Cubans fret over food ration cuts

Cubans fret over food ration cuts
Fri Nov 13, 2009 12:38pm EST

* Peas, potatoes removed from monthly Cuban ration

* President Raul Castro cutting social subsidies

* Cubans worry other subsidies to disappear

By Rosa Tania Valdes

HAVANA, Nov 13 (Reuters) - Peas and potatoes have become the harbingers
of change in Cuba as President Raul Castro chips away at some of the
Cuban revolution's most hallowed social programs.

Without a word, the two vegetables were removed this month from the
subsidized food ration Cubans have received since 1963 and prices shot
up in what people fear was a glimpse of the future.

Many view it as the first step toward the end of the ration program,
known here as the "libreta," and possibly other government subsidies
that Castro has complained are too costly for the cash-strapped
government and discourage productivity.

"There's a lot silence from the country's leaders about most of the
things that are affecting we Cubans. The libreta is slowly disappearing
without explanation," said Marco, a retired lawyer who did not give his
full name.

Cubans say the libreta only gives them enough food for about two weeks,
but at least guarantees part of their monthly diet. In a country where
the average monthly salary is equal to about $20, losing it would be a blow.

"People are not very happy about it. It's not that what you get lasts
for the whole month, but it's a help because you can get those things at
a price that's not too high," said Havana housewife Yuliet Cruz.

The libreta gives Cubans subsidized prices for set quantities of basic
foods like rice, beans, sugar, salt, coffee, eggs and meat.

If they need more food than the libreta provides, they have to pay
regular market prices that are much higher, although generally low by
international standards, or find it on the black market.

PRICE JOLT

The newly unleashed prices for peas and potatoes gave Cubans a jolt.

Potatoes more than doubled in price to 1 Cuban peso, equivalent to 4.5
U.S. cents, for a pound, while the price of peas increased 20-fold to
3.5 pesos, or 16 U.S. cents per pound.

Government insiders have said the libreta is unlikely to be eliminated
for people such as retirees living on fixed incomes or those who for
legitimate reasons are unable to work.

But the Cuban government is in the midst of a deep economic crisis
brought on by the global recession, three damaging hurricanes last year,
generally low productivity and other factors.

President Castro has hinted at broad changes to get rid of subsidies and
has a trial program under way in four government ministries to eliminate
daily free lunches given to 3.5 million workers.

Instead of free food, they are getting 15 pesos a day, equivalent to 68
U.S. cents, to buy their own lunch. If the trial saves money, it is
expected to be applied throughout the state-dominated economy.

"Social spending has to be in accordance with real possibilities, and
that means eliminating those (programs) that can be done without,"
Castro said in an August speech.

The challenge for Castro is to implement the changes without causing
problems in a population where complaints about economic circumstances
are common.

"Cubans are worried that potatoes and peas may be the equivalent of the
canary in the coal mine," said Cuba expert Dan Erikson at the
Inter-American Dialogue in Washington.

"Raul is playing a risky game by cutting back on long-standing social
safety nets without offering new economic alternatives," he said.

The prospect of losing handouts has made some Cubans long for the days
when Fidel Castro, not younger brother Raul, was in power, said
housewife Cruz. Fidel Castro, 83, resigned the presidency last year
after 49 years in power.

"They say if the comandante was in charge, none of this (stuff) would be
happening," she said.

(Editing by Jeff Franks and Vicki Allen)

Cubans fret over food ration cuts | Industries | Consumer Goods & Retail
| Reuters (13 November 2009)
http://www.reuters.com/article/rbssConsumerGoodsAndRetailNews/idUSN1220877620091113?sp=true