Truth about Cuba's economy lies in middle

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Ryan Rudolph
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Truth about Cuba's economy lies in middle

Post by Ryan Rudolph » Fri Aug 11, 2006 12:51 am

The cuban economy has intrigued me since visiting there in 2000 and apparently there has been an overly optimistic view of Cuba presented by David Sukuki on the nature of things so I desired to discover the truth of Cuba for myself just because of the bleak perception I have always had since visiting there. This article seems to shred some light on the current economic difficulties the country now experiences.

Your input is also valued if you have something to share on the state of the Cuban economy.

Truth about Cuba's economy lies in middle
Saturday 3rd September 2005 by Paolo Spadoni .

What is the truth about the current status of Cuba's economy?

The economic situation in Cuba is not as bad as U.S. officials would have us believe. The country's economy grew 3 percent in 2004, mainly thanks to a substantial increase in revenues from tourism and nickel exports, rose by approximately 6 percent in the first half of 2005, and is expected to end the year with a 5 percent growth.

Apart from an aging Fidel Castro, who just turned 79, there is little reason to assume that the present government in Havana is on the verge of collapse, especially after its recent and extremely beneficial agreements with Venezuela and China.

Since October 2000, Cuba has been paying for vital imports of cut-rate Venezuelan oil (supply has now reached 80,000 to 90,000 barrels of crude per day) with medical and educational services. Between 2001 and 2004, according to official figures, the Castro government received almost $130 million in revenues from various treatments to little more than 7,500 Venezuelan patients in Cuba's hospitals and medical centers (around $17,000, on average, for each patient treated). And these revenues do not include services provided by some 20,000 Cuban doctors stationed in Venezuela and those offered by teachers and sports trainers. Last December, Cuba and its South American ally signed new agreements aimed to promote investment as well as technical and educational cooperation between the two countries.

During the 1990s, China had been the only foreign country that granted a considerable amount of financing to Cuba at highly concessional terms. Between 1990 and 2004, the Asian giant provided soft credit and donations of more than $160 million, mostly in the areas of education, tourism and agriculture. In the past few months, China has announced new credits and aid to Havana and major investments in Cuba's nickel and oil sectors. The Chinese capital involved in new projects on the island could represent more than one-fourth of the total amount of foreign direct investment ($6 billion) committed by overseas firms over the past 15 years.

But Cuba's economy is not even as good as Havana's authorities proclaimed. Leaving aside the frequent blackouts that have plagued the entire island in recent months, the reality is that the latest progress at the macroeconomic level has not yet translated into tangible benefits for the Cuban population. While the Castro government is trying to address some major deficiencies of its economic system, three chronic problems remain unresolved in Cuba: the availability of food and other basic products, the construction of new houses and the reparation of existing ones, and the very precarious condition of the public transportation sector.

The majority of Cubans have great difficulty in acquiring food and other items they need because of the limited purchasing power of their salary in regular pesos and insufficient domestic production. As several goods must be purchased in state-run stores that accept only the convertible peso or CUC, a local currency worth 24 regular pesos, most prices remain prohibitive for the average Cuban. This holds true even after the recent 7 percent revaluation of the regular peso against the CUC and substantial increases of salaries and pensions for many Cuban citizens.

Between 2000 and 2004, the number of new houses built annually by the Cuban government dropped about 65 percent. Last year's number was the lowest since 1990, even lower than the annual average of new homes completed between 1991 and 1993, during the worst time of the economic recession in Cuba. Regarding public transportation, the total number of passengers transported each year by bus and taxi plummeted by about 80 percent between 1990 and 1998, with a small improvement since then. In 2003, however, the volume of passengers was the same as in 1963, when the Cuban population stood at just 7.4 million, almost 4 million less than its current size.

In short, the truth about the current economic situation in Cuba lies somewhere in the middle between the overly optimistic assessment coming from Havana and the nearly catastrophic one made by Washington.

Cuba's economy is neither a phoenix rising from the ashes nor a system on its last legs. It looks like a bird with strong legs that keeps walking but has not learned how to fly, at least not yet.

Paolo Spadoni is a Ph.D. candidate in the Department of Political Science at the University of Florida. He wrote this commentary for the Orlando Sentinel.

millipodium

Post by millipodium » Fri Aug 11, 2006 1:01 am

Plus it's totalitarian, with little to no notion of rights to free speech, or basic human rights. Given that, it's a total piece of shit in my book.

You sound like a neocon fascist speaking gleefully of china's gdp, as if that will somehow translate in to freedom. It won't. It isn't. Global fascism is on the march. We will soon be told we must allow more centralized planning and we must rollback basic worker protections to "compete".

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Post by Ryan Rudolph » Fri Aug 11, 2006 1:07 am

No I agree, I also feel that a totalitarian system is much more inferior compared to the potential of capitalism/democracy.

Capitalism/Democracy is definitely much more intelligent. There is less control by the government allowing more diversity of terms of products and services to be produced and this naturally creates a society that functions much more efficiently with better organization, reliability, security and employment.

Cuban's economy is painfully unreliable, unstable and disorganized.
Last edited by Ryan Rudolph on Fri Aug 11, 2006 1:10 am, edited 1 time in total.

millipodium

Post by millipodium » Fri Aug 11, 2006 1:09 am

cosmic_prostitute wrote:No I agree, I also feel that a totalitarian system is much more inferior compared to the potential of capitalism/democracy.

Capitalism/Democracy is definitely much more intelligent. There is less control and therefore more divesity of terms of products and services therefore producing a society that functions much more efficiently with more organization and reliability.

Cuban's economy is painfully unreliable in every sector.
What do you think about fiat currency? Yes. I'm one of "those guys"

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Post by Ryan Rudolph » Fri Aug 11, 2006 1:13 am

Milli wrote:
What do you think about fiat currency? Yes. I'm one of "those guys"
Define flat currency.

millipodium

Post by millipodium » Fri Aug 11, 2006 1:17 am

cosmic_prostitute wrote:Milli wrote:
What do you think about fiat currency? Yes. I'm one of "those guys"
Define flat currency.
That's F.I.A.T. sometimes the I's look like L's. It's currency that has no guaranteed redeemable value for any kind of commodity whatsoever. It has value because the government says it does, dammit.

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Post by Ryan Rudolph » Fri Aug 11, 2006 1:24 am

As humanity becomes more intelligent so will the currency of money, any drastic change to global currency will only be a superificial change because human nature will remain the same.

Human nature needs to change first then the currency will naturally change with it.

So I say leave the currency as it is and dedicate ones life to understanding the psyche of oneself.

This is the highest service one can perform.

millipodium

Post by millipodium » Fri Aug 11, 2006 1:45 am

cosmic_prostitute wrote:As humanity becomes more intelligent so will the currency of money, any drastic change to global currency will only be a superificial change because human nature will remain the same.

Human nature needs to change first then the currency will naturally change with it.

So I say leave the currency as it is and dedicate ones life to understanding the psyche of oneself.

This is the highest service one can perform.
Our system of fiat currency is actually a very powerful control structure. Any money you have in your account is guaranteed to devalue over time due to the continual printing of new money. The only way to maintain value is either to translate all your funds into tangibles asap, or to reinvest in the control grid through stock purchases. The massive ownership of public stock provides both a level of plausible deniability to the public at large because "hey, I don't run the company, I just own stock", and an everpresent jusification for immorality on the part of the executves because "hey, my job is to turn a profit for the stakeholders". Thus, nobody is really responsible for massive profiteering on slave labor in china. It's like black magic.

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Post by Ryan Rudolph » Fri Aug 11, 2006 2:11 am

Milli wrote:
Any money you have in your account is guaranteed to devalue over time due to the continual printing of new money. The only way to maintain value is either to translate all your funds into tangibles asap, or to reinvest in the control grid through stock purchases.
This accidental loss of value seems to be a minor thing.

Milli wrote:
Thus, nobody is really responsible for massive profiteering on slave labor in china. It's like black magic.
Exploitation of giant offshore companies seems to be one of the primary driving forces affecting fluctuations of global currency, if a large percentage of companies suddenly adopted the philosophy that they would stop exploiting employees then this would have a drastic affect of the global currency fluctuations.

Another factor is to consider is the amount of goods and services produced within a country affects the overall worth of its dollar.

Another factor is that countries that have had a boost in their economy since the 50s such as America have had lots of time to accumulate more wealth by loaning funds to other countries so global debt affects the overall worth of a countries dollar.

The lender's dollar increases in value while the borrower's dollar decreases in value.

It is fairly complicated issue because there are many factors contributing to the overall worth of a country’s dollar.

To recap:

The US has the most valuable dollar because they are the leading producers for many manufacturing industries, they have large loans that they are making tons of money from Third world countries and even developed countries and many of their companies that have been successful in the states have left to other countries and engaged in exploitation to make even more money off weak growing economies where the people are desperate for employment. The US has also networked with some of the other most powerful countries and established business mechanisms to ensure that developing countries stay small while they grow larger.

This all affects the fluctuations of currency in various countries, and my question is if the world were philosophers how many of these behaviors would end and as a consequence if these behaviors did end what affect would that have on the various currencies of the world?

would the currencies eventually stablize and be equal? But this can only happen if human nature changes.

millipodium

Post by millipodium » Fri Aug 11, 2006 2:25 am

cosmic_prostitute wrote:Milli wrote:
Any money you have in your account is guaranteed to devalue over time due to the continual printing of new money. The only way to maintain value is either to translate all your funds into tangibles asap, or to reinvest in the control grid through stock purchases.
This accidental loss of value seems to be a minor thing.
SO you like working hard for something guaranteed to devalue?
That's interesting. And it's not an accident.

Milli wrote:
Thus, nobody is really responsible for massive profiteering on slave labor in china. It's like black magic.
Exploitation of giant offshore companies seems to be one of the primary driving forces affecting fluctuations of global currency, if a large percentage of companies suddenly adopted the philosophy that they would stop exploiting employees then this would have a drastic affect of the global currency fluctuations.
Yet regardless, it should be done for moral reasons. We used to embargo totalitarian nations. And we should return to that policy.

Another factor is to consider is the amount of goods and services produced within a country affects the overall worth of its dollar.

Another factor is that countries that have had a boost in their economy since the 50s such as America have had lots of time to accumulate more wealth by loaning funds to other countries so global debt affects the overall worth of a countries dollar.

The lender's dollar increases in value while the borrower's dollar decreases in value.

It is fairly complicated issue because there are many factors contributing to the overall worth of a country’s dollar.



To recap:

The US has the most valuable dollar because they are the leading producers for many manufacturing industries, they have large loans that they are making tons of money from Third world countries and even developed countries and many of their companies that have been successful in the states have left to other countries and engaged in exploitation to make even more money off weak growing economies where the people are desperate for employment. The US has also networked with some of the other most powerful countries and established business mechanisms to ensure that developing countries stay small while they grow larger.
Yes. It's a complicated issue, with many factors, and usually, the country with the most powerful military gets to have the strongest dollar. Funny it how it works out that way, isn't it?

This all affects the fluctuations of currency in various countries, and my question is if the world were philosophers how many of these behaviors would end and as a consequence if these behaviors did end what affect would that have on the various currencies of the world?

would the currencies eventually stablize and be equal? But this can only happen if human nature changes.
The point is not to have equal national currencies. The massive power any state lords over it's people through the sole dictation of money creation is enormous. This is why all statists, academics, and other various and sundry power titsuckers are all for fiat currency and fractional reserve lending.

The problems of the world are not with the ignorant people, they are harmless. Evil comes from the statist power seekers and the power to define value itself is their biggest weapon.

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Post by Ryan Rudolph » Fri Aug 11, 2006 3:27 am

Milli wrote
Yes. It's a complicated issue, with many factors, and usually, the country with the most powerful military gets to have the strongest dollar. Funny it how it works out that way, isn't it?
Well, usually a country has developed a powerful military to protect the wealth in which they accumulated over years and years. Wealth comes first then fear of losing it and then the military.

Milli wrote:
The problems of the world are not with the ignorant people, they are harmless. Evil comes from the statist power seekers and the power to define value itself is their biggest weapon.
I suspect it is everyone, everyone working together is a confused greedy way is one creates this lopsided world that we live in. For instance an ignorant construction worker has his greed/excessive consumption, but it is not as gross as a CEO such as Donald Trump because Donald trump has more wealth and therefore more power. He is able consume more, but both are ignorant/power hungry, I see them as the same thing.

So everyone is a part of this.

Another factor that influences a country’s currency is how the private investor will invest his money into the economies of other countries.

EG:// Suppose I’m an American and I invest in the Japanese Economy, This is going to help the Japanese economy more than the American Economy because those are funds that are being lost to external investing.

One would think that if 10 millionaires who live in American invest a large percentage of their wealth into the Japanese Economy, this would increase the value of the Japanese currency while decreasing the value of the American currency.

millipodium

Post by millipodium » Fri Aug 11, 2006 3:36 am

cosmic_prostitute wrote:Milli wrote
Yes. It's a complicated issue, with many factors, and usually, the country with the most powerful military gets to have the strongest dollar. Funny it how it works out that way, isn't it?
Well, usually a country has developed a powerful military to protect the wealth in which they accumulated over years and years. Wealth comes first then fear of losing it and then the military.
And then comes forcing the world to accept your currency through threat of violence.

Milli wrote:
The problems of the world are not with the ignorant people, they are harmless. Evil comes from the statist power seekers and the power to define value itself is their biggest weapon.
I suspect it is everyone, everyone working together is a confused greedy way is one creates this lopsided world that we live in. For instance an ignorant construction worker has his greed/excessive consumption, but it is not as gross as a CEO such as Donald Trump because Donald trump has more wealth and therefore more power. He is able consume more, but both are ignorant/power hungry, I see them as the same thing.
But the powerful do the most damage, and tell themselves they're noble. I see a huge distinction there. Some even seek power BECAUSE they have a greater opportunity to abuse.
So everyone is a part of this.
But the power differential makes a big difference. And many times the most powerful and abusive feel they're doing something good for the rest of the world.

Another factor that influences a country’s currency is how the private investor will invest his money into the economies of other countries.

EG:// Suppose I’m an American and I invest in the Japanese Economy, This is going to help the Japanese economy more than the American Economy because those are funds that are being lost to external investing.

One would think that if 10 millionaires who live in American invest a large percentage of their wealth into the Japanese Economy, this would increase the value of the Japanese currency while decreasing the value of the American currency.
Yeah. And so. So the inherent unequal power of fiat currency is great? Focus like a lazer beam.

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