Its economy relies to an absurd extent on the low-wage tourism sector. Because it lacks higher-wage, tech-oriented jobs, its average citizens struggle to bridge the chasm between their incomes and their exorbitant living costs.
But so what? It’s a sunny town on a bay with muy caliente Latin flavor. The visitors and their money will keep coming and keep the place afloat. Besides, it’s got more important things to worry about – like a mortal political enemy 90 miles away.
Am I describing Miami? Yep. But I’m also describing Havana, Cuba.
Which is why the ridiculous row over whether to allow Airbnb into Miami-Dade County raises an instructive question: Why is Miami so terrified of Airbnb – but Havana isn’t?
READ MORE: The Florida Roundup: Airbnb in South Florida
No, I am not comparing Miami’s vibrant capitalism to Havana’s dismal socialism. But the Airbnb hysteria spotlights a troubling similarity between the two economies – and it ought to be a wake-up call on this side of the Florida Straits.
Let’s first understand why Airbnb – the online service that helps property owners rent out rooms for short-term visitor stays – is so popular in Miami-Dade.
Tourists can find cheaper rates in a market whose hotel bills are among the highest in the world. More important, owners can leverage their ranch houses and condos into the extra earnings they need to keep their financial heads above water.
That ain’t easy when the median Miami-Dade household income is less than $45,000 but the median home price is more than $300,000. Half of Miami-Dade households spend more than a third of their income on housing. As residents told WLRN’s “The Sunshine Economy” this week, that’s a millstone around their necks.
A big culprit is the relative scarcity of jobs that pay more than changing hotel sheets does. Pockets of Miami like Wynwood and the Jackson Memorial healthcare district do showcase tech talent here. But Florida International University business professor Jerry Haar says Greater Miami ranks 39th out of 40 large U.S. cities in growth of scale-up companies. Meaning, while Miami loves to celebrate start-ups, too few of them graduate to grown-up payrolls.
Havana’s got the same problem. Officially, most Cubans make about $25 a month. You can’t live on that, of course. But so many Havana citizens are doomed to basement earnings because their government is an even worse economic-diversification slacker. High tech in Havana means sitting in a wi-fi park with a $5 Internet card waiting to get your laptop conectada.
So to keep their financial heads above water, Habaneros are turning to Airbnb to rent out their own properties, or casas particulares. In fact, such short-term room rentals now account for at least a quarter of tourist beds available in Cuba.
But unlike local governments in Greater Miami, the Cuban government isn’t trying to kibosh the practice. In Havana, Airbnb isn’t illegal, as it is in the cities of Miami and Miami Beach. Havana doesn’t levy $20,000 fines against Airbnb use, as Miami Beach does.
Why not? After all, like Greater Miami officials, Cuban authorities rely inordinately on their formal hotel industry for economic sustenance. They too have a motive to shield it from Airbnb competition.
I think they don’t because, ironically, they’re approaching this with capitalist common sense while their Miami counterparts are reacting like statist protectionists.
For starters, they seem to understand Cubans need the moonlighting cash. (Last year I paid $40 a night for a week in a casa particular. Do the math.) They also seem to realize Airbnb at least brings visitors – who still spend their bucks on meals, taxis and scuba gear.
And they might decide, after walking Havana's seaside Malecón, that on their next visit they’ll stay at the Hotel Nacional. Just as the Miami Beach Airbnb visitor might stroll Ocean Drive and say, “Honey, next time let’s stay at The Clevelander.”
So kudos to Miami-Dade County this week for resolving to collect the 6 percent county bed tax from Airbnb guests – even if Miami and Miami Beach reject the arrangement, and even if Miami-Dade Mayor Carlos Gimenez told the Miami Herald the county is “not condoning” Airbnb.
Yes, it is. And it makes as much sense in Miami as it does in Havana.