Two Virtual Currencies

As 2012 begins it seems that the burden of the two currencies will continue on the weary shoulders of Cubans. When, before the Cuban peso was devalued and in a state of coma, and a U.S. dollar strong and active as the trickster deity Eleggua, there were roads everywhere, it was decided to remove the latter from circulation substituting for it the convertible peso (CUC), and no one anticipated the financial chaos this absurd decision would lead to.

Responding to eminently political objectives — that the enemy’s money with its ideological burden should not continue to circulate — the new notes, baptized by popular wit as “chavitos” (after Chavez), “carnivalitos,” “cuckoos” and so on, as virtual as the Cuban pesos (CUP), some overvalued and others devalued. They are not accepted by any international financial market, nor even by Cubans themselves, who try to maintain their meager savings in dollars or euros, and only change them at banks of currency exchanges when they have no choice.

The existence of two currencies is a reality very difficult to solve, in the context of current political and economic criteria, and they contribute very little to the needed increase in domestic production. The producer, if he receive income in Cuban pesos (CUP) and must satisfy his needs with convertible pesos (CUC), is not stimulated to produce, although some charity is delivered, from time to time in the latter currency. Citizens should receive their salaries, 100% in the same currency in which items must be purchased to meet their needs. As long as this absurdity, the result of voluntarism and improvisation, is not solved, everything else is just talk and good intentions.

To make a decision so disastrous, they consulted with neither God nor the Devil, and here are the harmful results. The blunders fill an endless list, and now they must try to rectify them, but as I pointed out on other occasions, there is a lack of time and credibility, which complicates the task. The authorities do not seem willing to implement it. It is possible the task will remain for those who come after them.

January 9 2012

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