Friday, December 25, 2015

Are Cooperatives Dangerous for Cuba?

Are Cooperatives Dangerous for Cuba?
December 24, 2015
Fernando Ravsberg

HAVANA TIMES — A few days ago, I saw a report by Telesur, Latin
America's left-wing broadcaster, which praised the creation of
cooperatives in Mexico and stressed that these had helped prevent the
closure of companies and unemployment in other Latin American countries.

Socialist sectors are precisely those that impel cooperatives as a means
of production that offers an alternative to "capitalist individualism."
In some cases, these yield good results in areas such as the food,
construction, housing or transportation industries.

If the economic essence of socialism is that "the means of production
are in the hands of the people," no company structure would represent
that system better than a cooperative. We could say it is the "socialist
people's company" par excellence.

Cooperatives, in fact, fit perfectly into the society Jose Marti dreamt
of: "A nation with many small owners is rich. A nation is rich not when
a handful of people are rich, but when everyone has some wealth."

Opening a cooperative in Cuba, however, is an arduous task: the
paperwork takes years, you need approval from the municipal government,
authorization from the pertinent ministry and permission from the
Commission for the Implementation of the Communist Party Guidelines –
and the very Council of Ministers has the last word anyways.

None of these permits, authorizations and years of waiting are justified
when the members of the cooperatives are simply going to repair air
conditioning units or old television sets. It's really not a question of
deciding whether this work is of "strategic" importance for the nation's

It seems that they fear, not the work per se, but the cooperative as a
company structure as such. Self-employed persons (setting up small and
mid-sized private enterprises) are given the licenses denied members of
cooperatives in a mere 15 days.

The explanations as to this wariness with respect to cooperatives are
varied. Some say they fear these could become the breeding ground for
corruption, but, in that case, they would have to start by shutting down
all State companies, where the greatest scams have been hatched.

This is not mere journalistic speculation: there are hundreds of
executives from the telephone, nickel, importing, garbage collection,
slaughterhouse, food industry, airline and even customs sector that have
already been imprisoned.

Barber shops were the first experiment involving cooperatives formed on
the basis of State companies and they have worked fairly well. Photo:
Raquel Perez Diaz

Others claim that the development of cooperatives would leave the
country's ministries without "sources of financing." The problem lies in
the fact that much of the "extra" money that circulates among corrupt
officials comes precisely from companies "administered" by ministries.

They may fear losing control. Cooperatives are legal entities, something
self-employed persons are not. They are a legally incorporated company,
with the obligations but also de the rights that State companies have,
even in terms of importing.

There are also those who believe that the development of socialism in a
given country is measured by the number of State-controlled industries
in it. In 1968, this led Cuba to launch its so-called "Revolutionary
Offensive," which placed even street kiosks in State hands.

These are the teachings offered by Soviet manuals, based on the
Stalinist model – manuals that "forgot" to mention that Marx recommended
the nationalization only of the "fundamental means of production" and
that Lenin impelled self-employment and cooperatives in the land of the

We could speculate forever, especially since no one can explain the
bureaucratic sluggishness of this process. In one ministry, they
appointed a single official to review applications for cooperatives
coming from all of the country's municipalities and, when this official
got sick, work was put on standby for months.

Many find it incomprehensible that they should have slammed on the break
on economic reforms developed by the Communist Party itself, debated and
supported by millions of Cubans and ratified by parliament. What further
support is needed to implement them?

A few days ago, President Raul Castro said that "the field cannot be
handed over to defeatists." Certainly, for an economy to work, a degree
of optimism is needed: those who set up businesses must believe they're
going to prosper, those who invest money must feel sure of their
decision and common folk must believe that their lives will improve
through work.

What's happening in Cuba today is that those who set up businesses are
thinking of earning whatever they can "for as long as these measures are
in place," those who invest fear they will not get their money back and
many average Cubans believe that the only way they will be able to
maintain their families with regular wages is to leave the country.

The government is partially responsible for that pessimism that grips
people today. If Cuban leaders don't lay all their bets on the new
economic model, the one they themselves developed and the people
approved, they can't expect others to have any confidence in the future.

Source: Are Cooperatives Dangerous for Cuba? - Havana -

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