Puerto Ricos crisis highlights its colonial status

As politicians wrangle over an overhaul of the tax system in Puerto Rico in order to avoid a budget crisis similar to the one that closed down the country’s schools and many government services for two weeks in May, the people are expressing their lack of confidence in the colonialist parties. Their attitudes are evident in public opinion polls and in the decision by increasing numbers to emigrate.

While Gov. Aníbal Acevedo Vilá, leader of the autonomist Popular Democratic Party (PPD), is not blameless in the current crisis, the lion’s share of responsibility has been put at the feet of Sen. Pedro Rosselló, chairman of the annexationist New Progressive Party (PNP). Rosselló is a former governor.

An article in the Puerto Rican pro-independence newsweekly Claridad said an Ipsos-Hispania poll, conducted shortly after schools and government agencies reopened, showed that 78 percent considered Rosselló either “very responsible” or “somewhat responsible” for the impasse between the legislature and the governor’s office that caused the shutdown.

José Aponte, PNP leader in the Chamber of Representatives, did not escape criticism either. Fifty-five percent said Aponte had a “negative image.”

A self-selected, unscientific online poll conducted by the daily El Nuevo Día showed that over 77 percent believe the government will likely shut down again. No doubt partially as a result of this belief, many Puerto Ricans have told the media they plan to move the United States.

Social scientists in Puerto Rico are projecting new emigration figures that rival those of the 1940s and 1950s. In those decades, many thousands of Puerto Rican emigrants left for New York City and the surrounding area. Many of today’s Puerto Rican emigrants are moving to the Orlando, Fla., area. Florida now has the second highest Puerto Rican population of any state in the U.S.

The governor and the legislature are currently fighting over what kind of sales tax to impose on the people of Puerto Rico. The various sales tax schemes range from 4 percent to 7 percent.

Progressive forces are fighting for an extra tax on the big, profitable corporations under the slogan, “Let the rich pay.” Most of these are foreign companies, mainly transnational corporations based in the U.S.

The Puerto Rican Independence Party (PIP) submitted a bill that would have taxed corporations making $1 million or more in annual profits an extra 10 percent. The PNP and the PPD amended the bill, taxing the corporations at a lower rate. They also allowed the companies to claim the additional tax as a credit on next year’s bill, making the “tax,” in effect, a one-year loan.

The budget crisis and the question of who should pay for it has brought to the fore the question of the colonial relationship between the U.S. and Puerto Rico.

In its tax reform proposal last year, the PIP noted that families paid almost $3 billion in taxes in 2005, while corporations paid under $2 billion. As working families’ taxes rose, so did “the amount of profits taken out of Puerto Rico by corporations of foreign capital,” the PIP said.

These mostly U.S. corporations, which enjoy special status as a result of the colonial relationship, have taken more than $138 billion out of Puerto Rico over the last five years.

In his recent testimony before the UN Decolonization Committee, Hector Pesquera, co-chair of the Hostos National Independence Movement, said: “The national economy, dependent and peripheral to that of the U.S., is frankly bankrupt. Puerto Rico has a public debt which is more than $40 billion, which makes us the nation with the biggest per capita public debt in the entire hemisphere.”

He continued: “Private debts are over $50 billion and U.S.-bound emigration means that today there are more Puerto Ricans living outside the island than in the national territory. Meanwhile, foreign corporations, mainly U.S., take $30 billion in net profits out of the country, and the financial sector and the banks have accumulated scandalous amounts in profits.”