On the paradox of poverty and good health in Cuba

One of the most interesting (in my opinion) paradox in modern policy debates relates to how Cuba, a very poor country, has been able to generate health outcomes close to the levels observed in rich countries. To be fair, academics have long known that there is only an imperfect relation between material living standards and biological living standards (full disclosure: I am inclined to agree, but with important caveats better discussed in a future post or article, but there is an example). The problem is that Cuba is really an outlier. I mean, according to the WHO statistics, its pretty close to the United States in spite of being far poorer.

In the wake of Castro’s death, I believed it necessary to assess why Cuba is an outlier and creates this apparent paradox. As such, I decided to move some other projects aside for the purposes of understanding Cuban economic history and I have recently finalized the working paper (which I am about to submit) on this paradox (paper here at SSRN).

The working paper, written with physician Gilbert Berdine (a pneumologist from Texas Tech University), makes four key arguments to explain why Cuba is an outlier (that we ought not try to replicate).

The level of health outcomes is overestimated, but the improvements are real

 Incentives matter, even in the construction of statistics and this is why we should be skeptical. Indeed, doctors are working under centrally designed targets of infant mortality that they must achieve and there are penalties if the targets are not reached. As such, physicians respond rationally and they use complex stratagems to reduce their reported levels. This includes the re-categorization of early neonatal deaths as late fetal deaths which deflates the infant mortality rate and the pressuring (sometimes coercing) of mothers with risky pregnancies to abort in order to avoid missing their targets. This overstates the level of health outcomes in Cuba since accounting for reclassification of deaths and a hypothetically low proportions of pressured/coerced abortions reduces Cuban life expectancy by close to two years (see figure below). Nonetheless, the improvements in Cuba since 1959 are real and impressive – this cannot be negated.

Cuba1.png

 

Health Outcomes Result from Coercive Policy 

Many experts believe that we ought to try to achieve the levels of health outcomes generated by Cuba and resist the violations of human rights that are associated with the ruling regime. The problem is that they cannot be separated. It this through the use of coercive policy that the regime is able to allocate more than 10% of its tiny GDP to health care and close to 1% of its population to the task of being a physician. It ought also be mentioned that physicians in Cuba are also mandated to violate patient privacy and report information to the regime. Consequently, Cuban physicians (who are also members of the military) are the first line of internal defense of the regime. The use of extreme coercive measures has the effect of improving health outcomes, but it comes at the price of economic growth. As documented by Werner Troesken, there are always institutional trade-offs in term of health care. Either you adopt policies that promote growth but may hinder the adoption of certain public health measures or you adopt these measures at the price of growth. The difference between the two choices is that economic growth bears fruit in the distant future (i.e. there are palliative health effects of economic growth that take more time to materialize).

Health Outcomes are Accidents of Non-Health Related Policies

As part of the institutional trade-off that make Cubans poorer, there might be some unintended positive health-effects. Indeed, the rationing of some items does limit the ability of the population to consume items deleterious to their health. The restrictions on car ownership and imports (which have Cuba one of the Latin American countries with the lowest rate of car ownership) also reduces mortality from road accidents which,  in countries like Brazil, knock off 0.8 years of life expectancy at birth for men and 0.2 years for women.  The policies that generate these outcomes are macroeconomic policies (which impose strict controls on the economy) unrelated to the Cuban health care system. As such, the poverty caused by Cuban institutions  may also be helping Cuban live longer.

Human Development is not a Basic Needs Measure

The last point in the paper is that human development requires agency.  Since life expectancy at birth is one of the components of the Human Development Indexes (HDI),  Cuba fares very well on that front. The problem is that the philosophy between HDIs is that individual must have the ability to exercise agency. It is not a measure of poverty nor a measure of basic needs, it is a measure meant to capture how well can individual can exercise free will: higher incomes buy you some abilities, health provides you the ability to achieve them and education empowers you.

You cannot judge a country with “unfree” institutions with such a measure. You need to compare it with other countries, especially countries where there are fewer legal barriers to human agency. The problem is that within Latin America, it is hard to find such countries, but what happens when we compare with the four leading countries in terms of economic freedom. What happens to them? Well, not only do they often beat Cuba, but they have actually come from further back and as such they have seen much larger improvements that Cuba did.

This is not to say that these countries are to be imitated, but they are marginal improvements relative to Cuba and because they have freer institutions than Cuba, they have been able to generate more “human development” than Cuba did.

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Our Conclusion

Our interpretation of Cuban health care provision and health outcomes can be illustrated by an analogy with an orchard. The fruit of positive health outcomes from the “coercive institutional tree” that Cuba has planted can only be picked once, and the tree depletes the soil significantly in terms of human agency and personal freedom. The “human development tree” nurtured in other countries yields more fruit, and it promises to keep yielding fruit in the future. Any praise of Cuba’s health policy should be examined within this broader institutional perspective.

How Well Has Cuba Managed To Improve Health Outcomes? (part 3)

As part of my series of blog post reconsidering health outcomes in Cuba, I argued that other countries were able to generate substantial improvements in life expectancy even if Cuba is at the top. Then I pointed out that non-health related measures made Cubans so poor as to create a paradoxical outcome of depressing mortality (Cubans don’t have cars, they don’t get in car accidents, life expectancy is higher which is not an indicator of health care performance). Today, I move to the hardest topic to obtain information on: refugees.

I have spent the last few weeks trying to understand how the Cuban refugees are counted in the life tables. After scouring the website of the World Health Organization and the archives of Statistics Canada during my winter break, I could not find the answer.  And it matters. A lot.

To be clear, a life table shows the probability that an individual of age will die by age X+1 (known as Qx). With a life table, you will obtain age-specific death rates(known as Mx), life expectancy at different points and life expectancy at birth (Lx)(Where x is age). Basically, this is the most important tool a demographer can possess. Without something like that, its hard to say anything meaningful in terms of demographic comparison (although not impossible).The most common method of building such a table is known as a “static” method where we either compare the population structure by age at a single point in time or where we evaluate the age of deaths (which we can compare with the number of persons of each group alive – Ax). The problem with such methods is that static life tables need to be frequently updated because we are assuming stable age structure.

When there is important migration, Qx becomes is not “mortality” but merely the chance of exiting the population either by death of migration. When there are important waves of migration (in or out), one must account for age of the entering/departing population to arrive at a proper estimates of “exits” from the population at each age point that separate exits by deaths or exits (entries) by migration.

As a result, migration – especially if large – creates two problems in life tables. It changes the age structure of the population and so, the table must be frequently updated in order to get Ax right. It also changes the structure of mortality (exits). (However, this is only a problem if the age structure of migrants is different from the age structure of the overall population).

Since 2005, the annual number of migrants from Cuba to the United States has fluctuated between 10,000 and 60,000. This means that, on an annual basis, 0.1% to 0.5% of Cuba’s population is leaving the country. This is not a negligible flow (in the past, the flow was much larger – sometimes reaching north of 1% of the population). Thus, the issue would matter to the estimation of life tables. The problem is we do not know how Cuba has accounted for migration on both mortality and the reference populations! More importantly, we do not know how those who die during migration are measured.

Eventually, Ax will be adjusted through census-based updates (so there will only be a drift between censuses). However, if the Cuban government counts all the migrants as alive as they arrive in a foreign country as if none died along the way, it is underestimating the number of deaths. Basically, when the deaths of refugees and emigrants are not adequately factored into survival schedules, mortality schedules are be biased downward (especially between censuses as a result of poor denominator) and life expectancy would be accordingly biased upward.

Now, I am willing to reconsider my opinion on this particular point if someone indicates some study that has escaped my gaze (my Spanish is very, to put it euphemistically, poor). However, when I am able to find such information for other Latin American countries like Chile or Costa Rica and not for Cuba, I am skeptical of the value of the health statistics that people cite.

The other parts of How Well Has Cuba Managed To Improve Health Outcomes?

  1. Life Expectancy Changes, 1960 to 2014
  2. Car ownership trends playing in favor of Cuba, but not a praiseworthy outcome

How Well Has Cuba Managed To Improve Health Outcomes? (part 1)

Since the passing of Fidel Castro, I have devoted myself to researching a proper assessment of his regime’s achievements in matters of health care. The more I dig, the more I am convinced that his regime has basically been incredibly brilliant at presenting a favorable portrait. The tweaking of the statistics is not blatant or gigantic, it is sufficiently small to avoid alerting demographers (unlike when Davis and Feshbach, Eberstadt and Miller and Velkoff found considerable evidence of data tweaking in the USSR which raised a massive debate). Indeed, a re-computation of life expectancy based on life tables (which I will present in the new few weeks) to adjust for the false reclassification of early neonatal deaths as late fetal deaths (raising the low infant mortality rate by somewhere 28% and 96%) suggests that somewhere between 0.1 and 0.3 years must be knocked off the life expectancy figures. Given that the variations between different measurements available (WHO, World Bank, MINISAP, CIA, FAO) are roughly of that magnitude, it falls within a very reasonable range of errors. This statistical tweaking is combined with an over-dramatization of how terrible the situation was in 1959 (the life expectancy figures vary from 63.9 years to 65.4 years at the beggining of the Castrist regime). But that tweaking is not sufficient to invalidate the massive downward trend.  As a result, the majority of public health scholars seem confident in the overall level and trend (and I tend to concur with that statement even if I think things are worse than presented and the slope of the downward trend is too steep).

Those little tweaks have been combined with the use of massive coercive measures on the local population (beautifully described  by Katherine Hirschfeld in what should be an example of ethnographic work that economists and policy-makers should rely on because it goes behind the data – see her book Health, Politics, and Revolution in Cuba: 1898-2005) that go from using doctors as tools for political monitoring to the use of abortion against a mother’s will if it may hinder a physician’s chance of reaching the centrally-decided target without forgetting forced isolations for some infectious patients. Such methods are efficient at fighting some types of diseases, but they are associated with institutions that are unable to provide much economic growth which may act as a palliative counter-effects to how choices may make us less healthy (me having the freedom to eat too much salt means I can die earlier, but the type of institutions that let me eat that much salt also avoid infringing on my property rights thus allowing me to improve living standards which is the palliative counter-effect).  With such a trade-off, the issue becomes one of the ability of poor countries to improve in the absence of extreme violence as that applied by the Castrist regime.

Over the next few weeks, I will publish many re-computations of health statistics to sustain this argument as I write my article.  The first one I am doing is the evolution of life expectancy from 1960 to 2014. What I did is that I created comparatives for Cuba based on how much living standards (income per capita). Cuban living less than doubled over that 49 years period (82% increase) from 1959 to 2008 (the latest available data from the high-quality Maddison data).  Latin American and Carribean countries that saw their living standards less than double (or even decline) are Argentina (+90%), Bolivia (+87%), El Salvador (+68%), Haïti (-33%), Honduras (+71%), Jamaica (+51%), Nicaragua (-17%) and Venezuela (+7%). This forms the low income group. The remaining countries available are separated in two groups: those whose income increased between 100% and 200% (the mid-income group composed of Brazil, Colombia, Mexico, Peru, Uruguay, Ecuador, Guatemala, Panama and Paraguay) and those whose incomes increased more than 300% (the high-income group composed Chile, Costa Rica, Dominican Republic, Puerto Rico and Trinidad & Tobago).  I also compared Cuba with a group of countries that had incomes per capita within 20% of the income per capita of Cuba.  So, how did Cuba’s life expectancy increase?

Well, using only the official statistics (which I do not fully trust although they are from the World Bank Development Indicators Database), Cuba life expectancy (which was already pretty high by Latin American standards in 1959) increased 24%. However, all other countries – which were well below Cuba – saw faster increases. The countries that had the least growth in Latin America saw life expectancy increase 38% and the countries that were equally poor as Cuba saw life expectancy increase an impressive 42%. Chile, whose life expectancy was only 57.5 years against Cuba’s 63.9 in 1960, also increased more rapidly (also 42%) and it has now surpassed Cuba (81.5 years against 79.4 years) and what is more impressive is that this rate has increased in a monotonic fashion regardless of changes in political regimes (democracy, socialism, Pinochet, liberal democracy) while Cuba’s rate seems to accelerate and decelerate frequently. Now, this is assuming that the figures for 1960 are correct. I have surveyed the literature and it is hard to find a way to say which of the estimates is the best, but that of the World Bank for 1960 is the lowest. There are other rates, contained in McGuire and Frankel’s work – the highest stands at 65.4 years for 1960. That means that the range of increase of life expectancy in Cuba is between 21.4% and 24.2%. Its not earth-shattering, but it makes Cuba’s achievements less impressive (although it is impressive to keep increase life expectancy from an already-high level). But as you can see, more important improvements could have been generated without recourse to such violent means. In fact, as a post that I will publish this week shows, the decline in car ownership from 1959 to 1988 probably played moderately in favor of the increase in life expectancy while the massive increase in car ownership in all other countries played (all else being equal) in favor of slowing down the increases in life expectancy (but being too poor or making it illegal to import a foreign car is not health care and I deem it improper to consider that this accident from misfortune should be praised).

improvementslifeexpectancy

In a way, what I am saying is that the benefit is not as impressive as claimed. Given the costs that Cubans have to assume for such a policy, anything that makes the benefits look more modest should make more inclined to cast a damning judgment on Castro’s regime.

Coming up (I will add the links as they are published) :

  1. Life Expectancy Changes, 1960 to 2014
  2. Car ownership trends playing in favor of Cuba, but not a praiseworthy outcome
  3. Of Refugeees and Life Expectancy
  4. Changes in infant mortality
  5. Life expectancy at age 60-64
  6. Effect of recomputations of life expectancy
  7. Changes in net nutrition
  8. The evolution of stature
  9. Qualitative evidence on water access, sanitation, electricity and underground healthcare
  10. Human development as positive liberty (or why HDI is not a basic needs measure)

Socialism is just a new form of slavery

When Fidel Castro died he was totally alone. It doesn’t matter if relatives or friends were standing beside him: in the end, we are all alone. We experience the world through our sense of perception. Of the things themselves we have no experience. On the other hand, all humans have perception of themselves. We just know that we are. This self awareness is a fundamental aspect of what it is to be human. Castro’s death already received a lot of attention, but I believe it is a moment really worthy of reflection. Under his half-century regime millions died or suffered, and it’s always important to remember that we are talking about a little country, an island in the Caribbean. Cuba was one of the most prosperous nations in the Americas, and today it is one of the most miserable.

It is really sad to see that most of my colleagues are unable to call evil by its name. In the mid-nineteenth century Karl Marx predicted that capitalism was going to collapse because of its internal contradictions. He was not saying that he wanted capitalism to collapse. He was saying that this was a scientific fact, as sure as the next eclipse predicted by an astronomer. Capitalism, of course, didn’t collapse. Marx’s economic theory was simply nonsensical, and was contradicted by logic and facts. But Marxists couldn’t admit it. Instead they replaced economics with culture, and the working class with Others as the oppressed. Blacks, women, Native Americans, underdeveloped countries and many others became the new oppressed class. Fidel Castro fit beautifully in the Marxism of the New Left. He was the charismatic dictator of the charming island nation of Cuba. The US, ruled by leftists in the 1960s and 1970s, was unable to give a consistent answer to it. Latin America, ruled by dictatorships that the left called “right” (no one wants to take their dictators home), was also not in place to contrast the evils of the Castro regime. A perfect storm.

Castro, for all we know, died with no regrets for the evils he committed in life. Political commentators say that history will judge him. But this is a lie. History can’t judge anyone. Only people can judge people. And it is fundamental that political commentators today judge Castro for all the evil he has done. Castro didn’t kill people in Cuba only. He supported, in one way or another, brutal regimes all over the world, mostly in Latin America. To this day he is partly responsible for the evils of Foro de São Paulo. But many political commentators insist in the lie that in Cuba there’s true freedom: they have enough to eat, universal healthcare and universal education. Why would they want freedom?

Freedom is the fundamental state of human beings. We are, in the end, all alone. Of what goes in our hearts, only we are aware of. Sometimes not even us. All of us make choices based on knowledge that’s unique. Circumstances of time and space shape the choices that we make. And life is made of choices. Marxism, socialism, and all forms of statism go against these fundamental truths.

People in Cuba are not free. They are all slaves to the Castro family. Some people want to have life in a cage, as long as they receive food every day. Of course this is a lie. In order to live in a cage you need to have someone outside the cage bringing the food. Someone has to be free. This person becomes your slave as well, and this constitutes a fundamental contradiction of socialism: Alexis de Tocqueville mentioned that socialism is just a new form of slavery. In slavery someone is forced to work for somebody else under the threat of physical violence. Under socialism everybody is forced to work for everybody else. Let’s hope that Castro’s death may help put socialism in the past, where slavery is, and that Latin America may finally see the light of freedom.

Castro: Coercing Cubans into Health

On Black Friday, one of the few remaining tyrants in the world passed away (see the great spread of democracy in the world since 1988). Fidel Castro is a man that I will not mourn nor will I celebrate his passing. What I mourn are the lives he destroyed, the men and women he impoverished, the dreams he crushed and the suffering he inflicted on the innocents. When I state this feeling to others, I am told that he improved life expectancy in Cuba and reduced infant mortality.

To which I reply: why are you proving my point?

The reality that few people understand is that even poor countries can easily reduce mortality with the use of coercive measures available to a centralized dictatorship. There are many diseases (like smallpox) that spread because individuals have a hard time coordinating their actions and cannot prevent free riders (if 90% of people get vaccinated, the 10% remaining gets the protection without having to endure the cost). This type of disease is very easy to fight for a state: force people to get vaccinated.

However, there is a tradeoff to this. The type of institutions that can use violence so cheaply and so efficiently is also the type of institutions that has a hard time creating economic growth and development. Countries with “unfree” institutions are generally poor and grow slowly. Thus, these countries can fight some diseases efficiently (like smallpox and yellow fever), but not other diseases that are related to individual well-being (i.e. poverty diseases). This implies that you get unfree institutions and low rates of epidemics but high levels of poverty and high rates of mortality from tuberculosis, diarrhea, typhoid fever, heart diseases, nephritis.

This argument is basically the argument of Werner Troesken in his great book, The Pox of LibertyHow does it apply to Cuba?

First of all, by 1959, Cuba was already in the top of development indexes for the Americas – a very rich and healthy place by Latin American standards. A large part of the high levels of health indicators were actually the result of coercion. Cuba actually got its very low levels of mortality as a result of the Spanish-American war when the island was occupied by American invaders. They fought yellow fever and other diseases with impressive levels of violence. As Troesken mentions, the rate of mortality fell dramatically in Cuba as a result of this coercion.

Upon taking power in 1959, Castro did exactly the same thing as the Americans. From a public choice perspective, he needed something to shore up support.  His policies were not geared towards wealth creation, but they were geared towards the efficient use of violence. As Linda Whiteford and Laurence Branch point out, personal choices are heavily controlled in Cuba in order to achieve these outcomes. Heavy restrictions exist on what Cubans can eat, drink and do. When pregnancies are deemed risky, doctors have to coerce women to undergo abortion in spite of their wishes. Some women are incarcerated in the Casas de Maternidad in spite of their wishes. On top of this, forced sterilization in some cases are an actually documented policy tool.   These restrictions do reduce mortality, but they feel like a heavy price for the people. On the other hand, the Castrist regime did get something to brag about and it got international support.

However, when you look at the other side of the tradeoff, you see that death rates from “poverty diseases” don’t seem to have dropped (while they did elsewhere in Latin America).  In fact, there are signs that the aggregate infant mortality rates of many other Latin Americans countries collapsed toward the low-levels seen in Cuba when Castro took over in 1959  (here too). Moreover, the crude mortality rate is increasing while infant mortality is decreasing (which is a strong indictment about how much shorter adult lives are in Cuba).

So, yes, Cuba has been very good at reducing mortality from communicable diseases and choice-based outcomes (like how to give birth) that can be reduced by the extreme use of violence. The cost of that use of violence is a low level of development that allows preventable diseases and poverty diseases to remain rampant. Hardly something to celebrate!

Finally, it is also worth pointing two other facts. First of all, economic growth in Cuba has taken place since the 1990s (after decades of stagnation in absolute terms and decline in relative terms). This is the result of the very modest forms of liberalization that were adopted by the Cuban dictatorship as a result of the end of Soviet subsidies. Thus, what little improvements we can see can be largely attributed to those. Secondly, the level of living standards prior to 1990 was largely boosted by the Soviet subsidies but we can doubt how much of it actually went into the hands of the population given that Fidel Castro is worth 900$ million according to Forbes. Thus, yes, Cubans did remain dirt poor during Castro’s reign up to 1990. Thirdly, doctors are penalized for “not meeting quotas” and thus they do lie about the statistics. One thing that is done by the regime is to categorize “infant deaths” as “late fetal deaths” – its basically extending the definition in order to conceal a poorer performance.

Overall, there is nothing to celebrate about Castro’s dictatorship. What some do celebrate is something that was a deliberate political action on the part of Castro to gain support and it came at the cost of personal freedom and higher deaths from preventable diseases and poverty diseases.

H/T : The great (and French-speaking – which is a plus in my eyes because there is so much unexploited content in French) Pseudoerasmus gave me many ideas – see his great discussion here.

Adios a Fidel

It was so romantic when those truckfuls of young men with beards took over the cesspool of Havana on New Year’s Eve (a scene immortalized in The Godfather Two). They were bringing freedom and relief from poverty to the beleaguered people of Cuba who had suffered under American imperialism for more than sixty years.

When his main acolyte was through shooting a few hundred political opponents – which took weeks – the business of revolutionary construction began in earnest. Soon, the Revolution had to face an invasion from disgruntled sons of the exiled Cuban upper-class. The invasion was roundly betrayed by the fabled Pres. John F. Kennedy. After that, the Revolution found extravagant financial support from the Soviet Union, a poor country itself but a large one.

Later, the leader of the Cuban Revolution tried to get the US nuked by his big Russian brother. That cool leader must have had his reasons, I am sure.

The stubbornness of opponents (“worms”) was so great that the Revolution was forced to jail a few thousand of them, including poets (along with thousands of men whose crime was homosexuality). Other obdurate traitors to the Revolution left Cuba on balsa rafts and on rafts made with old barrels. Many drowned at sea. Their choice! After a while, one Cuban in five was living abroad, away from the workers’ paradise.

The Revolution triumphed in the fields of education and public health. Nowadays, Cubans’ level of literacy is a high as that of other Latin American countries. Although it’s not really free, the Cuban public health service is pretty good, what with its separate public-public sector and its sector for Communist Party members only, the two equal to each other, of course.

When the first leader became too old, somehow, the best revolutionary found to succeed him was his little brother, as happened in other people’s democracies such as North Korea.

In the meantime, there had been several military adventures, all in tropical countries where even ordinary Cuban privates could afford bananas for once. That they did not win anywhere was not their fault. One prominent general even had to be shot by the leadership because he was dealing drugs. His trial lasted a whole week.

Today, after fifty years, progress is so great that ordinary Cubans easily earn forty or fifty dollars a month. Many earn three times more by renting their bedroom to foreign visitors. Take university professors and medical doctors. They can always make much more than fifty a month by driving a taxi. And meat is now available six days a month instead of the customary four. You can’t argue with this!

As Westerners, we must be especially grateful that the Cuban Revolution has made the island into one of the best destinations for sex tourism in the world.

Yes, Fidel was really, really cool and we will all miss him. He was our youth. He embarked on a great experiment in human happiness. That it failed is not his fault at all. Nobody is perfect. At least, his long life of power and influence has had the great merit of showing what happens to Communist take-overs in the long run, when no external factor puts a precocious end to them.

PS To this day, many Cubans and an embarrassing number of western leftists believe that the Cubans’ poverty is mainly due to the US BLOCKADE of the island. Well folks, there was a blockade, in the early sixties. It lasted two weeks (fourteen or fifteen days). Since then, there has been an American economic embargo on Cuba. It means that Americans cannot buy from or sell most items to Cuban economic actors. Cubans could always buy anything from and sell anything to anyone else in the whole wide world, including our Canadian cousins who have everything we have. We are talking here of a fifty year-old grand lie. You had to be cool, like Fidel and his little brother to pull it off!