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CUBANALYSIS
#35
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THE INVASION OF THE GRAY-HAIRS
As Cuba's president Fidel Castro gets older, speculation
increases
about
his legacy to the country. Opinion runs the spectrum from Cuba
staying
firmly in the socialist camp to Cuba quickly returning to the
capitalist mode. For some Castro will produce no legacy; others
think
that his stamp will be eternal. However, little attention has been
paid to one legacy that is indisputable and will present a
tremendous
challenge to the country: an increasingly older population.
The World Bank has released population projections for the island
that are
entirely sobering and should be playing a big role in all the talk
about the future of Cuba. According to the Bank, the population of
persons 65 and older as a proportion of the total is projected to
increase as follows:
2000: 10%
2010: 14%
2020: 15%
2030: 19%
2040: 26%
2050: 27%
Perhaps even more sobering are the projections for persons 75
and
older:
2000: 4%
2010: 5%
2020: 6%
2030: 8%
2040: 11%
2050: 15%
By way of comparison, the projections for the United States in
2050
are
22% for 65 and older and 12% for 75 and over. Cuba is aging even
faster than the United States, but it can be argued that the
implications are more onerous for the former than for the latter.
What are those implications for the post-Castro era?
(Cubanalysis
goes out
on a limb assume Mr. Castro will not be present in 2050.) Two
major
ones stand out. One will be the increasing burden on Cuba's
healthcare
system. Already between 1989 and 1999 healthcare's share of the
government's budget increased from 6.5% to 10.7%. What will
happen, as
more and more senior citizens begin to press the system for more
frequent medical attention? Will the system have to become less
generous? Or will expenditures in other sectors have to be
trimmed? In
addition to the economic questions there are the institutional ones.
Who will care for the aged? Is care to be family oriented or
institution oriented? Will the institutions be run by religious and
other private entities or by the state?
Many of these questions are equally applicable to other societies
with
aging populations. However, one of the bastions of the Cuban
revolution has been free and universal healthcare from the cradle to
the grave. Thus the problem of aging is of particular relevance to
Cuban society. Either a core value of the society is modified or the
state will have to plan for ever-larger chunks of its budget being
destined to the elderly.
The other salient implication is the clear need for increasing the
productivity of the working sector of the population. Higher
productivity is needed just for Cuba to completely regain the steep
economic losses of the early 1990's. However, as the number of
working
people begins to decline as a proportion of total population, the
remaining workers will have to become more productive just to keep
away from further economic stagnation. Again, this is true of all
countries with aging populations. But the problem becomes
particularly
acute in Cuba where there has been no tradition of saving for
retirement or later years. There are no mutual funds, annuities,
bonds
or dividends in Cuba as supplementary sources of income for the
elderly. The upcoming retirees will be entirely dependent on
government pension schemes which have been part of Cuban life for
decades. People coming into the workforce during the next couple
of
decades will thus have to provide completely for a very large older
generation.
Despite all future uncertainties, life in Cuba after Castro will
have one
certain and notable feature: a lot of old folks. In all the talk to
come about a "transition to capitalism" or of "perfecting socialism",
it will be gratifying to hear how this foreknown problem will be
tackled by the sage planners.
CUBANALYSIS
Sources for this issue included
www.worldbank.org
CEPAL La Economia Cubana (2000)
