ECONOMIC EDUCATION FOR A MARKET ECONOMY: THE CUBAN CASE Jorge A. Sanguinetty The transformation of a centrally planned economy (CPE) into a market economy provides an excellent example of hysteresis between the trajectories corre- sponding to the transformation of each economic system into the other. The first process involves a transformation of a low-complexity system to one of much higher complexity.
Inversely, upon establish- ing a centrally planned economy following Marxist- Leninist tenets, the process is characterized by a re- duction of complexity in several dimensions: a) insti- tutional, b) legal, c) economic, d) behavioral, and e) cognitive. A Washington Post reporter, John Pomfret (1994) captured the phenomenon of hysteresis very succinctly, cEverybody knew how to go from a free economy to a communist one, but nobody knew how to go back. d Pomfret 9s critical variable is knowl- edge and it will also be the focal variable in this pa- per. The reduction in institutional complexity is easily observed when the newly established economy elimi- nates institutions such as financial intermediation, advertising, industrial organizations and relations, le- gal and other services associated with a market econ- omy, and reduces the number of enterprises in all in- dustries (rationalization).
This process of ... more. less.
insti- tutional reduction is accompanied by the creation of some institutions, but they do not match in com- plexity the old ones. For instance, the creation of a Central Planning Board and state monopolies are simple processes of concentration and centralization of old institutions. Besides, the disregard for money and profits brings about a general neglect of account- ing and financial management systems in virtually all enterprises, deepening the process of institutional simplification at that level.<br><br> The simplification of the legal system starts with the elimination or significant constraining of property rights, the keystone of a market economy, followed by the elimination of all legal instruments related to contractual security, market regulations, etc. This process is accompanied by the obvious reduction and simplification in the institutions that correspond to the legal system, starting with legislative bodies, the judiciary, tribunals, the human resource endowment (judges, attorneys, etc.), the accumulated practice, li- braries and archives, etc. Even though there are new additions to the legal system, they are focused in the reduction of the degrees of freedom of the individu- als to conduct all sorts of businesses and activities ap- propriate to a civil society.<br><br> This characteristic involve a process that is predominantly of simplification be- cause it reduces the range of choice of the society at large and, therefore, the implications of having more choices. As institutional and legal constraints increase and be- come more binding, economic choices are reduced for all economic agents, consumers, workers, entre- preneurs, investors, savers, etc. This process takes place directly and indirectly.<br><br> Direct effects are repre- sented by those created by the new legal and institu- tional constraints. Examples of direct effects could be the impossibility of buying equitable instruments, selling real estate, or getting a loan in a bank. Indirect effects are those that appear as secondary, usually un- Cuba in Transition · ASCE 1995 466 expected consequences of the implementation of the new constraints.<br><br> Among the most common are the reduction in the availability of consumer and pro- ducers goods due to decreases in production and dis- tribution efficiency and rationing. As individual choice is so severely constrained, indi- vidual behavior is equally constrained and a general loss of welfare can be expected at some point in the process. 1 Under these circumstances, how can a polit- ical system impose such radical changes without jeopardizing its tenure in power?<br><br> The answer lies on the application of sheer physical power (military, po- lice), social intimidation, and persuasion. The latter factor, persuasion, is a combination of educational strategies designed and applied for many audiences, at all levels of the society and covering virtually any topic, from economic to political, religious to philo- sophical, and scientific to artistic. Any person vaguely familiar with a CPE under a Marxist regime knows how many resources are dedicated to this effort, and how critically important this activity is considered by the authorities.<br><br> Why then has a similar effort not been made to pre- pare the ground for the establishment of market economies in the former members of the Soviet em- pire? It can be argued that this type of effort is neces- sary because it takes a great deal of deception (along with total control of all forms of communication) to impose a society whose ideological foundations would not stand freedom of expression, and this is true. But is also necessary to recognize that, after years of Marxist indoctrination, there is a great deal of prejudices in these societies, and they must be ad- dressed in very specific terms.<br><br> Such prejudices work against the installation of market economies and rep- resent one of the sources of ammunition for those 1. This is a highly controversial statement but we can assume that at least a large segment of the population will experience s uch a loss. who oppose the advent of a market economy and a free society.<br><br> Economists, unfortunately, have not paid too much attention to the needs for economic education in these contexts for two main reasons. First, the lack of glamour or drama in economic education. Many of the economists involved in transition economics seemed fascinated by the apparent opportunities to be influential in economies in transition as soon as the Soviet block began to unravel and there were ini- tial movements towards liberalization.<br><br> Second, the lack of understanding of how these societies were or- ganized, from their institutional setup to the exist- ence of mentalities and attitudes 4after decades of indoctrination and lack of freedom of expression 4 generally incompatible with market economies and an ample spectrum of individual freedoms. Few know that in Marxist dominated societies the mere study of western economics is not allowed and to pursue it may bring severe punishment to those who dare break the rules, and many underestimate the ex- tent of the damage done by the government control of all forms of communication and information. 2 There seem to be the pervasive notion among many economists that individuals will automatic and in- stantly adapt to a new set of prices and macroeco- nomic conditions, regardless what they know, their values, etc.<br><br> This paper is based on the assumption that, although economic behavior can be significantly influenced by all sorts of typically neoclassical variables, the cogni- tive endowment and values of individuals, and their nature and distribution in a society do play an im- portant role in the workings of the society and its ca- pabilities to evolve. This paper is an attempt to cata- log what the author believes are some of the most critical issues in economic education in a previously 2. A dramatic example of the ensuing isolation is provided by Reid (1994, p.<br><br> A26) reporting on an interview with North Korean o f- ficial Kim Dal Hyun, a nephew of Kim Il Sung trained in economics. Until then he had believed that Kim Il Sung defeated Japan i n World War II and liberated Korea from Japanese rule. After been asked about the role played by the U.S.<br><br> in defeating Japan, Kim Dal Hyun replied cThis is the first time anyone ever suggested to me that America helped defeat Japan in World War II. History show s that it was Kim Il Sung who defeated the Japanese. d Economic Education for a Market Economy: The Cuban Case 467 Marxist-dominated environment. The paper draws significantly on the author 9s years of experience in Cuba, as a student of Marxist economics, as an offi- cial in the Central Planning Board, and, later, as a professor of planning in American University and an international economic advisor in Washington, D.C.<br><br> The paper has three sections. The first section is a he catalog of issues per se with individual discussions of the nature of each topic and how to address it in an education program for a market economy. The sec- ond section provides the elements of an educational program including a view of the audiences that must be identified and targeted for in any education pro- gram of this sort.<br><br> Finally, the third section presents concluding remarks. A CATALOG OF ISSUES The issues discussed below and the corresponding prejudices or misconceptions generally have a Marx- ist origin. Nevertheless, this is not always the case.<br><br> Some economic misconceptions prevalent in Marxist societies are actually originated by governments or are more modern than Marx. In the Cuban case, the most important one is perhaps concerning imperial- ism and its role in determining the relative backward- ness of less developed countries (LDCs), especially the U.S. imperialism.<br><br> This will be discussed further below. Surplus Value and Profit In Marx 9s system, value is only generated by the worker through the application of clabor-power. 3 Surplus value is what remains of the total value gen- erated by the work force after paying for the corre- sponding wages and other inputs excluding the use of capital.<br><br> Marx then illegitimates the payment to the factor capital (profit) by stating that capitalists mo- nopolize the access to the means of production ac- cording to a legal system based on private property. In this logic, it follows that surplus value is tanta- mount to stealing from the workers. Though Marx 9s logic was not understood by most of the people living in former or current socialist coun- tries, it still serves to feed those in charge of ideologi- 3.<br><br> See Heilbroner (1991, p. 158) for a simplified, but effective treatment of these concepts. cal and political propaganda.<br><br> They appeal to the in- tuition of their audiences to expose the illegitimacy of profits as a result of the exploitation of man by man. In socialist planning, on the other hand, the concept of profit was never taken into consideration for a number of reasons. First, the Stalinist central- ization of enterprises, combined with price controls and rationing, made profits virtually obsolete.<br><br> There was not even a substitute term. Enterprises could al- ways spend more than what they registered as in- come. It is important to keep in mind that in this system the enterprises have very little influence, if any, on prices, levels of employment or investment; they are essentially limited to implementing quanti- tative production targets.<br><br> In other words, even when there is space for a concept of profit in a socialist economy, profits have not been important and the general public is not used to associating profits with efficiency. The lack of importance of profits is reflected in many ways. In Cuba, for instance, accounting schools at all levels ceased to exist towards the end of the nineteen sixties.<br><br> One prevalent notion in government circles was that accounting was not important since the country was already marching towards communism where money is not necessary! Yet lack of or poor ac- counting is not only a problem in CPEs, it is also a major obstacle in the privatization process necessary to establish a market economy. This is illustrated by Pomfret (1994, pp.<br><br> A1 and A13) when reporting on a joint venture between General Motors and the Pol- ish carmaker FSO: cSocialist accounting didn 9t factor in profits, and it didn 9t care about losses. A culture flourished, the old saw goes, in which the state pre- tended to pay the workers and the workers pretended to work. d In order to reestablish the legitimacy of profits is nec- essary to work on two fronts simultaneously. Firstly, educating the public to erase the notion that access to the means of production is a monopoly of ccapital- ists. d This includes demonstrating the importance of small enterprises in most modern economies, and Cuba in Transition · ASCE 1995 468 why market efficiency and financial intermediation are essential to widen the access of the general public to ownership of capital.<br><br> The second front should be the public enterprises themselves before they can be privatized. It is necessary to quickly reestablish ac- counting systems and publicize the financial state- ments of these enterprises as a means to educate the workers and the general public. As relative prices and other distortions come to an end, losses will be fre- quent and discussions about their causes and how to transform them into profits could be used as impor- tant educational material at many levels.<br><br> Private Versus Public Property Private property of the means of production is con- sidered immoral by many members of Marxist societ- ies. Private property is also perceived as predatory by large segments of the population, a perception that owners of capital refuse to accept as fact. These no- tions are consistent with the early Marxist concept of monopoly of access to the means of production.<br><br> The feeble defense of private property against massive ex- propriations by the Cuban government in the early sixties lend support to this notion, as well as the lack of sufficient popular support to return expropriated holdings to their former owners in Nicaragua after the Chamorro government took over. It is also important to realize that certain social-dem- ocratic trends in Cuban circles, inside and outside the country, show their lack of confidence in private property of capital by their continuous advocacy to the future development of a mixed economy. The most vociferous defenders of the full restoration of private property rights, however, have been those who suffer expropriations in the early sixties.<br><br> Never- theless, they have based their arguments on notions of fairness instead of on notions of economic expedi- ency. Neglecting to accept the possibility that the res- toration of private property rights in a post-Castro Cuba may depend on the will of the millions of con- stituents living currently in Cuba, acting in a demo- cratic context, previous holders of properties in Cuba may be unwillingly contributing to the permanent loss of their holdings for not recognizing the ideolog- ical or educational complexities around this subject. Yet property rights may be fully reestablished in Cuba before recognizing all of the existent claims.<br><br> Regardless of the damage that this course of action can be expected to inflict upon the Cuban economy, there are additional reasons to educate the Cuban population at large about the legitimacy and the eco- nomic advantages of universal property rights. Even if a transition government decides to recognize previ- ous claims on capital ownership and return the corre- sponding properties to their former owners, there is an unknown volume of state property that was never private, but a result of the government 9s investment plans since the early sixties. These properties can eas- ily fall into the hands of their administrators as a re- sult of the combined effect of (a) the workers lack of understanding of their potential role as future own- ers, and (b) a lack of a well-designed and implement- ed privatization program, as is taking place in many ex-socialist economies.<br><br> Pomfret (1994, p. A13) re- ports that, ca recent study by researchers at the University of Warsaw found that at least six out of 10 managers of medium-sized to big businesses were former Commu- nists. Hungary 9s privatization program effectively al- lowed many former Communist plant managers to buy up the firms.<br><br> In the Czech Republic, two waves of a voucher privatization program will theoretically place 80 per cent of the economy in private hands by early next year. But beneath the surface, the old Com- munist bosses remain: the privatization has yet to be accompanied by changes within most companies. d The point here is not the former political affiliations of the new owners, but the ironic lack of equity of a privatization process that may exclude most of the non-militant population simply because the current bosses are better positioned to become the new capi- talists and the lack of preparedness of the majority of the working population. This result may cast serious doubts on the legitimacy of property rights for a long time, and is not a desirable outcome of an effort to establish a market economy.<br><br> To avoid this a major public education campaign should be implemented to raise the public understanding of these issues in behalf of their own private interests. It would be a gross mistake to assume that such an education is not necessary since the public is intelligent and would be Economic Education for a Market Economy: The Cuban Case 469 able to determine where their interests lies in all con- ditions. This is true in the long run, but in the short run, those with more knowledge of these issues and more access to the relevant sources of information are better prepared to take advantage of the confusion of the transition 4especially if it is not well planed and executed.<br><br> Trade According to Marx, surplus value is only produced by work-power when applied in the sphere of materi- al production. Commercial activity is a net consumer of surplus value, the argument follows, therefore it does not generate wealth. Such is the conceptual ra- tionale for the virtual marginalization of trade activi- ties in CPEs.<br><br> Trade is seen as an activity that could be automatically performed as a necessary conse- quence of the socialist division of labor, but without deserving the level of attention that it enjoys in mar- ket economies. These concepts are additionally reinforced by the Marxist labor-theory of value, the concomitant rejec- tion of any csubjective theory of value, d and the ex- trapolation of both concepts to a CPE. 4 In other words, in a cperfect d economy, prices are determined by the amount of csocially necessary labor, d a notion founded on the philosophy of dialectic materialism that leaves no room for supply and demand, consum- er preferences, or any csubjective d factor.<br><br> Under these tenets, the freedom that is involved in trading is illegitimated, disregarding the need for the massive exchanges of information that take place in a market economy between producers and final buyers, in- cluding the essential intermediation of traders at dif- ferent levels, covering all the spectrum from whole- sale to retail commerce. All this results in the marginal position of the commercial sector in CPEs, expressed not only in terms of a reduced number of establishments, but also in their chronic lack of sup- 4. We must remember that Marx wrote almost nothing on the economic theory of socialism.<br><br> plies and inventories, and their generally drab ap- pearance. The prejudices against commercial activity are rein- forced in non-socialist economies, when there are in- termediation and transportation monopolies, which traditionally affect agricultural products. Pre-Castro Cuba seemed to have been full of these cases, which notoriously included among many others the alleged monopoly of pineapple wholesale trade held by Beni- to Remedios, a Senator of the Republic, and controls of stands in the cMercados Libres d or Free Markets.<br><br> Latin American countries are also full of similar ex- amples. Cargo transportation monopolies in Panama are legendary, while this and other countries still suf- fer from serious restrictions to free trade by the pow- er of government-granted monopolies and protection privileges. Such restrictions are rooted in the mercan- tilist tradition of the rent-seeking Spanish colonial system and contribute to a culture that accepts gov- ernment centralization and intervention as part of the natural economic order.<br><br> An education campaign to overcome these concepts can be easily designed on the abundant empirical evi- dence about the benefits of trade. This campaign, however, may be less necessary today in Cuba as even the limited and timid liberalization of cmercados agropecuarios d or agricultural markets and small family-operated restaurants ( cpaladares d) are showing a significant impact on the population 9s level of con- sumption. 5 MONEY, SAVINGS, INVESTMENT AND INTEREST RATES The rate of interest is the price of an inter-temporal transaction between economic agents.<br><br> As property becomes public in a CPE the state becomes the only economic agent, financial intermediation virtually disappears. All savings 4with minor exemptions for consumer purposes 4and all investment is done by 5. With the disappearance of the Soviet subsidies, the Cuban government was forced to do its own structural adjustment program, more reluctantly so as it did not count with the anesthetics that could have been provided by the International Monetary Fund a nd the World Bank.<br><br> The work of a post-Castro transition government will be undoubtedly easier if Castro finishes fundamental macroeco- nomic adjustments before departing. Cuba in Transition · ASCE 1995 470 the government. Individual time preferences lack a vehicle of expression, which is logical in a society that does not believe in csubjective theories of value. d In a CPE, while the government seems to adopt a growth-maximizing behavior within a budget con- straint dedicated to internal and international securi- ty, investment expenditure tend to be maximized too, the level of aggregate consumption receiving a residual treatment.<br><br> Investment projects are chosen by haphazard methods, as profits cannot be taken into consideration, in most cases. The Cuban case is somewhat different, since economic considerations seem to be less relatively important that political ones. The Cuban government, at least until the de- mise of the Soviet block, seemed to have followed what can be characterized as a policy of maximizing its influence in external affairs.<br><br> In both cases, howev- er, decisions concerning investments were never made taking risk, profits, or the population 9s time preferences into account. It is not possible to predict what the consequences of this lack of exposure to fundamental economic deci- sions have on the population. Many people may have grown used to not taking chances and live under the protective umbrella of the state paternalism.<br><br> This type of attitude is frequently reported among the cit- izens of former socialist states, especially those that have voted the old Communist rulers back into pow- er, with the exception of the Czech Republic. Public education to address these issues should be well coordinated with the issues raised previously about privatization. The topics covered in this sec- tion, however, are more abstract in nature than those relative to property rights and ownership, and they will require a different approach.<br><br> Rationing and Price Flexibility Rationing was instituted in Cuba in March 1962 and it is still officially alive though apparently non opera- tional. Nevertheless, an entire generation has been educated under the notion that a group of bureau- crats can arbitrarily decide not only about the prices of consumer goods, but also their availability, if at all, to the Cuban population. The most dramatic exam- ple of the consequences of this regime is the severe deterioration of all buildings in Cuba, after more than three decades that the Cuban government de- nied the access to basic means of maintenance to the regular consumer.<br><br> The need to liberalize prices in order to restore equi- librium to supply and demand relations is indispens- able to recover the Cuban economy and to install a market system. This however must be explained to the population to avoid the uncertainties that Russia suffered in this regard during the winter of 1992. Even though the current liberalization of some mar- kets in Cuba may help in this direction, the popula- tion needs to understand why prices may remain flexible and change with external and internal eco- nomic conditions.<br><br> Part of the state paternalism in Cuba is reflected in the expectation by a significant segment of the public that the state should always protect the common citizen from the vagaries of the economy. Public enterprises, on the other hand, never had to worry about adapting their production decisions to varying prices. In fact, these enterprises have devel- oped as institutional puppets of the Central Planning Agencies that work under the assumption that they know everything.<br><br> Therefore, re-educating the general public about the advantages of price flexibility and free supply and de- mand also requires some attention to functioning under these radically different conditions. This may sound very obvious and even naive to those lucky ones that have only lived in a free market environ- ment, but it represent a revolutionary change for those that were born in a CPE. Competition and Planning A closely related topic is that of the advantages of a competitive economy versus central planning.<br><br> In the Marxist world, market economics is equivalent to chaos, where the free enterprise system impedes the improvement of the standard of living of the com- mon citizen because there is not a crational allocation of resources d. The fallacy is based on the notion that the state can always look for the public good much better than a system based on private property and economic freedom. Economic Education for a Market Economy: The Cuban Case 471 Marx 9s obsession with his theorem about the falling rates of profit under capitalism, blocked him from understanding the importance of a legal system working in a democratic society.<br><br> But whatever his reasons, many still believe that competition is detri- mental to the general economic welfare since there is a great deal of redundancy among enterprises and re- sources, plus the fact that competition is inherently destructive. Planning, the argument follows, is neces- sary to reduce the chaos introduced by competition and only the state can be in charge of such a task. The evidence about which system is more efficient is overwhelming but there is always the need to support the evidence over more theoretical foundations.<br><br> The education campaign, for the audiences that can han- dle abstract discussions of the topic, must be focused on the fact that redundancy in itself is a desirable outcome of competition. On the one hand, it avoids monopoly and all its undesirable consequences, on the other, it provides more stability of supplies be- cause if a supplier fails to deliver there are other sources to rely on. Competition also encourages the constant improvement of the quality of the tradition- al products and the development of new ones.<br><br> But competition, to be beneficial, must exist in an envi- ronment of freedom of enterprise and consumer sov- ereignty. Labor Productivity and Employment Security One of the thorniest issues in the transition towards a market economy is how to provide job security. Many socialist workers will definitely miss their job security in a market economy, though they never knew how much it cost in terms of economic stagna- tion and chronic poverty.<br><br> Nevertheless, in the Cuban case, where the collapse of the economy demonstrat- ed that job security can be an illusion even in a CPE, the educational effort required in this front may be minimal after all the adjustments that are currently taking place in the country. In any case, a public education program should em- phasize: The dependence of the standard of living on the level of real salaries; the latter as a function of productivity; and the need to protect the levels of productivity by letting enterprises reduce employ- ment when economic conditions 4or specific behav- iors by some workers 4demand such an action. International Trade and Exploitation Cubans are aware of their economic dependence from the world economy, possibly today more than ever.<br><br> The government, however, in its failure to man- age the economy and its enterprises efficiently, blames the world economy for the poverty of the country through what they call cunequal terms of trade. d This condition, they say, is the main instru- ment of exploitation of the country by foreign pow- ers. These notions should be quickly dispelled by show- ing how intelligent economic policies can be highly beneficial to small countries. The examples of Hol- land, Switzerland, Denmark, Chile, and the Asian success stories must be widely disseminated in Cuba to foster the development of a market economy and contribute to its success through an export-oriented culture.<br><br> THE ELEMENTS OF AN EDUCATION STRATEGY 6 A public education program in support of the transi- tion to a market economy should distinguish among different audiences since their requirements and ca- pabilities vary widely. The main audiences should be the following: 1. The general public 2.<br><br> The opinion makers 3. Government officials 4. University professors and students of economics, business, law, and related disciplines 5.<br><br> Legislators 6. Workers and administrators in selected enter- prises 6. Although this section is written with the Cuban case in mind, the similarities with what other countries require may overwhe lm the differences.<br><br> Cuba in Transition · ASCE 1995 472 7. Union leaders 8. Primary, secondary and other non-university teachers 9.<br><br> Primary, secondary, and other non-university students This campaign should be designed and administered by personnel that can project the effort as a serious one and not as an exercise in propaganda. The pub- lic 9s minor suspicion of propaganda will inflict irrep- arable damage to the credibility of the effort and turn it wasteful at best. The program execution should not be overseen on a day-to-day basis by any political ap- pointee of the government in charge.<br><br> The design of the program must avoid addressing specific conflicts that may arise during its implementation in other sectors of the economy, even though it has to be pre- pared to approach highly controversial issues in a sobber and intelligent manner. The most important audience is the general public and it should receive top priority in this program. This campaign should be implemented over a long period of time, with a variety of activities to be per- formed through the communication media of the country, including radio, television, and newspapers.<br><br> The detailed formats will not be discussed here but should include ample public participation in radio and television round tables, talk shows, and inter- views with experts that can answer telephone calls. These programs should also publicize other educa- tion activities of a more specific or specialized nature, and the availability of reading material that could be made available as part of the education program. An indispensable complement to the program ad- dressing the general public is the education of opin- ion makers and journalists of all persuasions.<br><br> This part of the effort requires that some of the individuals in charge of the education campaign be given signifi- cant access to the media, not only as guests but also as hosts, producers, and directors of the programs to be delivered to the public. Government officials , new and old, including those in top positions, should participate in regular and in- tensive seminars and workshops about relevant as- pects of a market economy. This part of the educa- tion program should have a general component and a specific component according to the sector in each case.<br><br> For instance, the material to be offered to the judiciary will differ in many aspects to the material to be offered to the officials working in economic insti- tutions that survive the initial restructuring of the state bureaucracy. It would be advisable to produce some material for readings. With time this will be- come indispensable as the needs for the transition process are better defined and understood.<br><br> University professors and students of various disci- plines follow in importance in the education pro- gram. This audience, however, plays a critical role in the short and long run. For the short run, seminars and workshops should be established to deal with the initial issues of the transition to a market economy, But they are also the professors and the future profes- sionals that will be in charge of studying and operat- ing a market economy, therefore a long-run program to change study programs and curricula should be put in place simultaneously, as well as the availability of the corresponding books and journals.<br><br> A transition to a market economy requires the partic- ipation of legislators in order to enact the laws 4and finally the constitutional framework 4needed in a market economy. The complexity of the task in their hands is impossible to exaggerate and they should work with the maximum understanding possible if a market economy will ever work in Cuba. They will be easy victims of old preconceptions and the politi- cal demagoguery that may inflict serious harm to the effort to build new economic and legal systems.<br><br> Leg- islators should be subjected to intensive seminars and workshops focusing on the effects of legislative initia- tives on the economic affairs of the nation. All enterprises must change their management style and culture to operate in the much more sophisticat- ed environment of a market economy. Workers and managers of these enterprises, even long before any possibility of privatization appears, must participate in education campaigns that would also have a gener- al economic component and a specific one dealing with general business administration practices inher- ent to a market economy.<br><br> It is critical to address is- Economic Education for a Market Economy: The Cuban Case 473 sues like the following: a) the importance of profits and its relation to worker productivity, salaries, and the economy; b) the need for a management system capable to respond effectively to macroeconomic and market conditions; c) the need for management flexi- bility and factor mobility to achieve efficiency; and d) the relationships among labor productivity, sala- ries, and standard of living and how the economic prosperity of a nation depends on the efficiency of its enterprises and not on labor security. Union leaders would be included in a program simi- lar to the one just described, but perhaps with some adaptations to their roles and institutions. It is im- portant to take into account that one of their main concerns is employment security on the one hand, and on the other that they have been subjected to a traditional paternalistic role by the state and by a so- cial-democratic influence that advocates for a cmixed d economy and heavy state intervention.<br><br> Per- haps this is the time to look for a more modern con- cept of trade unionism in which more attention is given to improve the training of the worker and his adaptability to a continuously changing economy. Teachers and students other than university 9s should be included in the educational program on a long-run perspective. This will have to be done, how- ever, during the early stages of the transition to a market economy, since socialist dogma of the current curricula must be replaced by more liberal subject matter as soon as possible.<br><br> This will be the ideal mo- ment to introduce economic education as part of the regular offerings of the schools system at all levels. Other audiences which remain and must be incorpo- rated to the program include security forces, police, the military, and the judiciary. They require special treatment because their deep exposure to indoctrina- tion from the past and their need to integrate them- selves into the new economic system.<br><br> Another im- portant sector of the population to be specifically addressed with tailor-made programs is the agricul- tural worker and the small farmer. Their integration to a market economy is essential, but their accessibil- ity is difficult for educational purposes; radio may have to be the main vehicle for this group. CONCLUSIONS Few countries have undertaken economic education as a major endeavor in support of their economic sys- tems.<br><br> The United States and the United Kingdom have been the leaders in this field, though other countries have made significant efforts. In the U.S. the existence of the National Council on Economic Education covers several decades and their audiences range from young students to college professors of economics.<br><br> The Council is today increasingly active in some ex-Soviet republics, a welcome development suggesting that some have discovered the importance of economic education in the establishment of mar- ket economies. Yet more efforts are necessary to facil- itate this process and avoid losing the ground gained for economic and political freedoms since 1989. Do- nor agencies and international financial institutions should become more sensitive to this need and dedi- cate resources to this type of effort.<br><br> Decades of in- doctrination were necessary to install the systems that are already disappearing, but they have left a legacy that must be eliminated more quickly than what can be achieved by a policy of benign neglect. As a mar- ket economy is much more complex than a CPE, it require knowledge and understanding of its partici- pants and main beneficiaries. Raising the level of economic understanding of the general public will contribute to reducing the uncer- tainties of the transition to market economies in all the countries involved.<br><br> It will also help to adjust ex- pectations to the immediate realities of each of the countries, especially in Cuba where accumulated needs for over more than three decades is leaving a legacy of an impatient population. Cuba in Transition · ASCE 1995 474 REFERENCES Heilbroner, Robert L., The Worldly Philosophers , Sixth Edition. New York: Simon and Schuster, Inc., 1992.<br><br> Pomfret, John, cThe Big Leap into Capitalism, d The Washington Post (October 25, 1994). Reid, T.R., The Washington Post (October 22, 1994). <br><br>