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January 24th, 2010

Walk the streets for money

Having starting discussing my impressions of the economics of present-day Cuban communism, I should say more before moving on.

When the USSR collapsed, Cuba had to move from driving its economy by selling sugar, and only sugar, to the Soviets at prices which were almost charity on the part of Moscow. To recover from this, the 'Special Period', Cuba opened itself to tourists. At first they were physically divided from the locals, but as this is impractical and not fun for the folks relied upon to happily spend money, economic segregation was instituted. Now, in Cuba there is a 'double economy' with two currencies: Convertible pesos (CUC$) and Cuban pesos, moneda nacional (MN). The former is for the tourists, and the later for Cuban nationals, and the conversion rate is 25 MN to the CUC. Thus, as I understand it, the idea is to put consumables that might corrupt the locals from their good socialist ideals far out of their reach. Also, as CUC$1 is about AU$1.60, it is to milk tourists for as much cash as possible. It would only be comfortable at this time to travel to Cuba on Pound Stirling or Euros. Why this formula was chosen to reach these two ends is uncertain to me; maybe it is the only one feasible, despite its flaws, until a new way of building the economy is found and tourists can be booted out again. One is left to wonder if there was more wealth to splash about and equal wages for all were higher, if the system might be okay and not have the failures it does.

I don't know much about the MN, as in my whole time there I only possessed 23, but I can relate this example to give an idea of scale: a street 'peso pizza' costs MN 10. In a tourist hotel, a beer was CUC$3; that is, 7.5 times a street pizza. A strong encouragement for Cubans to keep out of places not for them. This is held in the region to be a shame of the post Special Period; under Battista, the horrid dictator Castro overthrew in 1959, Cubans were forbidden from certain places in their own country (then, mostly Casinos but also hotels and the like), and after the revolution Cuban nationals had their country for themselves, and many factors in the standard of living went up to levels never seen before. But now, while health care, education and other things are still world-leading, some things have come full circle, such as on full access for Cubans to places in their own nation. While all vendors have the same price for all items (and this is great; no need to shop around, and it fits with my view that an item has an intrinsic value – a can of Coke is a can of Coke and does the same job whether you pay $1 or $1.50), in some cases where both locals and tourists need something non-corrupting, there is a price in MN and one in CUC; we found that a ferry trip across the harbour is CUC$1 per person, or 50 MN cents. Needless to say, that's where some of my MN23 went thereafter.

Another difficulty of this method of segregation is that it has bred a class division where there was none before, with the new upper class being those in professions that deal directly with tourists: ironically, hotel maids and bar staff, the low paid positions in capitalist societies. Cubans, as I understand it, get the equivalent of about CUC$30 in MN per month (this even includes important folk like the Buena Vista Social Club; more on that later). If a maid gets a CUC$1 tip per room and cleans 30 rooms a day, there's a regular monthly wage in one shift. This caused me a dilemma as a leftist, I must admit: tip generously and prop up the economy and thus the people, but risk damaging a social laboratory for eliminating class division.

Another way some in the society get access to Convertibles is as old as society itself. It is incredibly common to see stunningly gorgeous, non-addict, young black women in their 20s (and some, I am disturbed to suspect, are younger) in the company of balding, pot-bellied tourist men at tourist hotels they would otherwise be barred from by the door staff if alone (no soliciting inside, but if you've got a job you can come in). It is everywhere, so much so that any Cuban woman in the company of foreigners is assumed to be a jinetera; I've heard of Cuban women with PhDs in the company of male associates being told off by prostitutes for not sharing (apparently there are no pimps; sisters are doing it for themselves). It seems the only reason myself and my friend Chris were not approached is that we had equally foreign women with us. Or at least one obviously foreign woman; after Chris and his partner Honor left, Naomi and I stayed on for a few days. On one occasion, I was in the street-side cafe of our hotel, and Naomi went in to get something from the room unaccompanied. Seeing a dark-skinned woman entering the hotel alone, the door man challenged her, and only upon hearing her non-Cuban accent let her pass. (While Nae was understandably upset for being taken for a hooker, the plus side is that she was obviously deemed to be beautiful, as the overwhelming majority of Cuban hookers could be models.)

Scams of people approaching you on the street wanting to sell you bogus cigars to get the CUC are frustratingly prevalent (so much so that when I open a t-shirt company for tourists, the Cuban Special will have the slogan “Close, but no %$#@ing cigars”), as is the offer of services from 'tour guides' (to take you only to bogus cigar shops and bars for commission). However, authentic tour guides at certain sites will offer to show one the city on their day off for a fist-full of pesos, and this is invaluable, as then you have the service of a person, who having made a deal for half a month's wage per person plus tips, which is little to us, is not out to rip you off. Then, you can ask all the curious and inane little questions about how the other half (or, erm, other now-much-less-than-half) live that you have, and get honest answers.

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