David R. Henderson  

Fidel Castro's Monstrous Behavior

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I learned about flash mobs early on in my life. One of my aunts was particularly religious. She and I end up going to church one Sunday morning probably in late 1961 or early 1962. While the mass is taking place, a mob of anti-Catholic protesters gathers around the church and blocks all exits. The angry mob makes the parishioners walk through a long serpentine of insults, screams, and spit as they exit the church.
This is from George Borjas's heartfelt post in which he remembers living in the hell hole of Fidel Castro's Cuba.

Another excerpt:

In the days before credit cards and electronic transfers, all transactions were made in cash. Castro quickly found a simple way of confiscating "excess" cash. The currency was changed overnight. And everyone had to turn in their old paper currency for the new paper currency, with some limits being imposed on the amount of the transactions. There was a miles-long line on what I think was a Saturday morning, as the entire Cuban population was turned into beggars for the new currency.

Notice the connection between the government's total control of the money supply and the degree of economic freedom.

By the way, George Borjas wrote the piece on immigration for my Concise Encyclopedia of Economics. It's here.

I disagree with George's recent statements against allowing a lot of immigrants into the United States. But I'm SO glad that George got in.

HT2 Greg Mankiw.


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CATEGORIES: Monetary Policy , Regulation




COMMENTS (6 to date)
Michael writes:

fully agree with the sentiment, and Borjas is very decent and ideologic in his post

However, I can't help but notice that it's a very weak selection of illustrations of the Cuban regime's cruelty. Shaming, harassment and expropriation are, sadly, far from unusual anywhere in the world. Think India for currency 'reform'. Think the US for asset forfeiture. The killing of the godfather comes closer to revolutionary terror, but it is not an actual experience of Borjas'

If one was adversarial or a cynic (I want to be neither) one could say that the special feature of Borjas' experience is that he's from a (formerly) better off background, and, if one was to be even more cynical and adversarial, that this was as intended by the revolutionaries (ensues a discussion about justification...)

Thaomas writes:

I think it is worth pointing out that it was the Castro Regime's seizure of total political control, unconstrained by Constitutional norms, that permitted the kinds of abuse that Borjas recounts.

Michael writes:

I of course meant UNideologic re: Borjas, in the first line of my first comment above

Mactoul writes:

Prof Henderson,
I am not getting your point regarding govt's total control of money supply. The paper currency is entirely creature of the govt that issues it. So any govt that issues a paper currency has total control of money supply, whether it be a capitalist country or a socialist country. Economic freedom is not adversely affected by it.

Alex writes:

"Notice the connection between the government's total control of the money supply and the degree of economic freedom"

I don't see the connection here David. Anyone can issue "currency". The board game monopoly issues Monopoly currency. Of all the crimes that Castro committed, issuing currency was the least important. In the US the government issues currency, but you are not forced to use it except for very few transactions.
If this were such a problem, then people wouldn't use government currency for private transactions, yet they do.
Fantastically wealthy and free nations have government issued currency and the people are just fine.

David R. Henderson writes:

@Mactoul,
The paper currency is entirely [a] creature of the govt that issues it. So any govt that issues a paper currency has total control of money supply, whether it be a capitalist country or a socialist country.
True. And that’s a dangerous power for government to have. Also, any country that has a government-run currency has, to that extent, one of the institutions of socialism.
Economic freedom is not adversely affected by it.
Actually, it is. That’s the relevance of the example that George Borjas gave. Or, to take a more recent example, the Indian government is doing something similar. That’s definitely an assault on economic freedom.
@Alex,
Of all the crimes that Castro committed, issuing currency was the least important.
I don’t agree that it was the least important, but it was certainly way less important than his many murders. It was also a harbinger of things to come. And the problem wasn’t the issuing of currency per se. It was the confiscation of currency.

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