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Free-market makeover

Why don't Cuba's barbers and beauticians like their new cut?

A Cuban man gets his hair cut in a makeshift barber shop as another man walks by in Old Havana, Aug. 8, 2003. (Claudia Daut/Reuters)

HAVANA, Cuba — The Cuban government keeps close tabs on its citizens, but at least it’s getting out of their hair.

Starting this month, in a small but significant nod to market economics, the Castro government has begun handing over state-run barbershops and beauty salons to their employees, marking the first time communist authorities have ceded control of retail-level small businesses that were nationalized in 1968.

The government still owns the physical properties, but not the businesses. And since Cuba’s cosmetologists will no longer be employees of the state, they’ll set their own hours and prices, keeping whatever profits they earn after paying taxes and fees.

“We’ll have to see what happens,” said Robin Corso, a barber who has been cutting hair for 15 years in a tiny, rundown shop in Old Havana. “So far it’s too early to tell if it’ll be a change for the better.”

If Corso sounds cautious about the change, one reason is that he’ll be paying the government nearly $40 a month in taxes and fees, which, at Cuban prices, is equivalent to about 40 or 50 haircuts. Utilities, supplies and maintenance costs will also eat into his earnings.

Havana’s other new entrepreneurs were just as ambivalent.

“The taxes are too high,” said one barber, who didn’t want to give his name while criticizing the new arrangement. “And you don’t pay, you can’t work.”

Such grumblings are a reminder that in Cuban hair care, as in many other aspects of the economy, the distinction between state and private ownership isn’t always clean-cut.

Cuba’s economy is about 90 percent state-controlled, but workers at many government-owned stores, factories and restaurants have devised elaborate schemes to skim cash off the state to supplement their woeful salaries — about $20 a month on average. The moral and economic toll of such practices has been acknowledged with unusual candor lately in Cuba’s state-run media.

Some workers steal to sell goods on the black market, but others get by with lesser forms of deception. Thus, many here don’t necessarily view being independent — and paying taxes — as a better deal.

Under the old system at state-run barber shops, for instance, official prices have remained essentially the same for decades — about 7 cents for a haircut. But to get good service and an appointment with their favorite barber, most Cubans paid 10 to 20 times that. The barbers simply pocketed the difference.

“That was the tip,” said barber Rene Navarro.