A Brief History of Capitalism in Cuba
Capitalism in Cuba is nothing new. Cuba under Fulgencio Batista knew
capitalism, though most people in that society were poor and had little agency in
consistent economic transactions—the upper class controlled most economic
activity. The Cuban Revolution replaced this inequality with the egalitarian
principles of socialism, in which the citizens work for the greater good of
humanity, rather than material incentives. Few citizens followed this dogma
religiously; as I will show, the idealized picture that Castro painted of his own
society clashed with the actions of the people during even the most socialist of
times in the Revolution.
Though Castro claimed to have eradicated capitali sm from Cuba during
this time, the black market thrived illegally under the centrally planned
economy. In effect, this continued the tradition of entrepreneurship in Cuba during
a time of heavy socialist propaganda and provided a free market structure tha t
prepared Cubans for the mixed economy that entered in the 1990s. Economist
Archibald Ritter has discussed the impact of this underground economy on the
mindset of the Cuban people in their transition to the Special Period economic
changes. Concluding that, “the size and vitality of this microenterprise sector,
operating legally or in the underground economy, is a main reason why it could
spring to life so quickly after its legalization in 1993,” Ritter illustrates the
importance of preexisting free market transactions in Cuba, reasoning that
experience with them enabled the people to quickly jump into self-employment in
the dollar economy.
xii Ritter goes on to show that Castro’s socialist system of
equal rationing in Cuba had the unintended effect of creating a spirit of
entrepreneurship among the people. Since everyone received the same rationed
products, writes Archibald, “everyone had an incentive to sell their unwanted
items or trade them for more desirable products…Thus, the rationing system itself
converted virtually everyone, regardless of the level of ideological enthusiasm,
into a minicapitalist.”xiii
If the people valued capitalism during a time of centralized economy and
pervasive socialist propaganda, their free market instinct could only grow in an
environment of legal capitalist elements and ideological contradiction. This
early exposure in profit motivation prepared Cubans for the day that they would
freely and actively contribute to a hybridized economy. In August 1993, Cubans