New Year´s Eve

It was a great privilege to be invited to somone´s house and enjoy the natural and easy hospitality of Cubans. The party of nine sat in a room measuring about 2 X 3.5 metres. Somehow it wasn´t cramped and somehow we felt comfortable. The roast pork was wonderful, the beans and rice was absolutely great. The 18 year old son asked ¨the chicos¨ lots of questions and we learnt a great deal by just being there. They did explain a great deal and some of it was quite moving.

One young women, who is about to be married told me that in life she has little ¨recourse¨, but she knows that when she has a baby it will be healthy, she will be able to feed it, it will be educated and even if the housing is poor, she will have somewhere to live whether the marriage lasts or not. She pointed out that for a third world country, Cuba was not doing so badly. Indeed!

The real miracle is how Cuba did not collapse when the Eastern Bloc fell in on itself. I don´t understand macro economics but Cuba was through if they did not get hard currency. The US blocade meant that it was not possible through the usual means of trade. The solution was the dual currency and to push tourism as a mean of extracting that currency. Essentially it has worked. It has a cost, perhaps it will not continue to work, but it has worked. Cuba extracts billions of dollars per year from tourists in the form of the Convertable peso. This, not China, not Venezuela, is the replacement for the Soviet aid.

Over dinner our host explained a number of things. We had seen trucks loaded with pre revolution refrigerators. We knew that the lastest push by the government was to supply new Chinese made fridges. But given that nothing is wasted in Cuba, and that mechanical ingenuity is remarkable, I couldn´t work out why people would not keep the old fridge and convert it into an airconditioner, or a motor bike, or a boat. The answer is that the fridge push was really about cutting energy use. The government made it conditional that people hand over their old fridges, because the new ones use about 10% of the energy as the 1940s dinosaurs. Energy is one of Cuba´s major issues. Even with Venezaulea´s Chavez swapping pertol for doctors, Cuba is still strapped. The two pronged policy is to reduce reliance on oil and build on the petrochemical alliance of the Carribean (Cuba, Venzeaula and Bolivia.) Cuba has the perfect climate for solar energy, but does not have the money to afford to intall it.

The story of milk is also interesting. There is very little dairy in Cuba, and while we have heard that it is possible to buy beef in the best tourist places, we have not seen it. Cuba decided that no child should be able to say that they went without milk. To do this dehydrated milk is purchased from New Zealand (no closer country would sell it to Cuba). So milk is rationed for children up to 7 years of age. It costs virtually nothing to buy with the ration card, but it is very heavily subsidised by the government.

This period of the dual currency is known as ¨the special period¨ and the national plan is to increase workers´ wages and eventually get rid of the dual currency. Exactly how this might happen is beyond my ability to comprehend fiscal policy.
Dancing in the corridor