The Militant (logo)  

Vol. 81/No. 20      May 22, 2017

(lead article)

Washington pushes cuts on Puerto Rican people

Just days after approving measures to further slash the standard of living of working people in Puerto Rico, the government there filed for a form of bankruptcy May 3. The move puts on hold lawsuits over the government’s inability to pay a $74 billion debt to bondholders and $49 billion owed to workers’ pension funds.

It’s an unusual bankruptcy because Puerto Rico is a U.S. colony. Under U.S. law, the colonial regime couldn’t file the request without the approval of the Financial Oversight Board, appointed last year by Washington. The board has dictatorial power over all financial and budget decisions of the Puerto Rican government.

And when a U.S. judge orders the start of negotiations over “restructuring the debt,” no representative of the Puerto Rican government will be at the table. Instead, Washington’s fiscal board will “negotiate” in the name of Puerto Rico.

Kowtowing to the board’s dictates, Gov. Ricardo Roselló signed the “Law to Carry out the Fiscal Plan” April 30, tearing up union contracts for public employees, cutting vacation and sick days, reducing overtime pay and gutting seniority rights.

“They’re undoing all the gains we have made since 1940,” Ángel Figueroa Jaramillo, president of the electrical workers union UTIER, told the Militant by phone May 5.

“They slashed our vacation days in half and cut double time pay for Sundays we had fought for and won. Now they’re only going to pay time and a half,” Figueroa Jaramillo said. “We accumulate sick days. They’re taking that all away.” In a separate move the junta ordered the government-run electrical utility to prepare to privatize energy generation as well as to cut pensions and other labor costs further.

The new law also “increased the charge for water, which had already been increased, and takes away many medical benefits. It increases driver license fees and adds 100 new taxes,” Frank Pizarro, secretary treasurer of the AFL-CIO affiliated FCT union federation, said by phone. “They are lowering our wages and benefits and increasing the cost of living at the same time.”

Already household electrical bills often reach hundreds of dollars, a gallon of milk costs $6.25 and workers face an 11.5 percent sales tax.

Blows to the working class
These measures come on top of more than a decade of devastating blows to the living conditions of working people on the island. Puerto Rico’s gross national product has contracted by 18 percent since 2006. Nearly one-quarter of the government workforce has been laid off and many pharmaceutical and other factories have closed down.

The island’s Department of Education announced May 5 the closure of 184 more public schools this year. Officials closed 150 schools from 2010 to 2015. Enrollment has dropped 42 percent in the past three decades as Puerto Ricans abandon the island for the United States to escape the economic and social devastation.

But the squeeze on the island’s workers hasn’t satisfied bondholders, who say that the $800 million a year the fiscal board has approved toward payment on the debt is not enough. That’s far less than the $3.5 billion a year the coupon clippers demand.

Many of the hedge funds had scooped up bonds at cut-rate prices as Puerto Rico’s economy was gutted. With the bankruptcy filing, the fight between creditors on who gets paid most and when will intensify.

‘The plebiscite is a farce’
In the midst of the crisis and protests against the fiscal board — including a strike, protests by tens of thousands on May 1 and a student strike at the University of Puerto Rico — Roselló advanced plans for a June 11 plebiscite “for the immediate decolonization of Puerto Rico.” Initially voters would have had two choices, either “Statehood” or “Free Association/Independence.” If the second option won, there would be a run-off between “Free Association” — often translated as “Commonwealth” — and “Independence.”

Most proponents of free association say that they want an “enhanced” relationship to give the island-nation more autonomy from Washington.

In another act of colonial arrogance, the U.S. Department of Justice rejected the wording on the ballot, claiming it would not “accurately reflect the current popular will of the people of Puerto Rico.” To meet Washington’s dictates, Roselló added a third option, “Current Territorial Status.”

In response, the National Hostosiano Independence Movement, the Puerto Rican Independence Party and the Popular Democratic Party are now calling for a boycott of the plebiscite.

“The plebiscite was always an optical illusion,” said electrical union leader Figueroa Jaramillo. “It wasn’t even a binding vote.”

“I’ve never participated in a plebiscite,” longtime independence fighter Rafael Cancel Miranda told the Militant. “Independence isn’t something to be discussed, it’s to be respected. It’s our right. The plebiscite is a farce.”

Many unions and student groups are calling for the debt to be audited, but the colonial regime has refused.

“They don’t want it audited because they’re hiding something. The debt is not ours. They owe us, we don’t owe them,” said Cancel Miranda, pointing to the billions of dollars in profits that U.S. corporations have made in Puerto Rico.

“They’re sinking Puerto Rico,” he said. “The only alternative is independence.”
Related articles:
SWP: ‘End US colonial rule in Puerto Rico!’
Oscar López will be free May 17! Welcome back!
Oscar López will be free on May 17, tour Puerto Rico, US
Front page (for this issue) | Home | Text-version home