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John Pilger: Times have changed in Cuba, but softly the struggle continues

The Cuban people still hold their independence dear.

On my first day in Cuba, in 1967, I waited in a bus queue that was really a conga line. Ahead of me were two large, funny women resplendent in frills of blinding yellow; one of them had an especially long bongo under her arm. When the bus arrived, painted in Cuba's colours for its inaugural service, they announced that the gringo had not long arrived from London and was therefore personally responsible for this breach in the American blockade. It was an honour I could not refuse.

The bus was a Leyland, made in Lancashire, one of 400 shipped to Cuba in defiance of Washington, which had declared war on the revolution of Fidel Castro. With "The Internationale" and "Love Me Do" played to a bongo beat - the Beatles having been "admitted to the revolution" - we lurched through the crooked streets of Havana. Such a fond memory now accompanies me on my return to Cuba; yet, looking back at what I wrote then, I find I used the word "melancholy" more than once. For all the natural warmth of Cubans, the hardship of their imposed isolation left smiles diminished and eyes averted once the music had stopped.

Beyond the nationalised American department stores (the windows empty except for Chinese electric fires of which Cubans had no need) and the flickering necklace of lights at the almost deserted port, there was the silhouette of an American spy ship, the USS Oxford, policing Cuba's punishment. In 1968, the revolution added its own folly by summarily banning all small businesses, including the paladares, Havana's lively bars and restaurants. The Soviet era had begun.

Spirit of independence

The needs of survival now underwrote a morose presence of Russian advisers. Cuba's main crop, sugar cane, went almost entirely to the Soviet Union in a life-saving deal struck in 1961 by Che Guevara, who had little time for the Soviet version of communism. The urgency was made clear by the then US secretary of state, Dean Rusk, who the following year wondered if "this is the time to eliminate the Cuban problem by actually eliminating the island". The CIA's relentless terrorism against Cuba included numerous attempts to assassinate Castro and the blowing up of a Cuban airliner with the loss of 73 lives. Three US administrations tightened the vice of the blockade so successfully that the calorific intake of Cubans in the 1990s dropped by a third. Today, Cuba is banned from buying nearly half of all world-class drugs in a market dominated by the US. A catastrophe has been averted, says the American Association of World Health, only because of the extraordinary priority the Cuban government has given public health. For me, to arrive in a Latin American society without grinding poverty filling the eye is almost a shock.

“Accelerating the hard features of Cuba," a US diplomat once said, memorably, "will be the measure of our success, not theirs." He meant the authoritarian line handed down from the top, and the petty restrictions and impediments to serious dissent. When they could, many Cubans left. These days, the hard features are softer, perhaps changed beyond recognition. The educated young have made their disaffection known. Raúl Castro, who formally replaced his elder brother as president in 2008, says the bureaucracy to which he has devoted his life "has been tied for years to obsolete criteria". He wants to reduce the presidency to two five-year terms, a proposal once unthinkable.

With the Soviet times preserved in the rusting shells of missiles strewn on the bluff next to Che Guevara's house, Cuba seems determined to reclaim the independence that was its original heroic achievement: the precursor of contemporary revolutions, however imperfect. Proudly manipulating the gears of his canary-yellow 1952 Chevy convertible, Juan Ramón Ramírez pointed out the cardiac institute where his life was saved, free of charge. In most of Latin America, he would probably be dead now.

Off the leash

Tourism has long replaced sugar, with the benefit of jobs and hard currency and the odium of a separate currency. When I first came, Havana's great cathedral of a hotel, the Nacional, was so bereft in its echoing emptiness that I was offered Errol Flynn's room - 235 - and a laundry service that entailed a man in a dark suit and shades driving my shirts somewhere in a mighty 1940 Cadillac LaSalle. Today, the great teak doors and Corinthian columns overlook Europeans with neat rucksacks. A jukebox still plays and there is a list of "famously nostalgic" rooms: Mafia 211, Nat King Cole 218, Ava Gardner and Frank Sinatra 225, Fred Astaire 228, Johnny Weissmuller (Tarzan) 232. That I, an inveterate swimmer, lapped the very same pool as the great Weissmuller, one of the fastest swimmers of all time, compensates for missing out on Errol Flynn's art deco playpen.

The Cuban writer Leonardo Padura Fuentes describes his country's attraction as a "magnetism, sometimes morbid, sometimes admiring", leaving no one indifferent. Radios that crackle, a new airport terminal with birds nesting, the early-morning snores of an official at passport control and the palpable ambivalence of pride and frustration belong to a revolution that sends tens of thousands of doctors across the world for the sole purpose of helping other human beings: an epic internationalism.

It is the idea of Cuba having slipped the leash that still threatens America's time-warped sense of its own power and self-given right to define other societies. As Richard Gott points out in his fine book Cuba: a New History, modern Cuba's creator, el máximo líder Fidel, in swapping his slogan from "socialism or death" to "a better world is possible", has ensured that there will be little change when he dies: regardless of machinations across the Florida Straits, change has already taken place.

John Pilger, renowned investigative journalist and documentary film-maker, is one of only two to have twice won British journalism's top award; his documentaries have won academy awards in both the UK and the US. In a New Statesman survey of the 50 heroes of our time, Pilger came fourth behind Aung San Suu Kyi and Nelson Mandela. "John Pilger," wrote Harold Pinter, "unearths, with steely attention facts, the filthy truth. I salute him."

This article first appeared in the 08 August 2011 issue of the New Statesman, Slum rule

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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.