HAVANA - As more and more Cubans go into business for themselves under President Raul Castro’s economic reforms, the ethos of capitalism is increasingly seeping into the island’s daily life - often in stark conflict with fundamental tenets of the Cuban Revolution.

In parts of Havana these days, it seems there’s a mom and-pop snack shop or pirate DVD stand on every other block. The chants of cart-pushing vendors echo through residential streets. Farmers line up before dawn at an open-air market to jockey for the best spot to sell their produce.

After decades of being urged to report any black market activity in their neighborhoods, some Cubans now find themselves looking at their neighbors’ legal businesses and worrying that they’re falling behind.

The free market is still limited in Cuba, but it is already altering lives and reshaping attitudes. Some fear - and others hope - that values anathema to a half century of Communist rule are taking root more with each passing day. It’s increasingly acceptable for workers to reap the benefits of their own labor directly, instead of seeing it redistributed.

“There have been changes, and as the country grows there will be more,” said Luis Antonio Veliz, proprietor of the stylish, independent cabaret-nightclub Fashion Bar Habana. “It’s a very positive thing, but some Cubans are having difficulty understanding that now not everything depends on the state.”

While many new entrepreneurs have failed, undone by a lack of supplies, a limited customer base and scarce resources, many of those who have succeeded have entered a glamorous world that disappeared after Fidel Castro’s arrival in Havana put an end to the freewheeling 1950s.

It’s on display at Fashion Bar Habana, where Veliz has draped the walls in luscious silver and gold brocade. He’s done well enough that he recently was able to relocate his business to prime real estate in the colonial quarter that draws well-heeled tourists.

But with success, came sacrifice. Veliz realized he had to be on-call 24 hours a day to solve problems, an unthinkable notion when he was a state-employed restaurant worker. He skipped vacations, and sometimes went days without seeing his family.

“When you work for yourself, you have to look out for your own interests,” Veliz said. “I’ve become harder, tougher, more confident.”

The law of the marketplace visibly dominates places like Old Havana’s Egido Street, which teems with horn-blowing, smoke-belching cars and independent pedicab drivers calling out to potential fares.

Dozens of entrepreneurs have moved in to take advantage of the foot traffic around a farmer’s market. They include 13 flower shops and at least seven modest luncheonettes that all offer more or less the same ham and cheese sandwiches for about 20 cents apiece. Sometimes street vendors park their carts here, ramping up the competition further.

Yeska Estiu, a 44-year-old florist, recalled the dilemma she faced when stores ran out of the green spray paint they use to spruce up the accent ferns in their arrangements. In an inspired moment, she hit on switching to white paint - giving her bouquets a snowy touch that was a big hit with clients.

Within a few days, the others had copied the technique.

“Here, sales are based on quality, on innovation,” said Estiu, who also tries to stand out from her neighbors by swathing her bouquets in brightly colored paper and ribbons brought from overseas by her husband. “We are all competing to have a better product.”

The new business ethos comes with risks, some Cubans say. Gilberto Valladares, better known as “Papito,” worries that competition and self-interest will eat away at revolutionary values such as solidarity, unity and nationalist pride.

Valladares is the founder of the private Artecorte hair studio, which resembles an opulent European salon for its mosaic floors, high ceilings, intricate plaster molding and romantic candelabras.

He’s on a mission to convince fellow entrepreneurs that they have a moral duty to give back to the community. In recent years, he has used his Artecorte salon to bankroll a neighborhood revival project, opening up an adjacent barbers’ school, repainting shabby walls and installing plants and street lights.

“I want people to understand that not only should there be economic benefit,but they can contribute to the social benefit,” said Valladares, 44.

For three decades after Fidel Castro’s 1959 revolution, the Cuban experiment to create honest, obedient citizens who selflessly hold the needs of society above their own was helped along by generous subsidies and trade from the Soviet bloc.

In return, the government guaranteed every last islander a job, a home and enough food to eat. Low salaries were offset by free health care and education, and other benefits like subsidized appliances.

But the socialist contract began to fray in the 1990s after the collapse of the Eastern Bloc sapped billions of dollars from the island’s economy, made worse by the U.S. trade embargo. Amid empty store shelves and chronic fuel shortages, necessity forced Cubans to look out for their families and themselves first.

Meanwhile, tourists began arriving in droves as the state looked anywhere it could for foreign revenue. They brought with them material goods rarely seen in what had largely been an isolated society, as well as a dark side in the form of hustling and prostitution fed by desperation for hard currency.

The “Special Period” of austerity cemented in the Cuban identity islanders’ famed knack for finding a way to make do: Bartering pilfered flour for equally pilfered eggs, for example, or keeping a 1950s Cadillac on the road by swapping in a Russian Lada engine.

If the ingenuity and individualism of the 1990s was about getting by, for many it’s now about getting ahead.

Many islanders are using new found income to build second stories and other additions to their crowded houses. Even the very concept of the family home has been turned on its head by a measure legalizing real-estate sales.

Better-off Cubans wear the latest designs brought in from Miami, Ecuador or Panama. Six years ago, cellphones were closely restricted and there were only 330,000 of them for a country of 11 million. Today, there are 1.8 million mobiles, according to government statistics.

Officials have repeatedly said state guarantees of free education, health care and other things are sacrosanct, and the reforms aim to perfect socialism, not embrace capitalism.

But the economic changes are bound to bring changes to the social fabric, and some Cubans who aren’t in business sense that the reforms may be passing them by, particularly retirees living on pensions of about $10 a month.

Back at Egido Street, Manuela Pena, 73, who has lived alone for 20 years in her drab home with peeling gray paint and rickety chairs, complained that prices are soaring. After hearing decades of Marxist preaching that all Cubans should share the same fate, she’s falling behind.

And all that bustle outside her front door? As far as Pena’s concerned, all it’s done is fill the neighborhood with noise and litter.

“The country is going from bad to worse,” she said.

Business, Pages 67 on 12/15/2013