The Cuban dictatorship’s Great U.S. Dollar Scheme

Like all communist regimes, Cuba’s Castro dictatorship doesn’t do anything that isn’t for its own benefit and maintain its grip on power at the expense of the Cuban people. This latest U.S. dollar scheme is no different.

Julio Schilling explains in El American:

The Castro Regime’s Dollar Scheme

One thing is most assuredly: the Cuban people will foot the bill as they have for over 62 years

“temporarily” suspending the acceptance of bank deposits in U.S. dollars, effective June 21st. Essentially, all persons and businesses, Cuban and foreign, will not be able to transact, carry, or deposit in Cuban banks United States dollars until further notice. Why is the Marxist government doing this? Is this a rationally justified state economic decision, or a Castro regime dollar pillage scheme?

The publicly announced rationale from the Island’s totalitarian rulers follows its historical pattern of pointing the finger at the United States for its maladies. The amplified sanctions placed by the Trump administration and its difficulty in transacting in greenbacks was the most cited reason. It is true that the specific targeting of Castro-Communism’s military state-owned enterprises, like the GAESA (Grupo de Administración Empresarial SA) mega commercial emporium by the former Republican president, has frustrated business ventures and hard currency entries. Yet, this does not comprehensively explain this step (or misstep) by Havana.

For quite some time now, Cuban communism has carried out most of its international commercial transactions in Euros or other currencies. The bulk of the Castro regime’s foreign trade, in other words, is unfolded in other currencies. The only major industry transacted almost exclusively (until June 21st) in U.S. dollars have been the remittances from Cuban exiles in the United States. Less important sectors that also employed greenbacks were cash purchases by the communist government from American farmers, tourist operators in the United States, and Panamanian-based business transactions. The American dollar, in other words, did not have hegemony over Havana’s business activities.

There are far more plausible explanations for this apparent divorce between the much sought-after United States dollar and the Castro regime. Cuba’s war on the greenback is an opportunity for the Marxist dictatorship to rake in the American dollar. By making it virtually illegal tender, for practical purposes, after June 20th, Cubans were forced to rush to the state banks and surrender the world’s premier signature currency. Given the communist dictatorship’s exquisite history of looting its citizens’ property (foreigners too), most Cubans have kept American dollars out of the government’s reach. To put it another way, Cubans hide their U.S. dollars so that they can buy or barter things in the black market, Cuba’s unofficial, but most efficient economy.

The socialist economic model has always been about planning under centralized stewardship. It was never about common-sense economics or supply/demand rationality. Therefore, a vibrant black market, underground economy, has been inherent to socialism globally.

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