The Cayman islands and Cuba - Why the difference?

[Rehdarh]

Hello,

I am curious as to why the Caymen islands are doing so well and yet they are smaller than Cuba, and Cuba is doing so horribly.

I understand that open banking leads the way for the Caymen islands, and Cuba isnt open for that, but why such a big difference?

And also, shouldnt the big bad capitalistic banks be hurting the country's people?

Rehdarh

[Dimentio]

Tax havens are generally despised by most people, as is Cayman islands, Lark, Liechtenstein, San Marino, Monaco and Switzerland, which are considered "petty rougue states" since the rich are hiding their wealth there.

The world price system is an intricate eco-system where the tax havens have a specific role. Not all regions/countries could become tax havens, or pursue the same policies as them, since countries has different strengths and weaknesses.

As for Cuba, there are some sides which are quite not so bad, and others which are. Cuba cannot trade under the same terms as for example the USA because Cuba is not a part of the World Bank or the WTO.

I will move this thread to the O.I now.

[Qwerty Dvorak]

Hello,

I am curious as to why the Caymen islands are doing so well and yet they are smaller than Cuba, and Cuba is doing so horribly.

I understand that open banking leads the way for the Caymen islands, and Cuba isnt open for that, but why such a big difference?

And also, shouldnt the big bad capitalistic banks be hurting the country's people?

Rehdarh
Well it's generally much easier for tiny nations such as the Cayman islands to do well anyway, since the smaller population means that less healthcare, education policing etc. has to be provided. Also, the fact that the nation is so small means that it has been able to become, as Serpent said, a tax haven for the rich of other nations. These rich people have earned their riches through the abuse and exploitation of workers in other countries. Tax havens have also been used to hide away the profits of fraud, corruption and other large-scale financial crimes, so in a sense the banks are hurting the people.

[Demogorgon]

Not to forget that the Cayman islands is a British overseas territory propped up by Britain for the sake of keeping the people who live there (as opposed to hiding their money there) in any kind of reasonable standard of living.

In terms of "normal countries" (i.e. those that aren't American or British dependencies, protectorates or client states), Cuba is actually the best off country in the Caribbean.

[Rehdarh]

Oh I see.

So basically Cuba is unfit to be a financial-tax-haven?


The world price system is an intricate eco-system where the tax havens have a specific role. Not all regions/countries could become tax havens, or pursue the same policies as them, since countries has different strengths and weaknesses.

If you could just expand on why Cuba would be unable to be a tax-haven that would be much appreciated.

Thanks for the feedback!

Rehdarh

[pusher robot]

Oh I see.

If you could just expand on why Cuba would be unable to be a tax-haven that would be much appreciated.
Uhhhh....not to state the obvious, but could it be because Cuba has high taxes?

[Rehdarh]

Exactly,

so why doesnt Cuba eliminate them all togather and alow the banks to come in? Wouldnt that make it wealthier?

Sure that may be against the socialist ideology, but theoriaticly speaking, wouldnt it eventualy turn out to be the cayaman islands?

Sorry for the stupid questions,
I am just asking about ideas that have been used against me in previous debates.

Rehdarh

[spartan]

so why doesnt Cuba eliminate them all togather and alow the banks to come in? Wouldnt that make it wealthier?

No it would make the handful of people who invest into Cuba wealthy, and then we would have Batista all over again.

You shouldnt judge succees on the handful of people who will potentially benefit from a free market system implemented in states like Cuba.

Sure a free market system allows everyone a chance at succeeding, but only a minority of those who try actually will end up succeeding, because the system is designed in such a manner that it requires that there always is an under class to do all the jobs either not wanted by the money makers or created by the Bourgeois as part of their attempt at making money for themselves.

Now i would be the first to admit that Cuba has some problems (Which are mostly economic related due to the collapse of the USSR and the fact that the US has them placed under a trade embargo) but the last thing that they would want is the situation that they had prior to the revolution, where Cuba was one big casino and playground for the Mafia and the American Bourgeois.

[Rehdarh]

No it would make the handful of people who invest into Cuba wealthy, and then we would have Batista all over again.

I see.

But the Cayman islands are doing well are they not? It is far from a batista regime, and has a high standard of living. Furthermore, even though there is a lot of banking investments, it is rare you will find any money laundering and other criminal acts in that country.

So it begs the question once again, theoraticly speaking, would it be somehow possible for Cuba - through following similiar policies as the Cayman islands - form a system which includes lower taxes and investments of offshore banking to produce a healthy nation much like the Cayman islands? I think that would be an impossibility, but I am not sure exactly why, thats why I came here to seek help.



I am asking these questions to learn, to get a better grasp as to the reasons of Cuba's communism and restrictions. Deep down I believe they are fair and right considering the circumstances they are in. But I still have the conscience to question reason.

Rehdarh

[Qwerty Dvorak]

So it begs the question once again, theoraticly speaking, would it be somehow possible for Cuba - through following similiar policies as the Cayman islands - form a system which includes lower taxes and investments of offshore banking to produce a healthy nation much like the Cayman islands? I think that would be an impossibility, but I am not sure exactly why, thats why I came here to seek help.
It would be impossible for Cuba to become a tax haven because it has a much larger population than the Cayman Islands, to whom it has a duty to provide essential services like healthcare, education and a police force. All these things cost money, which come from taxes. Furthermore, as has been pointed out, the Cayman Islands are financially supported by Britain while Cuba is not.

[Dimentio]

Uhhhh....not to state the obvious, but could it be because Cuba has high taxes?

Cuba does actually not have any income tax, unless for small family-based businesses. It does not have any treasury taxes either.

[Rehdarh]

So what I have so far is that Cuba would not be able to alow investments because they are unable to be a tax-haven. They are unable to be a tax-haven because they need to have taxes to support their population with services such as medical care, and they need to balance out the wealth because they are unable to trade with the United States.

BUT, what about Switzerland?

They have almost as much people as Cuba, they rely mostly on imports, and they are very small. Why do they, while having a population much like Cuba, be able to have such a stronge economy through banking while Cuba cannot?

Rehdarh

[Dimentio]

Switzerland has been developing banks since the medieval age. It was the Swiss who borrowed out money when the great European dynasties fought each-other. Switzerland also developed a mechanical industry quite early.

Nowadays, Swiss banks are popular in some segments of the elite due to the guaranteed anonymity of the account. I know a considerable amount of the money in Swiss banks are A) Jew gold from the second world war, and B) national budgets for third world republics squandered by kleptocrats.

As for the world economy, we should not talk about countries, but regions. Have you ever questioned why those areas which have the most natural resources tend to be those which are the poorest, while those who produce least (cities) tend to be the richest?

If Cuba was capitalist, it would most likely have been another raw material provider, not a banking paradise.