Protests are mounting in Puerto Rico as the centrist government of Governor Alejandro Garcia Padilla, of the Popular Democratic Party (PDP), goes ahead with a privatization scheme involving the Luis Muñoz Marin airport, which provides service to the capital, San Juan.
The scheme was cooked up last year by Mr. Garcia Padilla's predecessor, Governor Luis Fortuño of the New Progressive Party (PNP). Fortuño's administration was wracked by street protests against his neo-liberal policies of austerity and privatization, which led to his defeat by Mr. Garcia Padilla in the November 2012 elections. The Popular Democrats also got majorities in both houses of the Puerto Rican legislature in those elections.
The Fortuño plan was explained by the previous government as being necessary because Puerto Rico is broke, with the Port Authority, which runs the airport, more than a billion dollars in the red. This impecuniousness was also given as the reason for severe cuts in the higher education budget, which set off a struggle by unions and student organizations in 2010 and still continuing. But in fact the effort to impose the neo-liberal austerity and union busting program in Puerto Rico has been going on since long before the present world financial crisis. In 1998, there was a massive labor and people's struggle to prevent the privatization of Puerto Rico's telephone services, which met with a vicious repressive response from the government.
The specific deal concerning the airport involves the Aerostar Company, gives the Mexico-based company a 40 year lease to run the airport in exchange for $2.6 billion in cash and equity over a number of years. Aerostar is a 50-50 combination of the Mexican firm Grupo Aeroportario del Sureste, which runs several airports in Mexico, and Highstar Capital, a U.S. "infrastructure investment" company.
On Monday, the U.S. Federal Aviation Administration, which has authority over airports in Puerto Rico because the island is not an independent country but a U.S. "commonwealth" (some would say colony), indicated to the Puerto Rican government that it has approved the plan.
Governor Garcia Padilla said he did not especially like the plan but felt he had to go ahead and implement it because his predecessor had made a commitment and now it became a question of Puerto Rico keeping its word to the investors. But labor unions and other people's organizations, as well as the left, in Puerto Rico objected strongly.
Worse for the governor, it appears that most of his party's representatives in both houses of the legislature are also angry about the deal.
Labor's object focuses on the fact that nothing was negotiated to make sure that current employees of the airport and its present subcontractors would not be let go and replaced, perhaps even by foreign workers brought in for the purpose, leading to unemployment and union-busting. Puerto Rican business concerns also object that the continuation of their contracts to run some airport services is not guaranteed in the agreement. Opponents of the deal also fear that it will result in significant cost increases to consumers of airport services, while enriching foreign corporations instead of Puerto Rican businesses.
In the Legislative Assembly, Representative Jose Varela Fernandez, representing the caucus of the governor's own Popular Democratic Party presenting a report denouncing the arrangement, saying "the transaction in question lacks the indispensable value of transparency which should characterize every transaction which alienates ... a good which forms part of the national patrimony."
Puerto Rico receives subsidies to the tune of $4 billion annually from the United States but as a U.S. possession, has limited ability to deal with fiscal and economic crises. It does not control its own currency, for example, and can not unilaterally do anything about the fact that vast areas of the country are occupied by U.S. military bases. Removing U.S. military operations from the offshore island of Vieques took a long, massive struggle, which continues still with a focus on cleaning up the environmental damage done by the military.
The formerly ruling PNP calls for Puerto Rico to be made the 51st U.S. state, but leading members of the US Republican Party, with which the PNP itself is loosely allied, puts conditions on this such as changing Puerto Rico's official language from Spanish to English; a high hurdle in a land where 97 percent or more of the people speak mostly Spanish.
Governor Garcia's PDP wants to continue the current "Commonwealth" status, if possible with enhanced autonomous powers, while the PIP and other left wing parties without current parliamentary representation call for Puerto Rico to become fully independent, which would allow it to become part of growing trade and aid arrangements that are raising living standards in the Latin-America and Caribbean area.