The situation in Cuba Marc Vandepitte
Rebellion Translated by Sven Magnus
1. A math puzzle
many tourists have already made sure the numbers with the Cuban salary. In 2009 the average salary was 415 pesos. Is the equivalent of 12 euros, it seems ridiculous. Seems even more absurd when you know that an entire income is spent on the purchase of a pair of jeans or a pair of shoes. So one wonders what the hell does a Cuban to make ends meet? Look at the example of Ricardo. 52, is married and has two daughters. Employee at a state enterprise. The euro equivalent of his salary is less than what they give to my cousin of 14 years to buy some candy. Looked at this way, Ricardo belongs to the poorest on this planet. However it is not true. Because despite their poor pay, Ricardo owns a house with three bedrooms. The two daughters are studying at university and, according to statistics, Ricardo will live 20 years longer than its neighbor Haiti. Last year I had heart surgery, an operation that is reserved for the wealthiest in the rest of Latin America and Ricardo is no exception, is the rule.
How is it possible? No charges almost nothing and yet can afford things that in other Latin American countries can afford only the wealthiest strata of society. This apparent contradiction has to do with the fact that the price of goods and services can vary greatly from country to country. Cuba is an extreme case because many goods and services such as education, health, transport, culture and food commodities are free or very cheap. The pay in Cuba does not have the same function in a capitalist society. A good understanding of the Cuban situation is even more difficult because of three complications. First is the dual currency system: there is the Cuban peso and the CUC. The weight is mostly used for basic goods and services, CUC is used for extras. Tourists generally only pay in CUC. The CUC has more or less the value of a dollar (varies slightly against the euro). For the past few years has fixed value of 24 pesos. A product of the weight circuit is worth much less than in the circuit of CUC. A drink, for example, or a meal at a restaurant in pesos, comes easily 10 or 20 times less than in a place where you pay with CUC. In the nineties, the CUC was a thing of the tour, but that changed. It is no longer unusual to find a menu with prices in both currencies. A second complication is that many families supplement their income with foreign currency sent by relatives abroad or CUC because they work in tourism or in a joint venture where together tips, because they work on their own, etc. In addition there are many workers and employees receiving products and / or bond exchange for certain assets in addition to their wages as such. The third complication is that there are goods and services also offer very cheap to staff through the company. The same device costs much less when purchased through the company when edquiere in a store. This is for example a TV, but can also be a holiday week.
The foregoing makes it clear that it makes little sense to calculate the equivalent of a Cuban salary in euros or dollars. The result of this calculation only gives us what we could get a Cuban abroad, not what they have access in their own country, except in stores CUC (and still do.)
To really know what a Cuban can buy with the wages, or in other words what is your standard of living, calculate the "real Purchasing Power." In theory it is very easy, in fact this calculation is not so easy. Is as follows. It takes a basket hundred such products and goods. First calculate how much this basket in Cuba in pesos. After calculating the value of the basket in a reference country. We take Belgium, but we could choose any "developed" because there are hardly any differences in pricing between rich countries. Results in other words do not depend on the country reference, in this case Belgium. Assume that the basket is worth 200 pesos in Cuba and one basket is worth 300 euros in Belgium, then to 200 Cuban pesos, you can buy both in Cuba and with 300 euros in Belgium. In this example because the real purchasing power of a Cuban peso equals 1.5 euro. This result allows us to calculate the real value of a Cuban salary in euros.
2. Some figures
Actually the average rate is 1 peso = 1.6 euro or 53 times the nominal exchange rate. Find the explanation of our calculation in the appendix. Closely approximates the information found on the public record of the CIA: CIA World Factbook. i The calculation shows that a Cuban (average) in Cuba can buy one Cuban peso, which can buy a Belgian with 1.6 euro. The CIA mentioned: 1 peso = € 1.6 dpi (Purchasing Power Parity or purchasing power parity). Mind you, this is an average. There are huge differences depending on the products and services. Some examples: a doctor visit or hospital admission comes zero weights, a weight 0.2 bus ticket, a visit to the barber 3 pesos, the monthly electric bill 25 pesos, a train ticket (100 km) 8 pesos , a book about 25 pesos. These are examples of services or goods cheaper. At the other extreme is a new pair of shoes cost 240 pesos, a fan 1,000 pesos and 2,000 pesos a microwave. When
differentiate between various types of products and services, get an even better idea of \u200b\u200bwhat would amount comparable services or products in our country. For commodities - the vast majority of what Cubans eat - there is a parity of 1 peso = € 4.15 dpi or 141 times the official exchange rate. For CUC stores products or services of private persons (to be paid in CUC), parity weight is 1 euro = € 0.025 dpi. That's even less than the official rate, ie 0.8 times. In the annexed behind a list of products and services, and others.
figures and examples show that the price structure in Cuba is completely different from what we handle. This is a result of heavy subsidies for basic goods and services and the fact that Cuba, after the fall of the Soviet Union, had to start paying for its imports to world market prices. Some examples of the amazing prices in Cuba: the monthly fee to pay the mortgage on the house is less than 10% of salary, but a pair of shoes at a store CUC is worth easily a full salary. On the other hand, the monthly bill for energy and water costs the equivalent of two beers at CUC sector. A pack of cigarettes worth the equivalent of the monthly food basket for the whole family. You may go several times to the theater, movies, or to a baseball game (comparable in popularity to football here) for the price of a gallon of gasoline, etc ...
Therefore there is a difference between the products and services, and others. The former are subsidized and are free or very cheap. Studying at university or a renewal after a long hospitalization are free or very cheap. A bus ticket costs 170 times less in Europe than here in Cuba, the same goes for a visit to the theater. With a basic ration one can buy a number of very cheap clothes and food, but the supply is limited. For extras or luxury goods, the Cuban pays market-driven prices internal when it comes to food and the world market for the rest. In comparison with commodities, these prices are soaring. Together now
puzzle pieces. We took a family where both parents work and have two children. A child is in college and the other is in secondary education. This first category of families only have their pay by weight and has no access to additional revenue in CUC. 40% of Cubans are in this situation. Have average income of 830 pesos. To buy what they can buy these Cubans in Cuba, here in Belgium we need 2,220 euros. Recently calculated that a family with two children studying in Belgium, you need at least 2,150 euros to make ends meet. Cuban families will not need loans for their children to study, you will not postpone any operation in the hospital despite their relatively low incomes. The acquisition of a house will not be problematic: over 80% of the population own their home. For a refrigerator, a washing machine, TV or radio there is also room in the budget of this family. But eating meat every day is impossible, and with shoes and clothes have to be careful. For arrangements in the house will have to take out a loan or have to save up have enough money. A dinner in a restaurant where you pay to CUC will be rather rare or totally impossible. This family has a very tight budget, but it hardly can be called poor, much less when compared with the standards of other Latin American countries.
Figure 1
The second family consists of the same way, but provides additional income. 60% of Cubans fall into this category. The average family has, in addition to their regular income, additional income of 70 CUC or 1680 pesos, or a total income of 2,510 pesos for the family. When calculated in dollars, this family triples income of the first family, but those extra dollars CUC or not engaged in the purchase of commodities, are devoted to extras. These goods are much more expensive, sometimes even 100 times more expensive than products and services. These 70 CUC gives purchasing power equal to average 480 euros in Belgium, which has the purchasing power of this family to € 2700 PPP. In pesos tripled wages, but because of the price structure, this means only a modest growth of 22% of purchasing power. This family will have few problems getting meat on the table or buy clothes or a pair of shoes. A microwave or dryer is no problem and a beer in the circuit CUC occasionally be possible. Saving a little can buy a DVD player or mobile phone. The acquisition of a computer is not evident. Whereas European standards, this family is not rich, but live much better than an average family in any Latin American country.
Figure 2
Within the group of 60%, which has access to CUC in Cuba are relatively wealthy families who have additional income that are above average. They are Cubans who have a business (legal or illegal) that are very profitable and a lot of money from abroad. This is a very small percentage of the Cuban population, some tens of thousands of people. Besides all the previously mentioned products, they can easily acquire a laptop, mobile phone, a second TV, very expensive designer clothes etc ... But that does not mean that these families would be significantly richer. For a doubling of real purchasing power would have to have extra month of ₱ 3,000, or 170 times the average salary in pesos.
Figure 3
This piece has not yet completed the puzzle. Within the group of 40% with no access to CUC, we speak of an average family where both parents work, but that's not for everyone, of course. There are also unemployed, pensioners and people living alone. As in the rest of the world, this category of people is a fragile category. 20% of Cubans are in this category. A single mother has to survive on an average of EUR 1,700 dpi, that is, some less. Recent studies in Belgium estimated that a single person with two children, you need between 1,500 and 1,900 euros, depending on the age of the children. The statutory minimum wage in Belgium is between 1,000 and 1,300 euros. Cuban average retirement in 2006 was worth around EUR 800 dpi. Roughly corresponds with the figure of Spain. In Belgium the average retirement comes to be 200 euros and stands at 1,000 euros. Within
yet remain low incomes, but we must bear in mind that in Cuba almost all commodities and services are (almost) free and largely rationed, that is fairly distributed. The shortage is therefore not come to light in the same way as in Europe. In Belgium, one in ten families say postpone doctor visits for lack of money and why our country has one of the best health systems in the world. In Cuba this is something unthinkable. No one, however "poor" that is, stop going to the doctor or buy medication. None of the three categories will have problem to send to college their children. However this does not mean you have to envy their lives. Meals from these groups tend to be austere fragile. There is enough food (calories and protein) but it is monotonous, long beans and rice. The Cubans like pork, but eats little. I like to cook with oil, but these sections of the population rarely can do. Hygiene products are also a problem. Worn shoes are no exception. Arrangements in the house are almost inaccessible, so they are far from paradise. But too far from the deep poverty of the continent. 3. Some observations
3. 1. Economic development and development
social medium in Belgium for a family of two children is € 3,010. In Cuba, the median income is € 2,500 dpi, a family without CUC has to live with € 2220 dpi or respectively 83% and 73% of the average Belgian. Although Cuba is not an economically developed country such as Belgium and has a very weak position in the global market, is able to provide a decent standard of living for its population. Kofi Anan said that "Cuba has shown that even for a poor country, it is necessary to expose its people to the worst hardships. Cuba has a health status exist in most poor countries. In that way everything can be learned from the Cubans. "
The following chart shows very clearly that a country (economically) poor social indicators can have very high level. Is calculated based on data from UNDP (United Nations Development Programme)
Figure 4ii
Dashed line are the results of the OECD countries (Organization for Economic Cooperation and Development ), the club of the 30 richest countries. In regard to infant mortality, life expectancy, nutrition (underweight children) and education (percentage of primary and secondary) Cuba gets results that compete with the OECD average. But when we look at GDP per capita, we see that Cuba is much lower. This chart shows how even from a very weak economic situation, it is possible to develop a society based on social or socialist principles. An additional problem is that Cuba is having derarrollarla in a hostile climate. Cuba's example teaches us that a weak position in the global market, can be compensated almost completely, taking the right decisions for society. The weak economic base is obviously a barrier to providing adequate food, a decent education and adequate health system, but this show can be overcome. Social development is not determined by economic development. Cuba is not the only country to prove it. Kerala, a state of India, is situated economically far below other states, but socially is far above the rest. Conversely
iii high GDP does not guarantee social development. Take two countries with a GDP per capita nine or ten times higher than that of Cuba: The U.S. and Britain. • U.S. E n life expectancy of the poorest groups of the population (mostly Latino and black) is the same as in China and some states of India, that is six years younger than in Cuba. iv
• In the U.S. 25% of children under age 12 are hungry and one in seven adults is illiterate. v LONES
• 1.5 thousand of children have no roof and one in six people over 65 is required to continue working because they reached retirement. vi
• 22% of all Britons are poor. Children are worse: 28%. vii
• 130,000 families in the UK are homeless each year viii and 25,000 Britons die of cold. ix
course that's not the "promised land" that the U.S. propaganda has to Cubans to demonstrate the superiority of their system.
The high social development despite the weak economic base, also has its disadvantages. The high social, cultural and intellectual because obviously high expectations among the population, but they lack the economic base, which in turn causes frustration in the population. The development of the tourism industry still further reinforces that feeling. Cuba should be the only country in the South, where the degree of scolarización local population is higher than the tourists. But the tourist does have more purchasing power. Therefore the biggest challenge for the Cuban revolution is destroying this economic backwardness. And develop this point in another article. x
In short: the development and combating poverty is primarily a question of distribution of power relations and therefore the policy. Poverty is not a question of fate, but a consequence of power relations that exist in a society.
3.2. Compare with Latin America
Calculations made real purchasing power in Cuba, we compared with Belgium. We did it for educational reasons, so that a European could see what the situation would be if I lived in Cuba. There is however a danger in this exercise as compared to the spontaneous that makes a tourist when in Cuba. It is an unfair comparison, therefore the conclusion can not be other than baseless. If we judge a society, we need to do based on their potential (economic), its history, its conditions, etc ... and not on our own. It makes much more sense, is more appropriate to compare Cuba to other Latin American countries. xi
Figure 5
First the economy. To measure the production of services and products, often using GDP per capita. If measured according to the official exchange rate in 2007 was $ 4580 compared to 3610 in Cuba in Latin America. If we express by volume (according to purchasing power parity) was respectively $ 12,000 and $ 9780 dpi dpi. The graph above puts Cuba compared to other Latin American countries. In both calculations Cuba is about 25% above the Latin American average. In the years 2004-2009 the annual economic growth in Cuba was 3.2% higher than in the rest of Latin America. Above must take into account that, if Cuba had been able to maintain the level of growth it had in the years 1959-1989, after the fall of the Soviet Union GDP now would be at least 75% higher still. xii Without the economic blockade -The longest in the history of the planet, we might add another 75%. xiii In this case, Cuba would be positioned as in the following graph.
Figure 6
always talk about averages, that means you h ave to keep in mind that the Latin American continent is the continent where the gap between rich and poor is bigger. In other words, much of Latin America's population is below this average. According to ECLAC (Economic Commission for Latin America, United Nations) 35% of Latin Americans in 2007 were considered poor, and 13% extremely poor. Those are the people xiv the huge slums in the capital.
And Cuba? Our calculations based on figures from the beginning of the millennium we teach that the weakest group of Cuban society (the poorest 10%) in terms of real purchasing power was still above the Latin American average. xv Meanwhile quite a number were increased salaries and pensions. As in Cuba and commodity services are free, you can not talk about poverty of money. The most recent UNDP report estimates that the number of Cubans who are below the threshold of "human poverty" (the index HPI-1) is between 4 and 5%. This index measures life expectancy, the rate of Scolaro and social conditions (access to safe water and underweight). In the case of Cuba the figure measures the social marginality, that is, the percentage of people who for one reason or another "off" and lives on the margins of society. This figure for Cuba is among the lowest and therefore the best in the world. advanced position on social issues that Cuba has with the rest of matinoamérica, is well reflected in the following figures:
• Life expectancy in Cuba is five years above the average for the continent. xvi
• Infant mortality is five times lower than the Latin American average. If Latin America had the same result Cuba would be saved each year nearly 300,000 infants and children. xvii
• According to FAO (Organizacón of the United Nations Food and Agriculture) Cuba obtained, despite the economic blockade, the highest rate of Latinamerica in food safety, superior even to the country "flesh" par excellence, Argentina . In Latin America 10% of the population lack food, Cuba is below the minimum threshold of 2.5%. xviii
• On education, the Cuban results are far superior to the rest of the continent. According to a UNESCO study, the Cuban school third grade are far more to the rest of Latin America. For math, 54% of Cuban students in the highest level. Cuba was placed under Nuevo León (Mexico State) with 23%, Uruguay and Mexico 19% 16% met. For language the result of Cuba is 44%. Nuevo León, Costa Rica and Chile are with 18% each. xix
Poverty in Cuba has nothing to do, but in C uba wealth has nothing to do with that of Latin America. The American rich are organized as a class, often described as the oligarchy. They control much of the economy and the media and have an enormous influence on the state and political parties. In most cases can count on the support of senior army and church. In order to achieve great social progress for the benefit of large parts of the population is necessary to break the power of this oligarchy. Recent developments in Latin America is clearly demonstrated. In Cuba the situation is totally different. The rich do not form a class, do not control any part of the economy and do not employ anyone. Nor have the least influence on policy decisions or in the media.
3.3. The internal gap in Cuba
E n 1993 he authorized the use and possession of the dollar. Subsequently, the dollar and replaced by the CUC. Following this double monetary system was born a gap between Cubans with access to CUC and those who do not. Because of the low value of the peso against the dollar this gap was quite big in the mid-nineties. At that time was needed (on the black market) to pay 150 pesos for a dollar. A monthly salary was "worth" then a dollar and a half. This situation was explosive and during the summer of 1994 there were uprisings in the streets of Havana. Meanwhile, the Cuban peso's value was multiplied by seven and a greater share of the population has CUC or received a pay raise or a higher income. At this time the gap between Cubans and non-CUC is not as big in terms of purchasing power: the difference is only 20%. In addition, those living in lower scales, do not Flata any basic product or service, as is the case in the rest of the world, even the rich world -. Despite the double currency system, Cuban society is still very egalitarian. Also of note in the street is not extravagant decadence or dire poverty, as is common in the rest of Latin America.
And the gap with the tourists? No doubt the two million tourists a year have a demonstration effect that can not be underestimated. The expensive cameras and other bells and whistles, how to spend like CUC pesos certainly called attention to the Cubans. The purchasing power of tourists who visit the tropical island is actually much higher than an average Cuban. But this situation must be seen in context. The real purchasing power of the average tourist will easily exceed 1.5 times the purchasing power of a Cuban. But when we examine how tourists spend, we see a very different picture. Many travelers are accommodated in private houses, paying 20 to 25 CUC per night. One night in Varadero, on the contrary it easily between 200 and 300 CUC all-inclusive or 10 to 12 times more. Varadero is not for any tourist. In this context there is another observation necessary. During the visits we made the last years we see how more and more mixed Cuban consumers with tourists. In many restaurants, bars and tourist buses are consuming mixed with the Cubans. Would it be an exaggeration to say that the gap between tourists is larger than the gap between the Cubans?
Just do not underestimate the psychological effect. The basic ration is too tight and the Cubans who live weights have almost no access to new clothes, can not vary their diet and can barely move in the sector CUC. They see their fellow Cubans with CUC with expensive sneakers, cell phones, mp3 players, etc ... In a society that gives much importance to equality as Cuba, that stings even more. But a further point problematic is the structure of wages.
3.4. Social uprooting
The low value of the peso against the dollar and other foreign currencies, not only resulted in very unequal prices, but also very unequal income. A taxi driver or a waiter in the tourist sector easily multiply the salary of a teacher or a doctor. In Miami, which is just 200 km, can earn tens of times more so. In a country like Belgium this would have horrific social consequences. The difference in wages is much lower than that of Cuba at this time, however, and are brought to Belgium Romanian and Filipino nurses to address the lack of personal in hospitals. Not to mention sectors such as horticulture, construction and hotels, restaurants and bars. In this sense it is small wonder that hospitals and schools in Cuba are still personal enough.
problem is crystal clear that this causes tensions. The teacher's son who is 16 years for example, can earn in one night more than the salary of his father, taking tourists to a particular restaurant. Her sister may be able to win twice if it comes to seducing a tourist for a night. That explains why some girls love to engage in the business of the weak flesh and also why some try their luck across the ocean. But the biggest problem lies in the work ethic. If someone only has weights, you have to pay exorbitant prices for a pair of shoes, an extra piece of meat or a microwave. This seriously affects the motivation, increased corruption and endangered in the whole production system. In the long term this is unsustainable and therefore constitutes a second and very important challenge for the revolution. The series of reforms that are doing now is an attempt to address this concern. xx
generally calculated in PPP rate does not vary much through the years. Only when there is a difference between inflation in both countries compared, the rate change significantly.
List
calculation of purchasing power parity (ppp):
We made our calculations based on a basket that contains almost all goods and services purchased by an average Cuban family with two children and two adults through the years . It comes down to cost per month of this or that product or service. If a table is 600 pesos and lasts 20 years, this table costs 2.5 pesos per month. (600 divided by 20 and in turn the result divided by 12). The same applies to the calculation of the table in euros. Therefore takes into account the product or service that occupies the entire budget. The CIA World Factbook estimate that reached $ 1.96 ~ 1 weight dpi Euro: a weight ~ € 1.4 dpi (data from July 2009).
products and basic services: house (rent or mortgage fee), energy (water, electricity, gas), basic meals (book), maintenance products, public transport, medical and pharmacy costs, school fees, basic shopping clothes and shoes (or second-hand book), newspaper and magazine, tv, cinema, theater, sports game.
TV, washing machine, refrigerator, gas stove, etc ... purchased by the company where you work.
Rest: extra power in rural markets or shops CUC, snuff, alcohol CUC sector, extra clothing stores CUC, maintenance and use of the car, extra fuel, microwave, stereo, computer, phone, ...
TV, washing machine, refrigerator, gas stove, etc. .. CUC at a store.
Sources: ECLAC
, http://www.eclac.org/.
UNDP, Human Development Report, Washington, 2007-2008 and 2009. Vandepitte
M., De gok van Fidel. Cuba tussen socialisme in kapitalisme?, Berchem 1998. M. Vandepitte
'Armoede, rijkdom in socialisme', in K. Demuynck, ea, Cuba, ís een andere wereld mogelijk, Brussels 2002. Notes
i The figures given are the product of a comparative study of purchasing power in the summer made the 2009. CIA The World Factbook, https: / / www.cia.gov / library / publications / the-world-factbook / geos / cu.html.
ii Calculado a base de la UNDP, Human Development Report 2009, Washington 2009.
iii Vease M. Vandepitte, '15 years after the fall of the Berlin Wall: the unknown Kerala 'http://archive.indymedia.be/news/2004/11/90238.html.
iv Banco Mundial, Attacking Poverty. World Development Report 2001/2002 Nueva York 2000, p. 46.
v http://www.frac.org/html/hunger_in_the_us/hunger_index.html; http://www.fundmymutualfund.com/2009/11/nyt-1-in-4-children-and-1-in- 8.html; http://www.livescience.com/culture/090110-illiterate-adults.html.
vi http://edition.cnn.com/2009/US/03/10/homeless.children/index.html ; Http://www.postandcourier.com/news/2009/oct/12/new-normal-includes-work-after-retirement/ http://en.wikipedia.org/wiki/Poverty_in_the_United_Kingdom
vii; http:/ / www.theyworkforyou.com/wrans/?id=2005-06-20a.807.h.
http://www.poverty.org.uk/81/index.shtml viii. Http://www.freerepublic.com/focus/f-news/1918914/posts
ix. X See Vandepitte
M., 'The economic and social challenges of the Cuban revolution in 2010', http://www.rebelion.org/noticia.php?id=106387&titular=los-desafíos-económicos-y-sociales-de la revolution, Cuban-en-2010-, 23/5/2010. Xi
Figures from UNDP, Human Development Report 2009, 'Health Report', Financial Times, March 26, 2009, p. 26-7. Xii
After the fall of the Soviet Union, Cuba's economy collapsed. It took 15 years to regain the GDP was Cuba in 1989. The 1959-1989 growth rate that means a loss of 75%. Growth figure for the first thirty years, see R. Herrera, Cuba Revolutionaires. Take 2. Economie et planification, Paris 2006, p. 93. Xiii
Calculated by Alejandro Aguilar Trujillo, a professor emeritus at the University of Havana.
http://www.eclac.org/publicaciones/xml/5/30305/PresentacionPSE-2007versioncortafinal.pdf xiv, p. 12. Xv
Vandepitte M., 'Armoede, rijkdom in socialisme', in K. Demuynck, ea, Cuba, ís een andere wereld mogelijk, Brussels 2002, p. 50. Xvi
UNDP, Human Development Report 2009, p. 171-4. Xvii
unicef-based calculation, State of the World's Children 2009, New York 2009, p. 117. Xviii
FAO, The State of Food and Agriculture 2007, Rome 2007, p. 189-193. Xix
unesco / llece, The learning of students from Latin America and the Caribbean: Executive Summary of the First Report on Results of the Second Regional Comparative and Explanatory, Santiago, Chile, June 2008, p.24 at 29, Unesco, Education All in 2015. Alcazar "goal?, Paris 2008.
xx See Vandepitte M., 'The economic and social challenges of the Cuban revolution in 2010'.
Rebellion has posted this article with the author's permission through a license from Creative Commons, respecting their freedom to publish it elsewhere. TacnaComunitaria
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