The End of the Illusion for Cuba’s Regime

By Mauricio de Miranda Parrondo

Dr. de Miranda-Parrondo is a Cuban economist.

For some time now, much of Cuba has found itself increasingly in the dark. In cities and towns across the island, power outages can last for hours or even days. When the lights come back on, families scramble to cook what they can and store what little remains until service is interrupted again.

Public transportation is practically nonexistent. Many hospitals do not have enough medicine to treat their patients; many schools do not have enough staff members to teach their students. For most people, getting food means waiting in long lines and paying exorbitant prices.

The Cuban government has repeatedly presented the island’s emergency as a phenomenon imposed from the outside. It is true that the Trump administration’s recent efforts to restrict oil shipments to Cuba have added pressure to the economy. But Cuba’s economy was already on the brink of collapse. What is happening in Cuba today is essentially the result of decades of structural economic failure under a rigid political system that has consistently resisted any reform.

Since the regime came to power in 1959, the Cuban economic model — built around a centralized administration, the nationalization of the essential means of production and severe restrictions on markets — has proved incapable of generating sustained growth, development and social well-being. Now the implicit social contract that sustained the regime for years is crumbling. The extreme rigidity of the country’s totalitarian political system has become the main obstacle to the reforms the economy urgently needs. Without a political transformation, economic recovery will remain an illusion.

The regime’s economic structure is driven by an obsession with state control as the ultimate guarantor of political survival. By centralizing production and limiting the private sector, the Communist Party has sought to prevent the formation of any independent power that could challenge its authority, creating, in turn, a citizenry highly dependent on the state. This system is intrinsically reluctant to reform; even modest shifts are perceived as ideological threats to the party’s monopoly on power. The current crisis was triggered in 2021, with a botched currency overhaul that unleashed an inflationary spiral, aggravated by the collapse of tourism during the Covid-19 pandemic.

Cuba is governed by a closed and bureaucratic elite within the Communist Party — the only legal political party — which has turned into a rentier class. Power is concentrated in a small circle of old-guard leaders and their successors, including President Miguel Díaz-Canel, alongside business conglomerates controlled by the armed forces, which dominate the most profitable sectors like tourism. Over the past six decades, this system has given rise to a web of interests in which the leadership prioritizes political control over the needs of the population.

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