• Submitted by: manso
• Business and Economy
• 08 / 24 / 2010

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Wednesday, 18 August 2010 22:27. The text can be read quickly. "The Council of Ministers agreed to expand the practice of self-employment [...] eliminating several existing prohibitions to the granting of new licenses and the commercialization of some products, making the hiring of a labor force more flexible."

So said President Raúl Castro Ruz, addressing the Cuban Parliament on Aug. 1.

This is just one aspect of an important group of topics the president touched on, regarding the economy, the current legislation and the major deficiencies that hinder the country's progress, without losing his objective of social justice.

In the mid-1990s, there were 210,000 self-employed workers practicing 157 trades. By the end of 2009, the number was 143,000, a drop due, among other factors, to the shutdown of various businesses because of tax evasion, the illegal acquisition or sale of goods and even the inappropriate use of the facilities (some paladares [home restaurants] were turned into luxury brothels and others functioned as fronts for even shadier activities.)

The expansion to almost 200 human activities is the result of a restructuring of the Cuban economy, with measures adopted by the Council of Ministers in mid-July. Announced during the plenary session of the National Assembly, "they constitute by themselves a structural and conceptual change in the interest of preserving and developing our social system and making it sustainable in the future," Raúl said.

What emerges from all this, aside from the already published decision to lease barbershops and beauty shops to groups of workers who can determine prices and work schedules, and similar measures?

The hiring of salaried workers by entities other than the state had been possible only in the agricultural sector. The new regulations broaden that framework and allow the commercialization of industrial products, a move many see as the advent of a small-business sector that, until now, only included artisans (footwear, jewelry, clothing, etc.)

Some private entities have started small businesses that manufacture bricks,tiles, and utensils for house cleaning and domestic use. Some of those businesses even supply state companies and some sell their products in stores or the so-called industrial markets.

"It is a continuation of the slow but pragmatic steps to make adjustments without destabilizing the current system," analyst Heather Berkman of the Eurasia Group consulting company said in Washington.

Referring to the alternatives in sight, Cuba's Minister of the Economy and Planning, Marino Murillo, said that, as more licenses are granted to private taxi drivers, that kind of expansion "should be extended to other services" because "the state doesn't have to look after everything."

That is why Cubans expect an early creation of cooperatives of masons and other construction workers who could be hired both by individual persons and official sectors. That modality could be explored as a way to obtain better quality of work and savings in materials, without the paternalism that now smothers production. The new wage-earners and their employers would receive direct material stimuli, pay taxes on their earnings, and contribute to the social security funds.

The appearance of medium-size businesses reminds us of practices established in the late German Democratic Republic, where, despite the contrary Soviet criteria, people created photo studios, ice-cream parlors, butcher shops and other commercial centers and private service suppliers. None of those enterprises contributed to the toppling of the Berlin Wall.

The groups organized in the construction industry could include, separately or together, electricians, plumbers and whatever manual specialties are required for the repair and construction of buildings.

Bearing in mind the differences among the various activities, we could start from what works in taxi stands. The state leased to the drivers the material base, i.e., cars, machinery for cleaning and maintenance, parking lots and offices. The scheme includes the drivers, mechanics, cleaners and, if necessary,office workers. It all depends on what the entrepreneurs need and want.

Other modalities in transportation could include the urban buses. An experimental plan has been instituted in the Alberro bus terminal in Havana,whereby some bus drivers have been leased routes from a central point in Havana to towns outside the capital. Like taxi drivers, the bus drivers turn over a certain percent of their earnings to the state and pay taxes, just as anywhere else in the world.

The hiring of salaried personnel is expected in gastronomic centers, from the typical street stands for the sale of fast foods to cafeterias, canteens,catering and the almost infinite "et cetera" that can be found in the food industry.

Some existing activities and businesses could undergo changes and pass from state hands to private hands. That's the case with security providers and night guards who watch over property in rural areas. Their use in urban areas should not be ruled out.

Other fields would include the care of the elderly and the very young (there are precedents for that, too), but the small print still has not explained the transformation and new modalities.

Geriatric institutions are currently run by the state, except for those serviced by religious organizations. Working families receive money from the state to hire attendants who can look after the physically disabled, but such attendants are hard to find because their salaries are low.

Many people who work little or not at all at their place of work, "a flaw known as "la botella" or sinecurism" can expect to be dismissed. If so, jobs such as caretakers or attendants become an option.

As regards children, there are already some small daycare centers that are officially controlled in terms of food and hygiene in play or rest areas. That sanitary vigilance would be maintained if the self-employment initiative is expanded. The creation of daycare centers is not a profitable endeavor for the state, but the country cannot continue to assume such a responsibility at a time when it needs to direct its resources and materials to the repair and building of homes.

The reduction of payrolls (something that will affect 90 percent of all workers) will lead to the creation of these enterprise jobs. Cutbacks will be announced soon and some will be completed before the first quarter of 2011. Other modifications and initiatives will develop over the next five years.

From the rumors, half-truths and simple logic, we can deduce that the investment projects Cuba has signed with other countries in the Bolivarian Alternative for Our America (ALBA) will have a spillover effect for our country in terms of job sources and novel possibilities. The best example is the valuable exportation of medical and educational services that is bringing hard currency to the nation's coffers, at the same time that it serves as a mission of high professional and humane outreach.

This is only the first wave of possibilities. The flood is yet to come.

By Elsa Claro, Elsa Claro is a Cuban journalist who specializes in international topics.

Source: http://groups.yahoo.com/group/CubaNews/message/117239