Planet Money - Dark times for Cuba’s economic experiment

Episode Date: April 2, 2026

Live event info and tickets here. For more than 60 years, Cuba has survived on two seemingly contradictory economic strategies: leaning on friendly communist and socialist countries, and flirting with capitalism. And right now it seems the US is making both strategies impossible.Since January, the U.S. has been preventing almost all oil from reaching the island. Doctors can’t get to the hospitals where they work, many buses aren’t running, trucks can’t deliver food and medicine where they’re needed. And there have been frequent blackouts. On more than one occasion over the last few weeks, the entire country has lacked power. It’s hard for people to even talk on the phone because they can’t always charge them or get cell service. So we asked them to send us voice notes describing this moment in Cuba’s history. We also wanted to know: How did Cuba get here? On today’s episode: a brief history of Cuba’s communist-capitalist experiment. Pre-order the Planet Money book and get a free gift. / Subscribe to Planet Money+Listen free: Apple Podcasts, Spotify, the NPR app or anywhere you get podcasts.Facebook / Instagram / TikTok / Our weekly Newsletter.This show was hosted by Erika Beras and Nick Fountain. It was produced by Luis Gallo. It was edited by Marianne McCune. It was fact-checked by Sierra Juarez and engineered by Robert Rodriguez. Alex Goldmark is Planet Money’s executive producer.  To manage podcast ad preferences, review the links below:See pcm.adswizz.com for information about our collection and use of personal data for sponsorship and to manage your podcast sponsorship preferences.NPR Privacy Policy

This is Planet Money from NPR. Cuba is in crisis. Since January, the U.S. has been preventing almost all oil from reaching the island. Doctors can't get to the hospitals where they work. Many buses aren't running. Trucks can't deliver food and medicine where they're needed. People's lives are in danger because there are frequent and long blackouts. In the last few weeks, on more than one occasion, the entire country has lacked power.

In one case, for more than a full day. We wanted to understand what it's like for people trying to make their way in Cuba right now, what it's like to try to work or to run a business. Because even though Cuba has a communist government, at times it's also had a pretty thriving private business sector. But recently, these blackouts have become so frequent that it's hard to even charge your phone. Cell service and internet are spotty. So I've been talking to people through voice notes. Like this farmer, Lady Casamito. Who says she can only use her phone for about two hours a day and never knows when.

She also told us right now she has no gas so she can't get to the other farmers she works with. A hotel manager named Mulfredo Medeiros-Carsia told me when the electricity's out, you have to keep the fridge closed. try not to open it. And then, when the electricity comes back on, you jump into action. And addelant to some of the house. A lot of people said that if the power comes on in the middle of the night, that's when they cook. That's when they work on their computers.

Use their phone. Like this guy who runs a bicycle business. Hello, Erica. My name is Jaseer Gonzalez-Cabrera. Yasser Gonzalez-Cabrera was up for sending more than just a few messages. So I said, okay, I'll record my questions. And you record your answers, and that's what we've been doing. In one of his earliest messages, he told me things have been bad in Cuba for a while.

But the recent oil embargo and the resulting blackouts, it's affecting every aspect of life. In some messages, his voice sounds normal. You can hear the birds. in the background. Sometimes he's walking down the street in his Savannah neighborhood, or he's in his kitchen cooking. Sometimes music is playing the background. But then sometimes

he records these voice notes, and it sounds like he's just sitting by himself in the dark. He tells me he worries about his parents, because the electricity situation for them is even worse. Because they both live in more rural areas, and the

government is prioritizing cities. For example, my mom, she just goes to bed at seven now. When the sun goes down. Yes, there is the bike guy in Cuba. And you'd think with so little electricity across the island, maybe bikes might actually be a good business at this moment in time. Except, to make any money, he needs tourists. Which Cuba used to have.

Because even though Cuba was once a 100% strict communist state-run economy, at one point, not that long ago, it had a small but vibrant private sector. At the height of Yasser's business, he was running bike tours for like 400 tourists a month. But last year, he only had about 25 customers total all year. And now with everything going on, it's even worse. He says he hasn't even had a paying customer this year. You can hear in his voice how hard things are. He said, not only is difficult to live so in Cuba. He told me I always used to see a lot of potential for my work in Cuba.

But now? No, no, I see a future. He doesn't see any future. Hello and welcome to Planet Money. I'm Erica Barris. And I'm Nick Fountain. The long and winding economic experiment, that is, Cuba, has an extremely uncertain future. Yasser's parents grew up in communist Cuba, where the state was in charge of everything. Then Yasser came of age in a much looser, some might even say capitalist-ish, Cuba, where he could start his own business.

And now, Yasser can't even plan for a phone call. much less run a business. Today on the show, how did Cuba get here? For more than 60 years, Cuba has survived on two seemingly contradictory economic strategies, leaning on its communist and socialist compatrizz and flirting with its frenemy, capitalism. And right now, it seems like the U.S. is making both strategies impossible. When I asked Yasser, how did all this happen? How did Cuba go from this mini boom to near failure?

Was it because of the U.S. oil embargo over the last few months? I'm guessing he listened, rubbed his temples and was like, where do I start? What's going to be intensification of what came to pass. In his message back, he told me, what's happened the last few months is an intensification of what's been happening for a long time. It's complicated, he said. So for help with my complicated questions, I also contacted an economist. So you are Cuban.

I am Cuban. Born and raised. But you're not in Cuba now. I'm not in Cuba. I left Cuba almost five years ago. This is Ricardo Torres. An economist who we can speak with on the phone right now because he does have regular internet and cell service.

He's in Washington, D.C. He works at American University. But before all that, Ricardo lived and studied economics in Cuba. So he was the perfect person to talk to us about Cuba's decades-long economic experiment, going between its communist compadres and its frenemy, capitalism, starting with the 1959 Revolution, which Ricardo learned about in elementary school, when his teachers would tell him the heroic story of the great revolution led by their beloved leader, Fidel Castro.

Before 1959, Cuba was run by a dictator, and American companies ran most of Cuba's sugarfields and refineries, railroads, hotels, casinos. Then Cuban rebels overthrew the government and made Cuba into a socialist communist country. Cuba is just 90 miles from the U.S., and this was the Cold War. These two countries became the opposite of Comparres. So the U.S. imposed what soon became the mother of all embargoes on Cuba. Nothing from the U.S. could be exported to Cuba. So at the outset, Cuba's economic strategy was lean on its communist friends.

At this point, Cuba was 100% fully communist. Everyone was employed by the government. The government appointed people to jobs. It set wages, and it owned and controlled everything. The government gave people little ration books, little paper books that told them how much of what kind of food, a person or a family could get in a given month at a given store. The Cuban government now owned the tobacco and sugar industry. And to get the other things it needed, especially. oil, it relied on its most powerful communist

compadre, the Soviet Union. The Soviets bought Cuban goods for more than they were worth and sold Cuba oil for less than it was worth. They also got access to an island 90 miles away from their mortal enemy, the United States. And for a few decades, yeah, it worked. Cuba was poor, but collaboration with the Soviets kept it going. Even the poor in Cuba, they had their basics covered. Like shelter. Yeah, like shelter, like through the rationing book, sufficient food.

And then you could always send your children to school and you were taking care of if you got ill because health care was accessible and free of charge. With help from the Soviets, Cuba developed a strong health care and education system. But in 1991, Cuba lost its key compadre. The Soviet Union broke up and stopped being communist. I mean, the Soviet Union disappeared when I was 10. Right. And those post-Soviet countries stopped paying top dollar for Cuban exports and sending Cuba cheap oil. And this was devastating for Cuba.

This period in the early 90s was called the special period, which makes it sound good special, but was actually terrible. There was less food. Cuba's GDP sank by 35%. People were suffering, fleeing, some people even making. rafts out of whatever they could find and trying to float to the U.S. Thorac Carter says many Cubans still believed in the revolutionary dream. They didn't have material reserves, but they did have faith, what he calls moral reserves. Moral reserves in a way that, okay, socialism does work. We just had now bad luck.

We were abandoned. We were left behind by these countries, traders, as they would put it in Cuba. but we'll figure it out and we'll go back to that period of well-being. By that time, Ricardo had gotten his hands on an old Soviet economics textbook that extolled the virtues of communist countries and highlighted the inequalities of capitalist ones. But young Ricardo was wondering, okay, well, why did the Soviet Union break up and ditch communism if it was so great? Well, perhaps reality is a little bit different from what I saw in the book.

And this was a moment where maybe Cuba had to reassess its strategy. Like, are we going to survive sticking only to this communist compadres crowd? So a few years after the Soviet Union broke up and Cuba no longer had its help, Cuba, for the first time in decades, begrudgingly tried basically hanging out with some capitalist frenemies. In 1993, Cuba started its first experiment in capitalism. since the revolution. I'm going to call it Caribbean communism, but with a teeny tiny capitalist exception.

Ricardo says this was supposed to be temporary. But it was a big deal. Yes. Before, everyone was employed by Cuba. But now, Cubans could be self-employed, have their own businesses. In the U.S., this made big news. This is Weekend Edition.

I'm Scott Simon. Fidel Castro changed his economic cabinet this week, promoted several ministers considered to be reformers. This has been interpreted as one more sign of Cuba's increasing turn to market-oriented reforms as it tries to cope. But there were a lot of restrictions on this new private sector, these new private businesses. Your employees had to be family members, and you could only have so many of them. The reality is that they had little freedom in making important decisions when it comes to production, prices, and all kinds of things that we would associate with free enterprise. Basically, anything meaningful to a business was not up to you.

It was up to the state. So this was a tiny first move. The number of people working in small businesses was really small. Less than 1%. They tried a few other things. Like a first small experiment in tourism, an experiment pegging a second currency to the dollar, but none of that was enough to pull Cuba out of its economic crisis.

So Cuba turned back to its old friend group, Went to its communist and socialist compadres for help. Cuba further developed its relationship with China. For example, they got a great deal from China on about a million bikes to deal with all those fuel shortages. But the biggest alliance that Cuba made during this time was with Venezuela, the land of oil. There's this famous speech where Hugo Chavez is in Havana, praising Fidel Castro, saying U. U.S. free trade ideals are basically a return to colonialism. And he talks about how Cuba is in the dreams of every Latin American revolutionary.

Ricardo says in the year 2000, Venezuela and Cuba agreed to their own sort of trade deal. Cuba started providing services to Venezuela. Teachers, doctors. also boxing and baseball coaches. Yeah, and then in exchange, Venezuela is basically sending oil. Uh-huh. Venezuela sent oil. She's the one thing that Venezuela had that Cuba needed.

That was the trade. When it came to oil, Venezuela took the role that the Soviets had played. And soon, Cuba's GDP was growing faster. Cuba was back from the brink. In the early 2000s, Ricardo got a job teaching economics in Havana. As an academic, he was able to visit Europe and the U.S. And he says he could have left Cuba. But he was like, why leave when I can study and maybe even influence this giant economic experiment?

I say, why not? I mean, this is a good place to be if you want to do something for your own country. The Cuban government has been infamously repressive of dissent. But Ricardo says as an economist, he was able to access and study data and hold public discussions about the Cuban economy. And that's what he was doing when Cuba started shaking up its friend group again,

because Fidel Castro, Cuba's original communist leader, got sick, and his brother Raul took over. He started talking about our economy is not in good shape, and we can trace some of the factors behind that

to our economic system, so we need to introduce some changes here. Stay calm. But get a little more capitalist. Open up some more. Crank up this capitalism thing. That kick this up a notch. Raul Castro said, let's expand our teeny tiny private sector.

At the time, Cuba's small businesses were basically tiny restaurants run out of people's homes or taxis or people renting rooms out of their houses. And Raul said, let's expand what's allowed. Let's let our small businesses hire outside of their families. And try to bring in more tourists. The government updated a list of jobs people were allowed to hold. Now they had almost 200 options, like a barber. Someone who dresses up in old Havana for a tourist is like a fortune teller or an old school dandy, specific musical acts for the now medium-sized and still growing tourism industry. This wasn't like capitalism unleashed, though.

Ricardo says the government was still wary of the free market taking over. We want a private sector as long as it is a complement to a state activity. But it cannot become more important than the state sector. Still, Raul is actually talking to the United States around this time. President Obama starts to loosen restrictions on trade and travel with Cuba. And Cuba's private sector grows even bigger. It was around this time that Yasser, the Guy Navanna, who's been answering our questions via voice notes.

really got into bikes. He was in his 20s, he was working as a software engineer, and he had heard about all this bike stuff that was happening in the U.S. and other places, things like dedicated bike lanes, city-run short-term bike rentals. And he was like, we need to have that too. So?

He started a company called Citigleta, hosting bike tours in the capital. Stop, right, free there, 19th Uttura, we have a event super-calient. Big group, riding their bikes through the streets of Havana with him. I've seen all these videos of him leading tourists on bikes. Everyone seems happy, Cuba looks beautiful,

there's just, you know, general good vibes. And in 2016, President Obama visits Cuba, the first president since the communist revolution to visit the island. It's a historic opportunity to engage directly with the Cuban people and to forge new agreements and commercial deals to build new ties between. between our two peoples. For enemies.

For Yasser's bike business, this was awesome. He was giving bike tours to people from everywhere. Germany, Holland, Germany, Holland. His customers were Mexicans and Colombians and tourists. And tourists from the United States. Cuba was open for business. Luxury fashion house Chanel just staged its very first show in the Cuban capital. Fast and the Furious film there.

The Rolling Stones held a monster concert in this country where rock and roll had once been restricted. That boom, you know, lots of people wanting to visit Cuba in part was driven by this romantic idea. Well, you know, Cuba is changing so fast. It's no longer going to be a communist country or a socialist country in a few years. So we want to. We want to go there and see it before it changes completely. And we have McDonald's in every corner of Cuba, like everywhere else. So we want to see it before it ends. Many hundreds of thousands of Americans, and their dollars, went to Cuba around that time, including me.

I was there, too. And so was our producer on the show, Luis Gairo. Up until this point, Cuba had oil from Venezuela and tourists from the U.S. and elsewhere. It was boomtastic. Oil from its friends. tourists from its frenemy. But of course, that all came to an end. That's after the break.

So in the heyday of Cuba's flirtation with its frenemy, capitalism, the country leaned all the way into tourism. In the 20 teens, tourism was supposed to be the people's capitalist growth engine. Cuba still had state-owned industries. It was still exporting sugar and cigars to fund its government. And it was still getting help from its allies, cheap oil from Venezuela, cheap solar panels from China. Cubans could also buy sneakers or dishwashers or cosmetics or bug spray from the U.S.

But to make money, more and more Cubans were going into tourism. People were converting homes into hotels, opening restaurants. Yasser was leading his bike tours. Cuba's economy was growing in large part because of one industry, tourism. Small economies, they tend to be more specialized. than big economies. And then if your main industry is effective for one reason or the other, then you add in troubles. And trouble did come for tourism in Cuba.

Three big shocks to the industry. The first big shock was sort of a slow-moving one. Venezuela's economy started to fall apart. So starting in 2016, the country sent less and less oil to Cuba. The second big shock came when President Trump took office for the first time, in 2017. Trump was not on board with the warming relations between the U.S. and Cuba. He cited the country's human rights violations and accused it of spreading violence and instability, accused Obama of propping up a repressive regime. So Trump brought back many of the economic sanctions

Obama had relaxed and heavily restricted travel again. Third shock to this new tourism-based growth engine? The pandemic. Travel just stopped. From boom to bust, but like without preparation or anticipation of any kind, like in a few months, all gone, almost all gone. Both frenemies and compadres were giving Cuba the cold shoulder. Cuba had a new president by then, and he tried to fix the country's ailing economy. He said those small businesses we've allowed, now those can get even bigger. Companies can hire more employees, up to 100. According to government necessities, there were almost 10.

thousand of those operating in Cuba. Ricardo said some Cubans made big money, but he says even before this latest venture into capitalism, the loosening of government controls had given rise to a culture of have and have-nots. There'd be a blackout across

much of the country, but in some richer neighborhoods in Havana, people would still be partying. They'd have lights on, eating lobsters, and Cubans did not accept it. There were protests. People said the government wasn't taking care of their needs. Ricardo says that people were running out of that thing he called moral reserves,

their faith that the Cuban experiment could ever work. Ricardo, too, was frustrated. In 2021, he was preparing to go to the U.S. for a fellowship. And looking around, he decided that this time, when he left, he wasn't coming back. I think I've contributed more than enough. And I've sacrificed many things as well. So I said, okay, well, it's time for a new beginning. elsewhere. And, well, the U.S. was that place.

He was part of the biggest wave of migration out of Cuba yet. According to one estimate, nearly three million people have left since 2020. A quarter of the population. And now when Ricardo goes back to visit, he says it seems Cuba's rich are getting richer. You see Tesla's and escalades on the streets. But he says Cuba's poor are also getting poorer. Things that were unthinkable in Cuba before, and I say with sorrow, I'm not proud about those.

You know, beggars, people looking for food in trash cans. That's become very common. Trash was piling up. Ricardo says that's the Cuba he saw the last time he was there in 2025. And then at the start of this year, the U.S. captured the president of Venezuela and essentially took over its oil industry. So that lifeline Cuba was getting from its best composite. Andre was yanked away.

The Trump administration told Venezuela no more oil for Cuba. And they told other countries that would have sold oil to Cuba, like Mexico, that if they do, they will get tariffed. Then this week, after several months preventing any oil tanker from reaching Cuba, President Trump changed his mind. Decided, yes, he would let a tanker from Russia land on Cuba's shores. Ricardo says it seems Cuba is at the mercy of the U.S. The oil embargo has exposed all the vulnerabilities of Cuba at once. U.S. foreign policy is choking off much of the help the Cuban government gets from its allies. And Cuba's big industry, tourism, requires tourists who either can't or won't visit a country whose antiquated Soviet electrical system definitely cannot survive a U.S. oil embargo.

So now you are confronting your two real jobs. challenges. One is a dysfunctional economy at home and then the U.S. government 90 miles away. The only way out for Cuba is through a negotiation with the United States. And the U.S. is turning out to be a very ferocious frenemy. The voice notes Yasser keeps sending me are sounding pretty hopeless. No one is paying for bike tours. But at the same time, he says, He feels a responsibility to keep holding these biking events,

just free ones, teaching Cubans to bike. Like, even with the blackouts, he recently held a big bike gathering in a park. He and others grilled food, they had music. And he says people were grateful to have something during these days where they have nothing. Yasser says a lot of people around him have this notion that bikes are a tool

of necessity. These things that were shipped over from China during Cuba's first oil shortage back in the 90s. He doesn't want people to think of bikes as just how you get around when there's no gas. He wants people to think of them as a way to engage and interact with the world, a way to be together, something that can bring

joy, even during this very difficult time. I am so excited that we are going to see you in person on our book tour. I am going to be on stage in Pittsburgh on Wednesday, April 22nd. And I'm going to be in Los Angeles on April 16th. The book is called Planet Money, a guide to the economic forces that shape your life. And we're coming to a dozen cities. Each stop will be unique with different hosts and guests.

And if you get a ticket, you can also get a tour exclusive tote bag with your purchase, while supplies last. Find the show nearest to you at the link in the show notes or go to planetmoneybook.com and thank you. Today's episode was produced by the great, great Luis Gaiio. He's headed off to greener pastures. And we're going to miss you, bud. You were so good. So good. You were so good at this job.

Thank you so much. The show was also edited by Marian McCune. It was fact-checked by Sierra Juarez and engineered by Robert Rodriguez. Alex Goldmark is our executive producer. Thank you to Ader Peralta, Sarah Doty, Margarita Fernandez, Jasper Goldman, and Michael Bustamante. I'm Erica Barris. And I'm Nick Fountain. This is NPR.

Thank you for listening.