Cuba Part 1

“NO Viet Cong ever called me nigger.”

Mohammed Ali’s controversial words succinctly expressed his conscientious objection to the Vietnam War. More importantly, though, his words underscored a critical point– the free-thinking individual does not necessarily share the same enemies as his government.

To this day, I cannot recall a single Cuban who has volleyed harsh word or deed against me… so despite the US government’s nonsensical, ongoing diplomatic war against its island neighbor, I decided to go see the country for myself to see how bad a centrally planned economy can be.

Yes, until His Eminence decides to lift the travel ban, going to Cuba is breaking the rules in most cases for American citizens… of course, so is riding a bicycle without a helmet and walking your dog on the beach.

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Getting there can be cumbersome. Some people fly to the Bahamas from the US, then pay cash for a puddle jumper to Havana on the Cuban airline. Given my impression of how poorly things are run on the island, however, the better option would be to take a Latin American carrier like Mexicana or Taca.

As I happened to already be in Panama for a business dinner on Friday night, I decided to hop a flight on Copa Airlines, which offers nonstop service from Panama City to Havana for about $250.

Even at the airport in Panama you get the impression that you’re doing something bad. The immigration officials at Panama’s Tocumen airport do not stamp your passport, essentially eliminating the official trail that you ever left the country.

The same is true upon arrival to Cuba. After a short 2-hour flight to the Jose Marti International Airport in Havana, I arrived to find professional, discreet, English speaking Cuban immigration officials who slid my unstamped passport across the desk as if we were both parties to a secret drug deal.

My curiosity grew.

The ride into town from the airport was surreal; the poverty level is so overwhelming, there are few cars on the road. Traffic is nonexistent. The handful of cars that still run are all owned by the government and at least 50 years old.

Billboards on the sides of the road still praise the virtues of the communist revolution, including “United, productive, and efficient,” and “We live in a free country…”

I wondered out loud… does anyone still believe this crap?

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I would find out over the course of my trip that the answer is resoundingly N-O.  But Cubans are too afraid of their government to do anything but tow the line in public.  Castro’s regime has effectively castrated Cubans’ ability to prosper; most Cubans get by on less than a dollar a day, and their interaction with foreigners is monitored and restricted.

For example, I was approached by an enterprising teenager on the street who wanted to introduce me to some women– this is quite common in Cuba.  Nearby police saw him talking to me and almost took him to jail until I intervened and explained that I was just asking for directions. My new friend told me later that the usual punishment is 30-days in jail… and Big Brother is always watching.

Most locals are so scared they would not even make eye contact with me. Those who had to interact with me—hotel workers, for example, were courteous but impersonal. It was only in very private settings that many of the locals I met were able to open up to me about their lives.

Despite their collective poverty, those who are lucky enough to have relatives in foreign countries receive regular remittances, or even gifts like apparel, DVD players, mobile phones, and satellite radio.  The youth, in particular, all seem to have designer jeans and access to the latest trends, even though many live in houses without electricity.

Most buildings in Cuba are run down, and they are all owned by the government, or at least in partnership with the government.  There are a few notable exceptions like the Hotel Nacional and the Hotel Saratoga, but by and large the government has figured out how to screw up what could have been one of the most architecturally beautiful cities in the world.

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Very little about Cuba is cheap… and what is inexpensive is still overpriced for the value. Most hotels and restaurants are of notoriously poor service and quality, even though I found myself spending as much as I would in Miami.

Part of the problem is the Cuban government’s tightly controlled monetary system; Cuba has two currencies, an internal currency for locals and an external currency for foreigners, known as the “Cuban Convertible Peso (CUC).”

Although the CUC is officially pegged 1:1 with the US dollar, dollar holders are charged a 20% surcharge when they change their money into CUC; thus, $100 only buys 80 CUC, which is enough for dinner and a few drinks… not exactly a screaming deal.

Moreover, US based credit cards are not accepted in Cuba. If you do not have an overseas bank account, you will have to deal exclusively in cash… and losing 20% off the top can certainly dig into the budget.

Mobile phones don’t work either– AT&T and Sprint obviously do not have roaming agreements with the Cuban government, and given the limited availability and functionality of internet on the island, it doesn’t take long to feel cut off from the outside world.

Despite the cost and inconveniences, Cuba is an absolutely rich and alluring place that I would highly recommend for a couple of days, though any trip there needs to be properly planned.  I have much more to say about Cuba– culture, investment insights, etc. and I will detail these in a future missive.

About the Author

Simon Black is an international investor, entrepreneur, and founder of Sovereign Man. His free daily e-letter Notes from the Field is about using the experiences from his life and travels to help you achieve more freedom, make more money, keep more of it, and protect it all from bankrupt governments.