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Economic Readjustment at the Expense of Rights

December 19, 2010 3 comments

The Cuban government recently released its draft guidelines for economic and social policy, for approval at the next congress of the Communist Party of Cuba, scheduled to be held in April 2011. Apparently during the next 5 years the issue of fundamental rights of Cubans, mainly workers’ rights, will be off the state’s agenda.

In Cuba the economic system is based on the “socialist state ownership of all the people” over the basic means of production. The new update of the economic model takes a series of measures to eliminate subsidies, gratuities, and paternalistic treatment, but does not mention citizens’ guarantees against the power of an administration that is completely unresponsive to its constituents.

The socialist state continues to appear as the only entity capable of satisfying the general interests of Cuban society, both at the individual and collective levels. The new policies strengthen its enterprises at the detriment of the rights of workers.

This strategy was already put in practice with recent legislative changes undertaken by the State Council, which have as their main objective the elimination of the legal responsibility of the “socialist state” and its enterprises for  the protection and relocation of redundant workers.

In the face of this excessive power of the socialist administration, labor guarantees are minimal.  State enterprises have the authority to carry out restructuring plans, to make mass layoffs, and to question the ability of workers, citing lack of fitness.

The worker’s only means of defense is with a “Labor Base Justice Body”, one of whose members represents the administration of the entity that did the firing, or with the courts, which under the constitution receive direct instructions from the Council of State, the same body that enacted the measures restricting the exercise of workers’ rights.

There is no right to strike, and demonstrations are allowed only if they are organized by the state itself or its mass organizations. Anyway, the Constitution makes it clear that no civil liberties can be exercised against the existence and objectives of the socialist state.

Obviously the rights of citizens are not on the priority list of the Cuban state. The economic readjustment seeks only the survival of a system that has conclusively proven to be ineffective, and the staying power of the longstanding historical socialist leadership, at the expense of the welfare of Cubans.

Translated by: Tomás A.

Waiting for Changes in State Policy

December 17, 2010 Leave a comment

After two months, uncertainty fills the Cuban scene. The government still has not specified the principles that will govern self-employment. Meanwhile, the number of the unemployed and the expectations of the population are increasing.

One of the concerns raised is whether the government will grant rights to the self-employed in order to extract administrative concessions, bearing in mind that it considers the activity of individuals as an adjunct of the state.

Up to now it has said nothing about this.  But several of the activities authorized for self-employment are related to the exploitation of mineral resources, such as quarrying, and producing pottery items for sale.

Others, like producing and selling granite and marble items, remain stalled, according to the official newspaper Granma, because there is no legal market for acquiring the goods.

The Ministry of Basic Industry is authorized to grant or deny mining concessions for small deposits of certain minerals, recognized by the Constitution of the Republic as properties of “socialist state ownership of all the people.”

Two years ago, the citizen Amada Pupo Cisneros presented an application to the National Office of Mineral Resources for exploitation of mineral clay in the town of La Estrella in Las Tunas. His claim was rejected by the recently deposed Minister of Basic Industry, Yadira García Vera.

The former government official denied the right on the recommendation of the National Bureau of Mineral Resources, which determined that the request by Pupo Cisneros was contrary to the general principles of the practice of self-employment.

Since 1992, state assets can be transmitted, wholly or partially, to the proprietorship of private persons or corporations, with the prior approval of the Council of Ministers or its Executive Committee. But the government only recognizes this right for foreign investors.

Cuban nationals like Amada Pupo are excluded. Their participation in the national economy is seriously limited by the Constitution, by Decree-Law 141 of September 8, 1993, “On Exercise of Self-Employment”, and by other complementary legislation regulating this right.

Article 21 of the Constitution recognizes private ownership of the means and tools for personal or family work. But it restricts that right by prohibiting their use in obtaining income from the exploitation of the labor of another.

Despite being a constitutional right, in the last parliamentary session the President of the Councils of State and Ministers, and a member of the Politburo and Deputy Secretary of the Communist Party of Cuba (PCC), announced that his government would lift some restrictions on the exercise of self-employment, including hiring labor.

Nevertheless, the government made clear that it will maintain its policy of identifying, monitoring, and controlling these activities, and who can perform them. It will also oversee the conditions of marketing the products and services of the self-employed. According to the newspaper Granma, an official organ of the PCC, the measures will become effective, without specifying the day, starting in October.

So far, the socialist government denies its nationals the right to draw on public services, natural resources or public works, although the law gives them that possibility. We will have to wait and see if they change the discriminatory principles of state policies and its system of exclusion. It is time that the Cubans become involved, on equal terms, in their own economy.

Translated by: Tomás A.

Economic Guidelines Ignore Policies of Segregation on the Island

December 15, 2010 2 comments

The draft guidelines for economic and social policy proposed by the Cuban communists declare that equal rights and opportunities exist for all citizens, not egalitarianism. But at no point do they give respect to the rights of Cubans.

On the contrary, inherent in the “Update of the Socialist Economic Model” is the continuing discrimination against Cubans in favor of foreigners, principally when it comes to participating in the national economy.

The island’s communists continue promoting the participation of foreign capital, while precluding the formation of capital by nationals, by excessive regulation and state control. Notwithstanding that the Cuban Constitution treats foreigners and nationals equally in the enjoyment of rights.

While only foreigners are allowed to join with the state in large businesses, Cubans must comply with limits on their activities that impede the progress of individuals and families.  Is this what they call equality of rights and opportunities?

It is no secret that foreigners enjoy a privileged position in Cuba, from an economic and social standpoint. Of course these freedoms are not a response to external pressures, but are purely government policy.

While a self-employed Cuban must pay tax, up to 50% on income over 50,000 pesos, foreigners pay a maximum of 30% on their profits. The policy is to apply higher taxes on higher incomes, hindering the activity of Cubans in their own economy

The new regulations on self-employment are pure formalities. They still do not encourage new participants, who have the responsibility of contributing to the burdens of state, creating jobs, and increasing productivity in the country. Nor do they take into account that many families depend on the progress of the activity of the self-employed.

It is fair to say that foreign investment in Cuba brings benefits to the economy. But it is not the sole solution for addressing the overwhelming problems, nor a justification for a policy of discrimination.

In the Cuban Constitution, discrimination on the basis of national origin is prohibited, and punishable by law. But there is still no legislation giving effect to this principle. Moreover, the government itself implements policies of segregation, which prevent its citizens from investing in their own economy, from being responsible for their own fate.

Translated by: Tomás A.

Legal Representative of the Minister of Justice Appears in Court

September 9, 2010 Leave a comment

This past August 10th, Dr. Diego Fernando Cañizares Abeledo, a specialist in the Legislative and Advisory Directorate of the Ministry of Justice (MINJUS), appeared before the Second Civil and Administrative Chamber of the the Havana Provincial Court, representing Justice Minister Maria Esther Reus González on the administrative claim filed by the attorney Wilfredo Vallín Almeida, based on the silence of the Administration, asserting the right of appeal recognized in the Constitution of the Republic.

In his brief, the Minister’s lawyer described the claim as “nonsensical.” In his opinion, the plaintiff, Mr. Vallín Almeida, chose “a legal wrong way. We do not know for what specific purpose,” he argued. In his view, the President of the Cuban Legal Association should try to gain legal recognition through the Associations Act, without the Ministry of Justice being required to issue anything in writing.

On April 7, 2009, The lawyer Wilfredo Vallín Almeida, president of the Cuban Law Association, a union of dissident lawyers, on behalf of his organization, had asked the Registrar of Associations of MINJUS to certify that there was no Non-Governmental Organization (NGO) in the country with the same name and purpose as the association of attorneys.

The state agency never issued the certificate, a document which is essential to continue the legal procedures for setting up the union. In March 2010, the group reiterated its request and received no response. The lawyers, on administrative appeal to the Minister, Reus González, lodged a complaint for breach of the required legal formalities, which was also ignored.

The Law of Civil, Administrative, and Labor Procedure (LPCAL) provides that if the administrative authority at any level of the hierarchy does not resolve an appeal by the legal deadline, or after the expiration of 45 calendar days, then the application shall be considered rejected, with the effect of establishing that implied rejection for the subsequent appeal.

Cañizares Abeledo, appointed by Ministerial Resolution No. 215 on August 6, 2010, alleged that it was impossible to deliver to the court the applicant’s government record, and the administrative decision of the head of Justice relating to the matter raised by the plaintiff, Mr. Vallin Almeida, claiming that the agency had no documents regarding the matter.

Laritza Diversent

Translated by: Tomás A.

From Revolutionary Friend to Foe

August 29, 2010 Leave a comment

If Chilean businessman Joel Max Marambio Rodríguez does not appear before the Inspector from the Ministry of Interior, Lieutenant Colonel Francisco Miguel Estrada Portales, this 23rd of August (the deadline specified in an indictment), the criminal proceedings initiated against him could proceed to a final judgment of guilt.

Max Marambio was summoned and interrogated on July 10 and August 3, by Officer Estrada Portales, who is in charge of investigating the case, according to two notices published by the Interior Ministry in the Official Gazette of the Republic of Cuba. According to the published documents, the businessman lives in the “Las Condes” Commune in Santiago de Chile, where his business offices are also located.

Marambio, known in Cuba as “El Guatón” (the fat man), arrived on the island in the mid ’60s, when he made personal contact with then-President Fidel Castro. On the island he began his training as a guerrilla, under the direction of the legendary Manuel Piñeiro, known as Barbarossa.

At the end of that decade he returned to Chile and joined the Movement of the Revolutionary Left (MIR) and then led the Group of Personal Friends (GAP), the non-military cohort of President Allende. He took refuge in Cuba after the 1973 coup.

He also worked with Patricio and Tony Laguardia, in the Special Troops of the Ministry of Interior, and survived the political scandal that resulted in the firing-squad executions of Antonio Laguardia and General Arnaldo Ochoa in 1989. Then he was one of the founders of CIMEX, among the largest Cuban state-owned corporations, with annual revenues of more than one billion dollars.

During the decade of the nineties, under the protective wing of Fidel, he went from guerrilla to successful businessman, to the point that today he owns a holding company that does more than a hundred million dollars of business per year. His memoir, “The Weapons of Yesterday”, was presented a couple of years ago in the Havana Book Fair.

There is speculation about what caused his status to change from revolutionary friend to adversary. Some say it was for financially backing the campaign of Marco Enríquez-Ominami, who was dismissed from the center-left coalition that governed Chile for 20 years, and whose candidate lost to the rightist billionaire Sebastian Pinera.

Others believe that it was for indelicately demanding his capital, when a year ago Cuban authorities froze the funds deposited in Cuban banks, and the transfers of all foreign businessmen, because of the serious lack of liquidity in the country.

Translated by: Tomás A.

Agent 007 Is Running Out of Time

August 26, 2010 Leave a comment

Chilean businessman Joel Max Marambio Rodríguez faces a deadline of August 23rd to appear before the Inspector from the Ministry of the Interior (MININT), Lieutenant Colonel Francisco Miguel Estrada Portales. If he does not appear before the time runs, the criminal proceedings initiated against him could proceed to a final judgment of guilt.

How does an intimate friend and protegé of the elder Castro reach this point, managing the business of a holding company that moves more than 100 million dollars a year? Why would a friend of the revolution for more than 40 years become its adversary?

There are still many unanswered questions, some of which will be answered in the course of the trial, where the Chilean businessman will apparently be tried in absentia and evidently he holds the key to the box of secrets. Marambio, age 63, a former bodyguard of ousted President Salvador Allende and former friend of Fidel Castro, is accused by the Cuban government of the crimes of bribery, acts detrimental to economic activity or employment, embezzlement, falsification of banking and commerce documents, and fraud.

The businessman, owner of International Network Group (ING), was a partner of the Cuban state in the joint venture “Río Zaza Foods,” specializing in the production of juices, dairy products, and alcoholic beverages for the Cuban market and abroad. In late 2009, the Auditor General, a state body subordinate to the State Council, chaired by Army General Raul Castro, began investigating the leftist entrepreneur’s businesses on the island.

Unofficially, he was linked to a corruption scandal involving the deposed director of the Institute of Civil Aeronautics of Cuba (IACC) and Major General Rogelio Acevedo.. Max Marambio and his brother Marcel, were also partners of the IACC in the Sol y Son tourist agency. Several directors of the company were arrested, accused of paying kickbacks, misappropriating funds, and diverting resources abroad. Lucy Leal, executive director of ING, was arrested and is being investigated.

Authorities have not officially said anything about the scandal.  In April, however, they acknowledged that Marambio’s companies were under investigation, when one of the managers of Rio Zaza Foods, the Chilean Roberto Baudrand, age 59, under house arrest and being subjected to interrogation, was found dead in his apartment. The Cuban autopsy, accepted by the family of the deceased, said the cause of death was respiratory failure combined with the consumption of drugs and alcohol.

Marambio, known in Cuba as “The Guaton” (the fat man) was summoned and questioned by Inspector Estrada Portales, in late April and early August. The officer is in charge of the investigation. The summonses were published by means of two MININT notices in the Official Gazette of the Republic of Cuba, the agency that discloses the laws and governmental acts on the island. To date, he has not appeared.

The Summons was issued on July 19. In it, the MININT inspector summoned the Chilean businessman to appear before him on the 29th, warning him that if he did not appear on the date indicated, an indictment would be issued on August 3. Officer Estrada Portales ordered the police agencies and State Security to search for, apprehend, and present Marambio within 20 days.

The summons expires on August 23rd. If the deadline passes without his appearance or presentation, he will be declared in default. In the case of crimes against the fundamental political or economic interests of the nation, the Cuban judicial system provides that proceedings against a defendant declared in default can proceed to a final decision.

The judicial system in Cuba offers few safeguards for defendants. The criminal case against him is in the preparatory phase, when pretrial proceedings are conducted. If Marambio returns to the island he is most likely to end up in jail, as a precautionary measure to secure his appearance. Until then, he cannot appoint a legal representative for his defense.

Everything seems to indicate that the legal route will be the means of settling accounts. The publication of the summons and indictment in the Official Gazette of the Republic of Cuba is a formal requirement. The island’s government does not intend to pursue the businessman internationally.

The aim is to declare him in default and try him in absentia. In that case, he could appoint a lawyer. He could also appear at any time and revoke the declaration. He could even void the final judgment against him and be heard in a new trial. Marambio could be a time bomb for the Castro brothers. For what he knows and for what he has been quiet about. We suspect he will not return.

Iván García y Laritza Diversent

Translated by: Tomás A.

Government Measures Raise People’s Expectations

August 17, 2010 Leave a comment

Self-employed

In his most recent speech, General of the Army Raul Castro Ruz announced a series of measures affecting the employment rights of the Cuban people. The most far-reaching of all was the extension of self-employment.

According to Castro, who is also President of the Councils of State and Ministers, the government agreed to extend the practice of self-employment as an alternative employment, and eliminate several existing prohibitions against the granting of new licenses.

The rise of individual economic activity on the island began in 1989 with the collapse of the socialist sphere, as a government measure to readjust the economy, given the lack of credit and the inability to obtain the cooperation of international financial organizations. Starting in 1997, the state began restricting licensing, to reduce the independent economic sector.

At present, self-employment is subject to control and supervision by the government, which considers it a supplement to state activity. It is done at the municipal level, on a case-by-case basis.

Permits are renewable every two years. They cover activities of producing and marketing goods and services, at the address of the permit-holder, and can only be offered to private individuals.

It is prohibited to conduct on the island any activity of producing, processing, or selling goods or services without authorization. The authorized activities are specifically listed in Resolution No. 9/2005, “Regulations on the exercise of self-employed person,” by the Ministry of Labor and Social Security. The law approves 118 activities, and authorizes the granting of new licenses for only 40 of them.

The law requires the self-employed to buy the raw materials in the retail market in convertible currency, but to offer their products and services for sale in national currency. This requirement impedes the development of private economic initiative on the one hand, and on the other it promotes the rise of lawlessness. The self-employed turn to the black market in order to continue their business and keep their license.

At the same time Castro, the Second Secretary of the Communist Party of Cuba, announced that the Council of Ministers approved the implementation of a system of taxes on this type of activity, presumably to ensure that the newly self-employed contribute to social security, pay personal income and sales taxes, and that those who hire workers pay a tax for the use of the workforce.

The measures – especially those concerning the marketing of new products and flexibility in hiring labor – have generated an expectancy among the populace. Their implementation will require the government to reform the legal system: the criminal law that prohibits the employment of labor or the use of methods or materials of illicit origin, also revokes licensure.

Laritza Diversent

Translated by: Tomás A.

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