The Relationship Between Wages and Corruption

Cuba: The Relationship Between Wages and Corruption / Dimas Castellano

Posted on August 4, 2013



Experience, supported by social sciences, teaches that interest is an

indispensable engine for achieving goals. In the case of the economy,

the ownership of the means of production and the amount of wages

decisively influence the interests of producers. When that interest

disappears, as happened in Cuba with the process of nationalization, the

impediment to ownership and/or receiving wages that correspond to one's

efforts, forced Cubans to seek alternative sources to survive through

the appropriation of the supposed property of the whole people.



Such conduct, prolonged over too great a time, becomes the moral

component, that is, the socially accepted norms that are generalized

throughout the whole society. To low wages Cubans responded with

alternative activities; to the absence of civil society, with life

underground; to the lack of materials, theft from the state; and to the

closure of all the possibilities, with the escape into exile. Actions

expressed in the same way in the nineteenth century; but now, not to

abolish slavery and achieve independence, but to fight to survive. A

collection of behaviors summarized in the popular expression: "Here what

we must not do, is die."



Given this reality, the government's response focused on repression:

police, surveillance, restrictions, inspectors and inspectors of the

inspectors, expulsions, convictions and imprisonment. Actions on the

effects, without taking into account that solutions require recognition

of and action on the causes.



At the closing ceremony of the National Assembly of People's Power on 7

July, the first secretary of the Cuban Communist Party (PCC), Raul

Castro, said that the implementation of the Guidelines requires a

permanent climate of order, discipline and exigency in Cuban society and

the first step is to delve into the causes and conditions that have led

to this phenomenon over many years.



He also added: "We have perceived with pain during the 20-plus years of

Special Period the growing deterioration of moral and civic values, such

as honesty, decency, modesty, decorum, honor and sensitivity to others'

problems.



He enumerated the negative manifestations, known by everyone, including

that to a part of society it has come to seem normal to steal from the

State, concluding that: It is a real fact that the nobility of the

Revolution has been abused when the full force of the law has not been

utilized, however justified that might be, giving priority to persuasion

and political work, which we must recognize has not always been

sufficient. And recognizing that we have regressed in citizens' culture

and civics.



Despite what he declared, he failed to recognize that the grants

received from abroad, based on ideological relationships and therefore

beyond economic laws, were useless to promote development and that in

its place, this "help" overlapped the inefficiency of the Cuban model

until the collapse of the socialist camp revealed the falsity of the

foundations that underpinned it.



At that time, instead of finally redirecting itself toward the creation

of a proper and efficient economy, the Government limited itself to

circumstantial changes in hopes of better times, until new subsidies,

from Venezuela, allowed it to stop the reforms.



The attempt to ignore that the interrelated system of the elements that

make up society suffers permanent mutations, which if not addressed in

time compel us to reform the entire social structure, has characterized

Raul Castro's government. He is endowed with sufficient political will

to preserve power, but without the need for structural reforms, decided

to deepen the changes aimed at achieving a proper and efficient economy,

but subordinated them to the maintenance of power, which explains the

limitations and failures of commitment.



Amid these efforts, the disputed presidential elections in Venezuela in

early 2013, triggered an alarm about the fragility of subsidies from the

South American country, which has made the order of the day, with no

possibility of retreat, the urgent need to deepen reforms already begun.



However, both the first measures implemented, like the most recent,

occurring in the absence of a civil society with the capacity to

influence them, has determined that the subject of the changes is the

same that came to power in 1959. Given its prolonged duration, it has

interests to defend and is responsible for everything that has happened,

good or bad; a characteristic that prevents it from acting as might a

movement that comes to power for the first time. For this reason the

scope, direction, speed and pace of the changes have responded to the

conservation of power.



Immersed in contradiction of advancing without structural reforms, the

Government is facing the huge obstacle signified by the mismatches that

have occurred in the social system for decades. Among these is the

damaging effect of the disproportionate relationship between wages and

the cost of living, as reflected in the prevailing corruption.



Read wages should at least be sufficient for the subsistence of workers

and their families. This means that the minimum wage must provide a

living, while incomes below that limit mark the "poverty line." Since

1989, when a Cuban peso was worth almost nine times what it is worth

now, the growth rate of wages began to be less than the rate of increase

in prices, which explains why, despite increases in nominal wages,

purchasing power has decreased to the point that wages are insufficient

to survive.



With the average individual monthly salary, around 460 pesos (less than

20 CUC, which is less than $20), one can not cover basic needs. A study

of two family units, one of them consisting of two people and the other

of three, showed that the first family earns 800 pesos and spends 2391,

almost three times more than its income; while the three-person family

earns 1976 pesos and spends 4198, more than double what they take in.



The first family survives through remittances sent by a son who lives in

the United States, while the second will not declare how they make up

the difference. This disproportion is the main cause that, given the

loss of the purchasing power of wages, the Cuban family dedicates itself

massively to seeking alternative sources of income to survive, in most

cases through activities outside the law.



Because it can only distribute what is produced, the government faces a

complex contradiction. Cubans, unmotivated by salaries unrelated to the

cost of living, are not willing to produce, and without increased

production living conditions cannot improve.



The solution is not ideological calls for the people to step up, but to

recognize the state as the main cause of the anomaly and so to

decentralize the economy, allowing the formation of a middle class,

freeing up everything that slows the increase in production, and even

making possible the unification of the two currencies which would permit

wage reform.



All this implies deepening the reforms to make them comprehensive in

nature, including, of course, the restoration of civil liberties,

something that so far the government has refused to do.



From Diario de Cuba



1 August 2013



Source: "Cuba: The Relationship Between Wages and Corruption / Dimas

Castellano | Translating Cuba" -

http://translatingcuba.com/cuba-the-relationship-between-wages-and-corruption-dimas-castellano/