Dark times for Cuba’s economic experiment

Key takeaways

Cuba's current socio-economic crisis is largely driven by a U.S. oil embargo, which has resulted in essential blackouts and severely impacted daily life.
Cuba's complex history of economic strategies oscillating between communism and capitalism has led to significant socio-economic disparities.
The decline in tourism due to U.S. sanctions and the pandemic has substantially affected the economy, leaving many entrepreneurs desperate and without income.
Young Cubans are increasingly seeking opportunities outside of Cuba, reflecting widespread frustration with current conditions and the government's inability to provide for its citizens.
Despite the dire situation, there are instances of resilience and innovation among Cubans, particularly in the entrepreneurship sector, as they find ways to adapt to harsh realities.

Summary

Current Crisis in Cuba

Since January, Cuba has faced a severe crisis as the U.S. has blocked almost all oil from reaching the island. This has led to widespread suffering, with blackouts that can last for days, ultimately endangering lives. The impact of these blackouts reaches deeply into daily life, affecting businesses, communication, and healthcare. Citizens, unable to charge their phones or access the internet consistently, are forced to rely on voice messages to share their struggles. Key narrators include farmers and hotel managers who describe their realities amidst these challenges.

Historical Economic Landscape

Cuba's economic journey has been characterized by a fluctuating relationship with communism and capitalism over the past 60 years. After the 1959 Revolution, the country leaned heavily on its communist allies while simultaneously experimenting with capitalism in response to economic challenges. Particularly after the Soviet Union's collapse in 1991, Cuba sought to diversify its economic strategies, eventually forming connections with nations like Venezuela for oil support. The narrative illustrates Cuba's struggle with economic experiments and their implications on the lives of its citizens.

Impact of Oil Embargo and Tourism Decline

The recent oil embargo from the U.S. has exacerbated Cuba’s challenges, limiting access to essential resources and crippling the tourism sector that had once boasted significant economic promise. Following a brief tourism boom following thawed U.S.-Cuba relations under Obama, the reintroduction of sanctions under Trump and the COVID-19 pandemic have devastated the hospitality and travel industries. Personal stories, like that of Yacer González Cabrera, exemplify the desperation among entrepreneurs who relied on tourism for their livelihoods.

Future Uncertainty

The future of Cuba's economy remains uncertain as it grapples with severe restrictions and changing global dynamics. The heavy reliance on tourism and oil imports has left it vulnerable to geopolitical shifts, particularly U.S. policies. Recent waves of migration signal growing dissatisfaction among the populace, with many young Cubans seeking opportunities abroad. Despite this, there are glimmers of resilience, as some entrepreneurs continue to innovate, such as Yacer, who is trying to reshape perspectives on biking in Cuba.

Show notes

Live event info and tickets here.

For more than 60 years, Cuba has survived on two seemingly contradictory economic strategies: leaning on friendly communist and socialist countries, and flirting with capitalism. And right now it seems the US is making both strategies impossible.

Since January, the U.S. has been preventing almost all oil from reaching the island. Doctors can’t get to the hospitals where they work, many buses aren’t running, trucks can’t deliver food and medicine where they’re needed. And there have been frequent blackouts. On more than one occasion over the last few weeks, the entire country has lacked power.

It’s hard for people to even talk on the phone because they can’t always charge them or get cell service. So we asked them to send us voice notes describing this moment in Cuba’s history.

We also wanted to know: How did Cuba get here? On today’s episode: a brief history of Cuba’s communist-capitalist experiment.

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This show was hosted by Erika Beras and Nick Fountain. It was produced by Luis Gallo. It was edited by Marianne McCune. It was fact-checked by Sierra Juarez and engineered by Robert Rodriguez. Alex Goldmark is Planet Money’s executive producer.

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