A recent video featuring Sandro Castro, grandson of Fidel Castro, driving a Mercedes Benz has drawn attention to the inequalities and privileges of a ruling elite within Cuba's struggling economy, which has been enduring an unpopular adjustment process since January due to monetary unification.
Sandro "el Sencillo" apologized and stated that the luxurious car was not his, but the symbolic resonance of his display has resonated deeply in the national sentiment. This is especially true given that this and other episodes highlighting the privileges and economic perks enjoyed by the children and grandchildren of the Cuban ruling class contrast sharply with a discourse that has imposed hardships on the Cuban people for decades, promoting sacrifice and total commitment to the revolutionary project.
"Who are the rich in Cuba?" wondered the Deutsche Welle agency this week, which gathered opinions from several Cuban economists both on the island and abroad.
More than the hypothetical wealth of the Castro family, the video of the Mercedes, according to German political scientist Bert Hoffman from the GIGA Institute for Latin American Studies, "points to the hypocrisy of a socialist system that preaches drinking water while actually drinking wine."
A simple luxury car takes on a much more serious significance when we consider that, according to the World Bank, Cuba has consistently ranked at the bottom of global statistics over the last decade, with just 38 vehicles for every thousand inhabitants, including trucks, buses, and many aging Soviet and American cars.
"Wealth has various attributes in Cuba: a large house in specific areas, a modern car, frequent trips abroad, including for leisure, and satisfaction with the quality (not the quantity) of basic needs," explains Ricardo Torres Pérez, professor and researcher at the Center for Cuban Economic Studies (CEEC) at the University of Havana, to Deutsche Welle.
Torres estimates that "the rich" could represent one percent of the Cuban population: around 112,000 people, just over 30,000 households. "But there isn't a single social group there. There are certainly officials, but also entrepreneurs, farmers, and artists," he adds.
However, there is "very little general data" on economic inequality in Cuba, and it may not be a coincidence that "case studies, very focused on specific communities," are predominant, Torres asserts. Moreover, "little of that research is public," he confirms.
This absence of data has been labeled a "statistical blackout" by Pedro Monreal, another well-known Cuban economist, who, commenting on a recent CEPAL report, lamented "the little importance that appears to be officially given in Cuba to the public analysis of crucial issues such as poverty, inequality, and the social effects of low productivity employment."
"In Cuba, there are no public studies on income distribution, and there is no possibility to conduct free surveys, which limits research in this area," confirmed Cuban economist Mauricio de Miranda Parrondo, a professor at Javeriana University in Cali, Colombia, in an interview with DW. He emphasizes that, while there are international poverty lines, Cuba calculates poverty based on national parameters. Therefore, it could at least do the same with wealth.
Both the volume and the origin of wealth in Cuba, which still has a centrally planned economy, differ from those in other countries in the region. There is also the so-called "wealth of the official," a series of small perks that, within the Cuban context, take on a different dimension and are used to ensure ideological loyalty.
Many military personnel or those referred to as high-ranking officials, such as deputy prime ministers or ministers, for example, "do not possess personal wealth" beyond a house or apartment. This also explains why they cling to their positions: it is the only way to achieve a standard of living significantly different from the national average.
Therefore, as analysts conclude, to account for inequality and privileges in an economy like Cuba's, it is necessary to use non-monetary categories: "There is a significant portion of these privileges that relates to physical access to goods, services, or even properties, as well as opportunities to evade certain regulations, which do not involve a monetary transaction. And, therefore, they cannot be valued," acknowledges Torres Pérez.
"Not only any income in foreign currency, but also 'enjoying goods or services that are not accessible to the rest of society denotes privilege. And, in some cases, this could mean being considered wealthy in Cuban society, although not by international standards, where wealth and economic privileges are typically associated with ownership of businesses, real estate, or land,' agrees De Miranda."
However, beyond the revelations on social media - in a country that lacks transparency regarding the incomes and expenses of its public officials, and where press freedom is absent - "there is no way to prove it" with data, says Pavel Vidal, another well-known Cuban economist from Javeriana, to DW.
"We know that the reforms increased levels of inequality, with the private sector earning around ten times more than the state sector. However, it is difficult to link this to privileges because the sources of capital for private businesses are diverse. In joint and foreign enterprises, incomes are also very high, and hiring in this sector is controlled by government employment agencies. Therefore, there is a filter in place. But there is no information on what that entails," Vidal insists.
The German political scientist Hoffmann recently published a study on the reconfiguration of social classes in Cuba. His co-author, the anthropologist Katrin Hansing, was able to conduct a semi-representative national survey. Their findings indicate that access to foreign currency, either through remittances or investments in private businesses, currently determines social status in Cuban society. Additionally, there is a noticeable bias related to skin color: the most profitable businesses, which receive the highest investments, are predominantly owned by a mostly white and urban population, linked to island migration following the 1959 revolution.
The Cuban state, Hoffmann acknowledges, has placed high-ranking political figures in charge of state-owned, joint, export, and strategically important tourism enterprises, “under the umbrella of the military.” An emblematic example is the military consortium GAESA. Therefore, “the business elite of socialism is also doing well.” However, in the context of household economies, both sources of income—remittances and political connections—do not oppose each other but rather converge, asserts the German Latin Americanist.
Entrepreneurs "have the potential for higher incomes than those who rely on salaries from state jobs. However, they also take on risks and bear a tax burden that is not insignificant," points out De Miranda. Furthermore, he adds, the strict regulations for authorizing businesses on the island "seem not to have been so stringent for those who have family ties or other connections with high-ranking state officials, for whom everything is made easier in an environment lacking transparency, which is the closest thing to corruption."
"Socially, I do not consider that wealth or economic well-being achieved through work or effort is a problem," concludes this Cuban economist. The issue, he explains, "arises when belonging to a particular family that has been in power or connected to it leads to economic well-being and privileges through access to goods and services for use, even if not owned, which are ultimately enjoyed, and that has no relation to their efforts."
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