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Fulgencio Batista's Economic Policies, 1952 - 1958 Michael P University of Miami Scholarly Repository Open Access Dissertations Electronic Theses and Dissertations 2012-08-01 Fulgencio Batista's Economic Policies, 1952 - 1958 Michael P. McGuigan University of Miami, [email protected] Follow this and additional works at: http://scholarlyrepository.miami.edu/oa_dissertations Recommended Citation McGuigan, Michael P., "Fulgencio Batista's Economic Policies, 1952 - 1958" (2012). Open Access Dissertations. Paper 834. This Open access is brought to you for free and open access by the Electronic Theses and Dissertations at Scholarly Repository. It has been accepted for inclusion in Open Access Dissertations by an authorized administrator of Scholarly Repository. For more information, please contact [email protected]. UNIVERSITY OF MIAMI FULGENCIO BATISTA’S ECONOMIC POLICIES, 1952 – 1958 by Michael Patrick McGuigan A DISSERTATION Submitted to the Faculty of the University of Miami in partial fulfillment of the requirements for for the degree of Doctor of Philosophy Coral Gables, Florida August 2012 ©2012 Michael P. McGuigan All Rights Reserved UNIVERSITY OF MIAMI A dissertation submitted in partial fulfillment of the requirements for the degree of Doctor of Philosophy FULGENCIO BATISTA’S ECONOMIC POLICIES, 1952 – 1958 Michael P. McGuigan Approved: ________________ ________________ Steve Stein, Ph.D. M. Brian Blake, Ph.D. Professor of History Dean of the Graduate School ________________ ________________ Eduardo Elena, Ph.D. Kate Ramsey, Ph.D. Professor of History Professor of History ________________ Luis Locay, Ph.D. Professor of Economics MCGUIGAN, MICHAEL P. (Ph.D., History) Fulgencio Batista’s Economic Policies, 1952 – 1958 (August 2012) Abstract of a dissertation at the University of Miami. Dissertation supervised by Professor Steve Stein. No. of pages in text (335) Fulgencio Batista ruled Cuba from March 10, 1952 to December 31, 1958 and initiated the most ambitious and expensive government economic stimulus programs in the island’s history. He took power by military coup and overthrew the constitutionally elected Auténtico President Carlos Prío Soccorás. Batista immediately took credit for restoring security, order, progress, and honest government to the island. However, he lacked an official public mandate to rule acquired through an election, therefore, he sought acceptance by appealing to Cubans’ economic needs. In the months following the coup, Batista decided on a stimulus plan that in many ways followed the recommendations from international and domestic economists. It called for the restructure of existing government development finance agencies such as the Agricultural and Industrial Development Bank, and the creation of new ones. Batista’s approach to promote economic diversification and growth called for central management to provide low-cost credit and other assistance to non-sugar industries. Batista publicized his economic programs as national triumphs. Therefore, their performance in part determined his popular appeal. The study focuses examination on the dynamics, ideology, logic, efficiency, stakeholders and realized returns of Batista’s domestic economic development programs. This data is then employed to understand the links between his economic policies and Fidel Castro’s ability to acquire support, wage war, and eventually take over the island. Contents List of Tables ...................................................................................................................... v Preface................................................................................................................................ vi Chapter I. Introduction: The Cuban Economy in 1952...................................................... 1 Single Export Economy ................................................................................................... 5 Specialization versus Diversification ............................................................................ 17 Land Use and Ownership .............................................................................................. 21 Financial System............................................................................................................ 27 Labor .............................................................................................................................. 38 Chapter II. Studies of the Cuban Economy and Policy Recommendations Available to Batista in 1952 ........................................................................................... 44 American Studies of the Cuban Economy ..................................................................... 45 International Bank for Reconstruction and Development (IBRD) ................................ 59 The Cuban School ......................................................................................................... 66 Consensus ...................................................................................................................... 76 Chapter III. Raising Expectations .................................................................................... 79 “This is the man ............................................................................................................. 79 The New Government ................................................................................................... 84 The Domestic Coalition ................................................................................................. 89 Foreign Policy................................................................................................................ 95 The Constitutional Act of 1952 ..................................................................................... 99 Initial Economic Policies ............................................................................................. 102 Programa económico mínimo ..................................................................................... 113 Expansion of the BANFAIC ........................................................................................ 120 Batista es la paz! Batista lo hará! .............................................................................. 124 Chapter IV. “The Building Boom was Sensational” ..................................................... 135 Symbols of Progress .................................................................................................... 150 Mortgage Insurance Institute (Fomento de Hipotecas Aseguradas) ............................ 154 “How Americans Lose Their Shirts” ........................................................................... 155 July 26.......................................................................................................................... 162 National Finance Agency (Financiera Nacional de Cuba) .......................................... 164 iii Chapter V. Election Year ............................................................................................... 180 “The works we have started… have inspired confidence in our regime” ................... 188 Labor Relations............................................................................................................ 194 Economic and Social Development Plan ..................................................................... 197 The Campaign.............................................................................................................. 200 A Voice from Cuba, in Geneva and Petropolis ........................................................... 207 Chapter VI. Batista’s Road to Prosperity ....................................................................... 212 Return of the Constitution ........................................................................................... 212 National Economy Council ......................................................................................... 213 The Slow Recovery ..................................................................................................... 215 Debt and Spending for Economic Development ......................................................... 226 Hotel Law 2074 ........................................................................................................... 233 Chapter VII. “Cuba Enjoys a Boom in Prosperity” ....................................................... 239 Investment in Cuba: basic information for United States businessmen ...................... 247 Cultivating International Relationships ....................................................................... 250 Selective Economic Growth ........................................................................................ 252 Chapter VIII. Two Worlds Apart ................................................................................... 257 “There are no rebels in the Sierra Maestra” ................................................................ 266 Robin Hood.................................................................................................................. 275 The Lost Dream of the Monte Carlo ........................................................................... 280 Chapter IX. Conclusions ................................................................................................ 284 Agricultural Developments, 1952–58.......................................................................... 287 Industrial Developments, 1952–58 .............................................................................
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