Wednesday, February 12, 2014

Cuba’s Reward for the Dutiful - Gated Housing

Cuba's Reward for the Dutiful: Gated Housing
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With balconies and air-conditioning, the new apartments for Cuba's
middle ranks are a sign of a hybrid economy in which the state must
compete with private enterprise. Todd Heisler/The New York Times

HAVANA — In the splendid neighborhoods of this dilapidated city, old
mansions are being upgraded with imported tile. Businessmen go out for
sushi and drive home in plush Audis. Now, hoping to keep up, the
government is erecting something special for its own: a housing
development called Project Granma, featuring hundreds of comfortable
apartments in a gated complex set to have its own movie theater and schools.

"Twenty years ago, what we earned was a good salary," said Roberto
Rodríguez, 51, a longtime Interior Ministry official among the first to
move in. "But the world has changed."

Cuba is in transition. The economic overhauls of the past few years have
rattled the established order of class and status, enabling Cubans with
small businesses or access to foreign capital to rise above many dutiful
Communists. As these new paths to prestige expand, challenging the old
system of rewards for obedience, President Raúl Castro is redoubling
efforts to elevate the faithful and maintain their loyalty — now and
after the Castros are gone.

Project Granma and similar "military cities" around the country are
Caribbean-color edifices of reassurance, set aside for the most ardent
defenders of Cuba's 1959 revolution: families tied to the military and
the Interior Ministry. With their balconies, air-conditioning and fresh
paint, the new apartments are the government's most public gifts to its
middle ranks and a clear sign of Cuba's new hybrid economy, in which the
state must sometimes compete with private enterprise.

The housing is just one example of the military's expansive role in Mr.
Castro's plan for Cuba, and it illustrates a central conflict in his
attempts to open up the economy without dismantling the power structure
he and his comrades have been building for more than five decades.

In the short term, analysts and former officers say, he is relying on
the military to push through changes and maintain stability as he
experiments with economic liberalization. Yet his abiding dedication as
a lifelong soldier who was defense minister for 49 years threatens to
further entrench an institution that has often undermined changes
challenging its favored status.

"Raúl knows the military answer is not the answer, but he also knows
that at this time he absolutely needs military loyalty," said Hal
Klepak, a Canadian scholar who closely tracks the Cuban military. "They
are the only ones who will follow him if the reform succeeds, or if it

Mr. Castro and his brother, Fidel, given their guerrilla history, have
always turned to the military in times of need. In the 1960s and early
'70s, as Cuba's professional class fled, officers in fatigues ran
government ministries and nationalized industries. Since the 1990s,
after the fall of the Soviet Union, the armed forces have been slashed
to around 55,000, from a peak of more than 200,000, but they have also
been pushed further into the Cuban economy.

As president, Raúl Castro, 82, has accelerated the growth of what some
scholars have described as a military oligarchy. The chairman of the
Economic Policy Commission, Marino Murillo, is a former officer. Cuba's
largest state conglomerate, Cimex, which processes remittances from
Cubans abroad, among other tasks, is run by Col. Héctor Oroza Busutin.
Raúl Castro's son-in-law, Gen. Luis Alberto Rodríguez, is the top
executive at the military's holding company, known as Gaesa, which is
estimated to control 20 percent to 40 percent of the Cuban economy.

And its role is expanding. In 2011, a financial arm of the company
bought out Telecom Italia's 27 percent stake in Cuba's
telecommunications company for $706 million. Gaesa also has a network of
hundreds of retail stores selling everything from food to appliances. It
is a growing force in tourism, too, controlling fleets of luxury buses,
a small airline and an expanding list of hotels. And one of its
subsidiaries is overseeing the free-trade zone built alongside Cuba's
largest infrastructure project in decades — the new container port in

The military's interests bestow the privileges of business on a chosen
few, especially senior military officials. "They live better than almost
anyone in Cuba," said Brian Latell, a former C.I.A. officer who worked
in Cuba.

But in the lower and middle ranks, experts say, esteem and relative
wealth have eroded. Career officers in Cuba are now more likely to have
friends or relatives who live abroad, or who visit Miami and often
return with iPhones or new clothes unavailable at the state's musty stores.

Meanwhile, military members must report all remittances they receive,
and they are not allowed any "unauthorized contact" with foreigners or
Cubans living abroad — limiting access to the money that other Cubans
use not just for purchases, but also to improve their homes and open
small businesses.

"It's producing an exodus of talented people from the state to the
private sector," said Jorge Dámaso, 75, a retired colonel who writes a
blog often critical of the government. "Most people in the military have
seen their quality of life fall compared to a bartender or someone who
has a small business. They can see that they are at a disadvantage."

The new housing, a basic necessity in extremely short supply across the
island, looks to many Cubans like another attempt at favoritism.
According to government figures, the military's construction budget has
more than doubled since 2010. When combined with the Interior Ministry
(often described as a branch of the military), the armed forces are now
Cuba's second-largest construction entity.

Project Granma — named after the boat Fidel Castro took from Mexico to
Cuba to start the revolution — is one of several new military housing
developments around the country. Its equivalent in Santiago de Cuba,
where the Castro revolution began, has come under fire from Cubans
struggling in rickety homes damaged by Hurricane Sandy. But as an
attempt to match the private sector, or life in other countries, it is
perhaps no accident that the colors and architecture of the Granma, in
the same neighborhood that Raúl Castro calls home, give it the feel of a
Florida condo complex.

At its edge, there is a baseball field. Inside the gates, streetlamps
resembling classic gaslights line the sidewalks, while cars, another
perk, fill lots.

At a building with rounded archways, where a movie theater, market and
health clinic are meant to go, one of the project's engineers said
several thousand people would eventually call Granma home. Sweating in
green army fatigues, he praised the plan, noting its imported,
prefabricated design that allowed walls to be assembled quickly, like
puzzle pieces. He failed to mention what a security guard had pointed
out: Most of the workers painting were prison inmates.

Several residents said they were thrilled to live in what Mario Coyula,
Havana's former director of urbanism and architecture, called "the first
gated community in Cuba since the 1950s." Some said they had been living
in cramped quarters with generations of family.

Support for Raúl Castro's economic changes seemed strong here among
those willing to talk. "It's necessary," Mr. Rodríguez, the official
among the first to arrive at Granma, said as he sat outside with a
cigarette. "If you're cold, you put on a coat; it's just what makes sense."

But in the push and pull that has defined Cuba's economic policies over
the last two years, the government has often struggled with when to let
the market function and when to protect the Communist establishment. The
authorities, for example, recently cracked down on private vendors
selling clothes and other items, widely seen as an effort to help the
state's own retail network.

Mr. Dámaso, who spent 32 years in the military, said that the country's
leaders, while longing for economic improvement, mainly want to preserve
the Cuba they know.

"If you have a business run by military officers, when there's a
transition, you're not going to get rid of all these people," he said.
"This is a way to maintain a space for established powers in a future
Cuban society."

Source: Cuba's Reward for the Dutiful: Gated Housing - -

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