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Authors: Paarth Agarwal, Yong Hwee Shi Region Head: Tan Chok Geow
Editor: Akshat Daga
Abstract
Food rationing is uncommon in today’s society, but for Cuba, it is a longstanding tradition. The Libreta rationing system was established to address food security issues that the island has been grappling with since the 1960s. Supporters of the Cuban regime identified US sanctions as the main culprit, but detractors blame the inefficiencies of the socialist system. This paper explores Libreta’s history, and delivers the verdict on whether it should be continued, as it digs a bigger hole in the government’s wallet.
An Overview of the Rationing System: How it Works
Libreta was officially established in March 1962, and was administered by the Ministry of Internal Trade (Alvarez, 2004). Each household receives a rationing booklet which entitles them to specific quantities of the rationed items, depending on the number of people in the household (Alvarez, 2004). To ensure fair distribution, each Cuban receives equal monthly rations of staples such as rice, sugar, oil and eggs (Benjamin, n.d.). Children will receive more rations of milk, poorer people get extra ration portions, and those with health issues will receive special rations according to their prescribed diet (Benjamin, n.d.). The ration quota is distributed in bodegas and placitas[1], which have mostly existed since pre-revolutionary times but were expropriated for rationing (Alvarez, 2004). However, although rations are priced cheaply, Cubans have to purchase non-rationed items at higher prices as food imports are increasingly costly.
The Smooth-Sailing Decades, Aided by the USSR
The system has constantly struggled under the government’s financial pressures and the hardening trade embargo. That said, Libreta was not always in such a bind, and had seen better days.
Libreta was created to address Cuba’s food shortages, which supporters of the regime attributed to US sanctions. Cuba declared its Marxist and socialist status in 1961, aligning herself with the USSR but provoking an enduring trade embargo from America. While it did not prohibit the trade of food, it increased Cuba’s import costs by restricting credit and shipping. Besides rising import costs, the rationing system also increased the government’s financial burden, as their annual budget expenditure increased by 7,000,000 pesos to administer and manage the Libreta system (Cotayo, 1991). These costs were covered by the yearly subsidies of about US$5 billion, which Cuba received from the USSR (Benjamin et al., 1985).
Libreta progressed into the 1980s, during which it successfully eliminated hunger—a feat that is elusive even to developed countries back then (Benjamin et al., 1985). For three decades, the system allowed every family to receive sufficient rations and a decent diet for a month, at a small fee (Benjamin et al., 1985). The merits of the rationing system were most evident during this period, especially in the 1980s. There was greater equality in food distribution, and the island had one of the lowest infant mortality rates and highest life expectancy rates in the world (Benjamin et al., 1985).
The Nadir of the Libreta System in the 1990s
It wasn’t until the 1990s that the island started feeling the teeth of US sanctions, and the rationing system began to buckle. It became clear that Cuba’s economy was heavily dependent on the USSR. In 1987, 88% of Cuba’s trade took place with Eastern Europe and the USSR, and such trade relations helped Cuba to circumvent the effects of the US embargo (Oxfam, 2001). But with the 1990s came the downfall of Cuba’s largest benefactor, and without Soviet aid, Cuba’s ability to import food dropped by 75%, and rations fell by half (Benjamin, n.d.).
Initially, Libreta was introduced with the rise of farm ownership and organisation after the 1959 Cuban revolution. Agriculture was reshaped under state ownership, and became heavily mechanized and reliant on imported chemical inputs (Fig. 1). This agricultural model began to collapse in the 1990s as imported inputs such as fuel, electricity, and raw materials were not supplied, causing food production to come to a standstill (Oxfam, 2001). The 1990s thus ushered in what the government dubbed as the ‘Special Period’, during which the average Cuban lost 20 pounds, and persistent hunger became a daily reality (Benjamin, n.d.).
Fig.1 Cuba’s ‘High-Input’ Agriculture
The reliance on imports exposed the inefficiencies of the socialist system in the agricultural sector. Its state-owned nature resulted in unproductive organisation, with high absenteeism and low productivity of workers causing decreased food production, and in turn food shortages (Eckstein, 1981). In fact, Cuba devotes more than 20% of its import capacity, to the purchase of food that could be very easily produced in the country (Chepe, 2001). Moreover, most of the food rations since 1962 were in abundance before 1959 and produced domestically—a testament to the feasibility of having a stable food supply in Cuba (Alvarez, 2004).
With 60% of Cuba’s food being imported, and the continued rationing of food even with Soviet subsidies, the collapse is mostly due to the failure of the bureaucratic, state-run economy that saps the entrepreneurial spirit of workers and farmers (Benjamin, n.d.).
Cuba’s Agriculture and the Libreta System Today
The Cuban government adopted reforms to drive recovery from the Special Period, by ceding land to small farmers, reshaping state farms to multiple cooperatives and liberalising produce markets (Enriquez, 2003). Currently, the Cuban economy has improved since the Special Period, courtesy of Venezuela’s subsidized oil and tourism revenue (Benjamin, n.d.).
However, supply still falls short, and the monthly ration is just enough to keep people from starving—but not enough for a good diet (Benjamin, n.d.). While Cubans pay less than US$2 for their monthly rations, about 12% of the food’s real value, it leaves the government a US$1 billion bill for subsidizing Libreta rations, on top of its US$2 billion spending on food imports (Benjamin, n.d.). It is therefore unsurprising that President Raul Castro has suggested removing the Libreta system.
With Cuba’s agriculture in dire straits, the normalization of relations between US and Cuba under the Obama administration in 2014 ignited hopes that greater tourism and trade will help to restore Cuba’s economy, as well as food supplies (Lamar, 2015). But these hopes were dashed with the hardening of the trade embargo from the United States under the subsequent Trump administration, and the drop in the aid from Venezuela in the form of subsidized oil which has now been reduced by two thirds due to the collapse of their state-run oil company.
In light of this, the Cuban government is tightening the Libreta system to control the availability of certain food items, as supply suffers further shortfalls. Widespread rationing was implemented again in the face of a grave economic crisis and acute shortages (Weissenstein et al, 2019). Likewise, during the COVID-19 pandemic, Libreta was again brought back to deal with shortages during the resulting economic crisis, with new ration quotas of newly added goods at state-subsidized prices.
Should the System be Continued?
Libreta has been a symbol of Cuba's crisis strategy, and has been applauded as a fair and necessary system. However, rumours abound that the government would abolish the system due to its hefty price tag. There has been talk of the universal libreta being replaced by a food stamp system based on need and income disparities (Torres, 2020). What is certain is that the days where Cubans eat the same meals are gone, and food remains a basic human right for Cubans. This is reason enough for Libreta to continue, even if it gets modified, especially in a world where so many people still go hungry. According to Benjamin (n.d.), Libreta can make Cuba become a model of how to grow the pie and make sure that everyone gets a piece.
US President Elect Biden is likely to move towards Obama’s earlier policies to ease the pressure on Cuba and increase the scope of the Cuban economy to recover. As US-Cuban relations normalize, the hope is that Cubans can access a more varied diet with the expansion of the economy due to reduced import costs from the removal of sanctions. Keeping Libreta may be inefficient and taxing on the government, but perhaps such developments are a positive step to reducing such burdens. The government may also need to re-evaluate their reforms to further improve the efficiency of its system.
[1] Bodegas and Placitas are outlets for the selling of food products
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