of re-equilibration.

Which is actually the case?

On Cuban Uniqueness.

For a long time, specialists have dealt with Cuba as a

deviant, almost unique, case. We need to review the factors

making Cuba different, not to drive home the point that it will

remain so--that is, invulnerable to the changes that broke down

other socialist regimes--but to understand how these factors are

retarding the process of change. In very schematic fashion, here

is how five of those factors seem to be operating in the early

1990s.

First, Cuba's insularity and proximity to the United States

have always militated against regime change for a number of

historical and political reasons. These are well-known and do not

require additional elaboration except to point out that they have
allowed the fidelistas to play politics in terms of North-South

(small versus large, independent versus neocolonial) oppositions

and to isolate the Cuban public from external stimuli. In the

Cuban case, North-South contradictions have very profound

historical roots and become specific as a test of strength

between nationalism and imperialism. The result has been that the

more relevant contradiction of Cuban politics in the last four

decades--pitting of an oppressive regime against a dominated

society--has been overlooked and neglected.

Far too frequently, political actors in the United States

address Cuba as a domestic U.S. issue, seek to project power and

influence through American institutions, advance proposals that

ignore the historical antecedents of U.S.-Cuban relations, or

fail to incorporate the nuances of contemporary Cuban politics.

Regardless of the intent, the result is the perception in Cuba

that outside actors want to dictate solutions which, in many

cases, run contrary to the explicit wishes or public positions of

their would-be Cuban allies.

Second, none of the peaceful processes of regime transition

has been determined by external factors. In the 1970s, military

defeat abroad contributed to the deterioration of the Salazarist

regime in Portugal and to the collapse of the colonels' regime in

Greece. Similarly, the defeat in the Falklands unravelled the

Argentine military regime, but only after General Galtieri

committed his government to a gamble of his and his colleagues

own choosing, rather than one that was imposed on them. In

Central Europe, where the USSR instigated the removal of Erich

Honecker in the GDR, helped plot the overthrow of Nicolae

Ceaucescu in Romania, and orchestrated the ouster of Todor Zhikov

in Bulgaria, the Soviets had to act through local intermediaries

who had their own interests and priorities. The outcome of these

interventions was far from uniform. Such intermediaries have not

been available in the Cuban case, and potential local allies have

been unwilling and/or unable to assist in this project. The

United States lacks an effective domestic presence in Cuba and,

for the reasons adduced before, an American connection would

likely be a delegitimizing factor in the eyes of the majority of

the Cuban population, rather than a factor that would increase

the prestige and legitimacy of the opposition. In too many cases,

opponents of the regime, particularly those operating in the

United States, have chosen to highlight their closeness and

support for the Cuba policies of the incumbent administration.

Third, Cuba was a model of national communism which, despite

a heavy reliance and dependence on the Soviet Union, maintained a

degree of independence and autonomy that could not have been

predicted from a cursory inspection of the country's strategic

assets and resource potential. Cuban willingness to experiment in

the delivery of collective goods at home and aggressive pursuit

of proletarian internationalism abroad--including programs of

fraternal economic assistance--preserved the freshness of the

revolutionary experience for a long time. The boredom and despair
of the disaffected coexisted side by side with the optimism and

heightened sense of personal efficacy of the committed. That

sense of efficacy was probably much more widespread in Cuba than

in other socialist countries.

To be sure, the Cuban revolutionaries failed the test of

creating wealth. Nevertheless, they have evolved a winning

competitive ethos yet to be contradicted by military defeat or

catastrophic political setbacks. This ethos stands behind the

arrogance and self-sufficiency of the leading figures of the

regime. In the final analysis, they have a point: They are yet to

be defeated in the political arena. Castro and his closest

associates publicly reacted to the collapse of the socialist

regimes as something that Eastern European leaders had brought

upon themselves.4 They find no fault in their own policies and

insist that they are not to be blamed for the mistakes of their

former comrades.5

In a way, the worst foreign policy defeat, the collapse of

the Soviet Union and its world system of political economy, which

had major domestic political consequences for the Cuban regime,

was not a complete political catastrophe for Castro. This defeat

came precisely at a time of heightening tensions between a Soviet

reformist cohort, younger than the Cuban historic leadership, who

had mounted a major offensive along the lines of transparency in

government (glasnost) and economic restructuring (perestroika).

On their own, each of these objectives had profoundly

destabilizing consequences for the Cuban regime, which not only

resisted these changes but presented its own alternative policies

of rectification.6 Precisely at a time when he was in the

uncomfortable situation of defending Stalinist positions against

what Mikhail Gorbachev had presented as another effort at

Leninist restoration, a worldwide crisis of Leninism ended this

threat against Castro.7

Fourth, another element comes as a direct result of the

effectiveness of the Cuban formula of political domination. Given

the drawbacks of the "totalitarian model" and its shortcomings in

describing the dynamics of life under Communist Party domination,

using what appear to be the more accurate labels to describe this

system is problematic. Basically, in a structural sense, the

contemporary Cuban regime has resembled the Stalinist much more

than any other variety of Leninist regimes. Unfortunately,

Stalinism is a term laden with very strong ideological

implications, linked to a particular worldview (Sovietology) that

was neither a discipline nor scientific, and was at best a

remnant of the cold war. Nevertheless, the absence of civil

society in Cuba cannot be understood except in reference to this

form of communist domination, at least in an institutional way.

As a result, there are no practically autonomous

intermediary institutions in Cuban society. In Cuba, there is no

Christian Church that can mobilize the masses as was the case in

Poland or in the GDR. Despite one of the richest traditions of
unionism anywhere, an independent labor movement such as

Solidarnosc is nowhere in sight in Cuba. In the same vein, in

spite of a few well-publicized rows with the government, Cuban

dissidents and intellectuals have been unable to come together

into anything comparable to Charter 77, the Petofi Circle or the

samizdat movement.8

Absent institutional sanctuaries and social spaces in which

to evolve and camouflage political activity, the atomization that

characterizes Stalinist forms of political control has been

singularly effective in preventing the development of horizontal

solidarities that normally precede the crystallization of

organized forms of public protest. Without continued protest, the

government has not been forced to engage in major exercises of

public repression. The water cannon, the baton, the cattle prods,

the gas canisters, and the gas masks are all ready to be utilized

but they have been unnecessary. Thus far, the government has

found it sufficient to deploy the so-called "rapid reaction

brigades" against actual and suspected dissidents to prevent the

massification of public protests.

This dominance can also be seen at the level of the

political elite. Only three organizations have sufficient

institutional strength to pose serious challenges to the

leadership: the Communist Party of Cuba (PCC), the Revolutionary

Armed Forces (FAR), and the Interior Ministry (MININT). In June

1989, the regime demonstrated its strength as it moved publicly

to try to convict one of Cuba's most revered and decorated

military heroes, Division General Arnaldo Ochoa Sánchez. Ochoa

was found guilty and summarily executed along with three other

officers, including Colonel Antonio de la Guardia, a MININT

insider. This would have been inconceivable in most Latin

American countries. Subsequently, a thorough purge gutted out the

MININT, sending the interior minister, Division General José

Abrantes, to jail for 20 years and meting out stiff sentences to

a large number of his colleagues.9

 For all practical purposes,

MININT was put under the receivership of the FAR which, as was

the case in other socialist countries, seemed obedient to the

party.10

As for the party itself, some of the worst and most

sensational purges conducted in Cuba--in 1962, 1964, and 1968--

were against elements who allegedly were trying to use the party

organization to establish their own political base. More

recently, during the 1980s, party leaders and professional cadre

were under relentless pressure to make government policy work:

Turnover rates in the Central Committee, provincial and municipal

secretariats, and the party bureaucracy reached historic highs.

In 1985, Humberto Perez, chief of the Central Planning Board

(JUCEPLAN) and one of the prime defenders of economic reform, was

demoted from his job and ultimately expelled from the Central

Committee. In early 1992, a similar fate befell ideologist Carlos

Aldana, whose position on change remained ambiguous and whose

rising fortunes quickly faded as he was accused of corruption and
demoted to a menial job.

One final element of paradigmatic nature is uncertainty,

both at the level of the elite and of the attentive public. In

all previous cases of peaceful transition, elite agreements have

paved the way for elections or for agreed-upon rupturas offering

at least minimal guarantees to the those departing the scene. In

a way, a process of transition is a process of managing

uncertainty and, in the Cuban case, the last few years have been

a period of increasing uncertainty. This has gone beyond the fear

of and intimidation by official mechanisms of political control.

Party elites that could have pronounced themselves against the

present political course have yet to receive clear, unmistakable

pledges of non-retribution. They are concerned that U.S. policies

of economic denial through embargo and political ostracism are

geared to bring down the entire apparatus, not just the diehard

Stalinists. They read those policies as intending to destroy

everyone ever associated with the regime. This, to say the least,

has not been helpful. At the level of ordinary citizens, many are

certainly fed up with Castro, with his foolhardy experiments, and

with having to live in permanent dissimulation. But they are not

looking forward to ending 30-odd years of revolution--bearing

little personal freedom but accompanied by a number of tangible

social benefits--only to fall prey to a group of extremists and

arrivistes from the other end of the spectrum.

In short, Cubans are preoccupied about the alternatives to

their present predicament. Elites and masses are deeply worried

about the future. In the past, many had experienced considerable

social mobility and/or had seen their children reach positions

and distinctions that they could not have dreamed of. The rampant

neoliberal rhetoric, the costs of changing economic models in

Central Europe, and the continuing dire economic conditions of

millions of Latin Americans are constantly being highlighted by

official propaganda. In short, the public is not entirely

convinced that life would be better under capitalism.

Why is this important? A generic argument, advanced by Adam

Przeworski among others, is that a crisis of legitimacy does not

change or make a regime.11 There have to be alternative

leadership, policies, and strategies available to mobilize people

in favor of change.12 And change can only come from two

directions: from "above," that is from dissident factions of the

leadership--or from "below," that is from within the ranks of

ordinary Cubans. Once there are leaders willing to lead and

masses available to be mobilized, there can be an alternative.

The Paradox Restated.

To be sure, in the summer of 1993 the Cuban regime was being

bruised by very dire conditions. Judging by historical and

comparative standards, those conditions should at the very least

have produced a deterioration, if not a near breakdown, of the
regime. But Cuban leaders continued formulating and implementing

policy as if they were not confronting a terminal crisis.13

There are three ways of evaluating this paradox. The first

is to consider chaos without breakdown as the normal order of

things in revolutionary Cuba. This proposition rests on three

assumptions: First, the historical continuity of the ruling group

suggests that the Cuban regime has never changed.14 Second, it

has been argued that, except for 1975 through 1984, turmoil,

crises, and experimentation have characterized the operational

style of the Cuban regime. This has been variously described as

socialismo con pachanga and wartime communism (for the 1960s),

sociolismo, provisional institutions in perpetuity, or simply the

"anti-model."15 Third, as has been the case in the past, despite

all the avatars, Fidel Castro and his closest associates may

somehow find the means and opportunity to remain in power without

changing the regime. Each of these statements clearly exaggerates

what may have actually been or shall be the case. The bottom line

of this first option asks: Where except in its depth is the

novelty of this crisis? Are Cubans not accustomed to living in

crisis?

The second option would be to reject the paradox altogether

on grounds that the regime really is deteriorating and that it

cannot possibly continue relying on traditional mechanisms for

reproducing its legitimacy and control. This assumes that the

vectors of change are already in place and that it is simply a

matter of time before we witness regime breakdown. No matter how

astute a leadership, how willing to rule, and how much support it

may still have, it is hard to imagine that it can survive a

complete economic collapse. In early summer 1993, the news from

Cuba consisted of a steady staple of power outages, a generalized

breakdown of transportation, increased scarcity and hunger, and

the threat of epidemics of different sorts. Was a collapse

anywhere near?

The third option anticipates change, but in more gradual

fashion. It rejects unescapable economic determinism and posits

that continued selective application of pragmatic macroeconomic

policies and political repression (the lynchpin of the strategy

of re-equilibration used by the leadership in the early 1990s),

combined with the strategies used by ordinary Cubans to survive

the crisis, may change the regime in a gradual and largely

unanticipated way. It is conceivable that the same or a very

similar ruling group could preserve the ethos of the

revolutionary regime in a new structural configuration.16

Despite the official rhetoric and the supposedly diehard

attitude of the historic leadership, which has vowed to uphold

principle and resist until the end, re-equilibration is no

revival of "Guevarism" but an attempt by the historic leaders to

subordinate the scope and nature of change to their own political

and physical survival. Stated in the language of transition

analysis, this is a "re-equilibration without liberalization."
Therefore, the early 1990s are not simply a repetition of the

late 1960s. Creeping capitalism, the loss of ideological

referents, and deeper and more widespread popular resentment

against the regime are pushing Cuba into uncharted territory.

Cubans may not be ready to immolate themselves to improve

matters, but this does not mean that they will respond

enthusiastically to narrowly-defined policies of elite survival

and regime continuity. In short, elite-guided re-equilibration

and mass-based avoidance and disengagement are the stuff of the

politics of transition in Cuba. What is yet to be determined is

the outcome.

Change in the Cuba of the 1990s.

All the different permutations and combinations of these

three possibilities boil down to two interpretations. The

difference between these interpretations is not whether change

will occur, but whether it is going to be gradual and orderly,

(even if it results in a new or drastically altered regime) or

turbulent, and spin out of control. Which is likely to be the

case?

In 1993, four years after the collapse of the socialist bloc

and two years after its cliency relationship with the Soviet

Union had come to an end, the Cuban regime remained in place. To

be sure, a sense of urgency was palpable in much of the

formulation and implementation of domestic policy. Levels and

styles of citizen mobilization were more reminiscent of the

turmoil and experimentation of the 1960s than of the more

structured and predictable patterns of the late 1970s and early

1980s. Open massive unemployment and underemployment had become a

reality. In its edition of April 2, 1992, the weekly Bohemia

reported that, by that time, about 155,000 workers had been

reassigned to chores in agriculture and construction. By January

1993, roughly 75 percent of Cuban factories had simply stopped

producing anything because of the lack of raw materials. In

agriculture, animal traction had all but replaced tractors and

combines. Workers dining halls were shut down. In spring 1993,

the quota of food that could actually be purchased through the

official rationing system did not cover the entire month. All of

these things seemed to be pulling the regime away from its

blueprint for re-equilibration. Following a very violent storm in

March 1993, the Cuban government broke precedent and asked for

international donations to help repair the very extensive

damages. From that point onward, Cuban officials pointed to

adverse weather conditions as a major contributor to their

inability to fulfill commercial contracts and meet their own

production goals for the "special period." On June 3, 1993,

Alberto Betancourt Roa, director of CUBAZUCAR, announced that due

to force majeure Cuba would have to suspend its sugar deliveries

and that sugar production would not surpass the 4.2 million

metric ton mark. This was very bad news.
Externally, the regime had embarked in a worldwide campaign

aimed at forcing an end to the U.S. economic embargo, first

imposed in 1962. Passage of the Cuban Democracy Act, signed into

law by President George Bush in Miami in October 1992, had

tightened the provisions of the embargo on grounds that this

would accelerate a transition to democracy.17 Cuban officials

were utilizing this stated purpose to denounce the United States.

On their own, most of Cuba's traditional trading partners,

including steadfast U.S. allies (members of NATO and the EEC) and

countries not particularly sympathetic to the regime, denounced

the Act and/or announced countermeasures of their own.18 Even

before final approval of the Act, on October 8th, the European

Community filed a formal complaint with the U.S. Government on

grounds that this violated international law. Canada and the

United Kingdom issued orders imposing fines on any company

complying with the Act. On November 24, 1992, the United Nations

General Assembly approved a non-binding resolution condemning the

expansion of the embargo; only the United States, Romania, and

Israel voted against it. On December 2, 1992, the final

declaration of a meeting of the Group of Eight in Buenos Aires

included language criticizing "attempts to confer

extraterritoriality to the laws of any country." International

controversy about the Cuban Democracy Act put the Cuban problem

back in the venue of the nationalism- imperialism debate, to the

detriment of the reality of a besieged dictatorship steadfastly

refusing to negotiate a reconciliation with its opposition and

determined not to entertain any policy options except its own.

In terms of the relationship between rulers and ruled, there

was a palpable estrangement between state and society, and the

government was increasingly unable to provide services that the

population had grown accustomed to. This, in no small measure,

was a direct result of miscalculations and obstinacy on the part

of the ruling elite, particularly Fidel Castro. But it would be

hard to underestimate the very overwhelming impact of what was

probably the worst economic crisis in the country's history. What

had begun in the mid-1980s as a disguised program of economic

austerity, the so-called "campaign to rectify errors and negative

tendencies" (rectificacion), had evolved into a desperate

struggle for survival which the government euphemistically

described as "a special period in time of peace."

The population's response to these conditions was complex.

On the one hand the kingdom of dissimulation that ordinary Cubans

had built for themselves was giving way to increased social

disorganization, open discontent, and some isolated instances of

formal protest. The crime rate soared as Cubans found it

impossible to make ends meet without engaging in petty thievery.

Expressions of discontent were more open than ever before. For

example, in the municipal elections of December 20, 1992, about

31 percent of the 7,546,194 voters invalidated their ballots or

left them blank. There was increasing disbelief in the

government's insistence that the United States might invade and

that the economic depression that the country was experiencing
was a direct result of the U.S. embargo and the collapse of the

Soviet system. But there was also considerable resentment at the

United States for making things worse by tightening the embargo.

Dissidents ventured where they rarely had gone before,

openly criticizing the regime on live interviews with Miami radio

stations and in statements to international media. The Catholic

Church became more openly critical. In October 1991, Archbishop

Jaime Ortega Alamino asked Cuban Catholics not to join the rapid

reaction brigades organized by the government to intimidate

people and conduct acts of street violence against dissidents and

protesters. In May 1992, Archbishop Ortega criticized the

official media for openly espousing an attitude of "us versus

them" when referring to Cuban Christians. He added,

When we seem to be marching towards a lay state, it is

hardly convenient to continue talking about Marxism as

a religion and about the encounter of Christians and

Marxists as an ecumenical meeting between two churches.

In late October 1992, the Cuban Episcopal Conference issued

a statement condemning the Cuban Democracy Act and reiterated the

opposition of the Catholic hierarchy to the U.S. economic

embargo.

Intra-elite relations seemed to be experiencing considerable

turbulence. Despite official proclamations, the PCC was far from

united. Disunity within the party had been a problem for the past

10 years. In December 1985, due to a lack of consensus on a

number of issues, the last session of the Third Congress of the

PCC had to be postponed. Shortly after concluding its delayed

session, in February 1986, Castro went ahead on his own and

launched the so-called process of rectification on April 19,

1986.

Moreover, there were very complicated maneuvers involving

preparations for the Fourth Congress of the PCC in October 1991.

A number of ad hoc procedures were put in place so that the top

leadership would be able to control the process of delegate

selection and, by implication, the agenda and the debate. On the

one hand, many of the base leaders of the PCC elected by secret

ballot earlier in the year were not considered completely

reliable. But these did not reach the Congress in large numbers.

On the other hand, the llamamiento process, which was the

leadership's call for an open and sincere debate leading to the

Congress produced far too many controversial suggestions. The

Politburo had to issue a declaration clarifying that the

revolutionary project and its historic leadership were beyond

questioning.

Before the Congress ever took place, its organizing

commission implemented a number of important changes on grounds

that they would have been approved anyway.19 Even so, the issue

of the free peasant market, one of the first and most
controversial aspects of the policy of rectification, was hotly

debated at the insistence of "the right," with many people openly

calling for its restoration. For their part, "left" elements did

not concede the point about the inclusion of believers in the

party without a fight. Structural and personnel changes approved

by the Congress--including the elimination of the Secretariat;

the promotion of "safe" younger politicians (Maria de los Angeles

Garcia, Alfredo Hondal Gonzalez, Alfredo Jordan Morales, Carlos

Lage, Abel Prieto, Roberto Robaina, Nelson Torres Perez),

technocrats, and trouble-shooters (Concepcion Campa Huergo,

Yadira Garcia Vega, Candido Palmero Hernandez) to an expanded

Politburo of 25 members; and the elimination of deputy positions

up and down and across the entire party structure--were not

trivial. If anything, these complex changes were put in place to

help implement the strategy of re-equilibration with which the

government intended to pull the regime out of its state of

deterioration and prevent its breakdown. In addition, the

Congress gave the Politburo carte blanche to rule the country

through exceptional mechanisms for as long as this was made

necessary by the "special period."

What this cursory review of the evidence seems to suggest is

that there has been oppposition in Cuba, but that it has not been

able to establish and consolidate itself either at the level of

the leadership or within the ranks of the mass public. Is this

state of affairs likely to continue? Will the government strategy

of re-equilibration somehow merge with or assimilate some of the

demands of the opposition? Are the dynamics of

officially-sponsored changes and of their unanticipated

consequences likely to complement or collide with each other?

A Socialist Aperture Toward Capitalism.

Changes in the configuration of international political

blocs left the regime scurrying to find not only new trading

partners but also ideological moorings. This posed a

double-barreled threat to its legitimacy. Keeping a trading

economy afloat was a tall order; managing the deepening

contradiction between an official rhetoric of "socialism or

death" and the everyday practice of state capitalism was no

panacea. The top leadership strained to put the best possible

face on this glaring contradiction. In September 1991, President

Fidel Castro stated that Cuba could have both a socialist economy

and society and wide cooperation with foreign capital. In a

November 1992 interview which received national television and

radio coverage, Carlos Lage, secretary of the executive committee

of the Council of Ministers, described current economic policy as

"a socialist opening to the capitalist world." This, he hastened

to add, would not sacrifice the political, economic, and social

project chosen by Cuba.

In short, government policy calls for a mixed economy of

sorts, combining foreign capitalist enclaves, primarily in the
export sector, with socialist production and distribution

predominating in the domestic sector.20 This was an enclave-based

economic restructuring, unaccompanied by political

liberalization.21 It is likely that any successful reorganization

of Cuban political economy will require massive foreign

investment and a reorientation to export-led growth in

nontraditional sectors.22 While this strategy is probably

correct, it poses serious problems of legitimacy to a leadership

that has made the rejection of capitalism and market economics a

central tenet of its economic model.23

Two additional problems loom large. One is that, despite

very generous terms and facilities offered to foreign capital,

the latter has yet to take full advantage of them. While the

amount of foreign investment received thus far is substantial, it

is insufficient to pull the country out of its deep recession and

to make the official strategy of re-equilibration successful. By

spring 1993, there were close to 300 foreign firms already

operating in Cuba, including giants like BASF, Bayer, CIBA-GEIGY,

Komatsu, Nissei Sangyo, Rhone-Poulenc, Sandoz, and Volvo.24 But

many had yet to make an investment commitment, and new investment

remained heavily concentrated. For example, in 1992, reports of a

massive infusion of fresh Canadian capital used the figure of

U.S. $1.2 billion to describe what Sherrit Gordon intended to

invest in modernizing nickel plants at Las Camariocas and Punta

Gorda.

Linkages between these new resources/activities and Cuban

foreign trade and domestic economic activity remained tenuous.

One major factor was its enclave nature. Another was the collapse

of the Council for Mutual Economic Assistance (CMEA), which took

the lion's share of Cuba's trade. In 1984-89, Cuban exports to

and imports from CMEA countries were roughly 70 percent of the

total. (See Table 1.) In dollar terms, the amount of Cuban

imports from the Soviet Union was U.S. $5.2 billion in 1989. This

dropped to $1.7 in 1991. Accordingly, the Economic Commission for

Latin America (ECLA) reported that, between 1989 and 1992, Cuban

import capacity had declined by 73 percent.25 As a result of this

drastically reduced import capacity, Cuba's Gross Social Product

fell precipitously as vital imports could not be purchased

elsewhere because of a lack of foreign exchange and Cuba's low

credit rating. (The latter was due to its unilateral moratorium

on servicing its foreign debt with hard-currency countries in

1986.) Input shortages had a serious impact on all Cuban

industry. Sugar production declined from 8.1 million metric tons

in 1989-90 to 4.2 million in 1992-93.

Whatever trade this new investment is generating with the

Western Hemisphere and Europe cannot come close to filling the

void left by the Soviet Union and the CMEA. During 1984 to 1989,

Cuban export trade with the Western hemisphere moved from 2 to

4.6 percent of total exports and from 4.4 to 6.3 percent of total

imports. While these figures cover years preceding the

vertiginous free fall of the Cuban economy, they show the
enormous gap left by the disappearance of the CMEA. This cannot

be filled by new trading partners in a short period of time.

Second, the very generous terms offered by the Cuban

government have two negative effects in the short term. One is

that Cuban participation in profits is but a fraction of what it

could be if the country did not find itself in such a weak

position. While this varied somewhat from one sector to another,

and from one joint venture to the next, in essence what prevailed

was a buyer's market. Extensive concessions in taxation, profit

repatriation, and the provision of infrastructure reduced

national participation in the surplus generated by these

activities and deflated the net diffusion effects of this

investment in the domestic sector. For example, according to a

March 1993 report by Cuba's Grupo de Turismo, tourism generated

U.S. $530 million in gross revenues in 1992. This compared

favorably with the U.S. $145 million generated by the sector in

1987 and the U.S. $387 million in 1991. In addition, the sector

accounted for roughly 62,000 jobs or 1.6 percent of total

employment in 1992. These are all impressive numbers. But

according to several estimates, Cuba only netted U.S. $245

million in 1992 once profits, commissions, transportation

expenses and direct imports into the sector were discounted.26

What this means is that this high-priority sector, which seems to

be performing fairly well, cannot be counted on to produce

miracles or quick fixes. Major gains will require a sustained

effort and adaptability to changing market conditions to remain

competitive.

In summary, Canadian, Spanish, Mexican, Japanese, and other

investors cannot save the regime. Something more is required.

Consequently, following the inauguration of Bill Clinton in

January 1993, the Cuban government launched a strong public

relations campaign to shame his administration into easing the

embargo or abrogating it altogether.

The other negative aspect of Cuba's generous concessions to

new foreign investment is in the area of labor and community

relations. Although these remained enclave operations, their

social and political aspects posed a direct challenge to the

legitimacy of the regime. The contrast between foreign capitalist

affluence and domestic socialist mediocrity is just too strong at

all levels. For example, concerning tourism, criticism has

emerged from within the party itself over the system of apartheid

created by the increasing number of foreign tourists visiting the

island, which has resulted in the virtual exclusion of the

criollos from the choice spots in the littoral, and has put extra

pressure on the supply of food in the country. Cubans are

practically excluded from the "dollar area," and ordinary

citizens cannot make purchases in well-supplied stores reserved

for foreign tourists, entrepreneurs, and diplomats. More

ominously, prostitution, which Cuban officials had proudly

declared extinct 30 years ago, has reappeared as a direct result

of the upsurge in tourism and of the increasingly narrow

employment opportunities available to a predominantly young and

technically well-qualified labor force. In addition, hundreds of
young technicians and professionals are avidly seeking jobs in

the dollarized sector of the economy. This is an internal "brain

drain" of sorts.

But employment in the dollar sector entails having to adjust

to more demanding conditions than many Cuban workers are

accustomed to. The government's monopoly of the domestic labor

market, and the fact that it acts as intermediary between foreign

capitalists and Cuban workers, creates additional frictions.

While some major irritants have been removed, most workers

continue to be paid in Cuban pesos at a fraction of their nominal

dollar salaries. They cannot engage in collective bargaining and,

until recently, they could not use whatever dollars came into

their hands to patronize restricted shops. Despite these

annoyances and outright injustices, workers in the dollarized

foreign enclaves are considered lucky by those excluded from

them.

A recent study of the impact of this early onslaught of

enclave capitalism concludes somewhat tentatively. According to

this work, while direct foreign investment is undermining Castro

in several ways, this is being countered by other effects that

may actually help consolidate the system, particularly if foreign

investment increases.27 This and other sources are beginning to

discover antagonisms between Cuban managers in joint enterprises,

enjoying more autonomy, salaries, and working conditions, and

those trying to run state enterprises under all kinds of

vicissitudes.

Some Likely Scenarios.

On the surface, it appears that the almost legendary

adaptability of the historic revolutionary leaders has not

deserted them. Through a combination of official policies, astute

manipulation of certain factors specific to the Cuban situation,

and the adroit turning of some unfavorable contingencies to their

advantage, they have managed to disconnect potential links

between would-be leaders and followers, and thereby prevent

discontent from turning into political mobilization and massified

opposition.

While these conditions prevail, Castro has no incentive to

engage in serious bargaining and negotiation with his Cuban

opponents. He can continue his present course hoping that he may

finesse an accommodation with the United States, that his ad hoc

economic policies will mature and bear full fruit, and that the

number of imponderables shall remain a manageable few. Given the

trends afoot in mid-1993, this is probably too much for him to

ask. As suggested above, he needs major qualitative changes in

terms of access to fresh credit and really major levels of direct

foreign investment to jumpstart a restructured economy and put it

in the path of self-sustained growth. This is unlikely without

some major changes in the domestic configuration and
international relations of the regime.

While a relaxation of the U.S. embargo remained possible--

particularly with respect to food, medicine, travel, and

communications--there was very little to indicate that, short of

drastic change in the nature of the regime, the United States

would abrogate it altogether. Absent this, Castro's own

idiosyncracies and concern for his own political survival are

likely to prevent him from allowing the more drastic and rapid

conversion to market mechanisms that the Cuban economy requires

to be able to feed and employ the population, particularly in the

absence of a new external patron. In either case, with or without

a patron, and even barring any new complication, the vicious

circle in which the Cuban economy is trapped is likely to get

even worse. In other words, Castro will have to make some

additional concessions on the economic front.

Elite and popular reactions to these concessions are hard to

gauge. Dissent on economic policy alone is not likely to fracture

the elite in a regime-threatening fashion, whether to demand or

protest changes. However, the issue of repressing the population,

which could arise if economic conditions continue to deteriorate

unremittingly, would probably produce such a split. Absent a

sustained dialogue with the opposition or a previous tacit elite

agreement, this split may not bring about a crucial realignment

of forces or the emergence of a new winning coalition capable of

managing a transition. But it would force the regime to engage in

continued repression of spontaneous, sustained popular protest.

Ironically, given extant mechanisms of political control,

spontaneous protest may be more likely and, with the absence of

prior elite agreements and clearly formulated alternatives, the

potential for violence and anarchy will increase.

In the short term, however, there are no likely candidates

to play the role of connecting the elite and masses into a

coherent opposition. Military officers are less likely to lead a

dissenting faction and to play a prominent role in managing the

transition than the party apparatchiki. The existence of only one

party makes it easier for the politics of dissent to become the

politics of opposition within that party, than for a military

conspiracy to crystallize. A military coalition would require the

active collaboration of the intelligence apparatus, which was

effectively gutted and purged in the aftermath of the Ochoa

affair. At present, the MININT is under the receivership of a

trustee of FAR Minister Raul Castro, General Abelardo Colome

Ibarra.

For the most part, the present leadership of the dissident

movement has not made any decisive move to mobilize the

population; those who have tried to recruit more aggressively,

such as Yndamiro Restano of the Movimiento Armonia, have quickly

found themselves in jail. Those who remain free do not seem to be

contemplating a change of tactics; therefore, it does not appear

that they will lead an active campaign of civil disobedience any
time soon.

Without a leadership willing to lead, there may not be a

mass willing to follow. The strategies of survival evolved over

the years are not likely to be revised at a time of extreme

hardship and duress. People are just too preoccupied and busy

with subsistence to engage in the kind of spontaneous combustion

that might produce a massive blow up. Cubans have always worried

about not becoming martyred in sterile causes; consequently,

there is quite a lot of apprehension about "starting anything."

On the other hand, Cubans are also known to mobilize by anger in

the face of blatant injustice and abuse of power. It is not out

of the question that we could witness incidents of looting

diplomercados, hotel commissaries or even local groceries. It is

also likely that mistreatment of ordinary citizens by an abusive

official or mob could spark violence.

Castro may know more about the psychology of ordinary Cubans

than the rest of us but, in the early 1990s, those Cubans posed a

greater potential threat to him than anyone at the elite level.

He demonstrated his concern by vigorously campaigning during the

weeks leading up to the election of February 1993. He cannot rest

on his laurels, however. He is spread too thin over too many

projects and crises. Soon he may be confronted by the most

difficult choice of his career: whether to preside over a more

genuine process of change or eventually have to engage in massive

repression of ordinary citizens.

In conclusion, given the very narrow margins for success of

the present strategy of re-equilibration, the prospects for the

future seem to cluster around two options. One is a deepening of

the process of change, led by the government; the other is the

continuation of current policy, with increasing chances of

violence and turmoil. That Fidel Castro remained the key player

in determining which of the two courses would prevail seemed to

suggest which was more likely. That he has never put his

supremacy on the auction block does not augur well for the future

of his country.

ENDNOTES

1. For a recent, well-documented exercise in predicting

change see, Andres Oppenheimer, Castro's Final Hour, New York:

Simon and Schuster, 1992.

2. For a contrast, see, Edward Gonzalez, "The Beginning of

the End for Castro?" in Cuba Roundtable, Cuba in the Nineties,

New York: Freedom House, 1991, pp. 7-22; Susan Kaufman Purcell,

"Collapsing Cuba," Foreign Affairs, Vol. LXXI, No. 1, 1992, pp.

131-145; and Andrew Zimbalist, "Teetering on the Brink," Journal

of Latin American Studies, Vol. XXIV, No. 2, May 1992.

3. This question is addressed squarely elsewhere. See,

"Introduction" in Enrique A. Baloyra and James A. Morris eds.,
Conflict and Change in Cuba, Albuquerque, NM: University of New

Mexico Press, forthcoming, pp. 4-5.

4. For a sample of these reactions, see "Our Most Sacred

Duty: Save the Fatherland, the Revolution, and Socialism,"

Granma, August 29, 1991. Consult any of Castro's speeches during

this period--for example the September 5, 1992 anniversary speech

delivered at the Juragua nuclear power plants in Cienfuegos.

5. For an expanded discussion on these points, see Marifeli

Perez-Stable, "'We Are the Only Ones and There Is No

Alternative': Vanguard Party Politics in Cuba, 1975-1991," in

Baloyra and Morris, eds., Conflict and Change in Cuba, pp. 68-70,

76-84.

6. For description and discussion see, J. Richard Planas,

"The Impact of Soviet Reforms on Cuban Socialism," in ibid., pp.

246-256. Also see Jorge I. Dominguez, "The Political Impact on

Cuba of the Reform and Collapse of Communist Regimes," in Carmelo

Mesa-Lago, ed., Cuba After the Cold War, Pittsburgh, PA:

University of Pittsburgh Press, forthcoming, chapter 4.

7. This was the first time in which, in a confrontation with

the Soviet leadership, Castro had to defend his position

explicitly on grounds that he was not favoring Stalinism. For

details and discussion, see Enrique A. Baloyra, "Socialist

Transitions and Prospects for Change in Cuba," in Baloyra and

Morris, eds., Conflict and Change in Cuba, pp. 48-55.

8. For a more complete discussion on this topic, see Peter

Johnson, "The Nuanced Lives of the Intelligentsia," in ibid., especially pp. 140-148.

9. Abrantes died in jail later on, allegedly of a heart

attack while he was exercising.

10. For more details on the Ochoa-de la Guardia-Abrantes

case, see Enrique A. Baloyra, "The Cuban Armed Forces and the

Crisis of Revolution," in Louis W. Goodman, et al., eds.,

Civil-Military Relations in Latin America, Lexington, MA:

Lexington Books, forthcoming. For a discussion of political

control of the Cuban military, see Phyllis Greene Walker,

"Political-Military Relations Since 1959," in Baloyra and Morris,

eds., Conflict and Change in Cuba, especially pp. 115-128.

11. Adam Przeworski, "Some Problems in the Study of the

Transition to Democracy," in Guillermo O'Donnell, et al., eds.

Transitions from Authoritarian Rule, Part III, Comparative

Perspectives, Baltimore, MD: The Johns Hopkins University Press,

1986, pp. 50-53.

12. Leonardo Morlino, Como Cambian los Regimenes Politicos,

Madrid: Centro de Estudios Constitucionales, 1985, pp. 245-273.
13. Jorge I. Dominguez, "Secrets of Castro's Staying Power,"

Foreign Affairs, Vol. 72, No. 21, Spring 1993; Samuel Farber,

"Castro Under Siege," World Policy Journal, Vol. 9, No. 2, Spring

1992; Edward Gonzalez and David Ronfeldt, Cuba Adrift in the

World, RAND-4231-USDP, Santa Monica, CA: Rand Corporation, 1992.

14. For a critique of this point of view, see Carollee

Bengelsdorf, "Cubanology and Crisis: The Mainstream Looks at

Institutionalization," and Nelson P. Valdes, "Revolution and

Paradigms," in Andrew Zimbalist, ed., Cuban Political Economy:

Controversies in Cubanology, Boulder, CO: Westview Press, 1988,

pp. 212-223 and 196-206, respectively.

15. This was certainly the case until 1975. For discussion

and description, see Frank T. Fitzgerald, Managing Socialism:

From Old Cadres to New Professionals in Revolutionary Cuba, New

York: Praeger, 1990, pp. 111-131; K. S. Karol, Guerrillas in

Power, New York: Hill and Wang, 1970, pp. 451-476; Jose Luis

Llovio, Insider: My Hidden Life as a Revolutionary in Cuba, New

York: Bantam, 1988, pp. 206-213, 237-251; Rhoda Rabkin, Cuban

Politics: The Revolutionary Experiment, New York: Praeger, 1991,

pp. 50-52, 59-62, and 101-104; Sergio Roca, "The Comandante in

His Economic Laberynth," in Baloyra and Morris, eds., Conflict

and Change in Cuba, pp. 89-91; Andres Suarez, Cuba: Castroism or

Communism? Cambridge, MA: M.I.T. Press, 1967, pp. 237-241.

16. Cuba's revolution has frequently been compared to

Mexico's. For a discussion of how the Mexican revolutionary

regime preserved and improved on some of the key features of the

porfiriato, see Lorenzo Meyer, "Historical Roots of the

Authoritarian State in Mexico," in Jose Luis Reyna and Richard S.

Weinert, eds., Authoritarianism in Mexico, Philadelphia, PA:

ISHI, 1977, p. 4.

17. In its final form, the Act was included at Section 1701

et seq. of the National Defense Authorization Act of 1993 (H.R.

5006/S. 3114).

18. These included Argentina, Canada, France, Germany,

Mexico, the United Kingdom, and Venezuela.

19. The Secretariat was abolished, as well as the positions

of second secretaries and alternates. Party departments were cut

down to nine and the party bureaucracy was reduced accordingly.

20. For a comprehensive discussion of those policies and of

their probable outcome, see Carmelo Mesa-Lago, "Cuba's Economic

Policies and Strategies for Confronting the Crisis," in

Mesa-Lago, ed., Cuba After the Cold War, chapter 6.

21. I am aware of changes in the platform of the PCC and of

the 1992 constitution, but neither of these represents a

political liberalization.
22. "Nontraditional" is utilized here in reference to the

revolutionary period during which tourism and non-sugar exports

were neglected, and Cuba's insertion into the world economy

relied very heavily on its participation in the now-defunct

Council for Mutual Economic Assistance, which joined together the

economies of the Soviet bloc. Cuba's role within that order was

one of providing agricultural (sugar, citrus) and mining (nickel)

products.

23. For discussion of adequate future strategies, see Jan

Svejnar and Jorge Perez-Lopez, "A Strategy for the Economic

Transformation of Cuba Based on the East European Experience," in

Mesa-Lago, Cuba After the Cold War, chapter 9.

24. Taken from Amaya Altuna de Sanchez, "Cuba Mayo 1993,

Analisis Informativo de la Realidad," paper delivered at the

Annual Congress of the Partido Democrata Cristiano de Cuba,

Miami, June 4, 1993, pp. 19-23.

25. Naciones Unidas, Comision Economica para America Latina

y El Caribe, Balance Preliminar de la Economia de America Latin y

El Caribe, LC/G.1751, 18 Diciembre 1992, p. 8.

26. "Bridging the Gap? Cuban Tourism in the 1990s," La

Sociedad Economica, Bulletin No. 29 (London), April 19, 1993, p.

1. Also see Mesa-Lago, "Cuba's Economic Policies," in Mesa-Lago,

ed., Cuba After the Cold War, p. 224.

27. Gillian Gunn, "The Sociological Impact of Rising Foreign

Investment," Cuba Briefing Paper Series, No. 1, January 1993, p.

15.
U.S. ARMY WAR COLLEGE

Major General William A. Stofft

Commandant

*****

STRATEGIC STUDIES INSTITUTE

Director

Colonel John W. Mountcastle

Director of Research

Dr. Earl H. Tilford, Jr.

Author

Enrique A. Baloyra

Editor

Mrs. Marianne P. Cowling

Secretaries

Mrs. Deloris A. Hutchinson

Ms. Rita A. Rummel

*****

Composition

Daniel B. Barnett