BerksBarristerSpring2017 - 8

w w w.BERKSBAR.org

Americanos Receive Thumbs Up in Cuba!
The economic system of Cuba is bizarre. It has two
currencies. For Cubans, the peso is the standard currency. For
foreigners and Cubans who deal with them, the kook is the
currency. I don't know what a peso is valued at against the
dollar, but it is probably pennies on the dollar. A kook, however,
is artificially set at equal value to a dollar. The unintended
consequence of this is that people who are paid with the peso
may earn the equivalent of four to five thousand dollars a
year. That would include doctors, lawyers, accountants and
other professionals. A tour guide, however, may be paid by the
government in pesos, but is tipped by foreigners in kooks and can
earn twenty to forty thousand dollars a year. A society where tour
bus drivers can earn ten times that of a doctor is in trouble.
A Cuban economist we met with indicated that, not
surprisingly, young people were looking for careers in businesses
where kooks are used, including tourist based businesses, rather
than going to universities to become professionals. Simply putting
everyone on the kook will cause wild inflation and create another
set of problems. Having foreigners use the peso will give them
such an exchange rate advantage that goods and services would be

Continued from page 7

ridiculously cheap. I don't pretend to be smart enough to know
how to solve this problem, but it must be resolved and soon.
Cuba is a socialist society with a growing free market system
taking hold. Many restaurants are now private, as are other
service-related businesses. Many people own their own homes.
Yet everyone has a ration card through which they buy their basic
monthly food supplies of rice, beans, cooking oil and other staples
for about $1.50 a month. These basics are sold in government
owned stores. But there are privately owned grocery stores that
sell more of the "luxury" items. An American looking at any of
these stores would be amazed at how little choice there is. There
aren't twenty brands of olive oil. There is simply cooking oil. Yet,
despite the lack of variety, this system has provided for the people
of Cuba so that a person's basic food needs are almost free. People
aren't starving or malnourished. Healthcare and education are
both provided through the government.
Agriculture is a huge part of the Cuban economy, with sugar
and tobacco being its biggest crops. Rum is the natural byproduct
of the sugar industry, with Cuban rum being recognized as some
of the best the Caribbean has to offer. Everyone knows of the

Rice drying along the East-West Highway

8 | Berks Barrister
http://www.berksbar.org/
Table of Contents for the Digital Edition of BerksBarristerSpring2017
