File spoon-archives/marxism-international.archive/marxism-international_1997/97-01-08.181, message 26


Date: Tue, 7 Jan 1997 10:23:28 -0500 (EST)
From: Louis N Proyect <lnp3-AT-columbia.edu>
Subject: Re: M-I: Cooperatives?


On Mon, 6 Jan 1997, Jason A Schulman wrote:

> 
> Lou -- could you tell me a bit more about how the Cuban model was
> successful? I admit I know very little about it and haven't much time to
> do research.  You wrote an article on this subject, yes?
> 

Louis: My article was concerned more with the break with capitalism in
Cuba since I was trying to prove to "state capitalists" that such a break
indeed took place. The reason that the Cuban model was successful is
pretty simple. They planned. Planning makes rational use of resources,
both natural and human. Capitalism doesn't. Mexico is evidence of this.
Huge portions of Mexican farmland have been converted from the production
of food-stuffs for the families owning small to medium sized plots to huge
plantations cranking out flowers and tropical fruits for North American
dining tables. In NYC there are Korean grocery stores everywhere that
always have a Mexican immigrant standing guard over these very same
flowers and fruits. He is probably somebody who has been dispossessed from
these farmlands. At the conclusion of this post, I cite some impressive
information on Cuban economic growth.

> Are anti-market socialists (Albert & Hahnel, Pat Devine) therefore also
> indulging in sterile intellectual speculation? (I'm curious what your
> reaction -- and Doug Henwood's reaction -- is to the anti-market
> socialist article by Rhon Baiman that I posted.)
> 

Louis: I actually plan to put together my own utopian model for a world
socialist system one of these days. It will basically be something like
Lotus 123 on steroids from a technical/economic standpoint. Politically I
envision the whole thing being overseen by a "Council of Elders" with
somebody like Rigoberto Menchu in charge. Hell, if you are going to use
your imagination, you might as well go whole-hog.

---------------------------------------------------------------------

I recommend Claes Brudenius's book "Economic Growth, Basic Needs and
Income Distribution in Revolutionary Cuba" for a dramatic presentation of
the rapid growth of the Cuban economy when support from the USSR was
forthcoming. This book is unfortunately not readily available, but really
has the best information. If you can find anything by him in your library,
check it out. He is really very sharp on Cuba and Nicaragua. Here are
relevant comments from Chapter 3, "The Economic Performance of
Revolutionary Cuba". Market socialists can not make heads nor tales out of
this I would imagine. 

"The Cuban success story in terms of economic growth during the first half
of the 1970s is primarily the result of accelerated industrialization and
notably the growth of the capital goods sector. The share of capital goods
in total industrial output increased from 47% to 54% in 1975. An important
aspect of the expansion of capital goods is that it is the result of a
planning effort to build up a domestic resource base around agriculture
along the lines discussed earlier. For instance, Cuba today has a modest
but relatively important sector producing combine harvesters, fertilizers,
pesticides, and other inputs for agriculture. At the same time, there were
efforts made to increase the line of by-products from sugar cane, like
*bagasse* for the paper industry (instead of just using it as fuel) and
*methanol* for the chemical industry. There have, however, been no plans
to use pure alcohol from sugar (ethanol) as a substitute for gasoline, as
is the current trend in Brazil. 

But the expansion of the capital goods sector is not only related to
agriculture. Another Cuban success has been the rapid growth of fishing,
>from 22,000 metric tons of catch before the revolution to about 150,000 in
the mid-1970s. Since the late 1960s Cuba has produced an increasing number
of vessels for this increasingly important sector. Cuban shipyards had by
1975 built some 6,000 small and medium wood vessels plus 400 ferro-cement
medium vessels, and 90 steel large vessels. There has also been an
important expansion of fishmeal processing, cold storage and freezing
facilities. Cuba has from having been a net importer of fish in 1958,
become a net exporter and the seventh largest fishing nation in Latin
America. 

Other important investments, which will be of great importance in the
1980s, are those that have gone into the expansion of nickel
production--the export product with greatest potential for Cuba's economic
diversification. Soviet aid for the modernization and expansion of the two
existing plants was agreed upon in 1972 when the outstanding debt with the
Soviet was renegotiated and new credit lines awarded. These plants today
produce about twice the levels reached prior to the Revolution but the
goal had originally been to reach a level of 47,000 tons by 1980 but this
objective has been postponed until 1983. There have been plans to build
two, perhaps even three, more plants in the Moa Bay area with Soviet
assistance and output is scheduled to increase to 69,000 tons by 1985 and
100,000 by 1990. Apparently, however, there have been problems with the
technology supplied by the Soviets (the Cuban deposits are laterite ore
with low nickel content and much more costly to process, because of high
energy costs, than the more common sulfide ores.) 

The industrial growth during the first half of the 1970s is highly
correlated with sugar prices and with the Cuban terms of trade position
and import capacity in general. The change in relation to the gloomy 1960s
is conspicuous. Unfortunately for the Cubans, the favorable trend did not
continue after 1975. Juceplan prepared three variants of the first Five
Year Plan (1976-1980) to account for possible reverses of sugar prices.
Since prices fell more than expected, twenty-two major investment projects
had to be cancelled, most of which were to be financed with credit lines
>from the West. As so many times before, the Soviet Union had to come to
the rescue of the Cubans and thanks to steadily improving terms of trade
with the Russians, the trade balance was favorable for the first time
since the early 1960s. However, it is not only the fall in terms of trade
with the West (30 percent lower during 1976-1979 than during 1971-1975)
which explains the declining growth rates during the first plan. There
were also important difficulties in agricultural and livestock production
at the end of the period due to plagues and pests, such as sugar rust,
tobacco blue mold and African swine fever." 




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