In central Havana, a giant mound of sand-colored rubble fills an entire city block. It is all that remains of the Superior Institute of Industrial Design—a stately, historical building that in its 166 years of existence housed a Spanish officers’ club, U.S. occupation forces after 1898, Cuba’s health ministry, and, finally, the prominent design school. Having been declared uninhabitable years ago, the structure suffered two partial collapses in 2025. Despite the clear and present danger, the state never dispatched work crews or engineers to secure or fix it. This past February, what remained of the building suddenly fell in a catastrophic collapse, entombing several squatters who had been living inside the deteriorating halls. Months later, skinny men could still be seen scaling the craggy, unstable surface, prying loose bits of brick that they loaded up to build makeshift houses elsewhere.
Cuba, on its current trajectory, is headed straight for the fate of the design school: what lies ahead is an accelerating collapse of the state and the broader economy. Unless this destructive course is reversed soon, rebuilding the island as a stable, prosperous, and democratic place could become virtually impossible.
A few months ago, a slow and agonizing unraveling was not what most observers expected. Because of the stringent tariff threat in place since February against any countries supplying oil to Cuba, President Donald Trump’s repeated warnings of potential military action, and reports of secret backchannel talks between Havana and Washington, many analysts and diplomats believed that either a negotiated power-sharing deal or a Venezuela-style military operation was imminent.
By late May, however, that optimistic or dramatic scenario looked far less likely. According to reports from the Miami Herald, the covert talks had entirely collapsed amid stiff opposition from Florida Republicans and Havana’s flat rejection of Washington’s core offer: U.S. investment and vital petroleum in exchange for President Miguel Díaz-Canel’s removal and the privatization of Cuba’s state-owned oil company. Although Havana subsequently enacted 176 economic reforms in June—expanding the legal space allowed for the private sector—this maneuver failed to satisfy Washington. While allowing limited U.S. fuel and food to reach the island exclusively through private distributors, the Trump administration piled on new sanctions targeting state-run companies and regime officials. By August, U.S. Secretary of State Marco Rubio told Axios that the policy’s timeline had fundamentally shifted, asserting that dealing with Cuba would take "patience and persistence" and suggesting that the communist regime could potentially survive into 2028 or beyond.
There are a few different ways for political analysts to read Rubio’s calculated comments. One interpretation is that the administration is simply bluffing, threatening to maintain extraordinary sanctions pressure either to force the stalled negotiations back open or to misdirect the regime ahead of a surprise military operation. Another view is that, with the United States heavily entangled in conflicts in the Middle East and busy managing the ongoing political crisis in Venezuela, Cuba has simply been demoted as a foreign policy priority. Under this theory, the administration has essentially put the island on life support—permitting just enough U.S. fuel and food to reach private firms to prevent a total societal breakdown, but otherwise abandoning any proactive plan, effectively setting Cuba policy to autopilot. A third reading is that the administration has concluded that waiting for the one-party system to implode entirely from within is the only viable path to regime change, even if that path proves to be long, tortuous, and profoundly uncertain.
Regardless of which interpretation holds true, what is not widely appreciated outside of Cuba is how economic and state collapse—triggered in large part by the regime’s deep-seated unwillingness to enact structural reforms and hastened by tightening U.S. sanctions—is already fundamentally remaking the island. The Cuban state, aside from its enduring capacity for ruthless political repression, is rapidly weakening across every other metric. The economy is steadily contracting and growing dangerously more unequal, leaving behind a massive underclass that is far too poor to participate meaningfully in the newly emerging private sector. Social cohesion is visibly fraying, violent crime is on the rise, and plunging birth rates alongside relentless mass emigration continue to warp Cuba’s demographics in irreversible ways.
All of these troubling trends predate the foreign oil cutoff and the newest round of sanctions by years, if not decades, but each now appears to be accelerating at a dangerous pace. The overarching danger is that the longer the current political impasse lasts, the more these destructive trends will calcify into the permanent baseline conditions for any future national transition. This process steadily narrows the chances that Cuba will ever become a well-governed country, while significantly increasing the likelihood of an even more dysfunctional, chaotic future instead. If nothing changes soon, a transitional government could one day find itself in the exact same impossible position as the men atop the ruins of the design institute: trying to build something safe, habitable, and lasting entirely out of rubble.
Authoritarian Anarchy
While walking through the streets of Havana, visitors frequently hear a dark local joke: "Only two things work in this country: the state security apparatus and the hospitals." In truth, the joke is far too generous to the hospitals. Regarding the state security apparatus, however, the cynicism is entirely accurate. Political repression is the only thing the Cuban state still does remarkably well. This resilience owes less to any apparent abundance of national resources than to the leadership’s rational and ironclad political unity. The headquarters of the Directorate of Penal Institutions, which administers the country’s sprawling prison system, is as decrepit as any decaying building in central Havana, with cardboard haphazardly filling broken windows. Yet the generals and spy chiefs know precisely how much they stand to lose from genuine political liberalization. Even if the Trump administration has tried to convince some high-ranking figures that there are safe off-ramps, those efforts have yielded little success. Consequently, the elites stick together, and the state’s institutional capacity for repression remains fully intact.
Although ordinary Cubans met on the street are astonishingly willing to voice sharp criticisms of the regime on street corners or within earshot of their neighbors—a practice observed nearly universally—none expressed any willingness to join a public street protest, recognizing it as a near-certain route to immediate detention. In case anyone needed a reminder of the consequences, police cars were routinely spotted parked outside the family homes of known protest leaders as ominous psychological warnings. Given how desperately scarce fuel is across the island, it is particularly telling that the regime can always find the necessary gasoline to dispatch these intimidation vehicles.
On every other practical dimension, however, the Cuban state is vastly weaker than most foreign observers realize. This miscalculation is common among both right-wing observers abroad who imagine a monolithic anti-American leviathan, and left-wing sympathizers who cling to the romanticized fiction of fully functional schools and hospitals. A far more accurate description was offered by a European diplomat stationed in Havana, who characterized the situation as "authoritarian anarchy"—describing a state that can still ruthlessly stifle political expression but is increasingly incapable of providing basic public services or preventing generalized disorder.
Take the public health sector, which was long touted as one of the Cuban state’s proudest achievements. Access to the country’s best clinics always depended heavily on personal political connections. However, through the early 2010s, Cuba’s population-level health indicators—underpinned by well-trained medical professionals and generous public investments—remained among the strongest in Latin America. Today, by contrast, most hospitals completely lack essential medical supplies and basic medicines, forcing desperate patients to buy everything from antibiotics to amputation saws on the burgeoning black market. Although many dedicated doctors do their absolute best under extraordinarily difficult circumstances, unlivable public-sector salaries have made bribe-taking increasingly common. Newly graduating medical students now routinely pursue unrelated work in the emerging private sector or choose to emigrate altogether.
The results of this healthcare decline are stark. Infant mortality, which was once among the lowest in the entire region, has more than doubled since 2018. Furthermore, mosquito-borne illnesses that the state had previously successfully contained have made a dramatic comeback. Chikungunya alone infected up to a third of the entire population in 2025, while cases of dengue and Zika have also surged dramatically.
Violent crime, once almost entirely unknown on the island, is also rising sharply—serving as yet another visible sign of the state’s haphazard and humiliating retreat. Although the lack of reliable official statistics makes this trend difficult to fully quantify, and while Cuba still endures far fewer violent incidents than several of its regional neighbors, the growing fear of robbery and assault has fundamentally altered the daily routines of ordinary Cubans. Residents of Cárdenas, a small city located two hours east of Havana, now deliberately stay off the streets after nightfall. Local vigilantes are allegedly behind a growing number of killings of suspected criminals in that city and in Guantánamo, a city not to be confused with the nearby U.S. military base of the same name.
In Havana, stories of brazen break-ins to steal valuable solar panels and water tanks have become common occurrences, alongside a widespread public perception that the police are increasingly absent or entirely corruptible. Although crime remains largely disorganized for now—driven primarily by abject economic need or addiction to a cheap synthetic cannabinoid known locally as el químico, which is now ubiquitous across the island—observers warn that these criminal elements could easily cohere into something much more organized.
Crumbling power plants, a drastically shortened school year, and the makeshift holes that Havana residents have cut directly into city streets to siphon off scarce public water for resale or private consumption all point to the same reality: the hollowing out of the state is visible everywhere. The long-term effects of the U.S. embargo are partly to blame for these conditions, as is the severe cutoff of foreign oil imports since February. However, no external force compelled Cuba’s leaders to devote, by the year 2024, 37 times as much public capital investment to tourism, real estate, and hospitality projects as they did to health and education. That was a high-stakes, profit-seeking gamble made by a small clique of political insiders, and it ultimately failed. The urgent question now is whether the state will retain any capacity to function at all, including maintaining basic public order, after enduring several more years of compounding breakdown.
The Longest Road
The second major transformation remaking Cuba, and creating profound dilemmas for any future political transition, is economic. The national economy is shrinking rapidly, having contracted by at least 15 percent since 2020 as tourism cratered and foreign investors fled the island out of fear of triggering new U.S. secondary sanctions. In response to this existential pressure, the regime has grudgingly opened up space for private enterprise—not because the majority of officials harbor any ideological fondness for free markets, but because they have concluded that allowing some level of market activity is the only way to prevent the island from starving or erupting into mass rebellion.
Since the 2021 legalization of micro, small, and medium-sized enterprises, known in Spanish as MIPYMEs, these private firms have grown to number more than 10,000. They now account for an estimated 65 percent of all retail sales and 40 percent of total employment on the island. The economic reforms enacted in June formally expanded the scope of permitted private activity, though lingering U.S. sanctions, the regime’s profound lack of credibility with domestic and foreign investors, and severe internal political divisions will likely limit their ultimate implementation.
The growth of the private sector has undeniably been a positive and necessary development, keeping at least some store shelves stocked amid the broader crisis and making a portion of the population less beholden to state salaries, which have historically served as a primary source of political leverage for the regime. The 2021 currency unification was another necessary step. Despite its disastrous initial implementation, which severely shredded the purchasing power of most ordinary Cubans, it finally ended a convoluted dual-currency system that had heavily distorted prices and masked the chronic underperformance of state enterprises.
However, the specific manner in which these markets are taking root—leaving much of the population far too poor to participate meaningfully, operating entirely without the rule of law, and watching the wealth gap between winners and losers steadily widen—is deeply pernicious for the country’s long-term future. Several Cubans interviewed during reporting remarked that they felt as though they were living through Russia’s turbulent 1990s: a painful period characterized by murky backroom deals and rigged competition that led not to broad-based economic prosperity, but rather to the rise of entrenched oligarchs and mass immiseration.
The word that locals repeated most frequently was reparto—signifying a cynical divvying up of the country’s assets. Regime insiders are best positioned to reap the rewards, and new MIPYME owners have managed to get a foot in the door. Meanwhile, the young, the elderly, public-sector workers, and a disproportionate number of Afro-Cubans are increasingly struggling simply to buy food. As one Cuban woman bluntly summarized the situation: "We took the longest, most painful road to Latin American capitalism."
In many ways, Cuba is rapidly reproducing the worst structural defects of certain Central American economies—rigid class differences, systemic cronyism, heavy remittance dependence, and chronically low productivity—only without the benefit of their comparatively stronger economic growth. The widening inequality is impossible to miss. Even now, with rolling blackouts regularly stretching across two to three days at a time, better-off neighborhoods feature newly opened restaurants with diesel generators humming, bright lights glowing, live DJs playing, and tables filled to capacity. Just outside those establishments stand darkened, crumbling houses, while uncollected trash piles up aggressively on the unlit streets.
It did not have to unfold this way. Cuba’s population remains remarkably well-educated, even as the higher wages paid by private MIPYMEs pull skilled professionals away from their traditional academic and technical fields. A political transition undertaken today could still put a dynamic and fair market economy within realistic reach. If delayed by another two or three years, however, that window may close entirely.
Those Who Stay
The final dimension of Cuba’s multi-layered collapse is arguably the hardest to measure with hard statistics, yet it is the one that local residents expressed the most anxiety about: what several described simply as "social decay." The interlocking, compounding effects of mass emigration, rapid population aging, and a widening generational divide pose enormous, unprecedented challenges for Cuba’s future viability.
Since 2020, Cuba’s total population has fallen by an estimated 13 to 24 percent, driven primarily by an unprecedented, ongoing wave of emigration. Because those who chose to leave were disproportionately women of reproductive age, Cuba’s already rapid population aging has accelerated drastically. Demographic authorities forecast that by the year 2050, fully one in three Cubans will be over the age of 60, up significantly from one in four today. Managing such a demographic shift would present a massive challenge even for a country boasting a robust economy and a fully functional pension system. For a broken Cuba, it could easily become an insurmountable hurdle.
Emigration has also completely hollowed out entire professional fields, emptying hospitals of trained health workers, schools of qualified teachers, and even local churches of priests and pastors on a scale never before witnessed in modern Cuban history. Several middle-aged Cubans drew a sharp contrast with the severe economic hardships of the 1990s "Special Period," when the sudden loss of Soviet economic aid and trade shrank the national economy by about 35 percent. Back then, far fewer doctors and teachers left the country; the island was undeniably broke, yet hospitals and schools somehow managed to keep functioning. That is manifestly no longer the case. A deep social divide has also grown between Cubans who have family members living abroad—who receive regular remittances to start private businesses—and those with no such international connections, a demographic that is disproportionately Afro-Cuban.
Living day in and day out without sufficient food, energy, or medicine is also exacting a severe psychological toll on the population. The nation’s youth are paying the highest price, particularly those whose parents have emigrated and who are growing up hungrier and more socially excluded than earlier generations. Yet the emotional cost is generalized across all age groups. "This is not resilience," a man in Havana stated bluntly, pushing back against the romanticized cliché that Cubans are uniquely gifted at enduring endless hardship. "People can adapt to anything. We transform ourselves to manage to survive this process, but it is a degradation."
The Price of Delay
When Cuba’s Caribbean and Central American neighbors began their respective transitions toward democracy some 40 to 50 years ago, few international observers expected them to succeed. Most of those nations were far poorer, more economically dysfunctional, and more deeply unequal than Cuba is today. Yet they ultimately proved that unfavorable starting conditions are not permanent destiny: most successfully democratized and watched their economies grow and stabilize over time. Cuba could theoretically follow that same path.
However, the longer the current political stalemate drags on, the dimmer that prospect becomes. Sustaining the current level of maximum economic pressure may eventually cause the authoritarian regime to implode from within, or it may not. What it will unquestionably do, if persisted in for another year or more, is render Cuba increasingly ungovernable by anyone.
The Trump administration may not have fully weighed that compounding danger, or it may have judged it an acceptable cost to force a long-overdue political opening. Strikingly, some ordinary Cubans have independently arrived at the exact same calculation. Many residents met during reporting did not believe that U.S. sanctions were primarily to blame for the country’s current crisis. To them, whether sanctions stayed or went mattered far less than whether the regime remained in power, since in their view the government bore the overwhelming share of responsibility for the ruined economy. A nationally representative survey conducted by the AmericasBarometer reflects a similar sentiment: 74 percent of respondents blamed the Cuban government for the ongoing crisis, while just 16 percent placed primary blame on the United States.
That said, the risks of sustaining the current pressure indefinitely remain immense. For both countries, arguably nothing would be worse than a catastrophic spiral into rampant criminal violence and chaotic ungovernability on the island. Prolonged maximum pressure also dramatically raises the ultimate price of future national repair, and a post-transition Cuba will possess very limited domestic means of financing its own reconstruction. Rebuilding Cuba’s crumbling electric grid alone, which degrades further with each additional blackout, is projected to cost an estimated $8 billion. Furthermore, it could take the country years just to regain access to vital international financing from the International Monetary Fund, the World Bank, and other multilateral institutions. Given the broader fatigue among the U.S. public with foreign nation-building exercises, the U.S. Congress is unlikely to step in to fill that financial gap in the interim.
Pursuing the opposite course carries significant costs of its own, however. Those who advocate for swift normalization and the complete lifting of the embargo without requiring meaningful political change need to be entirely honest about what that policy entails: accepting the reality that ordinary Cubans would, completely against their will, continue living indefinitely under an authoritarian regime that enriches its own elite while keeping its citizens poor enough to easily control. They should harbor no illusions that Cuba’s current leadership, armed with fewer sanctions, would suddenly possess the ability or the desire to rebuild collapsing state institutions, lower widening inequality, or restore frayed social cohesion. The regime’s singular, overriding objective remains holding onto power at all costs.
A third way may still be possible: crafting a new diplomatic offer centered on targeted sanctions relief focused strictly on alleviating the compounding humanitarian crisis, implemented in exchange for specific, verifiable political and economic reforms that could chip away at the regime’s tight control. Even if Havana has repeatedly rejected such transactional deals in the past, it remains a diplomatic avenue worth attempting. But whatever strategic path Washington ultimately chooses to pursue, policymakers must carefully consider the steep costs of delay—costs that are already historically high and continuing to rise with every passing day.
