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Comecon and the Collapse of the Cuban Economy

Cuba, a social democrat point of view of its problems

The Council for Mutual Economic Assistance was an economic organization from 1949 to 1991 under the leadership of the Soviet Union that comprised the countries of the Eastern Bloc and many socialist states elsewhere in the world. The Comecon was founded in 1949 by the Soviet Union, Bulgaria, Czechoslovakia, Hungary, Poland, and Romania.
Comecon was initially set up to prevent countries in the Soviet sphere of influence from moving towards that of the United States. The Eastern Bloc’s response to the formation in Western Europe of the Marshall Plan and the OECD, Organization for Economic Co-operation and Development.
From its founding until 1967, Comecon operated only based on unanimous agreements. It became increasingly obvious that the result was a failure. In 1967, Comecon adopted the “interested party principle,” under which any country could opt out of any project they chose, still allowing the other member states to use Comecon mechanisms to coordinate their economic activities.
From its founding until 1967, Comecon operated only based on unanimous agreements. It became increasingly obvious that the result was a failure. In 1967, Comecon adopted the “interested party principle,” under which any country could opt out of any project they chose, still allowing the other member states to use Comecon mechanisms to coordinate their economic activities.
The 1985 Comprehensive Program for Scientific and Technical Progress and the rise to Soviet general secretary Mikhail Gorbachev’s power increased Soviet influence in Comecon operations. It led to attempts to give Comecon some degree of supranational authority. The program was not a success. “The Gorbachev regime made too many commitments on too many fronts, thereby overstretching and overheating the Soviet economy.

But what about Cuba? Cuba benefited enormously from the Comecon. Cuba exported to it sugar and citrics and got in return oil and other needed products. Nobody predicted the collapse of the Soviet Union and all other Socialist Republics. The Cuban economy was planned around the needs of this organization. Its dissolvement severely hurt the Cuban economy, and still, the Isle has not replaced it with any other international cooperation organization. The economy of the Island was directly and deeply affected by this event and the economic principles that govern a socialist society.

It will take another five years for Cuba to expand its current reforms and initiate others that could give Cuba the prosperity its people deserve. Indeed, it could take at least five years to embrace a socialist democracy with a mixed economy, private and state-owned. Cuba needs reforms but cannot betray the social nature of its society. Education and partially medicine and its social orientation have been reasonably successful.
Main cons and pros of a socialist economy.

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Pros of socialism

1. Reduction of extreme poverty
2. Free health care and Education
3. Diminishing marginal utility of income

Cons of socialism

1. Lack of incentives
2. Slow Economic Growth
3. Socialism Expands Bureaucracy

The Green Orbit has listed the main and cons of socialism to illustrate that a Social Democracy could preserve its main pros while addressing its cons.


[Social democracy a brief explanation]

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