Those Who Look and Do Not See
Cuba and “State Capitalism”

By Nelson P Valdés, Professor Emeritus, University of New Mexico, Albuquerque
November 20, 2016

A CubaNews translation. Edited by Walter Lippmann.

“…. At a certain time Lenin raised the idea of the construction of capitalism even under the leadership of the proletariat. For your peace of mind, of course, I tell you that we have no such thing in mind, and it is not because we disagree with Lenin, but because the circumstances are different, since our process, which could count on the assistance of the  Socialist camp and the USSR, has made great progress, has very solid forces and does not have to raise the issue in those terms. “Fidel Castro, August 6, 1995.

“I remember reading how at one point Lenin conceived the construction of capitalism under the leadership of the workers, of a workers’ government. He said: ‘We must build capitalism, we must develop our productive forces’. But such was the harassment, the aggression, the isolation and the critical situation that he had no choice but to accept that challenge; Marx would have put his hands on his head, really.” Fidel Castro, August 24, 1998.

“Revolution is a sense of the historical moment; It means to change everything that must be changed …” Fidel Castro, May 1, 2000.

Those who are supposed to study Cuba do not pay sufficient attention to the institutions and practices that exist in the country.

Most scholars and reporters from the outside discuss, write and prescribe an imaginary or imagined Cuba. They write about the future and very little about the real present or the one that was. In other words, they do not ask the question –for example: Why are there CUPET and ORO NEGRO gas stations? Why are there two instead of one single company selling gasoline? They do not wonder why there are so many different types of taxis: HavanaTaxi, PanaTaxi, etc. Everything is seen as ONE State controlling them all… and everything else… because this is not analyzed. Actually, it is not even perceived.

It is obvious that in Cuba there is an almost completely monopolistic state capitalism that faces many difficulties imposed from abroad –particularly by the US government. This description is not meant to be pejorative, it is only descriptive. This state capitalism, however, focuses on the distribution of what it produces or generates from products and income. These aspects differentiate it from the typical state capitalism that distributes profits only among private investors.

With state capitalism, there are corporations which are independent of one another and can respond to different sectors within the state itself. For example, MINFAR [Ministry of the Armed Forces] has companies (including the Banco Financiero Internacional -International Financial Bank –which is different from Banco Popular de Ahorro – (National Savings Bank, which it does not control). Also, MINFAR also has a line of hotels (Gaviota) and its own farms. These farms show us that there is “vertical integration” in different productive chains on the island. And these state entities and chains –autonomous from one[] another –COMPETE with other state entities.

Are there possible contradictions –in Marxist terms– between Gaviota and Cubanacan, for example? And, since when have these institutions existed? They began in 1985. And who has studied the economic and political process of Cuba on the basis of these conditions? What exactly is a “business group” (e.g., AZCUBA [Cuban sugar company)?

Those who call for the introduction of capitalist measures on the island and dream of the market are out of tune and clueless. Some elements already exist, but that is not the whole reality. Everything is more complex and complicated.

Journalists and many academics from abroad confuse this with the capitalism of private corporations. They do not understand that the practice of capitalism by semi-state-owned or fully state-owned corporations is something totally different. One big difference, of course, is who appropriates the profits and how they do it. The profits in private capitalism go –eventually– to private hands. State capitalism usually appropriates profits and distributes some of those profits among the administrators and –individually or socially– among those working in or out of the company. Both types pay taxes.

Note: In Cuba, there were precedents of this situation – and they were established by the United States government. For example, the Nicaro Nickel Company was a US state corporation. Nicaro was an administrative subsidiary of the Freeport Sulphur Company which in turn “acted” on behalf of the Defense Plant Corporation and Metals Reserve Company owned by the United States.

NOTE: The use of the term “state capitalism” has no pejorative intent.

URL of the article: http://www.cubadebate.cu/opinion/2016/11/20/los-que-miran-y-no-ven-cuba-y-el-capitalismo-de-estado/

Cubadebate, Contra el Terrorismo Mediático http://www.cubadebate.cu