Cuba Is Already Private. It Just Hasn't Admitted It Yet.

Díaz-Canel stood before Cuba’s National Assembly on Thursday and did something a real socialist wouldn’t have to do: he spent half his speech insisting the 176 economic reforms he was unveiling don’t mean what they plainly mean, while the other half blamed Washington for making him do it. The Cuban president approved a package that expands private business, encourages foreign investment, strengthens cooperative enterprises, increases exports, attracts foreign currency, and grants state enterprises and municipalities greater economic autonomy — and then, in the same address, told the country this was “not for more capitalism, but to defend and advance the construction of socialism.” I usually find this kind of assertion impressive for its commitment to a conclusion the evidence has already left behind. The sentence is an artifact for the museum. When you are expanding private ownership and market mechanisms to save your system, the system you are saving has already been replaced by the means you’re using to save it. A political movement can keep the brand — “Socialism or Death,” the closing slogan, is a branding exercise at this point — but the brand no longer describes the economic structure of daily life.

The reforms are real. The crisis behind them is real. The private sector now employs close to one in five Cuban workers — a number that was essentially zero fifteen years ago, before the government began quietly legitimizing self-employment. The cuentapropistas — self-employed workers, small-business owners, people operating in the gray space between state permission and economic survival — have been the island’s actual growth engine for years. The June reforms made that trajectory official. The July package extends it further. The regime is liberalizing the economy because it must, not because it chose to, and the speech’s function is to describe a thing while denying its name. The word “socialism” is doing the work here that “voluntary restructuring” does in a private-equity press release — making a necessary concession sound like a plan.

Díaz-Canel also blamed the U.S. embargo for the crisis — power outages, fuel shortages, a country running on roughly one tanker of fuel every seven months, 1,400 megawatts of distributed generation unavailable each day by his own admission — and he is partly right. The embargo is a real constraint, a six-decade-old policy that restricts Cuba’s access to financing, fuel, and the U.S. market next door, and pretending otherwise is dishonest. But the embargo is decades old. The reforms are new. Something prompted them, and it is not the discovery that the embargo exists.

Here is what he did not say out loud. The embargo constrains Cuba. The deeper constraint is the system’s architecture. A one-party state with no independent press, no independent unions, no independent courts, and no mechanism for citizens to replace failed leaders cannot correct its own mistakes. When the power grid collapsed — leaving 1,400 megawatts of distributed generation unavailable each day — no independent outlet was free to investigate why or to ask what was wasted in the years before the crisis hit. When the sugar harvest fails, no newspaper prints the number. When the economy stagnates for decades, no election offers the public a different direction. Díaz-Canel blamed Washington for the fuel shortage, and Washington’s restrictions are real — but he also presides over a system that spent decades making every major economic decision without feedback, accountability, or correction, and that is the kind of structural failure no embargo caused and no embargo can repair. The U.S. policy gives the regime a scapegoat. The regime’s architecture ensures it will always need one. The embargo is a wound. The architecture is a disease. Díaz-Canel knows which one he is treating.

Consider the comparison Cuba’s leadership never makes. Denmark taxes heavily, bargains collectively, funds universal healthcare and education, and lets businesses hire and fire with real flexibility — then catches workers with generous income support and active retraining. That is a system that has actual private ownership, actual markets, actual inequality, and a 25 percent sales tax on everything — and it works. It works because Denmark has independent institutions that force the government to show its math, unions strong enough to negotiate sector-wide, and a culture of honest accounting rather than fabricated harvest reports. Cuba could theoretically build any piece of that. But it would require the one thing the current system cannot tolerate: transparency. You cannot run universal provision on a 25 percent value-added tax when you cannot tell the public what the money bought.

Now here is the part the spectacle makes unavoidably clear for American audiences. The U.S. sanctions Díaz-Canel spent most of his speech condemning exist, in their domestic justification, as a standing argument against any leftward move in American economic policy. When a senator from Florida — or Ohio, or Texas — wants to kill a proposal for public-sector drug price negotiation, expanded worker ownership, or municipal broadband, the path runs through “we don’t want to end up like Cuba.” The blockade has to stay in place so the specter has a body. The body is hollow. A government that receives one fuel tanker in seven months, that has 1,400 megawatts of distributed generation offline daily, that is rolling out market reforms explicitly to attract foreign currency and encourage private investment — this is not a command economy projecting power. It is a government trapped in a hostile economic environment, responding with the same tools any government in that position would reach for, while calling them by different names. The private-wealth anxiety Díaz-Canel acknowledged — growing income inequality, the expansion of private business — is not a socialist government managing contradictions. It’s a government watching its people’s economic life reorganize around private accumulation and market exchange, and issuing statements to assure the party faithful that this is still the plan.

The things being proposed in American domestic policy debates — strengthening Social Security, letting Medicare negotiate drug prices, public investment in child care, worker representation on corporate boards — are so far from the Cuban economic situation that using the same word for both is a category error or a deliberate con. When someone tells you a public option would put us on the road to Havana, what they’re telling you is that they need you to mistake a campaign slogan for an economic category. It’s a leash. The word doesn’t travel.

Here is what Cuba actually needs, and what neither Díaz-Canel’s speech nor his Foreign Minister’s address nor the 176-reform package proposes: worker cooperatives — businesses owned and governed by the people who work in them. Not private firms dependent on state licenses. Not state enterprises run by party appointees. Member-owned cooperatives, where the workers vote and the surplus stays local. Unlike individually owned firms, a cooperative’s ownership is too diffuse to be captured by a handful of regime-connected license-holders, and its democratic governance makes decapitation by decree visibly costly — you cannot revoke ten thousand workers’ ownership the way you revoke one family’s business license. Mondragon in the Basque Country, founded in 1956, now employs over seventy thousand people and generates eleven billion euros in annual revenue, paying its top executive roughly six times what its lowest-paid worker earns. The average Cuban cuentapropista would recognize the idea instantly — someone who works hard should own a piece of what they build. The cooperative is not a foreign import. It is the thing Cuba claims to believe in but has never actually built: an economy where ordinary people control their own productive lives, not as a gift from the state, not as a concession to the market, but as a right of membership. That is what “construction of socialism” could mean if anyone in Havana were serious about the construction.

The deepest damage the word “socialism” has done to Cuba is not what American conservatives think it is. It is not that a market economy was forbidden. It is that the word became fused with the state — so that criticizing government failure sounded like attacking socialism, and defending socialism required defending every government failure. For decades, that linguistic lock let a one-party state operate without scrutiny. The Cuban people got the worst of both: the market was too constrained to function, and the state was too unconstrained to be honest. The new reforms will not fix that by themselves, because expanding private business inside an authoritarian framework simply creates a different kind of extraction — a small private class dependent on regime permission, operating without rule of law, vulnerable to revocation the moment political convenience demands it. I have seen this movie before, and the ending is not the freedom the title promises.

I don’t expect the cooperative alternative, which is why Díaz-Canel’s closing — the tribute to Fidel Castro, the slogans “Socialism or Death” and “Homeland or Death, We Will Prevail” — is the sentence that tells you everything. The reforms are real. The crisis is real. The private sector is already doing what the state cannot. And the regime’s response is to announce the changes while reciting the catechism that made the crisis possible in the first place. The Cubans in the National Assembly know the difference. The rest of us should too. Anyway.