Voices: Soviet bloc's lessons for change in Cuba

The sidewalk kiosks that began popping up across the street from my Moscow office in the early 1990s looked at first like a makeshift carnival midway, destined to be torn down when the circus moved on.

These makeshift structures — selling everything from ballpoint pens to soft drinks — were the most visible concession by the authorities that the hidebound state-run shops and stores were a dismal failure.

Mikhail Gorbachev's tepid perestroika campaign was the first attempt to tinker with the economy, but eventually triggered a hard-line backlash — and almost comical coup — that collapsed four days later in a heap, along with the Soviet empire.

Next up — a bare two years later — was Boris Yeltsin, whose brain trust brought tremendous dislocation with "shock therapy" that knocked the props from the old communist economic model, leaving average Russians reeling from rising unemployment, soaring prices, heavy taxes and the gradual disappearance of subsidies on everything from food to energy.

Eventually, the economic reforms did begin to break the state's formal ownership of big industry, but also ushered in the era of oligarchs — as local and regional party bosses "appropriated" major industry they once ran and ushered in the era of Kremlin-protected billionaires.

Much of this unfolded against a backdrop of China's experience at Tiananmen Square, where Beijing's Communist leaders used brute force against protesters to put the political cork back in the bottle that economic reform had removed. Over the years, Poland, Estonia, Hungary, and other East bloc nations shed their socialist straitjackets.

Now it's Cuba's turn.

Can the last Soviet-style economy learn anything from the agonies of its one-time Marxist-Leninist brethren?

It is a question just about everybody but Cuba is asking out loud. The Americans certainly are. I attended a seminar on "Cuba in Transition" last week — not in Havana but in Washington. It was (notably) sponsored in part by the U.S. Chamber of Commerce.

Participants pointed out that Cuban officials bristle at the term "transitioning." Cuban authorities may concede a need for change, but they aren't transitioning away from anything, most certainly not to a capitalist system.

Or as Cuban President Raúl Castro says in his take on economic change: sin prisa pero sin pausa (Slow but steady.)

But change has a habit of slipping the grasp of even the tightest fist.

In the early '90s, I watched the Gorbachev team try and fail to shore up the Marxist-Leninist economy. Like Castro's, the mantra was to "improve" the system not replace it.

Instead, tinkering bred dissent on the right and the left — and led to the collapse of the entire structure, taking Gorbachev with it. In China, there may still be an entity called the Communist Party, but communists are few and far between.

Cuba is taking it slow, opening up the small entrepreneurial sector, but not exactly greasing it.

But the same forces that may prompt Cuban officials to look the other way at a thriving black market (how else can you buy a tire?) will be hard-pressed to stop the expansion of the private economy as more and more people become dependent on — or beholden to — it. If workers flood the private sector, who will work the state firms at subpar wages?

Worse, from the viewpoint of the ruling party, economic change inevitably brings political reform, or an end to the experiment altogether.

Cuba, long ago weaned from Moscow's largesse, is now struggling with the loss of aid and cheap oil from Venezuela with the worldwide collapse of oil prices. That leaves little maneuvering room.

Vadim Grishin, an International Monetary Fund senior adviser who teaches a course on the Economics of Transition at Georgetown, University, watched the borscht being made close up in Moscow during the early '90s when he served with the Yeltsin administration as it struggled with economic reform.

Cuba's current economic model, he says flatly, "is not sustainable."

"This is not a random phenomenon," Grishin says. "Shortages and delays in development are not due to some mistakes in policy or to some fatal coincidence of circumstances, but rather to deeply rooted properties of socialism."

As economic pressure mounts, change in Cuba seems inevitable. But as ambitious politicians, the Cuban diaspora, U.S. companies and a tiny population of 11 million people jockey for change, Cuba may be able to avoid the wrenching excesses that brought down the Soviet behemoth. As one seminar participant noted, Cuba is "too small to fail."

Paste BN reporter Stanglin covered the Cold War from Russia and Poland for Newsweek, U.S. News & World Report and UPI