Note — this is post 2 of a 5 part series on my Cuba trip.
- Getting to Cuba, and first impressions
- (This post) Free healthcare or modern luxuries? Cuba’s economic paradoxes
- What growing up in China taught me about Cuban society
- Tobacco farming and the art of cigar rolling
- Fantasies of a San Fran-Cuba
When we first landed in Havana, I felt like I was entering a foreign yet familiar land: the wifi-less, A/C-less airport with its long customs line and slow baggage carrousels reminded me of Jakarta, and many of the other airports in SE Asia. I even had a brief flash of fear: what if this trip isn’t as exotic as we thought it would be! That was a short-lived fear, because as we visited more and more places, a fascinating time-capsule did start to emerge from our visits, chats, and drives.
Cuba’s economy has survived a roller-coaster ride of ups and downs in the last century. Around the turn of the 20th century, Cuba was enormously rich from its sugarcane fortunes and its prohibition-era tourism profits. That prosperity devolved into a despotic presidency, which then led to a military coup and a corrupt dictatorship. All this came to a head when Fidel Castro and Che Guevara’s gang, the self-styled Los Barbudos, led and won the Cuban Revolution. As much of the country’s business and wealth became nationalized and re-appropriated, its rich and educated class fled the country or suffered being exiled.
As Cuba’s economy suffered and the US imposed an embargo to flush out her new idealistic leader, the country resorted to aligning with the USSR, and then more recently Venezuela, to receive foreign aid to support its sagging economy. The population generally remained very poor, and Cuba had several refugee exoduses in the last 60 years. On the other hand, things weren’t all bleak. As Fidel moved the country towards socialism and the state took ownership of ~90% of all agricultural production, it also created a social safety net system that provided for housing, education, and universal healthcare.
We were dropped into the middle of this fascinating stew of influences, and caught lots of glimpses of this economic puzzle that’s practically held together by duct tape. Now that Venezuela’s economy has tanked, Fidel’s brother Raúl has been forced to slowly introduce economic reforms, such as opening parts of the country tourism, and allowing locals to own homes and operate private businesses, but more on that later..
For our first night, we stayed in the Marianao suburb outside Havana, then the next morning took a cross-country drive east towards Cienfuegos. Life outside the major cities revolved around an agricultural economy that hasn’t changed much in the last 50+ years. Our hosts at the casas particulares all raised chickens in their backyards, and often grew banana or other fruit trees if they had space. Neighborhood markets mostly operated out of people’s houses, push-carts, or bicycles, and all hawked fresh, local produce (heh). We learned that this self-sufficiency trend really started during the “Special Period” in 1991 — when the USSR collapsed and 1/3 of Cuba’s imports dried up overnight. Food shortages were rampant across the country, and many Cubans resorted to growing their own fruits and vegetables, and raising their own livestock and chickens.
In the countryside, farm-life and “modern” technologies co-exist, sometimes comically. As we criss-crossed the country on the Autopista Nacional de Cuba (A-1), our car often had to share the road with farmers on horse drawn carts, chickens freely running around, grazing cows, and cowboys riding their horses. Us city slickers also learned that it was harvest time, because we passed several groups of farmers drying their rice on the side of the road.
Even in Cuba, there’s a rural/urban divide, but it doesn’t seem nearly as divisive as in America. Farmers may joke that Havanans don’t know how to ride a horse, yet rural folks often make supplemental income from selling their handiworks to passing drivers. Our Havana-based guide took us on a detour near Pinar del Rio, because a farmer there famously smokes his own chorizo and ham, and sells them to passers-by. We ended up hauling that smoked pig leg for 2 days in the trunk of our taxi.
Those taxis were adventures in themselves. Cubans who could even afford a car can either struggle to keep their 1950’s US cars functional (“luckily” there seems to be minimal govt regulations for safety standards), or drive Russian imports like the Lada. Several of our taxis were literally falling apart — the first one only had one window handle between its 4 windows, so each time a person wanted to roll down the window, we had to pass around the driver’s window handle.
But often the cars were beautifully restored, with the long-gone American engine swapped for a more reliable and durable German engine. Our driver from Trinidad back to Havana confidently zipped down the highway at 70 km/hr in his ’55 Chevy BelAir. Only the car’s body and chassis were original, and it’s been refitted with a 5-cylinder Mercedes engine, with Mercedes & Chevy brakes. These old American steel tankers are so heavy that Mercedes engines are often the only ones capable of carrying so much weight.
Side note: each car on the Cuban road represents a huge labor of love! Our driver joked that Cuban Taxi drivers are the most skilled mechanics in the world — because they have to resourcefully hunt down used Russian or European parts, and service their cars every 2 or 3 weeks just to keep it running! Doing all this for a 60 year old car seems baffling to most Americans, yet even a rusting old car is still a coveted prize for the average Cuban. Just like in China ~20–30 years ago, having a driving license and driving a company car is a respected job that makes a really good wage.
Haunting shadows of Cuba’s rich pre-revolution heydays also abound in its buildings and architectural styles. In major cities like Cienfuegos, Trinidad and Havana, 100 year old neoclassical and Spanish-style mansions now stand in disrepair. They’re sometimes overcome by encroaching trees and the tropical weather, reminiscent of the temples around Angkor Wat.
Cubans are proud, resilient, and resourceful. When Fidel’s revolutionary army re-appropriated mansions from the upper class and distributed them to the poor, most of that population didn’t make enough income to maintain their houses. But they persevered. When residents could afford the occasional coat of paint, they would repaint the outside back to its original glory, much like the ‘55 Chevy BelAir. But often, if you aren’t careful and miss that laundry line hanging from the balcony, you’d easily mistake a house for being completely abandoned and ready for demolition.
Raúl Castro has slowly eased Cuba’s isolation and introduced economic reform in the last ~10 years. Cubans are now allowed to buy homes, though people usually buy homes in cash, because the mortgage industry is practically nonexistent. Locals are also allowed to own small businesses now, most of which are related to the tourism industry. However, because the government was afraid of letting western tourism change the local culture unfettered, it created a dual economy that exists awkwardly side by side. It’s the tale of two currencies.
Tourists change their currencies into the CUC (Peso Convertible), which is pegged to the USD, while Cubans mainly use the CUP (Peso Cubano / “moneda nacional”), worth 1/25 CUC. Tourist pay very Western prices with their CUCs (e.g. restaurants charge 10~15 CUC per meal), while locals pay local prices (maybe 1/20~1/100 of Western prices). Banks always sport extremely long lines, so it’s hard work to change money between the two currencies.
The average Cuban monthly income is ~25–30 USD. So being in the tourism industry can be extremely lucrative. Many families rent one or two rooms in their house, with each room per day costing ~30 USD. Even at this managed pace of economic easing, it was shocking to see tourist-destination cities (e.g. Viñales or Trinidad) look so much more modern and wealthy than places in the countryside or even poor parts of Havana. It’s also very common for Cubans to change careers from very respectable white collar jobs to tourism. For example — our tour guide told us that half her classmates from law school have already left Cuba, and those that remain have mostly moved into the tourism industry.
For those Cubans not working in tourism, they can thank the national social net for keeping many items practically free. For example, our tour guide told us that glasses are only ~20 CUP, and medical services like LASIK surgery are free!! Hopefully the lines for those services are shorter than the lines for banks, pharmacies, and groceries.
As the economy continues to transition in spurts and starts (though, depending on when Trump gets around to Cuba, this could change), it’ll be interesting to see which parts of this paradox evolve. There’s already evidence that tourism dollars are benefiting Cubans unevenly, and the gap between rich and poor is widening. Economic development comes with its evils, but I’m optimistic that this little idealistic and socialist nation may be able to evolve an interesting and different model for capitalism than what we’re used to here in America.
