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How poor does Cuba look?
The question is why anyone might think Cuba is doing OK, relative to northern Mexico. Megan McArdle offers (more than) two points:
3) Deep poverty is much more picturesque than moderate poverty. Poor countries have their old colonial buildings still standing, because no one had the money (or the reason) to tear them down and put up something bigger. The countryside is dotted with adorable houses made out of natural materials and natives wearing colorful traditional garb. Animals graze in verdant fields, besides teams of sowers and reapers. Middle income countries are smoggy, and almost everything looks like a cheaper, shabbier version of what you get in the US. Scenic landscapes are despoiled by cinderblock buildings with hideous tin roofs, or trailers; cities are choked with boxy modern buildings that look something like our housing projects. The genteel decay that looks gothic and intriguing on an old Victorian mansion just looks seedy when it's eating away at badly poured concrete. Affluent Americans underestimate the utility value of things like having personal space, or an automobile.
4) Cuba was relatively wealthy in 1959; it therefore has more of the markers, like old majestic buildings, that we associate with wealth.
I found the most evident signs of Cuban poverty to be the unceasing supply of articulate and sometimes weakly sobbing mendicants, none of whom sounded like con men, all of whom needed money to buy food and clothes for their families. The most shocking part is what small sums of money they would ask for or be made happy by. Or the numerous women -- and I mean ordinary women in the streets -- who would offer their bodies to a stranger (handsome though I am) for a mere pittance. Yes in Cuba there is good access to doctors but anesthesia is in short supply and the health care system stopped improving long ago.
If you want to understand northern Mexico, get out of the Tijuana tourist strip and visit Hermosillo. Count the number of new housing developments, and then count how many of them are inhabited by fairly dark-skinned, previously dirt poor, Mexican mestizos. Put that number over the number of buildings in Havana that do not have serious maintenance problems and see if you can divide by zero.
It's quite possible that a lower middle class Mexican eats better food than you do, but there is no chance of that for anyone in Cuba except the top elite. Powdered milk is a luxury there.
I've long thought that Prague looks much richer than it is, and that the ugly northern Virginia or Houston looks poorer than it is. Where else looks deceivingly rich or poor?
Posted by Tyler Cowen on February 26, 2008 at 06:04 AM in Economics | Permalink
Comments
I think a lot of Western Europeans underestimate how poor Russia is based on the elegant-slash-bombastic architecture of Moscow and St Petersburg. Throw in a sprinkling of luxury goods retailers and large black German cars, and the deception is quite effective.
Anyone having a stopover in London but only seeing Heathrow will no doubt think that they are in one of the poorest corners of Europe.
Posted by: Johan Almenberg at Feb 26, 2008 7:45:54 AM
If you ignore the generally ugly communist look of the city, Cluj-Napoca Romania has many aspects that belie its poverty relative to Western Europe. The residents especially have a cosmopolitan flair that is hard to see through.
Posted by: Jeff Holmes at Feb 26, 2008 7:50:28 AM
I'm surprised how many people come back from Cuba talking about how wonderful life is there. Yes, there's a lot to like (the look of the place, the music, the people) but if you ever managed to get people to talk to you about their life (including talking to doctors and teachers from the supposed jewels in Cuba's crown about the organisations they work in) then you get a different picture. And yes, the many sobbing women offering to have sex with you 'for free' if you give them some food for their children, is also a clue. I know Haiti is worse, I just am surprised how many people think Cuba is better than it is.
Posted by: Luis Enrique at Feb 26, 2008 8:07:50 AM
....think Cuba is great? Take the ferry from Old Havana, right across the street from Hotel Santanderia (sp?), into Regla, where actual Havana residents live.
Posted by: shawn at Feb 26, 2008 8:14:03 AM
GDP per capita for the Czech republic is something like 12000 $/yr, with high PPP compared to the US (the world factbook uses an almost factor 2 PPP multiplier, but that seems a bit too high to me) . Add in that Prague is the richest part of the country, and I'd say that Prague doesn't look poor because it isn't poor.
Posted by: greatzamfir at Feb 26, 2008 8:17:59 AM
College campus are gorgeous and teem with gorgeous young men and women, bubbling with hope and youth. That's one reason people just can't bring themselves to believe that academia is screwed up.
Posted by: Daniel Klein at Feb 26, 2008 8:36:50 AM
Seoul and Gwangju in South Korea look much much much poorer than they are.
Posted by: Rue Des Quatre Vents at Feb 26, 2008 8:46:02 AM
I grow up in a poor, corrupt but non-socialist economy. I was always amazed at how easily Americans would dismiss progress in places that weren't picturesque, run by rulers they didn't like.
Even if the the people living in a run-down shanty town had seen their real incomes double in the space of a decade, various visiting student activists would tend to dismiss this progress by noting that their lives were still miserable. It's hard to explain to wealthy students that there's a huge difference between living on two cups of rice a day vs. living on two cups of rice a day plus a small fish and having something left over for a cheap t-shirt or alcohol.
Posted by: jn at Feb 26, 2008 8:49:57 AM
This post about women selling their bodies to tourists for some food for their children makes me heartsick.
Does anyone here know of any worthwhile charities to help people in Cuba improve
their lives, hopefully by supporting market institutions and small
businesses?
Posted by: Matthew at Feb 26, 2008 8:51:15 AM
"Where else looks deceivingly rich or poor?"
Iceland. To my eyes, Iceland looks a lot poorer than its GDP statistics would indicate. I was confused about this disconnect for a while. The key to remember is that GDP is a flow. But our eyes see the stock of accumulated (net) wealth. Iceland has been desperately poor for centuries. I'm talking about on the verge of starvation poor. Only in the last few decades has any real growth occurred.
The general rule is that countries that are historically poor, but become richer in a short span still don't have much accumulated wealth, and thus look poor to our eyes.
In contrast, previously rich places that are struggling still have the lingering wealth accumulation. Cuba fits this pattern. As does much of Europe.
A better indicator of how our eyes see the richness of a place would be the SUM of all previous GDPs discounted for some rate of depreciation.
Posted by: Bob at Feb 26, 2008 8:55:19 AM
Large parts of Tokyo (the parts with endless rows of 3-4 story 1950's pre-stressed concrete buildings) look pretty shabby. I guess it's what comes of having your city flattened by bombing, and putting up replacements in a hurry after the bombing stops.
Posted by: Don K at Feb 26, 2008 8:59:22 AM
I agree with saying that Tokyo looks pretty shabby in a lot of places. Especially along the train tracks entering the city from Narita. Lots of the high-rise "mansions" (condos) look really cramped, moldy, and dirty. Many of the street level shops look shabby. Much of this is simply because of the insane density of the city, compared with the expectation of a very rich country's capital.
Posted by: Erik at Feb 26, 2008 9:10:10 AM
Houstonian here, and wanted to agree wholeheartedly with your observation. Houston looks poor for one of the same reasons it feels rich: the lack of zoning laws. With the exception of a couple deed-restricted neighborhoods, all the very nice parts of town have a few run-down houses (or abandoned warehouses or factories) among them. But because any of these can instantly (talking six months or less) become three $300k townhouses, house prices are very, very low ($150k median). With much less money locked up in mortgage payments, we have lots more left over for shopping and eating, and damn do we do a ton of that. On a traffic-filled trip to the mall last weekend my husband and I were lamenting oil at $100 a barrel.
Also, as a pretty new city (100 years old, roughly), Houston lacks the charming old buildings that make other places seem nicer. And the sprawling nature of the place means that offices are scattered all over, so we don't have the downtown density (less so than even places like Dallas, Atlanta, Los Angeles, etc.) that also is associated with wealth.
Houston also is one of the most diverse (on a neighborhood level) cities I've ever seen, but that's another topic, I suppose.
Posted by: Amber at Feb 26, 2008 9:36:04 AM
Yes in Cuba there is good access to doctors but anesthesia is in short supply and the health care system stopped improving long ago.
From what I understand in Cuba to become a doctor takes 5 years of post secondary schooling. If you make it easy enough to become a doctor any country can provide good access to doctors. (Another reason to battle the AMA and excessive licensing of Doctors.)
I've long thought that Prague looks much richer than it is, and that the ugly northern Virginia or Houston looks poorer than it is. Where else looks deceivingly rich or poor?
Amen, amen, amen long live the mobile home in the American south. I have long had the impression that poor people live much better in their mobile homes here in Florida than people do in my native Rhode Island but the mobile homes are a real eye sore. The poor rural south can be ugly but it how some people choose to live.
Posted by: Floccina at Feb 26, 2008 9:44:33 AM
I think that Bob (accumulated wealth) and Don K(wartime damage) have two parts of an explanation.
One of the biggest factors in judging the prosperity of a city is the architecture, and the quality of architecture is generally representative of the prosperity of the city at the time the building was built.
If you take a city that has been prosperous continually for many centuries, like Paris, then what eventually sinks in is that there is great diversity in the buildings - there are great buildings from practically every one of the last nine centuries.
Prague, for a comparator, is a much newer city than Paris, and was only really rich for a short period under Rudolf II, but was extraordinarily rich then, and had one of the all-time leading patrons of the arts spending the income of a great empire to beautify his capital. So there's lots of really good architecture, but for a completely different reason.
If you want a sense of the wealth of a city now, then the best way is to look at new buildings, and also at the people, and the businesses. It can still be hard - for instance a moderately prosperous city with big variations in wealth can look either very poor (lots of beggars) or very rich (expensive stores) depending on what you look at.
Posted by: Richard at Feb 26, 2008 9:47:01 AM
Heathrow really is two airports: Terminal 4 is clean, modern and well appointed (albeit overcrowded, about 10 years after it opened). Terminals 1-3 look like something from Karachi.
Haven't been there since T5 opened.
Edmonton is a bit like Houston north, an insane oil boomtown, but it does look a bit distressed. Partly because of a lack of stately old buildings and wide, tree-lined boulevards, and swaths of blah tract housing from the 40s and 50s (selling for $600K a pop these days). Many parts of Richmond, VA look a lot richer, but I'm sure it ain't.
Posted by: bartman at Feb 26, 2008 10:06:14 AM
I second the point about Heathrow.
Posted by: Chris at Feb 26, 2008 10:08:01 AM
PS talk about ugly rich and pretty poor, the Cubans seem to have solved the obesity problem.
Posted by: Floccina at Feb 26, 2008 10:12:51 AM
Prague is a wealthy city, in fact. Its GDP per capita is well above the EU-15 average. Plus, the income structure is relatively very egalitarian, thus no really poor neighborhoods.
Richard - it's pure nonsense that Prague is much newer than Paris. There are all architectural styles in Prague from Romanesque to Gothic, Renaissance, Baroque, Classicism, Art Nouveau, Art Déco, Functionalism... to postmodernism. Prague's diversity rivals that of Paris, OK, Prague is smaller and not as rich as Paris.
As I'm spoiled with Prague's charm I often find other cities uninspiring. I like New York, Washington DC and Boston, but last year I've been to Seattle and was rather unimpressed. Thanks for the Space Needle, though. Atlanta was pure boredom then, sorry to say that, no offence intended.
Posted by: Pavel at Feb 26, 2008 10:22:27 AM
Bob says: "In contrast, previously rich places that are struggling still have the lingering wealth accumulation. Cuba fits this pattern. As does much of Europe."
Until quite recently, European per capita income levels were way, way below US levels, even in its richest countries. Perhaps European capitals gave you the impression that Europe was (relatively) rich in the past, but what you are really looking at are the leftovers of a concentration of wealth in a few cities.
Posted by: greatzamfir at Feb 26, 2008 10:24:31 AM
I think Cape Town's wealth and wealth distribution can accuratly guessed by the buildings. Some new lavish homes, many modest homes and appartments, lots of extremly poor shacks. (BTW great place to vaction, breath takingly beautiful, just stay way from the shacks)
Posted by: Mason at Feb 26, 2008 10:41:17 AM
I think Cape Town's wealth and wealth distribution can accuratly guessed by the buildings. Some new lavish homes, many modest homes and appartments, lots of extremly poor shacks. (BTW great place to vaction, breath takingly beautiful, just stay way from the shacks)
Posted by: Mason at Feb 26, 2008 10:42:53 AM
Urban blight is a well-known phenomenon. What about suburban blight? I have to guess there is some good analysis of this new development. The idea of development happening in extending rings around a major city is correct, but won't the rapidity of re-development also be a decreasing function of distance from the center? Taht is, will the next 50 years see a wave of suburban blight (where the displaced residents of gentrified city centers go)?
Posted by: Tim Kane at Feb 26, 2008 10:54:17 AM
http://www.flickr.com/search/show/?q=havana+cuba
Posted by: Floccina at Feb 26, 2008 11:05:30 AM
Jamaica looks poor and is poor.
Suburbia was largely built by moving the middle class from the cities to the outer areas. This was a result of the Great Society government policies of the 60s and 70s. I suppose a rebirth of good paying jobs in the inner city could bring people back. That seems to be happening since the 1980s, the result of Reagan's economic revitalization.
However, another trend is the growth of mega suburbs which are small cities in themselves. Also, airports are a magnet for attracting economic growth and consequent porpulation growth. Transportation is becoming a major issue due to energy costs. People may start living where they work again. Telecommutting is also growing, nullifying the transportation problem.
After tearing down the public housing slums, cities like Chicago have large swaths of land available for re-development. Can the government screw this up? As the patronage armies and government bureaucracies grow in the large cities, taxes are becoming a major burden for the middle class and an obstacle to development. Increasingly, the center city is populated by an economic elite like ancient Rome. Government appointments are powerfully sought after. I think the practice of royal licenses may make a come back. Schools become dysfunctional. Instead of circuses were have public works like parks and sculptures. Anyone for a temple of Jupiter?
Posted by: jorod at Feb 26, 2008 11:14:49 AM






