Raul Castro: A Hard-Line Commie with a Soft Spot for Free Enterprise?

     Raul Castro: a free enterprise-friendly Communist?

     That’s how NBC’s Andrea Mitchell portrayed the 75-year old brother of Cuba dictator Fidel Castro in her report on the August 2 “Today” show. But some Cuba experts describe Raul’s concessions to capitalism as mere pragmatism meant to prop up a socialist economy otherwise doomed to failure.

     “Raul has been in charge of the military and the economy,” Mitchell explained to her audience, calling him “politically hard-line but more open than his brother to free enterprise, including foreign investment.”

     To bolster her claim, Mitchell then aired a sound bite from William LeoGrande from American University: “He’s also been someone who’s been open to economic experimentation, the use of market mechanisms and trying to help the Cuban economy recover from the shock of the collapse of the Soviet Union.”

     Following LeoGrande’s sound bite, Mitchell sought to contrast Castro’s supposed openness to reform with Bush administration trade policies.

     “The Bush White House has tightened sanctions, shutting down most U.S. trade with Cuba,” the NBC chief foreign affairs reporter noted.

    But it’s not that simple, say Cuba experts who stress that Raul Castro is hardly a modern-day Adam Smith, and that he’s shown signs of backtracking from pragmatic reforms put in place a decade ago.

    In an August 2 article in the New York Post and posted at AEI.org, former Senate Foreign Relations Committee staffer [1]Mark Falcoff argued that Cuban has regressed from its early 1990s market reforms.

     “The revenue stream produced by an opening to foreign tourism a decade ago has encouraged the regime to withdraw many of the modest concessions to the market it made in extremis,” Falcoff wrote, adding that a 90,000-barrel-a-day oil deal with Venezuelan strongman Hugo Chavez “has reinforced this trend.”

     Resale of surplus Venezuelan oil, about 40,000 barrels-a-day, yields a reliable supply of “hard currency” for the Cuban regime, Falcoff noted.

     Cato Institute’s Ian Vazquez agreed. In an [2]August 1 press release the libertarian think tank’s director for the Project on Global Economic Liberty forecasted that while eventually it would prove “difficult to hold Cuban socialism together” that “Cuba has a financial benefactor interested in propping up socialism – Venezuela.”

     “He’s a pragmatist. I don’t think by any means he’s been convinced that free markets are better, but rather that to some degree private investment and markets can help sustain him,” Vasquez said of Raul in an interview with the Business & Media Institute.

     What’s more, said Vasquez, Raul Castro’s acceptance of economic reforms can be explained by his desire for personal enrichment, not an openness to allow private ownership of capital and liberalized markets.

     Controlling the Caribbean island’s economy certainly has proven lucrative to Raul’s older brother. In May 2006, Forbes magazine estimated Fidel Castro’s worth at [3]$900 million.

   “To some degree private investment and markets can help sustain him. So that is the area in which he’s willing to compromise on some socialist principles but not because he’s somehow been convinced about the virtues of [the free] market,” Vasquez said.