“Everything that is not expressly approved is prohibited,” this phrase was repeated on countless occasions by one of the most beloved teachers—and also the wittiest—that I had in my undergraduate degree in Economics, back in 1973, when I began my studies, his name, Benito Matas. My colleagues from those days will remember him and they will surely do so with a smile. This was not the only famous phrase of his, he had many others, sometimes tremendously metaphorical, to describe the operation of the Cuban economy of those times.
The phrase came to mind as I was watching the Mesa Redonda television program where some of the doubts that the “negative list” had generated in the population were contextualized, explained, and clarified.
Several colleagues shared their impressions after the Mesa Redonda, I am not mistaken if I say that the balance that at least I obtained from their opinions was, in general, positive, about the Mesa and on the clarifications made on it. Needless to say, I practically agree 100% with their opinions.
However, for me, the most positive thing was the ratification of what I would call “approval by omission” of any new self-employment project. It is, perhaps, the most revolutionary in regulatory terms and generates a “new culture” that will take time to flourish and bear fruit, but we must take care of it as one of the most valuable resources on the path to the future.
That many Cubans have asked for clarification about what “can be done” as self-employment based on the negative list is the most logical thing that could happen, since positive discretion has characterized the conduct and operation of the national economy, from times even before my beginnings as a student at the Faculty of Economics. So, suddenly, without further warning, without a “preparation course” of the kind that abounds, we were all taken out of our comfort zone and were faced with one of the most difficult exercises that any human being has to face, the freedom to create their own “business,” something that in our “business environment” has been permanently absent.
Perhaps the most contradictory of all is the fact that our people, practically all of them, are almost genetically innovative, something that has been demonstrated time and again with their permanent resilience in the face of the infinite adverse phenomena we have always experienced, something that is expressed even in the most everyday aspects, as happens today with those groups that barter products through WhatsApp to remedy, at least in part, the rigors of shortages, and the lack of dollars to buy in stores in freely convertible currency. Exchanging disposable diapers for the elderly for compotes for a month-old baby with just one click is the modern version of that other barter at the block level when the man who smokes exchanged his condensed milk for “Vegueros” cigarettes in those glorious days of that ration book supply through which even beer was distributed.
“In this type of work, you cannot say that you are going to authorize a group of activities for three months, then return to update two more, because we are talking about people having the possibility of choosing a project that lasts beyond a few months. It is necessary to guarantee that there is transparency in what is done and the certainty that there will be durability to choose these alternatives as a life option.
“In this type of work, you cannot say that you are going to authorize a group of activities for three months, then return to update two more, because we are talking about people having the possibility of choosing a project that lasts beyond a few months. It is necessary to guarantee that there is transparency in what is done and the certainty that there will be durability to choose these alternatives as a life option.” Alejandro Gil, Minister of Economy
Conveying security and promoting transparency is perhaps one of the virtues that must be well cultivated and for this to reduce “discretion” to its minimum expression is essential. This is an old debate in economics—“rules versus discretion”—never well resolved anywhere in the world, in any of the known times. In our economy, the excess of discretion has meant a cost both in terms of percentage points of GDP growth, as in terms of failed collective projects and also in terms of frustrated individual projects or developed outside of Cuba, faced by the often unbeatable wall of that discretion.
Discretion has two very deadly companions for the business environment; a generally inefficient bureaucracy and corruption. We have suffered from both and are still suffering. Both are the worst evils for the economy and society in any country, also for the political health of any State.
Cutting down on bureaucracy’s interference in the entire self-employment project approval process is essential. Not making it depend on the “personal considerations” of an official or his “interests” is decisive. Current regulations contribute positively to reducing these evils.
The second of the aspects that I think is very positive on the negative list is the synergy that self-employment must produce with the local economy to empower the municipal governments. This undoubtedly happens because local governments understand the opportunities that the expansion of self-employment offers them—in terms of tax revenue, generation of quality employment, etc.—but above all, because seen from the point of view of the territorial development strategy, self-employment, together with the Territorial Development Projects, must be a decisive part of the backbone of the economy of the municipalities.
Much will depend on how proactive local governments are, on the depth and speed with which they produce and manage the “change of mentality” about “self-employment” and that the old prejudices that have surrounded it are replaced by those new “values,” supported by our Constitution and the new documents that regulate it. Not everything will have to be left to the individual initiative, the local development strategies that all municipalities must have and systematically update can constitute an important source for convening projects where the self-employed are incorporated, and either privately or public-private alliances contribute from the individual to satisfy greater collective interests. Undoubtedly, all of this will have to be accompanied by the appropriate incentives—not only fiscal—and with the “social” recognition of such activity, something that has its greatest impact on the neighborhood. Let us remember that until not long ago self-employment was considered “a necessary evil” and self-employed workers as the carriers of that evil.
The third of the positive aspects to highlight is more associated with the future. The new regulation for self-employment somehow establishes a “philosophy” and certain regulatory maximums for the future of the long-awaited micro, small and medium-sized enterprises (MSMEs). What should be the procedure for the creation of MSMEs? Well, never much more complex than the one decided for self-employment; they should be approved by omission and should be under the auspices of local governments. Thus, in a way, the new regulations for the self-employed constitute a “test ball” for MSMEs and will facilitate learning to introduce this other form of ownership into our economy.
There are still issues to be addressed and discussed, some very specific—such as the prohibition of the practice of tourism guide due to a bad previous experience, the prohibition that Cuban citizens have private “travel agencies” when they are allowed for foreigners, also private ones—and others that are deeply conceptual, such as the case referring to the exercise of self-employment by professionals, where the discrepant criteria do not respond only to “attacking what we do,” which undoubtedly exist and some are well-intentioned, but to well-founded studies and research, at least in terms of the economy. But these properly shared discrepancies give the possibility of improvement, because questioning what the government does is not only a right but also a duty of each citizen of our country and is a substantial part of the daily exercise that every government must submit to.
If today we have a new regulation, better suited to our needs and to the self-employment vision of the country, it is because of the questions and discrepancies that were expressed from the beginning of the previous regulation, rather than due to complacency and silence as a response. Hundreds of pages were written on the subject, many times not agreeing with the “official criteria.” Today, a fundamental part of its essence has been embodied in this new regulation, the result in part of those half-quixotic days that have lasted more than thirty years.