Throughout 1961, Cuba continued to move against American interests.
On August 5, Cuba expropriated American-owned telephone and electricity companies, 36 sugar mills, and $800 million in US petroleum assets.
The US quickly pushed through a resolution by the Organization of American States (OAS) condemning extraterritorial (Soviet) intervention in the western hemisphere.
Cuba responded by establishing diplomatic relations with Communist China and issuing a call for other Latin American countries to throw off US neocolonial control.
A month later the government nationalized the Cuban branches of North American banks along with 382 Cuban-owned firms. These included sugar mills, rice mills, Cuban-owned banks, railroads, textile factories, distilleries, department stores, and movie theaters.
A second Urban Reform Law was passed prohibiting ownership of more than one residence. Those leasing confiscated property became tenants of the state and former owners received compensation at a maximum rate of $350 monthly.
Later that month, Cuba nationalized another 166 North American enterprises, including insurance firms, import companies, hotels, casinos, textile firms, metal plants, tobacco export firms, chemical companies, and food processing plants. This all but eliminated US investment in Cuba.
Backtracking a bit, by January 1961 the US embassy in Havana had allegedly become the center for destabilization attempts against Cuba. Castro ordered the embassy to reduce its staff from 300 to 11. The US broke off diplomatic relations with Cuba and banned US citizens from traveling to the country.
In the wake of US actions, Castro mobilized popular support for the revolution, easily stirring the intense nationalistic fervor necessary to radicalize the revolution.
Moreover, the confrontation with the US sealed the necessity for an alignment with the Soviet Union. And, of course, the realignment deepened the conflict with the US.
In April 1961, Castro had declared that his was a socialist revolution. In December, he said he was a Marxist-Leninist.
While the Soviet Union had at first been cautious — and even suspicious — about the Castro regime, Khruschev was now presented with a fait accompli.
The Cuban communist party–the PSP–had not led the revolution, it did not control the government, it did not have a single ministerial level official, and the head of state did not originate from the ranks of the party. Nevertheless, in the context of Cold War competition with the US, the Soviets could not refuse to assist a government that had carried out the first socialist revolution in the Western Hemisphere.
Cuba was increasingly incorporated into the Soviet orbit.
Since Cuba had no major energy resources of its own, oil was a key element.
It was agreed that Cuba would trade its sugar, nickel, and citrus for Soviet oil, wheat, chemicals, and machinery.
Cuba argued that this was a mutually beneficial alliance characterized not by charity, but justice. After all, the great powers had a duty to help the less fortunate.
However, while prices were set to benefit Cuba, the reorientation of trade placed a major strain on the island’s economy as it attempted to meet expanded infrastructure demands.
Because trade relations with the United States had run on a pattern of frequent small shipments, the island lacked the port facilities and warehouses needed to deal with the large shipments that were now arriving from the Soviet bloc.
As a result, the changes put in place to facilitate the new direction of trade transformed the economy.
The Cuban-Soviet alliance soon extended to the provision of military supplies. According to an estimate by the US State Department, over 28,000 tons of military supplies had been received in Cuba between the time of Batista’s departure and November 1960. Most of the supplies had arrived from Eastern Europe and the Soviet Union. By April 1961, another 2,000 tons had been added.
Photograph by Lisa Reynolds Wolfe