Envisioning Cuba

Samuel Farber

• Publisher: The University of North Carolina Press
• Year: 2007
• ISBN:
  9780807877098
• Topic: History
• Subtopic: Latin American & Caribbean History
• Index: History

Analyzing the crucial period of the Cuban Revolution from 1959 to 1961, Samuel Farber challenges dominant scholarly and popular views of the revolution's sources, shape, and historical trajectory. Unlike many observers, who treat Cuba's revolutionary leaders as having merely reacted to U.S. policies or domestic socioeconomic conditions, Farber shows that revolutionary leaders, while acting under serious constraints, were nevertheless autonomous agents pursuing their own independent ideological visions, although not necessarily according to a master plan. Exploring how historical conflicts between U.S. and Cuban interests colored the reactions of both nations' leaders after the overthrow of Fulgencio Batista, Farber argues that the structure of Cuba's economy and politics in the first half of the twentieth century made the island ripe for radical social and economic change, and the ascendant Soviet Union was on hand to provide early assistance. Taking advantage of recently declassified U.S. and Soviet documents as well as biographical and narrative literature from Cuba, Farber focuses on three key years to explain how the Cuban rebellion rapidly evolved from a multiclass, antidictatorial movement into a full-fledged social revolution.

Chapter One
The Prerevolutionary Cuban Economy

Progress or Stagnation?

Did the economic conditions prevailing in Cuba during the 1950s encourage the development of a political climate conducive to a radical social revolution?

The incomplete and frustrated 1933 revolution took place in the midst of a world depression that severely affected the Cuban economy, but, on the eve of the 1959 revolution, the economic situation had certainly improved. Cuba then had the fourth-highest per capita income in Latin America, after Venezuela, Uruguay, and Argentina. Ranking thirty-first in the world by the same indicator, Cuba was wealthier than most “underdeveloped” countries.¹ Average per capita income is, however, not necessarily a reliable indicator of general economic development: in 1953, Cuba also ranked fourth in Latin America according to an average of twelve indexes covering such items as percentage of labor force employed in mining, manufacturing, and construction; percentage of literate persons; and per capita electric power, newsprint, and caloric food consumption.² Eugene Staley, the chief economist of the International Bank for Reconstruction and Development (IBRD, the predecessor of the World Bank) mission that investigated the Cuban economy in 1950, classified it as part of an intermediate group of nations that fell in between the highly developed and underdeveloped groups. Staley grouped Cuba with such countries as Chile, Poland, Hungary, and Spain.³

Cuba had enjoyed significant postwar prosperity. Sugarcane producers in Asia and beet growers in Europe were only beginning to recover from war destruction and could not yet compete with Cuban sugar exports. This boom allowed liberal but corrupt president Ramón Grau San Martín (1944–48) to proclaim that during his administration every Cuban had “five pesos in his pocket.” (One peso was worth one dollar.) By 1950, world sugar production had recovered from the effects of the war, and postwar Cuban prosperity had come under threat. However, with the outbreak of the Korean War, sugar prices went up, thus saving Cuba from an economic downturn, although only for a few years.⁴

On closer inspection, however, it becomes clear that the postwar boom had merely returned the Cuban economy to the predepression days of the 1920s. Thus, as the IBRD’s 1951 Report on Cuba pointed out, Cuba’s per capita income of about three hundred dollars per year was only slightly above that of the early 1920s.⁵ Cuba’s most important economic breakthrough had taken place from 1900 to 1925, right after Spain was forced to abandon the island in 1898 and the United States made Cuba into a de facto economic and political colony. During this period, the productive basis for Cuba’s relatively high economic standing in Latin America had been established. With a U.S. capital investment in the island that amounted to $750 million by 1925,⁶ Cuba was producing seventeen times as much sugar in 1925 as in 1900. But as the Report on Cuba also explained, the Cuban economy had made relatively little progress since then.⁷

IMPERIAL DEVELOPMENT IN CUBA

While the origins of Cuba’s sugar monoculture went back to the 1790s, the entry of U.S. capital and political influence at the end of the nineteenth century and beginning of the twentieth century marked a qualitative new stage in the island’s economy and polity. Because the U.S. sugar industry in Cuba required huge expanses of land for the cultivation of cane—with sugar companies competing with each other for the acquisition of land—the industry destroyed small and midsized landed property holdings and created a proletarianized labor force, not all of which would always find work as wage laborers in the sugar industry. The remaining small and medium-sized rural proprietors remained subject to the sugar mill owners, most of them North American, particularly if as cultivators of sugar they had to accept the prices and conditions imposed by the sugar capitalists.⁸ Much of this phenomenon resulted from the massive economic destruction that the Cuban guerrilla war against Spain—and heavy Spanish reprisals against the Cuban rebels—had created in the Cuban countryside. The undercapitalized nonsugar sector faced particularly great obstacles in recovering from this terrible experience.

Later, as the 1920 speculative bubble known as the “dance of the millions” was followed by the crash of the sugar market at the end of that year, Cuba’s sugar and banking sectors entered into crisis. Many sugar proprietors were unable to honor their mortgage payments and were forced to sell under very unfavorable conditions. The National City Bank took control of more than fifty sugar mills in the summer of 1921,⁹ thereby increasing overall U.S. control of Cuban sugar production.

Viewed strictly from the perspective of the U.S. economy, this economic breakthrough can be seen as another vivid example of capitalist accumulation that recognizes no national boundaries. In that sense, there was nothing special or unique about the growth of U.S. sugar investment in Cuba. When viewed from the perspective of the Cuban economy, the expansion of the period 1900–1925 signified the integration of the Cuban economy into the U.S. economy. From a Cuban perspective, this was not just capitalism but also imperialism.

THE RECIPROCITY TREATIES BEFORE AND AFTER THE DEPRESSION

The Platt Amendment and other forms of explicit U.S. political control over Cuba constituted a key element of the imperial relationship between the two countries. Less attention has been paid, however, to an important economic/political device that survived the Platt Amendment and played at least as important a role in subjecting Cuba to U.S. control: the various reciprocity and other economic treaties in force, in various forms, from 1902 until the early 1960s. These treaties cumulatively cemented Cuba’s role as a sugar export economy to the U.S. market and as an importer of U.S. manufactured goods.

The first reciprocity treaty was signed in 1902 and ratified and enacted in 1903, shortly after the adoption of the 1901 Cuban Constitution and the Platt Amendment and the inauguration of the Cuban republic on May 20, 1902. Cuban sugar received a 20 percent tariff reduction in the United States, while U.S. imports received tariff reductions ranging from 25 to 40 percent. As the Cuban economy recovered from the disastrous effects of the war against Spain and massive U.S. foreign investment in sugar created the biggest economic boom the island has ever experienced, Cuban consumption of U.S. imports grew, effectively displacing other suppliers, particularly those from Europe. For their part, Cuban sugar exports to the United States, controlled by U.S. sugar capitalists, increasingly dominated the sugar market in that country. By 1911, Cuba’s sugar exporters not only filled the U.S. market’s needs but sold their surpluses on the international market, mostly in Europe. This tendency reached its peak during World War I with the destruction of the European sugar industry. Cuban production further expanded during this period of the “fat cows,” culminating in the inflationary bubble of 1920 that was followed by the crash of 1921.¹⁰

THE WORLD DEPRESSION AND AFTER

The world depression that began in the late 1920s devastated the Cuban economy. Moreover, the sugar-based Cuban economy had a much harder time recovering from the depression than did the economies of some other countries. Although the Cuban government implemented a tariff reform in 1927 that encouraged some import substitution of light consumer goods, as Cuban economic historian Julio Le Riverend has pointed out, this limited reform could be realized only by respecting, on the whole, the exceptional advantages that had previously been conceded to U.S. products. The reform was more effective in substituting articles of European origin than those from the United States, but it remained limited in its effect because purchases from Europe had declined as a result of the rising importance of American imports in Cuba. Nevertheless, after 1927, Cuba’s production of eggs, poultry, meat, shoes, butter, cheese, and condensed milk, which had been neglected because of sugar’s growing dominance, went up at the same time that the import of those products declined. This phenomenon accompanied the strong worldwide protectionist tendencies of the 1920s and 1930s.¹¹

Cuba’s big economic growth in the early part of the century had been based, to a considerable degree, on sugar exports’ unrestricted access to the U.S. market. This changed in 1934, when the Platt Amendment was abolished and the United States and Cuba signed a new reciprocity treaty. That treaty, which continued the pattern of Cuban reliance on sugar, turned out to be more unfavorable for the island republic than the earlier agreement. In the 1902 treaty, Cuba had granted 20 to 40 percent tariff reductions on 497 U.S. products in exchange for a preferential 20 percent tariff for sugar and tobacco; in 1934, however, Cuba granted 20–60 percent tariff reductions on 480 products while ending up with a smaller share of the U.S. consumption of sugar, rum, and tobacco. The most important change was that while the 1902 treaty favored only 241 classes of merchandise (52 percent) with preferential treatment ranging from 25 percent to 40 percent, the 1934 treaty gave tariff concessions between 25 and 60 percent to 406 categories of merchandise (63 percent of the total).¹² While the reduction of tariffs on sugar and other primary products encouraged the growth of those sectors in Cuba, the increased competition from North American imports dealt a serious blow to efforts to diversify the Cuban economy. Thus, from 1933 to 1940, the U.S. portion of Cuba’s imports increased from 54 to 77 percent.¹³ Therefore, while in the aftermath of the world depression nationalist governments in Mexico and other Latin American countries embarked on a protectionist tariff policy to encourage import substitution, Cuba, as a direct result of the reciprocity treaty, had no such option.

To make matters worse for Cuba, the U.S. Congress approved the Jones-Costigan Act just before the new reciprocity treaty went into effect. This law replaced tariffs with quotas as the means of protecting U.S. domestic sugar producers. The U.S. secretary of agriculture now had authority to assign quotas to all sugar producers, domestic and foreign, on the basis of the secretary’s estimation of national sugar needs. While Cuba had derived some slight benefit from the lowered tariffs in the 1934 reciprocity treaty, the country initially was harmed by the quota system, which was based on the participation of sugar producers in the U.S. market between 1931 and 1933. Under the impact of the 1930 protectionist Hawley-Smoot Act, the Cuban share of the U.S. market during those three years was the smallest that Cuba had at any time. Cuban sugar production and exports to the United States did increase throughout the 1930s but did not return to the level of the 1910s and early 1920s.¹⁴ As a result of the limits set by the new law, Cuban sugar, whether controlled by Cuban or U.S. capitalists, could no longer compete with U.S. producers on an economic basis. Conversely, the price for the sugar that Cuba was allowed to sell in the United States was usually above that of the world market.¹⁵ In sum, these changes spelled the end of the days when Cuba, in free competition with sugar from the United States and other foreign producers, could export as much sugar as the U.S. market could consume, creating a much more unfavorable and asymmetrical economic situation for Cuba than had prevailed from 1902 to 1934. This new greater power asymmetry between Cuba and the United States was further reinforced by the fact that Cuba’s sugar quota under the 1934 Jones-Costigan Act was unilaterally determined by the U.S. Congress rather than being the outcome of bilateral trade negotiations between the two countries.

During World War II, many of Cuba’s sugar competitors suffered considerable war damage, but the benefits of that situation for Cuban sugar were significantly diminished by an agreement signed by Cuba and the United States. Cuba, as a war ally of the United States, agreed to sell its sugar to its North American neighbor at fixed prices for the duration of the conflict. During this period, Cuba produced 20 million tons of sugar, but the price paid by the United States remained below world market prices, meaning that the island failed to obtain an increase in income proportionate to the rising levels of sugar production and exports.¹⁶ According to estimates made by Jorge Domínguez, real per capita income in Cuba remained the same in 1945 as in 1938, although significant variations had occurred within this period.¹⁷ As the war created difficulties in transportation between Cuban and U.S. ports, Cuba planned to develop a small merchant marine to transport sugar to nearby ports in Florida and Louisiana and to bring home industrial raw materials and finished products. This plan, initiated by Cuba’s Junta de Economía de Guerra de Cuba (War Economy Board), provoked an official note from the U.S. government objecting in advance to any future efforts to reduce the amount of cargo carried between the two countries by the U.S. merchant marine. The note also containe...

Table of contents

• Cover Page
• The Origins of the Cuban Revolution Reconsidered
• Copyright Page
• Contents
• Acknowledgments
• Chronology Major Events in Cuban History, 1868–1961
• Introduction
• Chapter One The Prerevolutionary Cuban Economy
• Chapter Two Fidel Castro and the Cuban Populist Tradition
• Chapter Three U.S. Policy and the Cuban Revolution
• Chapter Four The Driving Force of the Cuban Revolution
• Chapter Five The Role of the Soviet Union and the Cuban Communists
• Epilogue
• Notes
• Selected Bibliography
• Index
• Series