Conference Draft Posted for Comment: "The Algorithms of Ideology in Economic Planning: A Critical Look at Cuba’s National Economic and Social Development Plan 2030, With a Focus on the Pharma Sector "

The 27th Annual Meeting of the Association for the Study of the Cuban Economy will take place in Miami, Florida 27-29 July 2017. The three-day conference, around the theme Cuba: Navigating a Turbulent World, will focus on evaluating the state of the Cuban economy taking into consideration the impending changes in Cuba’s relations with the United States. The press release announcing the Conference follows along with the draft Program are posted HERE.

I will be participating in the panel entitled, "Cuban Economic Policies & Growth Strategies," which is chaired by Carlos Quijano, World Bank (retired).  Penelists will present on a number of important themes: (1) Vadim Grishin, Adjunct Assistant Professor, Georgetown University, "Economic Reforms in Cuba: Myths and Realities"; (2) Gary Maybarduk, U.S. Department of State (retired), "Encouraging Reform in Cuba: Can We Get It Right?"; and (3) Juan Tomás Sánchez, Sugarcane Growers Association of Cuba, Inc., "The Soft-Swift Transition of Cuba to a Hard Structure with Proven Results."  Luis Locay, University of Miami; and Sergio Díaz-Briquets, Independent Consultant.

My presentation on this panel is entitled The Algorithms of Ideology in Economic Planning: A Critical Look at Cuba’s National Economic and Social Development Plan 2030, With a Focus on the Pharma Sector.  The paper considers the Conceptualización del modelo económico y social Cubano de desarrollo socialista: Plan nacional de desarrollo económico y social hasta 2030: Propuesta de vision de la nación, ejes y sectores estratégicos  in which the 7th Cuban Communist Party Congress posited that development can be better managed by rejecting the central role of markets, and substituting state planning in its place, taking an all around view of economic planning as inextricably bound up in social, political and cultural progress of a nation. The resulting structural proposal suggests behavior and choice algorithms with interesting implications even if only partially realized. This Conference draft is meant to spark conversation; it is very much a work (and thought process) in progress around a central insight  of the algorithmic qualities of central planning models and its utility in that form as a regulatory tool.

The abstract and Introduction follow.  The Conference Draft may be accessed HERE.

The Algorithms of Ideology in Economic Planning: A Critical Look at Cuba’s National Economic and Social Development Plan 2030, With a Focus on the Pharma Sector (Conference Draft)

Larry Catá Backer[1]

Short Abstract: The development plans of Marxist Leninist states are usually given short shrift as expressions of ideology (at best) and propaganda (at its most pathetic). Yet there is value in considering critically these development plans, if only to get a sense of the mindset of high level functionaries with control over macro-economic policy, and to get a sense of the administrative cultures within which governmental middle managers will actually exercise discretionary authority. Especially useful in that context is the Cuban Communist Party 7th Congress’s Conceptualización del modelo económico y social Cubano de desarrollo socialista: Plan nacional de desarrollo económico y social hasta 2030: Propuesta de vision de la nación, ejes y sectores estratégicos in which the PCC posited that development can be better managed by rejecting the central role of markets, and substituting state planning in its place, taking an all around view of economic planning as inextricably bound up in social, political and cultural progress of a nation. The resulting structural proposal elaborated in the Cuban National Economic and Social Development Plan 2030 (PNDES) suggests behavior and choice algorithms with interesting implications even if only partially realized. It is particularly important as a vision for transition developed in the wake of anticipated changes in higher leadership and the effects of normalization with the United States. This essay critically considers PNDES in the current context national and regional context. It starts with a brief analysis of PNDES for what it can reveal about entrenched ideological perspectives that shape decision making and analysis within Cuban Party and administrative elites. It then considers the way these appear to manifest themselves as a set of self-referencing decision systems that substitute or supplant market or regulatory determinations. Those premises are tested against Cuban approaches to the pharma sector, among the most important targets of centrally planned development. The essay ends with an assessment of the consequences of Cuban current approaches for national and regional affairs.

I. Introduction



Central planning for the development of the productive forces of the state has been a core element of Leninist governance since the 1920s. In the form of the Soviet five year plans, these efforts institutionalized the leadership of the Leninist vanguard party as the source of decision-making for the management of all national resources, and to “increase the state planning element in economic life” (Procopovicz 1930, 28). No less than in the Soviet Union of the late 1920s, the Cuba of the second decade of the 21st century continues to seek, through centralized planning, to naturalize a distinctly European Marxist collectivization in the “form of State organization of certain economic branches under the dictatorship of the Communist Party” (Ibid., 91). Leninist states are not the only political or economic enterprise that plans, and that reserves to its leadership class a monopoly of power to direct all of the productive forces of the enterprise. Planning in European fascist states of the 1930s shared many of the same characteristics (other than the ownership of the means of production) (Temin 1991, 573). Today most states devote substantial resources to strategic planning (Mintzberg 1994). Yet, as this essay means to demonstrate, at least within the state sector, central planning is acquiring an algorithmical character that may eventually supplant regulatory and principal based governance in the management of the state and its economic policies (Jessop 2013).


But ironically, it is in large enterprises that Soviet style central planning now thrives—organizations in which the governing institutions within the enterprise retain power and the enterprise owns all of the means of production subject to its planning. More importantly, in these enterprises, planning is an essential way to socialize their workers, express their ideology in concrete ways and set the parameters against which risks and options may be weighed and measured (Hayes 1985; Bryson 2011). Indeed, one of the most fascinating and least studied transformations is the way that Leninist principles—especially with respect to the internal ordering of a political-economic governance unit—has migrated in the West from the state to the enterprise, and from the enterprise to the structures of globalization itself (Varga 1964, 82-139). The largest Western multinationals manage their production chains (their internal economies) in ways that parallel the management by vanguard parties of the productive forces of the state. But the new planning is not merely qualitatively narrative, it has assumed the structures of algorithms—sets of rules that defines a sequence of operations, whether or not contingent (Bisschop & Meeraus 1982; Generally, Pasquale 2015).


Despite this resonance, or perhaps because of it, the development plans of Marxist Leninist states are usually given short shrift. They are useful as indicators of resource and production allocation but for little else (other than perhaps evidence of the failures of central planning when undertaken by the state). Beyond that, these documents are treated as mere (unattainable) expressions of ideology (at best) and propaganda (at its most pathetic) (Backer 2006). Yet there is value in considering critically these development plans, if only to get a sense of the mindset of high level functionaries with control over macro-economic policy, and to get a sense of the administrative cultures within which governmental middle managers will actually exercise discretionary authority. As global enterprises understand in this century (and as Soviet theorists understood a century ago) a principal object of development planning is not merely as an expression of the control of productive forces by the state apparatus under the leadership of a vanguard group, but also as a means of making meaning—(1) of expressing the ideology beneath those planning decisions, and (2) of the creation of structures within which such decisions can be valued and understood in accordance with the structural terms of the ideology from which they spring. Early in the existence of the USSR Lenin was famously quoted as explaining that “what socialism implies above all is keeping account of everything” (Kolakowski 1978, 748).


This core principle of Leninism is well expressed through the management by the state of all productive forces. Economic planning serves not merely to describe the ways that economic productive forces will be applied, but also to embed the valuation system inherent in validating those choices within the logic of the system within which these allocations are considered. More than that, it also serves to express the way in which social, political and cultural forces are to be deployed in the service of the choices made for the development of productive forces to build a socialist society. That, in essence, is the paramount aim of economic, cultural, social and political planning—the creation of a socialist society, the construction of which is left to the control of the vanguard party. Most Westerners have been inculcated with the incompatibilities of this ideology to their own. What they fail to appreciate is the extent to which this normative world view creates both a language and a means of measuring value that is then central to determinations of what for Westerners are “mere” economic transactions or capital investments. Economic plans, then, manifest a way in which the Marxist-Leninist vanguard party makes meaning through its control of the state apparatus in a manner that appears to parallel the way that meaning is made through the logic and premises of the market in trade (Generally Richards 2001). This in turn parallels the project of meaning making through law, in which the judiciary serves as the principal vehicle for making meaning within Western legal systems (Broekman & Backer 2013). The object, ultimately, is to control the meaning of words and the values they represent, including the very term “democracy” (Mitter 2017).[2]


The Cuban National Economic and Social Development Plan 2030 (PNDES) presented at the 7th Party Congress is particularly useful example of the way that ideology, social planning and politics pervades the economics of Cuban approaches to the management of their economic relations with foreigners (including the globally dispersed Cuban exile communities). But more important, it is an excellent example of the way that language is used to create meaning, to develop not merely a vocabulary (that appears tedious to the outsider) but to embed values that substantially affect the calculation of benefit among choices in both economic policy, and in dealings with foreigners. It is also important as a vision for transition developed in the wake of anticipated changes in higher leadership and the effects of normalization with the United States. But most importantly, PNDES itself can be understood as a crude but sophisticated algorithm for directing the Cuban economy and providing a coherent basis for making choices among economic activities.


This essay critically considers PNDES in this context. It starts with a brief analysis of PNDES for what it can reveal about entrenched ideological perspectives that shape decision making and analysis within Cuban Party and administrative elites. That is, it considers the way in which PNDES produces language that suggests the valuation algorithms to be used in making specific determinations about the operationalization of policy. It then considers the way these appear to manifest themselves in the context of pharma, among the most important sectors selected for development. That analysis will seek to extract the valuation algorithms embedded within PNDES and apply them to these sectors to see they can be used to understand the character of Cuban preferences and decision making in ordering these sectors. This exercise produces a crude set of relational equations that might help clarify the way that PNDES elaborates structures of decision making and incorporates valuations (though the values themselves cannot be supplied for the coefficients). The section ends with an assessment of the consequences of Cuban current approaches for national and regional affairs.


[1] W. Richard and Mary Eshelman Faculty Scholar, Professor of Law and International Affairs at the Pennsylvania State University . . . .  This conference draft was first presented at the 27th Annual Meeting of the Association for the Study of the Cuban Economy, “Cuba: Navigating in a Turbulent World”, Miami, Florida 27 July 2017 as part of a panel discussion on “Cuban Economic Policies & Growth Strategies.”


[2] “If China can persuade new partners to redefine “democracy” in its own terms, as a system that somehow does not involve national votes, free media or popular participation in government, then it will have won ownership in a powerful linguistic battle.” Ibid.