Friday, May 28, 2010

The Automobile is Cuba's Grand Prize

The Automobile is Cuba's Grand Prize
May 28, 2010
Fernando Ravsberg

The resulting chaos has become a fertile soil for the black market.

HAVANA TIMES, May 27 – The removal of Cuban Transportation Minister
Jorge Luis Sierra was a surprise to me given that his ministry was one
of the few sectors in which one can say the country has advanced
ostensibly, both at the urban and the inter-provincial levels.

I wondered what the errors were that Sierra made, so I began looking for
information among government officials. When they told me the reason, I
found it so difficult to believe that I continued looking for additional
sources to confirm what was said.

It seems that the sin committed by the former minister was authorizing
the importation of automobiles without payment of taxes by those Cubans
who had had an old vehicle to offer in exchange and who also have enough
money to buy a new one abroad.

I was familiar with that measure and I found it an intelligent way of
renovating the nation's automotive inventory without investments on the
part of the government. However, things went beyond what was foreseen
by the transportation authorities.

Most of the automobiles bought by Cubans were deluxe: late model
Mercedes Benz, Audis and BMWs. Some artists bought vehicles valued at
more than $50,000 (USD). However, there were also State employees —with
monthly wages of $30 (USD) — who were importing $15,000 vehicles.

Immediately, all the alarms sounded and imports were suspended exactly
when those who had the least money were prepared to get new cars. The
wealthiest don't have anything to worry about; their deluxe cars already
distinguish them.

I could speak hours of anecdotes of this case and of Cuban idiosyncrasy,
but what's certain is that the problem is much greater at the roots; it
exists in the mechanisms created by the system in relation to automobiles.

Typically, for a citizen to buy a vehicle they needed permission from
the vice-president of the country. I don't know who authorizes it now
but for years it was the job of VP Carlos Lage to decide who deserved a car.

Theoretically, as has often been said, the sale of automobiles should be
oriented toward those who need one to carry out socially beneficial
labor. Authorities affirmed that the ecosystem would collapse if all
inhabitants of the planet had their own vehicle.

However, later these same authorities reward citizens with automobiles.
During the good years, cars were sold for a highly subsidized price to
outstanding workers and more recently they have been given out to
retired athletes.

In Cuba, a vehicle is the Premio Gordo (the Grand Prize). I have an
acquaintance who —due to his technical contributions during the economic
crisis of the 1990s— received a motorcycle. The following year he came
up with additional new inventions so he was awarded another motorbike;
and as he continued to stand out, in this millennium he was allowed to
buy a car, a Russian Lada.

No one asked this outstanding Cuban technician if he needed a house, a
pay raise or if he wanted to take a trip. No, he deserved a grand
incentive – and these are vehicles. Consequently, this gentleman will
have to decide between enlarging his garage and ceasing to invent things.

Absurdities and Exceptions

The absurdity is such that to prevent the rewarded from reselling their
cars to third parties, who don't "deserve" them, there exists a
guideline that prohibits these sales by owners, although this is a
regulation that Cuban law itself authorizes.

To complicate things even more, there are exceptions. Sailors, artists
or diplomats can buy automobiles whenever they can justify their income.
However, farmers are not allowed to do the same, even when they can
prove that the money they accumulated was the product of their labor.

What's more, we're not talking solely about automobiles; farmers cannot
buy trucks or tractors. I know of a case of someone who was given a
tractor when he was abroad, but Cuban authorities denied him the right
to import it onto the island.

As foreigners do have the right to buy vehicles, some Cubans will offer
them money to buy a car in the non-native's name. An islander might
invest thousands of dollars knowing that when the legal owner returns to
their country, the car can no longer be driven.

The resulting chaos has become a fertile soil for the black market,
where every year automobiles are sold by taking advantage of gaps in the
law and by bending the rules with money (discreetly putting cash in the
hands of corrupt officials).

The relationship between Cuban authorities and automotive vehicles is
strange, almost traumatic. They have transformed the automobile into
the citizen's greatest material aspiration, which someone can only
access after accumulating high merit.

President Raul Castro already eliminated some of the prohibitions that
weighed on the citizenry —access to hotels, cell phones, the Internet—
and the universe remained intact. Equally, an opening in terms of the
sale of cars would only affect the bureaucracy, the black market and

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