Monday 25 September 2017

Putting together a picture of Puerto Rico

Reports are coming in dribs and drabs. One knows that anything coming from mainstream media is only a fraction of the truth.

The following may provide some clues as to what the people of Puerto Rico on an island and isolated, are having to put up with.

The interview with the mayor of San Juan paints a picture.
Look at Puerto Rico Devastation of Hurricane Maria

Environmental Disaster Looms in Puerto Rico, Lashed by Hurricane Maria & Left Without Power

Democracy Now!

Hurricane Maria made landfall in Puerto Rico Wednesday as a Category 4 storm, bringing record rainfall and catastrophic flooding, destroying power lines and leaving the entire country in the dark. This comes as many homes on Puerto Rico were still dark two weeks after Hurricane Irma cut electricity to hundreds of thousands. The storm also raised concerns about potential environmental disasters. Puerto Rico is home to 23 Superfund sites, including on the island of Vieques, site of a former U.S. naval test range, which took a near-direct hit from the storm. It is also the site of a coal-fired power plant owned by the private company AES. Residents across the island have been demanding the plant be closed and that the company stop dumping toxic coal ash into their community, saying the waste is poisonous to their health and the environment. We speak with Emily Atkin, staff writer covering the environment at the New Republic, who writes, "Puerto Rico is Already an Environmental Tragedy. Hurricane Maria Will Make It Even Worse."

ALERT! Nuclear Power Plant in Puerto Rico Hit by Hurricane Maria

The decommissioned Boiling Nuclear Superheater (BONUS) reactor, located northwest of Rincón, Puerto Rico, was developed as a prototype nuclear power plant to investigate the technical and economic feasibility of the integral boiling- superheating concept

Puerto Rico Guajataca Dam fails - Tens of Thousands evacuate + PR Maria footage

Puerto Rico dam weakened by hurricane, forces seniors to evacuate

San Juan mayor: “There is horror in the streets”

Mayor Carmen Yulín Cruz recounts the many struggles Puerto Rico's capital city is facing as it tries to regain its footing after Hurricane Maria

This gives some clue as to what was facing  Puerto Rico BEFORE  the hurricanes

Puerto Rico's Financial Future Now in the Hands of a Single Judge Overseeing Massive Bankruptcy

This was written after Hurricane Irma, and before Maria devastated the island
Thanks to Obama, Puerto Rico might never recover from Irma

15 September, 2017

In June 2016, Congress and President Obama passed a bill supposedly to address the economic crisis in Puerto Rico, by imposing external dictatorship on the island. Called the Puerto Rico Oversight, Management, and Economic Stability Act (or PROMESA), it placed an unelected seven-member board in total control of all important policy.

The supposed justification was to give the island some way to get through bankruptcy. In reality it has set the island up for a decade of mass unemployment and crisis — without remotely fixing the debt problem. It's no accident the locals call the board "La Junta."

And now Puerto Rico has suffered serious damage from Hurricane Irma, adding yet another problem to the pile. Without serious federal help, this crisis will continue indefinitely.

Puerto Rico got into debt trouble through a combination of odd tax loopholes, irresponsible governance, and even more irresponsible lending. The details are complicated, but the most important thing to remember is that every bad loan has two parents, borrower and lender. If it was irresponsible to take money, it was even more irresponsible to give it to an entity that was clearly in over its head. Other Wall Street goons in the form of "vulture funds" have been downright predatory, buying up abandoned debt on the secondary market for a small fraction of its face value, then filing a blizzard of lawsuits to get the government to force Puerto Rico to pay up in full, by cannibalizing its public infrastructure.

The other thing that must be remembered is that the austerity always demanded by creditors during a debt crisis is straightforwardly self-defeating. As many countries have demonstrated since the 2008 financial crisis, austerity during a depression makes a debt problem worse, by strangling the economy and reducing tax revenue. It's like trying to undertake heavy manual labor while on a starvation diet — you just make yourself weak and sick.

What Puerto Rico needs right now is a big check from the federal government to get its economy re-pressurized, coupled to a debt restructuring and partial write-down to get it on a realistic repayment schedule. This would ideally be coupled to a thorough economic overhaul, and finally U.S. statehood. "Structural reform" has become a dirty word due to it usually being code for austerity and neoliberal assault on workers, but Puerto Rico's economy really does need work. Its labor force participation rate and productivity are low, its unemployment and poverty rate is high. Those problems will not be solved with budget cuts, but they are real problems.

What's more, Puerto Rico's infrastructure — long neglected due to the years of fiscal crisis — is in sorry shape, as was shown during Hurricane Irma. It took a fairly bad battering from the storm, which knocked down buildings and left hundreds of thousands without power ever before the highest winds arrived. The island's oil-fired power plants are outdated and fragile, and it has little solar power despite being a prime location (thoughone large plant was opened earlier this year). A big infrastructure update would be a splendid candidate for a federal stimulus plan to restore employment, stop the hemorrhaging of residents to the mainland, and increase productivity over the long term.

But as economist Martin Guzman explains, the PROMESA plan — its board, by the way, still has a fervent right-wing Social Security cutter — goes the opposite direction:
Unfortunately the [Fiscal Control] Board approved a fiscal plan for the next decade, 2017–2026, that is not aligned with what Puerto Rico needs to recover. Even the creators of the plan project another lost decade for the country, and they're being overly optimistic since their projections are based on assumptions that are not sound. They're underestimating the consequences that the plan will have for the Puerto Rican economy and society. As long as the board doesn't settle on a sound macroeconomic plan with a sound debt restructuring proposal, PROMESA will not be fulfilling the role for which it was created. [Institute for New Economic Thinking]
Despite the wreckage left by Irma and its sorry economic condition, many Puerto Ricans generously took in refugees from neighboring islands that suffered a direct hit. That, I suggest, is the attitude with which the American mainland should approach its Caribbean colony, still home to 3.4 million American citizens. They're in trouble and need help — and help could be easily provided.

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