CLAIMS OF CUBAN COMMUNIST PERESTROIKA LITE

C O N F I D E N T I A L HAVANA 000572 SIPDIS SIPDIS E.O. 12958: DECL: 06/11/2017 TAGS: ECON KDEM CU SUBJECT: CLAIMS OF CUBAN COMMUNIST PERESTROIKA LITE Classified By: COM Michael Parmly; Reasons 1.4 (b/d) ¶1. (C) Dissident Economist Oscar Espinosa Chepe handed us an article written by retired GOC diplomat and academician Pedro Campos Santos on the subject of reform of Cuba's economy--written by and for communists as a "food-for-thought" paper. The point of departure for the article was Raul Castro's remarks at the late December, 2006 National Assembly (ANPP) meetings, at which the interim dictator himself and selected speakers publicly complained about corruption, poor transportation, poor housing and other glaring Cuban problems. The author observes that the officially-announced rate of CY2006 GDP growth of 12.5 percent "doesn't say much about the economic reality" of most Cuban people. ¶2. (SBU) Some other points Campos Santos makes are in the direction of change, albeit within an overall "revolutionary" or communist framework: -- Housing, tourism and sugar had low productivity; all performed below expectations; -- Companies need to operate with input from workers, who should be given more responsibility for management. Bureaucrats get in the way; -- More discipline alone will not improve productivity; salaries need to be based on output; -- Rigorous debate should be encouraged before making business (or other) decisions; -- The military and parts of the agricultural sector have had success with less bureaucratic business models; -- The Communist party, the GOC, state enterprises, and mass organizations overlap too much with one another. ¶3. (SBU) On the other hand, Campos Santos' writing includes plenty of Fidel Castro hero worship, and exhortations to keep the revolution's flame alive. Suggested reforms are not to be understood as a means to opening the door to "counter-revolutionary plans, such as the Varela Project, or pseudo-democratic nonsense that aims to restore capitalism..." People (like USINT staff) who would see fudging of statistics in the 12.5 percent growth figure are described as "the enemy," or "imperialists." He quotes Raul Castro saying: "We're tired of phony justifications in this revolution; the revolution does not lie." ¶4. (C) COMMENT: Chepe sees Campos Santos' piece as an example of ferment within the nomenklatura, similar to what we saw when artists and intellectuals zapped nasty e-mails back and forth last November to protest the reappearance of figures that harshly suppressed free expression in the 1960s and 70s. Chepe told us the document typifies what he termed as "widespread disillusionment" within the party. However, while Chepe failed to call attention to it, and although some of Campos Santos' observations about the failings of the Cuban economy have merit, he starts from the premise that communism can be improved upon to make life better for most Cubans. Chepe sees this as having to include throwaway lines that permit the article to be published in the first place. That is a fair point: Without the throwaway lines Campos Santos could be writing his next article from jail. On the other hand, Campos Santos' reasoning is flawed by taking Raul Castro at his word: The only way "The revolution does not lie" can ever make sense is if you know that the person uttering that phrase is lying. PARMLY