US takes over Puerto Rico's finances: a nudge toward statehood?
Puerto Rico turned over control of its finances on Friday to a seven-person board appointed by the US federal government, inaugurating a period of historic US control over a territory foundering under the burden of nearly $70 billion in public debt.
The board, created by legislation passed by Congress in June, held its first live-streamed meeting in New York on Friday, electing a president and deciding on which of Puerto Rico鈥檚 government agencies and institutions would fall under the board鈥檚 fiscal direction. The list is long, including the central government, its biggest university, the energy and sewage authorities, a government development bank, and the public pension system, .
Four Republicans and three Democrats make up the board. Only four of them are Puerto Rican, and , with some also serving stints in local government, the judiciary, and academia.
In New York on Friday, pro-independence demonstrators in protest of what they described as colonialist policies enacted by a 鈥渄ictatorship鈥�. And on the island, many saw little reason for optimism.
鈥淚f this Board acts the way it looks like it will, what鈥檚 waiting for us over the next five years is going to be fiscal austerity and, as such, restrictions that will translate into a continual exhausting of Puerto Rico鈥檚 economy,鈥� in an interview with Metro PR.
Others pointed to the inability of the island鈥檚 government to resolve the problems.
鈥淚ndependent of whether one can be in favor or against the board, it鈥檚 positive,鈥� El铆as Guti茅rrez, a professor at the University of Puerto Rico鈥檚 graduate school of urban planning, . 鈥淭hey鈥檙e talking about a dictatorship? But here in past years, we鈥檝e destroyed the middle class, the capital bases have been destroyed, [and] the bondholders have been beaten up, affecting their savings.鈥�
The takeover comes amid an unprecedented wave of migration to the mainland as many Puerto Ricans, who are US citizens, seek to escape an ongoing economic crisis. And with the island鈥檚 finances out of its hands, some say the takeover could invigorate the debate over its status as an unincorporated territory.
Politics in Puerto Rico are divided largely along the lines of where parties stand on whether the island should become a US state, remain a commonwealth, or declare its independence. But with unemployment at 12 percent and some convinced that the debt load promises further woes, the popularity of the biggest party in support of the status quo, the Popular Democratic Party, have tanked.
"The party has completely fallen apart," Eduardo Villanueva, a pro-independence political analyst, . Congress鈥� vote to put in place a federal takeover, he added, "was the final blow to the commonwealth status."
Even before the takeover, some members of the PDP argued that the status quo was no longer feasible. In 2015, University of the District of Columbia professor Rafael Cox Alamar, a one-time candidate for resident commissioner with the PDP, 鈥渁s soon as Puerto Rico hits the applicable fiscal and economic growth benchmarks,鈥� that would return control over its finances back to the island鈥檚 government, 鈥渋t should face a stark choice between sovereignty and annexation.鈥澛�
鈥淭he status quo must be discarded from the outset because it is both the source of the structural crisis besieging the island and a colonial anachronism at odds with the US鈥檚 geopolitical interests in the Americas,鈥� he wrote.
If it comes down to the two, statehood might be likely to win out. In a 2012 nonbinding resolution, 61 percent of voters chose it as an alternative to the status quo.
That plebiscite didn鈥檛 include a variety of other non-colonial options, Jorge Benitez, a political scientist at the University of Puerto Rico-Rio Piedras, .
"This isn't to say that support for statehood hasn't increased 鈥� it has. But the only thing we can decipher with certainty from the vote is that the people of Puerto Rico want a change to the current status.鈥�
"It isn't clear what change we want, but we want change."
