Rush to Buy Goods Underscores Cuba’s Economic Divide
By Miami Herald Staff, The Miami Herald
May 22–HAVANA — On weekday afternoons at the Claudia boutique shoe store across from Havana’s famed sea wall, ladies jockey for their turn to purchase spiked sandals and sequined purses.
At the Galeria Paseo shopping mall next door, pet vitamins go for $17, dress shoes sell for $82 and electric bikes go for as much as $800. Forget trying to find a DVD player at the mall — or at most other electronics stores for that matter. They sold out weeks ago.
The rush to purchase goods previously not available or banned debunks the long-held belief that Cuba’s economy is so dire that all its citizens are strapped for cash and food. It also underscores a vast economic divide in Cuba’s economy and shows that a significant portion of Cubans — primarily in Havana — have disposable income.
The buying frenzy finally lays bare what Fidel Castro struggled against and long denied: Cuba indeed has an increasingly privileged portion of society, even as the average state wage is about $17 a month.
After decades of being denied basic possessions like computers and microwaves, many Cubans here have emerged to take advantage of a series of new consumer liberties offered by Raul Castro, the country’s first new president in 49 years. Shortly after taking office, he liberalized the sale of items that had previously been sold only on the black market.
The measures were an about-face to the policies held dear to his older brother Fidel, whose socialist revolution was based on the theory of equality. If everyone could not afford it, Fidel did not permit it.
“I would say 70 percent of Cuba has no money, or just barely enough,” said Luis, a cab driver. “Thirty percent is doing OK. Of that, 10 percent of them, whoa, has money. I’m in the 30 percent. I did not buy a new DVD player when they came out; my home computer plays DVDS.”
Experts stress that the financial boom being felt in some homes is hardly universal. People in eastern provinces and cities far from tourist destinations have much less access to coveted dollars.
A University of Miami study showed that even as far back as 2002, there were 44 times more dollars circulating in Havana than Guantanamo, on the eastern tip of the island.
The DVD players made available for purchase lasted just hours on the first day last month that Cuban electronics stores began to sell them. ‘I see these DVDs and bikes flying off the shelves, and I ask myself, ‘Where is all this money coming from?’ ” said Margarita, who makes $10 a week working at a craft fair.
The first day DVDs went on sale, people in Cardenas — the small town east of Havana that is home to Elian Gonzalez — lined up at 5 a.m. at a store that did not open until noon. Some 7,400 people signed up for cellphones in the first 10 days the service was offered to locals, the Cuban government media reported.
“Despite 45 years of being forced to live in egalitarianism, Cubans don’t really buy into that,” said Ted Henken, a Cuba expert at Baruch College in New York. “Being forced into it actually created a lust for materialism. Cubans just want to consume. They want to live in the modern world, have cellphones, have flat screen TVs. These are human aspirations.”
Now, Henken said, they are conspicuous consumers obsessed with symbols of prosperity and modernism: “They want part of the American dream.”
That desire was evident at one housewares store in Old Havana.
‘You should see the customers — they don’t want just any DVD player. They want the latest one. They come in here and ask, ‘Do you have the one with a flash memory drive?’ ” said Juan Carlos, a clerk. “This pressure cooker costs $68 — that’s six months pay for me — and people buy it. You see this stupid thing that chops onions for $22? People buy that, too.”
He stopped to tell a customer she had best buy the washing machine she wanted immediately, because there would be none left by morning.
“They arrived today,” Juan Carlos explained, “and I’ve already sold three.”
The purchases are being paid with money from years of remittances from abroad, illegal businesses and legal jobs that pay dollar tips. These are the “new rich” who were long scorned by Fidel but were the first to benefit under Raul’s economic policies.
They are the class of Cubans who wear knock-off Dolce & Gabbana T-shirts and the latest sun glasses. They have home computers and digital cameras. Many already had a DVD player when Raul Castro lifted the ban last month.
An estimated 60 percent of Cubans get remittances from abroad, further padding nest eggs across the nation.
Much of Cubans’ purchasing power comes precisely because state salaries are so low. The wages are so insufficient that they virtually force people to break the law in order to survive. Somebody who works Cuba’s black market can make a state worker’s monthly wage in a single day.
In the three months since Fidel Castro gave up power for good, the Cuban government has finally acknowledged its previously concealed reality: Cubans watch foreign movies on DVDs, don’t much care to wash their clothes by hand, and are willing to pay 60 cents a minute for cellphone calls. While the vast majority of the country’s 11.2 million people, particularly those outside the capital, still struggle to get by on meager salaries, some Cubans have cash savings they are eager to spend.
“There is money in Cuba. There are also serious class divisions,” said Carlos, a bicycle taxi operator whose $90 monthly earnings are about 10 times what retirees make. ‘Fidel warned of this when they legalized the dollar in this country [in 1993]. He said: ‘People are going to get rich, and the rest of you are going to live in misery.’ And that’s exactly what happened.”
Carlos sports a gold ring he paid $40 for and plans to get a gold chain next. He would rather not eat, he said, than wear sneakers that were not Adidas.
“All this illustrates the differences between Raul and Fidel,” said Dick Cluster, a Cuba historian at the University of Massachusetts, Boston. “Raul is more inclined to publicly recognize reality, even if it’s unpleasant. He recognizes all the things he legalized are things that went on in the black market. Fidel tended to impose his sense of justice on reality.”
But Cubans say Raul Castro is only acknowledging human nature.
“They may have had this idea to eliminate social class, but that’s impossible to do,” said Julio, a masseuse who said he makes about $200 a month. “People are going to make money based on their ability and intellect. . . . The government knows this and has recognized it.”
The Miami Herald withheld the name of the correspondent who wrote this report and the surnames of some of the people quoted, because the reporter did not have the journalist visa required by the Cuban government to report from the island.
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