Cuba's ration book and more than sixty years of promises at the bodega

Let me tell you about the world's longest-running temporary measure. Somewhere in a Cuban neighbourhood, there is a small state shop called a bodega, and in that shop there is a small booklet, and in that booklet there are small boxes where a clerk marks down how much rice, sugar, beans, oil and coffee a family has been permitted to buy this month. The booklet was introduced in 1962. It was supposed to be a stopgap, a bridge over a rough patch on the way to abundance.

Folks, that is a bridge of more than sixty years. Engineers in other countries have built a bridge across a bay in less time. The ration book is a stopgap the way the Leaning Tower is a lean: technically true, and not what the brochure promised.

The claim, and what I am not claiming

Here is my thesis. The survival of the ration book for generations is the clearest verdict on what Cuba's revolution delivered: a system in which the state became the sole employer, the sole landlord and the sole grocer, and then could not feed the people it had made dependent on it.

I am not claiming that every Cuban policy failed in every respect. I am not claiming that the American embargo has no effect. And I am certainly not claiming anything against the Cuban people, who have shown more ingenuity in making do than any central planner could have predicted. My argument is about a system, and the word for the system's performance is the record.

1959 and 1960: the revolution and the takings

On January 1, 1959, the dictator Fulgencio Batista fled Cuba, and the revolution led by Fidel Castro took power. In its early months it was welcomed by many Cubans, and it is a fact that Batista's government was corrupt and repressive. A fair history says so, and says also that the early promises of the revolution included elections and a restoration of democratic rights, which were never kept.

The economy was transformed in short order. An agrarian reform law in 1959 took large landholdings. In 1960 the government nationalized foreign-owned properties, including American-owned sugar mills, oil refineries and utilities, beginning in the summer, and in October 1960 it took over the banks and most large Cuban-owned businesses. Within a few years, small shops, restaurants and many other enterprises had followed. The state owned nearly everything.

This matters for one reason in particular. Once one institution owns the farms, the factories, the shops and the wholesale distribution, a shortage is no longer a market problem that prices can fix. It is a government failure, because the government is the only party to blame.

1962: the libreta

In 1962, the government introduced the libreta de abastecimiento, the supply booklet, which gave each household a ration of basic foodstuffs at very low, state-set prices. It was explained as a measure for a period of difficulty, a way to guarantee that everyone got a minimum while production was reorganized. The justification was equality: everyone gets the same basic basket, regardless of income.

It has a certain logic. If food is scarce, a ration prevents the rich from buying it all. But a ration is also an admission. It says that production is not enough to let people buy what they want. A ration book is what a government issues when it has decided that a price will not be allowed to do its job. For the logic of why this happens, see Why Soviet shoppers stood in line, and the calculation problem behind it.

And the ration did not end the shortages. It institutionalized them. Over the decades, the monthly basket shrank in some respects, and families supplemented it by buying on informal markets, by relying on relatives abroad, and by finding what they could. The booklet became not a bridge but a destination.

The Soviet subsidy years

For about three decades, Cuba's economy was propped up by the Soviet Union. Moscow bought Cuban sugar at prices well above the world market and sold Cuba oil at favourable terms, and there was a large flow of aid and credit. It is a common observation that the Cuban system survived those years in a condition of dependence on a foreign patron, and the arrangement made the system look more successful than it was. Take away the patron, and you find out what the economy can do alone.

That is exactly what happened. When the Soviet Union dissolved in 1991, the subsidies ended and Cuba's imports of oil and food collapsed.

The Special Period

The Cuban government called the years after 1991 the Special Period in Time of Peace, a name that sounds like a promotional event at a department store and describes a period of severe hardship. Fuel was short, electricity was cut for hours at a time, transport slowed, and food was scarce. By many estimates, the economy contracted by a large fraction in just a few years, and people lost weight. Bicycles replaced cars on the roads. The state responded by allowing limited changes: allowing the holding of US dollars, allowing some self-employment, reopening farmers' markets, and courting tourism.

Notice what this admission means. The system had been presented as a superior way of organizing the economy, and when it came under strain, the government turned, in measured steps, to the very tools it had abolished: private initiative, foreign currency, markets. Every time the country got into trouble, the cure was a little capitalism. Every time the trouble eased, the cure was withdrawn.

The limited licences of 2010

In 2010, under Raul Castro, the government announced that it would reduce state payrolls and expand the categories of work in which Cubans could operate on their own account. Licences were issued for a list of private activities, including small restaurants, transport, repair, and the renting of rooms. The government spoke of updating the model, not replacing it. Tens of thousands, and eventually hundreds of thousands, of Cubans took out licences.

Look at the shape of this. A citizen of a country in which the state claims to own the means of production has to apply for a licence to cook food and sell it to a neighbour. And the list of permitted occupations was a list, which means that anything not on it was prohibited. It is an odd model of liberty in which an activity is forbidden until a ministry gives it a name.

Two currencies

For years, Cuba ran a dual-currency system: the Cuban peso, in which most state wages were paid, and a convertible peso, tied to the dollar, in which goods in many shops were priced. A worker paid in ordinary pesos earned a small number of convertible ones, and a person with access to tourists or to remittances from relatives abroad could earn far more. The result was a society in which a taxi driver could out-earn a surgeon. The government moved to unify the currencies in 2021, in a reform whose rollout was accompanied by price increases.

The dual currency was the system's own admission of how it worked. The official economy, with its low wages and fixed prices, was one thing. The real economy, where goods could actually be found, was another, and the gap between the two was filled with the dollar.

The strongest objection: the embargo explains everything

Now the other side's best case, which deserves a straight answer, because it is the heart of the matter.

The argument runs: the United States has maintained an embargo against Cuba since the early 1960s. Kennedy broadened it in February 1962 into a near-total embargo on trade, and later laws, notably the Cuban Democracy Act of 1992 and the Helms-Burton Act of 1996, tightened it. This embargo, the argument says, has denied Cuba markets, credit and goods, and any country would suffer under such pressure. Cuba's difficulties, therefore, are the embargo's fault, and the ration book is the shield that protected ordinary people against a hostile superpower.

I will take it in numbered points.

One. The embargo is real, and it is a legitimate subject of debate among conservatives. Some think it is sound policy against a regime that holds political prisoners, and others think it has failed to bring change and gives Havana a convenient excuse. That is an honest argument and it is going on inside the movement. But note the word "excuse."

Two. Cuba trades with the rest of the world. The embargo is an American law. It does not prevent Cuba from trading with Canada, Spain, Mexico, China, Brazil or anyone else, and it has not done so. Cuba has had, over the decades, trading partners, tourists, investors and, for thirty years, a superpower patron. A country that can sell sugar and buy oil on the world market and still cannot feed its people has a problem that is not the embargo.

Three. American food has been sold to Cuba legally since 2000. Under the Trade Sanctions Reform and Export Enhancement Act of 2000, American farmers have been permitted to sell agricultural products to Cuba on a cash basis. So the claim that Cuba cannot buy food from the nearest large producer in the world is wrong as a matter of law. The food can be sold. What is lacking is the ability of the Cuban state to produce enough of its own and to pay for the rest.

Four. The agriculture failure is domestic. Cuba, a tropical island with fertile land, once exported sugar in huge quantities and now imports a large share of its food. The policies that governed its farms, state control of land and inputs, low prices paid to farmers, and restrictions on selling what they grew, are not American policies. Farmers who may not keep the proceeds of their harvest do not plant much.

Five. Look at a comparison. An embargo does not explain why people from Cuba, one of the countries most geographically close to a wealthy market, risked the sea to leave. Nor does it explain why a country with a similar climate and history, but which had not adopted state ownership, has a very different record. For a comparison between systems on a shared starting line, see Two Germanys and two Koreas, the natural experiments that socialism lost.

I will concede one thing without reservation. The revolution made real gains in some areas, and the government's literacy campaign of 1961 and its public health system are things that Cubans point to with pride. Defenders of the regime are right that those achievements exist. But a literate, healthy population that is rationed its beans and sent abroad to earn hard currency is a population whose abilities are being wasted, and whose talents would do more in a free economy.

Why the booklet survives

Why has the ration book lasted? Because it is the instrument of dependence. A family that gets its monthly rice from the state has a relationship with the state that a family buying rice in a market does not. The one has a customer's freedom to go elsewhere. The other has a supplicant's reason to stay in line, literally and otherwise. A system that controls the food supply controls a great deal else, and it does not need to give an order to do it.

That is a conservative insight about every government benefit, and not only in Havana. The more a family depends on the state for essentials, the more the state's priorities shape the family's choices. The Founders feared exactly this kind of dependence. Alexander Hamilton, in Federalist No. 79, wrote that "a power over a man's subsistence amounts to a power over his will." That sentence was about the independence of judges, who must not be made dependent on the other branches for their salary. It applies with far greater force to a whole population whose daily bread arrives from one source.

Measure it against the Founders

The Declaration of Independence names three rights, life, liberty and the pursuit of happiness, and says governments are instituted to secure them. The pursuit of happiness assumes that a person can choose a trade, keep what he earns, and use his property as he sees fit. The Fifth Amendment says no person shall be deprived of property without due process of law and that private property shall not be taken for public use without just compensation. Cuba's revolution did the opposite on both counts. It decided that the state would decide.

Americans of Cuban descent, many of whom came here with nothing, have made enormous contributions to this country, and their families can tell the story better than any essay. What their experience proves is that the same people, with the same talents, in different institutions, produce very different results. For more on the systems that were tested and failed, Venezuela was once Latin America's success story, and then came socialism and eight socialism myths tested against the countries that actually tried it belong alongside this one.

The case in brief

1. After the 1959 revolution and the nationalizations of 1960, the state owned nearly everything, so every shortage became the government's own failure.
2. The libreta of 1962, introduced as a temporary measure, has lasted for generations, a plain verdict on a system that could not feed the people dependent on it.
3. Cuba survived on Soviet subsidies until 1991, suffered the Special Period afterward, and answered each crisis with a little private enterprise, such as the licences of 2010, which it then restricted again.
4. The embargo is a fair subject for debate, but it does not explain the record: Cuba trades with the world, American farm goods have been legally sold to it since 2000, and the failures of its farms are the result of its own policies.
5. Dependence on the state for basic necessities is a form of control, which is why the Founders insisted on property and independence.

What you can do: read the Fifth Amendment on the Constitution page, and then read a Cuban-American family's own account in a local library or oral-history project, so that you hear the story from the people who lived it.