Hornberger's Blog

Hornberger's Blog is a daily libertarian blog written by Jacob G. Hornberger, founder and president of FFF.
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Lessons for Americans from Welfare-State Failure in Cuba


Uh, oh! Problems in socialist paradise land. It seems that one of the primary bastions of socialism is considering moving away from its welfare-state principles. According to the Financial Times, “Cuba, one of the world’s surviving Communist states, is looking at watering down the generous social welfare system that has been a cornerstone of its economy for nearly 50 years, according to a senior government official. Alfredo Jam, head of macroeconomic analysis in the economy ministry, told the Financial Times that Cubans had been ‘over-protected’ by a system that subsidised food costs and limited the amount people could earn, prompting labour shortages in important industries.”

Despite changes in Cuba’s socialist economic system, however, the FT points out that “the welfare system has remained almost intact. Under it, all Cubans are entitled to basic foods, including breads, eggs, rice, beans and milk, at much cheaper prices than those elsewhere in the world. Rents and utilities are extremely cheap and education and healthcare are free.”

Does Cuba’s socialist system have any relevance for Americans? Of course! It helps to show Americans that they themselves have been living a life of the lie with respect to their own economic system for their entire lives.

From the first grade Americans are indoctrinated, primarily in public schools but also in government-licensed private schools, into believing that America’s economic system is “capitalist” while Cuba’s socialist system is socialist.

Yet, the reality is that both the Cuban people and American people (libertarians excepted, of course) share the same socialist philosophy. Let’s examine some examples.

1. Public (i.e., government) schooling. Both American statists (i.e., conservatives and liberals) and Cuban communists believe in this government program, which is the epitome of socialism. It involves government central planning, coerced attendance, taxation, and government-mandated curricula. Indoctrination by government schoolteachers in both countries is the name of the game. In Cuba, for example, students are taught that the CIA is bad while in American schools students are taught that the CIA is good. Both Cuban communists and American statists consider education to be a right. They ardently oppose the libertarian idea of a total free market in education, i.e., a complete separation of school and state.

2. Social Security. Both American statists and Cuban communists strongly embrace this socialist program. In fact, it is the pride and joy of Fidel Castro, just as it was the pride and joy of President Franklin Roosevelt, whose regime brought it into existence here in the U.S. Social Security is based on the Marxian principle of using the government to take money from one person in order to give it to another person.

3. Medicare and Medicaid. In Cuba, health care is free. It is also considered a right, just as it is here in the United States. Here, health care is also mostly free for Medicare and Medicaid recipients, and many American statists wish to extend free health care to every American, as Castro has done in Cuba.

4. Income taxation and equalization of wealth. Both Cuban communists and American statists believe in these two principles. That’s the idea behind progressive taxation and the inheritance tax here in the U.S. How many times have we heard American statists complaining about the great inequalities of wealth in America? That’s a sentiment shared by Cuban communists, which is precisely why they confiscated everything from the rich through nationalization when they took power in 1959.

5. Government subsidies. Both American statists and Cuban communists share a common commitment to domestic subsidies, especially in the agricultural field.

6. Paper money and monetary central planning. Both Cuban communists and American statists strongly endorse socialism in the monetary sphere, strongly opposing either a free-market monetary system or one based on precious metals (i.e., gold and silver coins).

Of course, we could also talk about such things as gun control, drug laws, immigration controls, trade restrictions, economic regulations, and the like, but … well, you get my drift.

Despite the fact that Cuban communists have embraced socialism to a greater degree than American statists, no one can really deny that the Cuban people are freer than the American people, at least in a psychological sense. For as the great German thinker Johann Wolfgang von Goethe pointed out, none are more hopelessly enslaved than those who falsely believe they are free.

This post was written by:

Jacob G. Hornberger is founder and president of The Future of Freedom Foundation. He was born and raised in Laredo, Texas, and received his B.A. in economics from Virginia Military Institute and his law degree from the University of Texas. He was a trial attorney for twelve years in Texas. He also was an adjunct professor at the University of Dallas, where he taught law and economics. In 1987, Mr. Hornberger left the practice of law to become director of programs at the Foundation for Economic Education. He has advanced freedom and free markets on talk-radio stations all across the country as well as on Fox News’ Neil Cavuto and Greta van Susteren shows and he appeared as a regular commentator on Judge Andrew Napolitano’s show Freedom Watch. View these interviews at LewRockwell.com and from Full Context. Send him email.