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*Once Again on So-Called Call Petty Corruption* Posted By *Circles Robinson* On September 25, 2012 @ 1:20 pm In *Lead Articles,Opinion* | *Esteban Morales* <http://estebanmoralesdominguez.blogspot.com/> [1] ** (photos:Caridad)* HAVANA TIMES A few days ago I wrote an article titled A Subtle Form of Corruption <http://www.havanatimes.org/?p=78030> [2], which has thus far been reproduced in *Cubarte* and *Havana Times*. It deals with petty corruption, which has little to do with penny-ante wrongdoing. Rather, millions and millions of pesos are being lost to the countrys economy through these devices instead of circulating within normal trade, where all of us would have the opportunity to purchase those goods with our money. This isnt about a simple incidence of robbery in which one person happens to appropriate something that doesnt belong to them. This is a widespread practice in which individuals and officials, taking advantage of their positions in which they are supposed to protect social (public) goods, instead divert those resources for their own advantage. This is why corruption isnt a simple act of theft or appropriation, but the systematic deviation of material assets from the normal operation of a society that creates, distributes and consumes, according to the rules governing the economic system in question. If you look more closely at the article I wrote, one will note what I described the characteristics of these occurrences and their multiple consequences, even political and ideological ones. However I didnt identify its root causes. I dont want to get in over my head, as they say, because these causes are quite complex and touch on aspects that go far beyond corruption as such, as these problems touch at the core of the deficiencies and inadequacies of an economic model that we want to change. Besides, this is a phenomenon that is not unique to our country, though in our case it has particular causes that respond to the particular situation being experienced by the Cuban economy. Our economy has already undergone three strategic restructurings, each occurring when it broke its economic dependence from a major power: Spain, the United States and the USSR. Fast Food. We now find the Cuban economy in a historical moment in which it wants to definitively break this cycle of dependency and build its own economically efficient and sustainable model. Therefore the phenomenon of corruption in Cuba cannot be separated from that context in which we live today. The root causes of this corruption, which existed previously, have to do now with several very important issues that touch squarely on the capacity of many of our people (too many up until now) to meet their needs. Among others these are: - The so-called inverted pyramid within the economically active population, which allows people without any training be employed in the dollar economy and tourism, where they receive wages, special pay and tips. These increase their opportunities for obtaining incomes in ways that arent feasible for any employee in the state economy, regardless of the skill level a government worker might possess. Trunk drivers, taxi drivers and service workers receive their incomes in hard currency, which is several times more than the salary of an employee in the state economy even when we compare these to highly qualified professions, such as doctors, university professors, specialists, researchers etc. - The confusion over the years (which isnt only theoretical) between social property and state-owned property, which has meant that workers dont relate to the means of production as their own property, while the state cadres manage the means of production as if it were leased to them for their own benefit. This has come to be reflected by the popular expression Everything belongs to everyone and nothing belongs to anyone. - Many people holding positions, even within the state economy, of low rank and low pay but who have access to the distribution of certain material goods, use their official positions to make ends meet through the diversion of resources. Neptuno St. in Havana. They create networks within which the managers of different operations exchange favors and privileges for the access to material goods, whose cost [to the state-owned business or institution] has no effect on their personal incomes. This activity becomes a kind of corruption that permeates even our political and mass organizations in workplaces. Low-wage workers in whatever government, private or semi-privately environment and in whatever industry continuously engage in theft, quite often with implicit acceptance of this by their own higher-ups, who also benefit from it. In this way they create mechanisms of permanent misconduct in the management of assets belonging to society. - In our case there is a gap between wage levels and prices, whereby the latter remain high and sometimes rise, even surprisingly so, while wages remain stagnant. - Nor is it possible to expect more pay resulting from more work. There also exists a complete impairment on the part of the working masses to pressure for wage increases; nor is an adequate response made by trade union organizations to resist downward pressures on workers real incomes. -The existence of the dual currency keeps people who dont possess hard currency at a constant disadvantage, especially if we consider that there are staples that can only be purchased with that form of money. While all of the basic necessities are received through rationing, these are in such small quantities that they dont meet the minimum needs of the population most in need. Therefore the root cause of this petty corruption is within the very functioning of our own economy, one which is incapable of satisfying needs at the wage levels required nor offering prices of unsubsidized products that meet the needs of the general population, who in addition dont have access to hard currency. There are many consequences of this situation and these not only cause corruption but other social distortions as well. Neptuno St. in Havana. This situation is what explains this widespread phenomenon, although we cant say that it includes the entire population. Firstly because there are some people who dont need to engage in this practice, while others refuse to participate in it for ethical and moral reasons. This phenomenon evidences indications of not being controlled by our economic system, which can generate moral deterioration at the level of the society as a whole. Legal and economic control isnt sufficient because this helps only to a small degree to repress criminal practices. The only real possible solution is the existence of an efficient and sustainable economic model, one that imposes limits by converting corruption into a negative practice only from the moral point of view, offering the foundation that would eliminate a phenomenon that is justifiable to a certain extent on grounds of material survival. In other words, the massive non-satisfaction of the basic needs of the population generates the corruption practiced by many people. A completely different matter is the illicit enrichment practiced by top and mid-level government leaders since these dont steal for immediate needs, since for the most part they have those met. I believe that neither this type of corruption nor any other type could be eliminated entirely; it could only be reduced to some minimal level. This can occur only after a long struggle that would fundamentally involve economic building, cutting out corruption, making it a criminal offense, so that society could fight against it correctly and without any moral justifications. *(*) An HT authorized translation of the original published by Esteban Morales on his blo <http://estebanmoralesdominguez.blogspot.com/> [1]g.* ------------------------------ Article printed from Havana Times.org: *http://www.havanatimes.org* URL to article: *http://www.havanatimes.org/?p=79145* URLs in this post: [1] Esteban Morales*: *http://estebanmoralesdominguez.blogspot.com/* [2] A Subtle Form of Corruption: *http://www.havanatimes.org/?p=78030* [3] Image: *http://www.linkwithin.com/* *-----------------* ** * The Presumed End of Cubas Dual Currency September 24, 2012 | Vicente Morin Aguado (photos: Caridad) HAVANA TIMES A man (who was over 60 and with a plastic bag full of packets of detergent that he was trying to sell to me) commented quite clearly: I dont understand all this with us having two currencies. I buy these packets at the hard-currency store in convertible pesos and I sell them in domestic currency. Im hoping to make a little profit, because to get these smaller packets you have to stand in line forever, and you cant find them just anywhere. I thought to myself about how when I buy a pack of cigarettes at the corner store, using either of the two currencies, I always get change except for when I pay with hard-currency CUCs, Ill lose a little roughly a peso (about 4 cents USD). The logic is that if I didnt take the time to go to the money exchange center beforehand, then that was my problem. In short, I just take the hit. A peso isnt as much as the time, cost and trouble of going to an exchange center, which arent always open. Actually, starting from when dollarization began back in the days of the fall of the Berlin Wall, followed by the institutionalization of the Chavito (hard currency CUCs), to the reform guidelines issued by the Sixth Party Congress (which endorsed the popular demand to end the dual currency situation), we Cubans have had at least two currencies, and weve always been willing to trade with them according to our needs or depending on how many of each of them we possessed. I dont think were seeing the beginning of the end of the dual currency. Practice, the supreme criterion of truth, tells us that my friend selling the detergent was right with his simple reasoning. The patently obvious truth is that many people forget when it comes time to explaining issues, which are seemingly complex but are really quite simple. What is money but the universal equivalent of all commodities? It is printed on paper according to the laws of the state and needs in light of the natural limitation on the movement of precious metals. In grade school arithmetic we can understand that this involves a common denominator, therefore we can understand the position of the gentleman with the packets of detergent. Its the same to me if a TV costs 300 CUCs or 7200 CUPs (at an exchange rate of 1:24). Anyway, the important thing is to have the money, whether it comes from remittances sent from the beyond, or whether its earned by selling avocados or its the payout from La Bolita (playing the numbers). In a day, the state could change this situation through an executive order (mathematically at least), but the trauma would be huge if we took into consideration the complicated accounting of a country marked by widespread corruption, where the economy would need to restructure itself internally before carrying out the simple act of transitioning to a single currency, where previously and this is not a typo the are four denominations. Let me explain. In the popular sense, we have the Cuban Peso, or domestic currency, called CUP. But we also have the Cuban Convertible Peso, identified by the initials CUC, which is equal to the US dollar that was previously in circulation here. There are, however, two more currencies: The ledger book CUC and CUP. In terms of business economics, at the level of bank accounts, these have values that dont coincide with the concurrency at the street level. In any case, this involves four currencies, which is a real puzzle for our economists. Any hotel pays its workers in CUPs while charging tourists in CUCs (with both currencies in circulation). But they also carry out banking operations with these same denominations through checks or other variations in which tangible cash is never touched. As all this is very disadvantageous to the overall economy, thus theres consensus around the need to change this situation. I sincerely believe that the country (meaning us Cubans) wants to live with a single currency, which is now a palpable reality that is recognized in retail trade daily in both state and private commerce. The time remaining until an executive order changes the current situation is a logical process of arranging elements on a complex plane of if the expression fits economic relations of this invention called socialism (which cant ignore the market and its categories and therefore must address them responsibly, without fear and without reproach). As I was recently told by a former student, who is now a university professor, were socializing poverty, but we must learn to create wealth in order to distribute it fairly. Socialism isnt defined solely on how wealth is produced, but also in considering the most balanced way possible for distributing it. Countries like Norway, Denmark and Japan, examples of nations with high United Nations Human Development Indexes (HDI), demonstrate one path. I firmly believe (getting back to the subject), that its essentially a cultural problem. Vicente Morin Aguado. 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