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    Fooling everyone, all the time?

    Fooling everyone, all the time?
    ROBERTO ÁLVAREZ QUIÑONES | La Habana | 23 Dic 2015 – 4:49 pm.

    General Raúl Castro’s government is lying when it claims that in 2015
    the Cuban economy grew 4%, which would be eight times more than the 0.3%
    to 0.5% that the ECLAC estimates for average growth in the Latin
    American nations this year.

    But this should not come as any surprise. This has happened every year
    since 1960, when Che Guevara, then president of the National Bank of
    Cuba, was outraged to learn that in 1959 the GDP had grown by only 1%,
    so he ordered the inflation of these statistics to transmit a “good
    image” of the Revolution.

    Economy Minister Colonel Marino Murillo did not tell the truth when he
    announced a 4% increase in the GDP. And the newspaper Granma also
    deceived the population by publishing the same figure. But that was only
    logical. The Economy Minister could not admit – without being instantly
    removed from office – that Cuba employs an unheard-of method to
    calculate its GDP, one that is fraudulent to the core.

    Neither could he recognize that Cuba’s gross fixed capital formation is
    only 9% of GDP (in Latin America it ranges from 20% to 32% of GDP) and
    that an undercapitalized economy cannot grow. It is impossible. Nor
    could he indicate that on the Island there are no independent entities
    that can verify the official figures, so fraud is inevitable.

    And now, with the process for the normalization of relations with
    Washington, the regime has even more reasons to lie. It is simple: a
    “robust” socialist economy, growing by 4% or more, is a great excuse to
    refuse Cubans total economic freedom and to suppress the emergence of a
    large and vibrant private sector, both in industry and in services. What
    for? According to the Government the centralized, state-owned system is
    working great, with a growth rate that would be the envy of Latin
    America, the United States, Canada, the European Union, Australia or Japan.

    It is unconscionable that the Government talks about economic growth
    when half of its arable land lays idle, overrun with sicklebush, making
    it necessary to import 80% of the food consumed in the country,
    including fresh fruits and vegetables for its hotels, and when it
    produces less milk, meat and coffee than it did in 1958. To give one an
    idea, in 1958 Cuba produced 960 million liters of milk, and in 2014 the
    figure was 497 million; that is, about half of the figure from nearly 60
    years ago.

    It is equally shameful that the country has to import the vast majority
    of its non-food consumer products because its feeble domestic industry
    is unable to do so, when 57 years ago it produced most of it. And that
    real unemployment in the country is easily over 20% of the total
    workforce, and another, much higher percentage has to rob the State to
    feed the black market – the only thing that works, and thanks to which
    Cubans are able to eat and clothe themselves.

    Neither will any leader forming part of the Communist nomenklatura admit
    that if there really was a spike in GDP in 2015 off 2014 (though not 4%)
    a key factor was the substantial increase in tourism, particularly from
    the US, family remittances, and many other advantages obtained by the
    regime as a result of the “thaw” between Havana and Washington. And also
    due to the abusive increase of the prices charged by the State at
    “shopping” establishments, which sometimes exceed 700% of the import
    cost, which is unique worldwide.

    Expenses as if they were revenue

    How is the fraudulent GDP calculated? The dictatorship’s bureaucrats
    record, in an unwarranted maneuver, certain social costs as if they were
    value-adding assets. That is, they count unpaid expenditures as if they
    had been collected and represented revenue. In the field of Public
    Health, for example, the regime arbitrarily calculates how much
    surgeries performed in hospitals in Cuba for one year, and blood tests,
    X-rays, etc. would cost in capitalist countries.

    In Education, the same thing is done with reference to the costs of
    university studies and other types of training in countries with market
    economies. All these calculations are placed on the books as revenue and
    new assets ??created by the Cuban economy, as if they had been
    collected. And then they are added to the GDP calculation.

    Moreover, the Government also records the subsidies corresponding to the
    salaries of the thousands of Cuban doctors in Venezuela, as if these
    were exported services, which is not exactly true. Revenues obtained by
    nationals abroad cannot be rolled into the GDP. What happens is that the
    regime retains those doctors’ wages as if these professionals were
    state-owned slaves.

    The funds generated by the doctors’ work in Venezuela, Brazil and 64
    additional countries do not belong to the State, but rather to them and
    other professionals working in foreign territories. Therefore, it should
    not be added to the GDP, which only includes the (collected) goods and
    services generated on national soil.

    This accounting fiction, all together, amounts to billions of dollars,
    registered as revenue and add newly created assets. That is, Castroism
    counts fictitious assets ??from services offered for free as if they had
    generated revenue from private institutions. Or collected abroad by
    professionals whose earnings are retained. All this based on another
    egregious fraud, by placing the CUC’s value equal to the US dollar, when
    in fact it is worth far less.

    Accepted manipulation

    But this dirty game of statistical manipulation, played to a point of
    madness, ultimately doesn´t matter unless it is discovered and proven.
    And it does not look like that is going to happen, at least in the short
    term. After all, the UN, ECLAC, FAO, OAS, European Union and all the
    governments and bodies around the world accept Cuba’s consistent
    statistical fraud without even batting an eyelash.

    The international community’s complacency, which ultimately may go down
    in history as complicity, whether unintended or not, explains why,
    despite the ostensible disaster that is the Cuban economy, the
    dictatorship never has never admitted a contraction in its GDP – except
    when there was an end of subsidies from Moscow in 1991.

    That is why the Castro brothers are the only politicians who have thus
    far defied Abraham Lincoln’s famous phrase: “You can fool all the people
    some of the time. And you can fool some of the people all the time. But
    you cannot fool all of the people all the time.”

    Of course, we all know that Lincoln’s axiom will ultimately be proved
    correct. Hopefully sooner than later.

    Source: Fooling everyone, all the time? | Diario de Cuba –