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Showing posts with the label state-capitalism

Cuba's Capitalism

The misty-eyed support for Castro's Cuba would not be so worrying were it confined to the ranks of Stalinists; however, its tendrils reach well beyond them to many Scots. The US trade embargo established in 1960 — the world’s longest-running trade sanctions — continue to squeeze Cuba’s finances, targeting foreign companies that do business with Havana for huge fines. But what has changed in recent years is that Raul Castro now publicly acknowledges that the island’s most nagging economic problems are mainly the result of bureaucracy and excessive state control.

The Castro regime has proven remarkably resilient and has maintained a tight control over the economy. At times, this has meant a heavy hand. None of this has abolished the commodity nature of production, nor the wages system. Generous subsidies from Moscow kept the island’s economy afloat until 1991, when the aid was cut off by the Soviet collapse. A period of painful austerity set in that Cuba has never really recovered f…