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Tue Apr 5, 2016, 12:58 AM

Financial Oversight and Colonialism in Puerto Rico

April 4, 2016
Financial Oversight and Colonialism in Puerto Rico

by Matt Peppe

118 years after U.S. troops landed at Guánica, Puerto Rico, the liberal political site the New Republic asks, “Why Are We Colonizing Puerto Rico?” The occasion for this comically tardy acknowledgment of Puerto Rico’s colonial status is a Republican proposal to deal with the island’s $72 billion debt problem by allowing a cabal of unelected technocrats carry out austerity measures against the will of the Puerto Rican people. Or, as the bill puts it: “To establish an Oversight Board to assist the Government of Puerto Rico … in managing its public finances.”

The Republican plan most certainly would “spell disaster for vulnerable Puerto Rican citizens, and create a bonanza for private corporations looking to take over public functions,” as David Dayen writes in the New Republic piece. But Dayen is shutting the stable door after the horse has bolted.
As I reported recently, vulnerable Puerto Ricans are already facing disaster in the form of cuts to social programs and oppressive increases in taxes. Private corporations have already taken over public functions, including the island’s largest airport and its largest highway. Former Governor Luis Fortuño created the Public Private Partnership Authority to allow the firesale of public assets to corporate vultures nearly seven years ago.

Alternative plans have been advanced in the Senate and the Obama administration. Both of these would allow restructuring of Puerto Rico’s debt, which the House Republican plan would not. While the Republican legislative proposal for Puerto Rico is vastly inferior to either of the other options, neither the Democratic Senate plan nor the White House plan would be fair to Puerto Rico’s residents.

The Senate plan would grant priority for pensions over bondholders. This would directly challenge the outrageous clause in Puerto Rico’s colonial Constitution which mandates that if revenues are ever insufficient to cover appropriations, the interest on public debt must be paid before anything else.

More:
http://www.counterpunch.org/2016/04/04/financial-oversight-and-colonialism-in-puerto-rico/

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