Vintage-American-car-Cuba-by-Teemu-R.jpg

Notes From a Failed Revolution

Just last month, economist Bob Aliber visited Cuba, keeping his eyes open and jotting down statistics and observations. Below, excerpts from the informal paper that Bob, a professor of international economics and finance at the Booth School of Business at the University of Chicago, has circulated to a few of his friends.  (Note that the topic headings are mine.)

Cuba, 50 years after the Revolution:

Honey, I Shrunk the Country

Cuba is shrinking; its revolution has hit the end of the road.  Its population is  growing at the rate of 0.1 percent a year, literally stagnation. The female reproduction rate is 1.7, or 0.5 percent below the rate necessary to maintain a stable population. In the next fifteen years, the number of women between age 15 and 40 will decline, and the number of births will decline further if the reproduction rate remains unchanged; the population will decline.  

The best and the brightest vote with their feet, between thirty thousand and thirty five thousand people leave each year for the opportunities in Miami and Mexico and Spain and Venezuela. (For reference, if the Cuban population were more or less constant with zero growth, there would be one hundred twenty five thousand in each one-year age cohort–the ten  year olds, the twenty year olds, the thirty year olds, etc; hence about twenty five percent of each age cohort leave. The intuition is that the proportion of university graduates and professionals who leave is higher.)  

The dependency ratio of the number of retired to the number of workers will increase, as the number of seniors increases relative to those in the active labor force, living standards will decline.  And the dynamic is that more people will leave….

Old Cars in Good Shape and Old Buildings in Bad Shape

20110116-_DSC1014_5_6_7_8.jpgThe fleet of 1947 to 1959 Chevys that circulate in Havana is amusing. Many of these vehicles are well maintained, and their upholstery is in remarkably good shape….New vehicles are not available in Cuba or are prohibitively expensive, while the cost of repairs of the sixty year old Chevy is modest by American standards. My guess is that the repair labor earns US$3.00 to US$5.00 an hour.

The deferred maintenance in the housing stock and public buildings is depressing….Sections of older Havana are remindful of the bombed sites in London and in Berlin in the late 1940s and the early 1950s–or of some parts of Chicago that had been abandoned by stable families because of gang violence.

The contrast between the love and affection shown the older automobiles and the decay of the eighteenth and nineteenth century buildings in old Havana appears to parallel private ownership and public ownership.

Fifty Years

There are now fifty years of data on the economic achievements of the Castro government. Its achievements in improving literacy and the health of the public–and especially the declines in infant mortality and the increase in longevity–are impressive. All of the deferred maintenance suggests a country in decline, one that has been “eating its capital.” The public and private savings rates are among the lowest in the world. The low birth rate for a poor country is a vote by the young women of Cuba that the government has failed to deliver on promises of abundant food. The outmigration of the young is like a vote of no-confidence in the management of economic opportunities.

The failure of leadership to respond to daily evidence of mis-management is remarkable.

As Ronald Reagan remarked, Fidel Castro promised to create the greatest Hispanic city in the Western hemisphere, and he did just that—only it was Miami, not Havana.

  1. Barbara Kidder

    Let’s not forget that our own New York Times hailed the ‘arrival’ of Castro to national prominence in Cuba as,

    “The George Washington of the Sierra Maestra…”!

  2. La Tapada

    It makes me sad to see buildings with so much character in decline. And why don’t we put up such beautiful buildings anymore?

  3. Totus Porcus

    This is unpossible. Mandela said the Cuban Revolution was a model and a great success.

  4. Franciscus

    Ahhh. Utopian Nirvana!

    Will our praetorian guard media report on this?

  5. Marion Evans

    When the thug finally dies, we are going to make a fortune fixing the sad country that he will leave behind. Capitalism always wins.

  6. Mike K

    Michael Totten, a serious journalist who travels all over the world, has a series on Cuba this month.

    http://www.worldaffairsjournal.org/blog/michael-j-totten/once-great-city-havana

  7. Jeff Shepherd

    Cuba and Detroit – socialism’s end result

  8. Quinn the Eskimo

    I wonder whether, after Castro dies, the country will make the turn towards becoming a free nation or whether it will continue to spiral into misery and failure.  One likes to be hopeful, but socialism is one of those things that people never give up on, no matter how much fails.

  9. Bereket Kelile

    Just think, when Cuba finally moves away from Castro and communism they’ll have an incredible comparative advantage in vintage cars. They may even become the vintage car capitol of the world.

  10. Look Away

    Is the Pope watching and listening?

  11. Tuck

    “Its achievements in improving literacy and the health of the public–and especially the declines in infant mortality and the increase in longevity–are impressive.”

    Assuming you can believe their statistics, and I’ve never heard a good explanation for why one could.

  12. Tuck

    “Ditto this with the state of things in Detroit.”

    Let me be the first to call for lifting the boycott of Detroit!  Especially at this time of year, it’s horrible that those oppressed Detroiters need to swim for freedom!

  13. Juliana

    This is only anecdotal, but we recently had a Cuban family join our school. We had a meeting with parents and asked about the education of their third grade son when he was in Cuba. (Dad had brought his wife and children from Cuba two years ago. He’s been in the States for 7 years.) Dad told us that in Cuba the education was worthless, that 16 year olds were teachers and the children were not even learning their letters or numbers. (His child’s academic level is at Kindergarten to 1st Grade.)  He was disgusted with Cuban education, to put it mildly.

    Cuba is but another example of the poverty-ridden, regressive societies that have been ruled by socialists or “benevolent dictators.” It’s sad to see this type of society held up as an example to which we should all aspire – after all, capitalism is the true evil of the world.

  14. Mallard

    The failure of Cuban communism is normally placed at the doorstep of free markets. For you see, it is the boycott of Cuba that caused the ruin. If only it (communism) was done right with no interference from the evil capitalists, then it would work perfectly. I have actually heard this excuse stated aloud. Thinking people laugh at this notion, but the Left and the general news media will keep trotting it out. They hope they can get some gullible 20 somethings to buy into it. Ditto this with the state of things in Detroit. 

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