Sunday, October 03, 2010

Cuba and the deficit story

Cuba is one of the few remaining communist countries left. It survived the collapse of communism 20 years ago. Whilst most countries sent socialism packing, Cuba clung to it, though at an enormous cost to its economy and standard of living. I visited the country 4 years ago and saw at first hand how threadbare and rundown everything is.

Now I see that under the leadership of Raul Castro, Fidel's brother who recently took over the reins of power, Communist Cuba is to shift towards capitalism in an attempt to cut the ballooning government deficit. By April next year, the state payrole will be cut by half a million people. Self-employment is to be legalised in a large number of trades.

I wonder what the Labour party in the UK thinks of that. They continue to argue for massive borrowing to maintain revenue expenditure. The rest of the world is moving to balance budgets. The Left, when it is in power, recognises that economic and financial reality cannot be ignored. The real world kicks in.

It is an interesting point that socialist governments the world over are bringing in austerity drives. It's not just Cuba. Spain has a socialist government. And austerity measures there are far greater than anything planned for the UK. Perhaps the UK Labour Party should look abroad to their "comrades" for a lesson in economics and finances.

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Left Lib said...

I think your article is a classic case of not wanting to take the Labour party seriously.
Cuba has never been a model for the Labour party, not even in the 1980s. So why mention it?
You could for the sake of balance consider the fate of Ireland. Like the UK the government there is run by deficit hawks, and look what happened to them.

Jonathan Wallace said...

The point I was making is that government's of the left the world over end up having to live in the real world and out of necessity have at least to try to live within their means.

Ireland is an example of what Britain could turn into if borrowing is not brought under control. Borrow too much in an unsustainable way and eventually the bills come back with payment demands. Surely it is better for the government to take action now rather than wait for the meltdown which is what happened in Ireland.