Cuba after the Cold War
Cuba at the turn of the new millennium
author Paul Boșcu, October 2017
After the fall of the Soviet Union, Cuba found itself truly independent for the first time only to confront itself with social and economic problems and the continuing US embargo. Because of his failing health, Castro handed over Cuba's destiny to his brother Raul. Raul, together with President Obama managed to reestablish normal diplomatic relations.
In 1991, the Soviet Union dissolved. Subsequently, Cuba’s economy suffered severe shortages of food and oil in the mid 1990s. Food shortages and prolonged blackouts caused Cubans to riot in Havana. The Cuban government responded by allowing 30,000 more Cubans to leave by boat for the United States. Cuba-US relations got worse in 2003. Cuba sided with other countries in questioning the motives of the US-led war on Iraq. The Obama administration sought to normalize relations with Cuba.

In the early 1990s, the loss of Soviet subsidies and a drop in world sugar prices caused a 35% decline in the Cuban economy. The Cuban people suffered from severe food shortages and other hardships during the long economic downturn. Castro maintained his hold on power in the post-Cold War period through repressive laws and policies designed to silence dissent. His government was accused of a multitude of human rights violations over the years, such as arbitrary arrests, imprisonment, torture, and execution of political opponents.

Castro was forced to respond to changes in the world political economy during the Special Period. He adopted gradual, pragmatic, market-oriented policy changes to meet Cuba’s needs for energy, key imports, markets for its own exports, technology, capital and foreign exchange.

A large number of ‘boat people’ died trying to cross the Straits of Florida. In 1995, the United States and Cuba agreed to permit 20,000 Cubans to immigrate legally to the United States each year. To encourage legal immigration, the United States also began sending all boat people found at sea back to Cuba.

Pope John Paul II visited Cuba for five days in January 1998. He called for an end to the US trade embargo while pressing Castro to release political prisoners and to allow political and religious freedom. The United States responded by giving special ‘licenses’ to delegations of American businesspeople and researchers to visit Cuba. Such visits are still possible today.

The American-Cuban relationship depends significantly on political circumstances in Florida, a state with many electoral votes in presidential elections. During George W. Bush’s Republican administration and his brother Jeb’s governorship in Florida, a firm stance against Cuba was expected.

With the collapse of communist regimes in Eastern Europe and the Soviet Union, Cuba found itself truly independent for the first time in its history. However, there is an old adage that says that one should be careful what one wishes for. Fidel Castro quickly realized that Cuba could not stand by itself and that new economic and political policies had to be implemented. These policies clearly reflect the acknowledgment that Cuba can never be truly independent in today’s global political economy. During this so-called Special Period, Castro placed Cubans on a wartime economy. Austerity measures were put in place.

Wages became stagnant and purchasing power plummeted. Fuel shortages, planned and unplanned electrical blackouts, factory shutdowns and transportation problems were common. Food shortages were becoming a problem and rationing reappeared, although it should be noted that rationing more than likely prevented the massive malnutrition and hunger that is common in many of the developing countries.

Living standards that had improved tremendously in the previous two decades were reversed. Expectations of higher living standards were shattered and there was a clear and growing disillusionment with Castro. In 1992 and 1993, more than 7,000 balseros—the name given to those who braved the Straits of Florida in makeshift boats or rafts—made it to the United States from Cuba. According to interviews, the vast majority of the balseros were escaping the economic hardships of the Special Period.

One of the major problems for the island during the Special Period was that it lacked the foreign exchange to pay for its imports and debts. In perhaps the most significant reform, the US dollar was legalized. Before this, it was a crime for Cubans to hold US dollars, even though more than $400 million in US currency was brought into the country each year via Cuban exiles living in the United States. Given that the government needed US dollars to pay its debts and to purchase imports, the decision to legalize the dollar allowed the government to capture this much-needed foreign exchange.

Sugar was the largest source of foreign exchange for the government prior to the Special Period. Cuba was dependent on the discounted fuel (oil) and the higher than world market prices that it received from the Soviet Union and the East European countries. With the arrival of the Special Period, this subsidy came to an end. Thus, by 1994 tourism generated more income for Cuba than sugar. The decision was made to encourage the growth of tourism on the island.

The Cuban government dramatically changed the law concerning foreign investments on the island. Both joint ventures and complete foreign ownership of companies were legalized. Most investment capital comes from Spain, Venezuela, Canada, Italy, Mexico, Holland and the United Kingdom, although more than fifty other countries have investments on the island.

In response to the agricultural crisis, reforms during the Special Period included the setting aside of land on all state farms and cooperatives for the production of food for local consumption. State farms and cooperatives began developing livestock for consumption by their workers and members. By 1993, individual farmers were also beginning to grow food locally to provide for themselves and their workers.

The end of the Cold War and the Special Period dramatically affected the Cuban Revolutionary Armed Forces—Fuerzas Armadas Revolucionarias or FAR. All military assistance and deliveries of weapons and supplies came to an end. One of the major reforms was that the mission of the FAR changed. Castro announced that the FAR must help with the economy. Soldiers returning from abroad were put to work on farms run by the state, while officers with technical expertise were put to work finding alternatives to the island’s dependence on imported fertilizers. Another major reform was that the size of the military was reduced considerably.

Spare parts for military vehicles, ships and aircraft became difficult to find. Fuel shortages forced reductions in vehicle and aircraft operations. Training exercises were reduced. The budget for the FAR was cut considerably. The FAR’s highly successful internationalist mission came to an end in 1992 after the last personnel had left Africa the previous year. The last Russian troops left the island in 1993.

The FAR was given the authority to create economic enterprises to begin to meet some of its own budgetary needs. Gaviota is a joint venture with foreign investment that plays a major role in the growing tourist industry of Cuba. It also provides hard currency for the FAR and employment for retired service personnel.

The Cuban military consisted of 105,000 troops in 1995. This represented a reduction of 100,000 troops since the mid-1980s. Mandatory military service for Cubans was reduced from three to two years. The current military has expressed doubts concerning the ability of the Cuban air force and tanks to defend the island from an invasion.

Dissident groups on the island increased and became more vocal in challenging authorities. The government responded with both repression and reform. The country was declared to be secular rather than atheist. The political system was reformed in 1993 by allowing the election of members to all levels of the Popular Power assemblies rather than just the municipal level. Non-Communist candidates were allowed to run for office and some were elected. By 1995, ten of the fourteen provincial PCC secretaries had been replaced with younger members.

Concilio Cubano, an umbrella organization for human rights groups in Cuba, called for a national meeting. The group was denied recognition by the government and in early 1996 more than 200 human rights leaders were harassed, arrested and interrogated. One should note, however, that the number of political prisoners has declined steadily since 1991 and more than 300 were released after Pope John Paul II’s historic visit in 1998.

In 1991, the Political Bureau of the PCC was expanded in size, but it excluded two important revolutionary figures: Vilma Espin, president of the Federation of Cuban Women—Federacıon de Mujeres Cubanas—and Minister of Culture Armando Hart.

Manuel Pineiro, a former guerrilla commander, lost his position as the head of the Central Committee’s espionage service. Ramiro Valdes, a former guerrilla captain nicknamed Red Beard, was removed as head of the powerful Ministry of the Interior. It was clear that Castro was beginning to bring the next generation of loyal leaders into the ruling circles of Cuba.

By 1996, it was clear that the economy was growing once again and that Cuba had survived the worst of the Special Period. Yet, the reforms were having some unanticipated outcomes. In particular, the dual existence of the dollar and peso economies was beginning to bring about a visible gap between the rich or privileged and the poor. The privileged work in the tourist and service industries that have access to dollars. The poor are those trapped in the peso economy of the ration card and state-run stores.

Even though the peso economy provides a basic standard of living due to the guaranteed social safety net, it is not able to provide the ‘extras’ that access to dollars can provide. In particular, this places a difficult burden on white-collar professionals who work for the state, such as doctors, nurses, teachers, engineers, government administrators and others. Their monthly peso income allows them a basic standard of living but does not allow them to ‘get ahead’. Many professionals have second jobs in the tourist sector as taxi drivers, where they can earn much more in US dollars.

Castro showed that he was like Cuban leaders of the past: he did not like to share power. Yet he was different from all leaders of the past because he created and was committed to maintaining a more economically egalitarian Cuba. The real threat to Castro’s political power came from within the country. By achieving one of the most literate and highly educated citizenry in the world and by achieving a revolutionary social safety net found nowhere else in the developing world, he created a set of high expectations and desires among his people. The desire for greater political freedom is a natural outgrowth of this success.

Repression of those who desire political reform may be a short-term solution, but in the long term, history has proven that is is never a successful strategy. At the same time, the failure to continue to meet those high expectations can lead to frustration and dissatisfaction within a population. This is clearly evident today among those Cubans who do not have access to the dollar economy and who are witnessing the growing gap between the privileged and the poor.

Dissatisfaction among Cubans is more acute because they continue to compare their living standards to those in the United States and are constantly reminded from relatives and friends living there that they are poorer than Americans.

Castro was a bundle of contradictions. He was an idealist and a realist. He could be an ideologue and a pragmatist. He was capable of 180-degree shifts in policies. He could be cooperative and obstinate. He could be gentle and ruthless. He generated both love and hatred. He had tremendous successes and tremendous failures. In the end, he was a political survivor who loved to play the game of politics and power. He was a revolutionary who challenged US dominance as no Cuban leader had ever done, and who maintained his revolutionary commitments to free education, cradle-to-grave healthcare and social security to all.

One may have expected the policy of the United States towards Cuba to change in the early 1990s with the collapse of communism in Eastern Europe. In addition, three of the four stated conditions necessary for US normalization of relations had been met by 1992. It looked like President Bush was moving to change US policy toward the island. But the presidential election of 1992 and the power of the anti-Castro Cuban American National Foundation (CANF) brought an abrupt end to any thaw in US policy.

Castro was no longer supporting revolutionaries in Latin America, Cuban military ties to the Soviet Union were, in effect, eliminated and all Cuban troops had been removed from Africa. The only condition left was an improvement in the protection of human rights on the island, and a 1989 State Department report indicated improvement in this area. President George H. W. Bush even vetoed a bill in 1990 that would have made it difficult for subsidiaries of US companies in other countries to trade with Cuba.

Due to the crisis created with the arrival of the balseros during the Special Period, President Clinton worked with Cuban officials to promote safe, legal and orderly immigration to the United States. The United States agreed to allow at least 20,000 legal Cuban immigrants per year. Clinton then took steps to promote more people-to-people contacts between the United States and Cuba by allowing private organizations to develop relationships with Cuban organizations.

Throughout the 1990s some dissenting voices concerning US policy towards Cuba were raised. In 1992 the UN General Assembly voted overwhelmingly to condemn the US embargo, and each year since then it has done the same. At a summit meeting in 1993, Latin American, Spanish and Portuguese leaders unanimously called for an end to the embargo. The Organization of American States condemned the Helms-Burton Act and the Inter-American Juridical Committee ruled that it violates international law on at least eight counts.

Pope John Paul II, who visited the island, urged the United States to end its embargo. In reaction to the pope’s visit, the Clinton administration allowed an increase in direct flights to the island, gave authority for direct food and medicine sales to Cuba and established direct mail service.

By the mid to late 1990s, it was clear to many agriculture and tourism-based businesses in the United States that they were missing out on the economic opening of Cuba under its reformed investment and trade policies. The United States-Cuba Trade Economic Council testified to Congress in 1998 in support of ending the US embargo.

In 2000, the United States passed a law that allowed the sale of agricultural commodities and medicine to Cuba on a cash basis only. Cuba agreed to purchase $73 million in grain, but this was delayed due to President George W. Bush’s refusal to grant visas to Cuban officials who went to the United States to finalize the deal.

In 1992, the US government passed the Cuba Democracy Act in order to discourage trade with Cuba. The US Helms-Burton Act of 1996 is the most recent economic sanction taken by the United States against Cuba. It was a US response to the downing of the Brothers to the Rescue aircraft over international waters. This act authorizes the US president to prevent business executives of foreign countries from entering the United States if their companies use US property seized by the Castro government. The law gives American businesses the right to sue in US court any foreign nations that benefit or profit from using the seized property.

The Cuba Democracy Act has two tracks. The first track discourages trade with Cuba by preventing foreign businesses owned by US companies from trading with the island and by preventing foreign vessels that are carrying Cuban goods from entering US ports. The second track allows Cuban Americans to visit their relatives in Cuba once a year.

US presidents have been reluctant to use the Helms-Burton law. The law would require that the United States take action against allies and important trading partners of the United States. These partners include Canada, Mexico, the United Kingdom, Germany, Russia, and France. All of these countries regularly conduct trade with Cuba today and have established diplomatic relationships.

Clinton threatened to veto the Helms-Burton Act, but Cuban planes shot down two US civilian aircraft belonging to the anti-Castro Miami-based group Brothers to the Rescue in international waters. In reaction to this event, the US Congress passed the Helms-Burton Act, and President Clinton signed it.

Perhaps the primary obstacle to a change in US policy is the importance of the state of Florida in the presidential election. This was clear to all in Bush’s narrow electoral victory over Al Gore in 2000. Cuban Americans in Florida voted overwhelmingly in favor of George Bush in the 2000 election and Jeb Bush in the 2002 election. As a result, US policy toward Cuba did not change significantly under President Bush.

In May 2002, former president Jimmy Carter made a historic visit to the island. He spoke live, uncensored and in Spanish on Cuban television. Carter urged the island to make the transition to democracy while calling for the United States to end the embargo. That same month, President Bush reiterated his hard-line stance against Cuba before a passionate Miami audience of anti-Castro Cuban Americans.

In 2006 the ailing eighty-year-old leader temporarily transferred power to his younger brother Raul. Two years later the transition became permanent when Fidel Castro officially stepped down after forty-eight years in power. Although some people hoped that Raul Castro would introduce major reforms to the island nation, he made it clear that he intended to proceed slowly. Still, the new Cuban leader made incremental changes that earned praise from the international community. Raul Castro also made a few overtures toward improving relations with the United States.

‘I was not selected to be president to restore capitalism to Cuba, I was selected to defend, maintain, and continue to perfect socialism and not to destroy it.’ Raul Castro declared. Raul lifted some travel restrictions for Cuban citizens, reduced government controls over businesses, increased laborers’ wages, distributed unused agricultural land to private farmers, and made it easier for people to buy homes, cars, computers, cell phones, and other previously restricted goods.

‘The American people are among our closest neighbors,’ Raul Castro said in an interview shortly after assuming the presidency. ‘Good relations would be mutually advantageous. Perhaps we cannot solve all of our problems, but we can solve a good many of them.’ As an indication of the easing of tensions on both sides, Castro was photographed shaking hands with President Obama at a memorial service for South African leader Nelson Mandela.

In late 2014, after a year of secret negotiations, the United States and Cuba reached a historic agreement to restore the formal diplomatic relations that had been severed in 1961. President Obama announced his decision to open a new chapter in US-Cuban relations. In addition to establishing an embassy in Havana, Obama said the United States would eliminate many restrictions on travel, commerce, and information technology. Although the American trade embargo remained in place, Obama asked Congress to consider lifting it. The president also promised to continue pushing Cuba to make democratic reforms and end human rights abuses.

As part of that agreement, Castro agreed to release Alan Gross, an American contractor who had spent five years in a Cuban prison for installing satellite television and phone service without a permit, and more than fifty Cuban political prisoners.

In his televised address President Obama said: ‘The relationship between our countries played out against the backdrop of the Cold War, and America’s steadfast opposition to communism. We are separated by just over 90 miles. But year after year, an ideological and economic barrier hardened between our two countries. Meanwhile, the Cuban exile community in the United States made enormous contributions to our country—in politics and business, culture and sports. Like immigrants before, Cubans helped remake America, even as they felt a painful yearning for the land and families they left behind. All of this bound America and Cuba in a unique relationship, at once family and foe.… Change is hard—in our own lives, and in the lives of nations. And change is even harder when we carry the heavy weight of history on our shoulders. But today we are making these changes because it is the right thing to do. Today, America chooses to cut loose the shackles of the past so as to reach for a better future - for the Cuban people, for the American people, for our entire hemisphere, and for the world.”

Obama’s decision to normalize relations with Cuba was not universally popular. Senator Robert Menendez of New Jersey claimed that ‘President Obama’s actions have vindicated the brutal behavior of the Cuban government.’

Senator Marco Rubio of Florida also denounced the changes. ‘This whole new policy is based on… the lie and the illusion that more commerce and access to money and goods will translate to political freedom for the Cuban people,’ he stated. ‘All this is going to do is give the Castro regime, which controls every aspect of Cuban life, the opportunity to manipulate these changes to stay in power.’

Cuba at the turn of the twenty-first century is undergoing a transition similar to that which occurred at the turn of the twentieth century. At that time, Cuban leadership, the United States and world economic forces interacted in such a way as to usher in a period of US hegemony. Today, Raul Castro, the United States and world economic forces are interacting in such a way as to integrate Cuba further into the global market place. Yet the biggest difference is that, at least in the near future, Cuban leadership— Raul Castro—will have more influence over the process of change.

In the early 1900s the United States flexed its regional power while world economic forces limited the options available to the newly ‘independent’ country of Cuba. The Cuban economy was devastated after years of warfare. The nationalist Cuban leadership that had been decimated during the wars of independence was weak and unable to counter the power of the United States and the market forces of the world economy. Cuba became politically, economically and, to a lesser extent, culturally dominated by its neighbor to the north.

As the revolutionary generation in Cuba grows older, the post-Castro era will be on us within the next decade or two. There are several possible post-Castro scenarios that scholars have put forward. The official replacement is Raul, head of the FAR and Castro’s brother. The problem with Raul is that he is neither popular nor respected among most Cubans. Some have suggested that the exile community in the United States will step in and govern the country. Others suggest that the FAR will step in and rule the country, at least for a brief period, should Raul Castro die suddenly and leave a power struggle.

Scholars argue that Cuba will follow the same path as the East European countries or the former Soviet Union. A post-Castro leadership will eventually arise that is less committed to real democracy and more committed to restructuring the economy and placing itself in position to take advantage of massive privatization. This will take place under the auspices of the World Bank, the International Monetary Fund, the United States and other wealthy countries of the world. Under such neoliberal economic restructuring, it is clear that the social safety net, Castro’s real revolutionary success, will disappear.

It is difficult to say what a post-Castro Cuba will look like, but the history of the island has shown that the future will be written by Cuban leaders who will have to struggle with the forces of the world economy and the power of the United States. These are the constants in the history of the island and they will be the constants in its future.