Friday, July 27, 2007

International Herald Tribune Editorial - Taxes in the global economy

Fidel's shadow looms as brother presides over Revolution Day
By James C. McKinley Jr.
Copyright by The International Herald Tribune
Published: July 26, 2007

CAMAGUEY, Cuba: A year ago, Fidel Castro led thousands of Cuban Communist Party faithful in enthusiastic cheers to celebrate the guerrilla attacks on army barracks that sparked his revolution a half century ago.

But Thursday, for the first time, it was Castro's brother, Raúl, who gave the traditional revolutionary harangue, deepening the widespread feeling among Cuba's citizens that their once all-powerful leader has slipped into semi-retirement and is unlikely to return.

And Raúl Castro, the acting president and defense minister, left little doubt he intended to shake up the island's centralized Soviet-style economy. He scolded the nation for having to import food when it possesses an abundance of rich land. He vowed to increase and streamline agricultural production. He also said Havana was studying ways to secure more foreign investment in industries without abandoning socialism.

"No one, no individual or country, can afford to spend more than what they have," he said. "It seems elementary, but we do not always think and act in accordance with this inescapable reality. To have more we have to begin producing more."

Raúl Castro spoke before about 100,000 people. His hourlong speech was studded with references to his charismatic brother's ideals. He ended the talk with one of Fidel Castro's more famous quotes about the nature of a socialist revolution, a passage the crowd mumbled along with him, like a prayer.

At times it seemed almost as if Castro were eulogizing his brother. "Not even during the most serious moments of his illness did he fail to bring his wisdom and experience to each problem and essential decision," he said. "These have truly been very difficult months, although with the opposite effect than our enemies expected, those who dreamed chaos would erupt and Cuban socialism would end up collapsing."

But Fidel Castro is still very much alive. Since the Communist Party has yet to officially replace him as the head of state, his presence in the wings continues to exert a strong influence in politics here, making it difficult for his brother to make significant changes to the island's state-managed economy, experts on Cuban politics said.

It was after two strenuous National Rebellion Day speeches last year that Castro suffered from an acute infection and bleeding in his colon from diverticulitis. Five days later, he handed power to his brother and a small group of cabinet officials on a temporary basis.

But since then, what looked like at the time like a temporary measure seems to have taken on a permanent aspect. He has had several surgeries and has acknowledged that at least one went badly. He has not been seen in public and has missed military parades and other events he usually attends.

The authorities periodically have released photographs and videos showing the 80-year-old leader looking first gaunt, then later more robust, the last of which appeared on television in early June.

He spends much of his time these days writing essays for the Communist Party newspaper on a range of topics, from the war in Iraq to the defection of Cuban boxers during the Pan American games.

He recently blamed the use of dollars and remittances from the Cubans in the United States for "irritating inequalities and privileges." The columns are rambling and sometimes humorous. He wrote last week that he was so engrossed in the games that he had forgotten to take his medicine.

"I don't have time now for films and photos that require me to constantly cut my hair, beard and mustache and get spruced up every day," he grumbled in one of his essays, entitled "Reflections of the Commander in Chief."

Raúl Castro, 76, has taken several small but meaningful steps over the past year that suggest he wants to open up Cuban society and perhaps move to a market-driven system, without ceding one-party control, not unlike what Communist China is endeavoring to do. In the 1990s, he supported limited private enterprise and foreign investment.

Since becoming acting president, Raúl Castro has twice offered to open negotiations with the United States to end a half-century of enmity and sanctions. He repeated that stand Thursday, noting that President George W. Bush would soon be leaving office "along with his erratic and dangerous administration."

"The new administration will have to decide whether it will maintain the absurd, illegal and failed policy against Cuba or if will accept the olive branch that we offered," he said.

Fewer dissidents have been arrested this year than in the past, and cadres of party militants have stopped harassing government critics, said Manuel Cuesta Morúa, a moderate opposition leader.

On the economic front, the younger Castro has allowed the importation of televisions and video players. He has told the police to let pirate taxis operate without interference. He has pledged to spend millions to refurbish hotels, marinas and golf courses. He even ordered one of the state newspapers to investigate the poor quality of service that state-controlled bakeries and other stores provide to people.

But perhaps the most important step he has taken was to pay the debts the state owes to private farmers and to raise the prices the state pays for milk and meat. Ordinary Cubans still live on rations and cope with chronic shortages of staples like beef. Salaries average about $12 a month, and most people spend the three-quarters of their pay on food, according to a study by Armando Nova González, an economist at the Center for the study of the Cuban Economy.

"What a person makes is not enough to live on," said Jorge, a museum guard who asked his last name not be used because he feared persecution. "You have to resort to the black market to get along. No, not just to get along, to survive." He said he and his wife together make about $30 a month, just enough to support their family of four.

Raúl Castro has disappointed many Cubans who had expected dramatic changes when he took over. One reason is he has always deferred to his older brother in the past and seems to lack the political power to take major actions until Fidel Castro either relinquishes total control or dies, said experts on Cuba.

"I would say what is remarkable over the last year is how little has changed," said Robert Pastor, a former aide to President Jimmy Carter and a political scientist at American University. "People have been calm, but of course, big brother has been watching."

Fidel's influence extends far beyond his new role as columnist in chief. Even as Raúl Castro appears headed toward permanent rule, leaders seem reluctant to roll back the elder Castro's decision to centralize the economy again and restrict the small-scale private enterprises that emerged in the 1990s after the fail of the Soviet Union, several economists and political scientists say. "His main impact on Cuba is not his writings but that he's alive, and it means Raúl and the others are reluctant to take major initiatives," said Jorge Dominguez, a professor at Harvard who studies Cuba.

In his speech, Raúl Castro acknowledged the stubborn problem of low wages and the lack of productivity, saying the economic problems were eating away at the social fabric. He urged Cuba to be patient. The problems could not be solved right away and he did not want to raise expectations too high, he said.

"Wages today are markedly not enough to satisfy all needs," he said, adding, "This has bred forms of social indiscipline and tolerance which, having taken root, prove difficult to eradicate."


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