Conversations with Cuba: The Absurdity of Student Debt

I recently returned from a trip to Cuba, and among the most notable conversations I had was one with a Paladar owner and waiter. Paladares are private restaurants, usually family-run, which although once prohibited, were allowed during the Cuban Special Period crisis.

I was a bit lost in western Havana, and ended up having lunch in this slightly over-priced restaurant. Due to the ambiance of the restaurant, I assumed the owner and workers were critical of the Cuban system, and would no doubt favor some sort of transition towards American style capitalism.

Upon hearing I was currently an economics student in the U.S., the waiter asked how student loans worked in the American system. I explained the U.S. is currently facing nothing less than a student debt crisis, where the vast majority of students graduate with some level of debt, the average level of debt has consistently been rising, many graduates struggle to find employment, and thus defaults on these loans have also been rising.

The waiter asked if even doctors and lawyers faced this problem. I explained students who decide to study law, medicine, or go to graduate school also face the same dilemma, with total debt sometimes going over $100,000, and taking decades to payoff (if you manage to pay it off).

The waiter called the restaurant owner so he could hear as well. Their reaction was very surprising. They cried out “You see! Our youth needs to hear these stories. Things are worse over there!”

Cuba, despite being a poor Caribbean island whose economy is burdened by a brutal economic blockade imposed by the U.S., has managed to develop one of the best education systems in the world, which is completely free at every level of instruction.

As a result, the Cuban population is among the most educated in the world. According to the U.N. Human Development Report, Mean Years of Schooling in Cuba was at 10.2 years in 2012, whereas the average for High Human Development countries was 8.1 years.

The Cuban health system has had similar results. In fact, the Human Development Report’s Health Index (calculated using Life expectancy) places Cuba (0.912) even above the U.S. (0.907) in 2013. One can only imagine what the Cuban system could achieve if the blockade were to be lifted.

The Cuban experience should be a reminder that free and accessible health or public education are not unrealistic goals. In fact, they are quite the opposite.

By Ricardo Fuentes-Ramirez, Center for Popular Economics

September 2, 2014

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