Sunday, December 21, 2014

Dealing with Cuba isn't a great deal for Cubans (and it's terrible for us)

This from Breitbart:

Before someone reflexively shouts "Breitbart", yes, the story appears to be accurate as reported by the Cuban government in Of course, the Cuban government describe it thusly:
"Everything is convenient as the worker will receive his salary doubled in national currency, with 9.09% deducted for holiday pay." 
(My translation. Somebody please check me.) 
By simply doubling the number without regard to the actual exchange rate they are attempting to spin 90% confiscation as a good thing. And of course, along with this draconian confiscation is the realization that workers have to pay for their vacation time out of what remains.

Raul Castro
The only winner
In the comments on there is some mention of the exchange rate. Originally the workers expected to receive 10 Cuban pesos, and someone complains that at two they're losing 8 pesos; with the government responding that this is fair because the exchange rate is actually two pesos (which it's not... the rest of the world knows the exchange rate to be 1:26.5). The government's answering comment is tricky, so again another translator would be welcome, but it appears to me that they're concerned with inflation: if they don't artificially hold down the wages, then higher prices will result in the future.

So instead they choose to withhold that money from the people so it may not be injected into the economy and may not raise the standard of living for all Cubans.

Of course, they could have simply capped salaries, but why do that when you can suck currency for free out of American companies who are willing to pay competitive wages to the workers? Again, this leaves out an important "exchange rate". While American companies are willing to pay fair wages to the workers, I hope that they're far less willing (read "not at all") to pay those same wages to the Cuban government for the privilege of oppressing workers. If Cuba wants to keep their workers down, I don't think they need our help.

Zamira Marín Triana
Cuba has responded in advance to these criticisms. Granma reports that Vice-minister of Labor and Social Security, Zamira Marín Triana claims that the 1:2 exchange rate they're enforcing represents a "significant increase". This in itself is not particularly impressive. As the Havana Times reports, "It is the custom in Cuba that if a foreign firm wants its employees to be productive they must pay them an additional amount of hard currency under the table, since the amount they officially receive after the government takes the lion’s share is not a living wage."

In addition to the lion's share of the workers wages, the Castro government will receive a 20% "negotiator's fee". for providing the labor.

America, just because something is profitable it doesn't follow that we must do it. Communists have learned to bait a hook in such a way that idiot Americans fall for it repeatedly. We have been presented with the illusion that we are benefitting oppressed Communist workers before, in China. The billions that we pour into our economy has made little difference because it's diverted into a foreign regime where it simply stops. Yes, the labor is cheaper, even though they get about 10% of the lower wage you pay them. So companies export the jobs, and with it the tech and the equipment. Then we wind up depending on relatively cheap foreign labor to the point where many U.S. companies could not be self-reliant if they had to. They become American in name only. I live in what was a textile mill town. I've seen it happen. We don't have to do that again.


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