The New Cuban Society

During the first decade of the Cuban Revolution, the economies growth was based on trial and error, characterized by inconsistence, low production standards and increasing bureaucracy. Che Guevara was appointed President of the National Bank of Cuba, where he advocated centralization and an ineffective moral incentive for workers, as opposed to a material one. Inexperience and the lack of so many professionals were taking their toll. In August 1963 some 10,000 farms were nationalized through the Second Agrarian Reform, which reduced the private land ownership to 65 ha. Therefore, more than ⅔ of the arable land was placed in state control.

In 1968 with the Great Revolutionary Offensive the last 55,000 small private businesses were nationalized on the island and freelancing of any kind was abolished. Many white-collar workers were assigned to agricultural labors, while military personnel took over government posts and economic control. Therefore, production sank and limitations got worse. Despite the humongous Soviet help, the Cuban economy weakened towards the end of the 1960s and the titanic effort to produce 10 million tons of sugar from the 1970 harvest brought the economy to the point of collapse, because production in other economic branches stood idle in order to make more emphasis on sugar. After this failure, more attention was paid to planning and mechanization of the sugar industry. The situation improved during the 70s, when a new generation of professionals and technicians graduated to fill the gap of those who had left for the US.

From the 1970s on, economic and political planning filled the agenda, based on close ties to the Soviet Union. With Fidel's visit to the Eastern European socialist countries in 1972, Cuba finally became a member of the Mutual Economic Help Council, headed by the Soviet Union, which guaranteed debts´ payments and better prices for Cuban products. However, planning was done in a centralized and arbitrary way. Trade with the USSR gradually increased from 65% in 1970 to 87% in 1988, harbouring a dependence that would negatively impact Cuba in the not so distant future. In 1975, the number of provinces augmented up to the present 14 and the first Congress of the Communist Party approved the institutionalization process, through which a Soviet-like system was established in Cuba. A third Constitution to replace the Fundamental Law of 1959 was issued and Fidel Castro substituted Osvaldo Dorticós as President in 1976.