[Marxism] Does socialism have a future?

Louis Proyect lnp3 at panix.com
Sat Dec 23 19:17:31 MST 2006

>Does capitalist investment in Cuba have a different impact compared to
>that of capitalist investments in China?


John P. Sweeney, "Why The Cuban Trade Embargo Should Be Maintained
Heritage Foundation, November 10, 1994

Those who favor lifting the embargo often point to the examples of 
Vietnam and China to justify their position, claiming that 
eliminating the embargo will encourage the growth of a free-market 
economy which will undermine the communist regime. Such comparisons 
are not valid. Capitalism is destroying communism in China, but the 
driving force is not international trade. It is a strong domestic 
market economy tolerated by the communist government. China's market 
economy is dominated by many millions of small entrepreneurs who are 
devouring the communist command economy. Moreover, China's market 
economy has been growing in depth and diversity since the mid-1980s. 
Free trade is promoting faster market growth and expanding the 
personal freedom of millions of Chinese, encouraged by entrepreneurs 
and investors from Taiwan, Hong Kong, and elsewhere who are providing 
the capital, entrepreneurial skills, and international trade contacts 
which are compelling China to transform its economy. In the process, 
a vast and prosperous middle class is being created.

In Cuba, however, the Castro regime is not willing to liberalize the 
economy and create a free market. Cuban exile communities in the 
United States, Latin America, and Europe are not willing to work with 
Castro, and market initiatives by the Castro regime to encourage them 
to do so are very recent, dating from 1993 for the most part. The 
basic orientation of the hard-liners surrounding Castro is to contain 
and restrict all initiatives that unleash individual entrepreneurship 
and creativity. For example, the government has arrested people for 
earning "too much" money in the dollarized informal economy, the 
variety of legally permitted "family businesses" has been restricted, 
and tax rates on the income of self-employed Cubans have been 
increased. Moreover, Cuba's constitution and legislation specifically 
prohibit all private initiative, notwithstanding recent reforms 
allowing self-employment by Cubans in approximately 140 categories of 
economic activity from which all professionals (the core of any 
middle class) are expressly barred. For over three decades, the 
regime has operated on the basis of divide and rule. Castro's bitter 
enmity toward the Cuban exile community precludes the possibility of 
replicating in the Caribbean what China's exile community has 
accomplished in China.

None of the alleged "market reforms" undertaken to date in Cuba are 
true free-market initiatives. Free enterprise remains highly 
restricted. Foreign investors doing business in Cuba today deal 
mainly with Castro's regime. Cuban partners in joint ventures and 
mixed companies are approved by Castro as "safe." Moreover, unlike 
China, Cuba has barely started to open up its economy, and what 
little has been done to date has been permitted with great official 
reluctance and with the objective of assuring the communist 
government's political survival. China's economic transformation has 
been under way since 1978, when important agricultural reforms were 
introduced, including the right of peasant farmers to grow the crops 
they wished and retain some of their profit. Moreover, the government 
of China has encouraged the marketization of the country's coastal 
provinces, and since 1992 the Chinese constitution has incorporated 
the concept of the "socialist market economy." Although China remains 
a communist nation where political freedoms are sharply restricted, 
the ruling regime has permitted vigorous development of the private 
sector, thus laying the seeds for its eventual demise and potential 
replacement by a politically pluralist, more open society.

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