Wednesday, May 27, 2015

NELSON DENIS : How the United States Economically and Politically Strangled Puerto Rico

Book Describes The Beginnings of the CFC Regime
This issue was emphasized and  highlighted by Attorney Luis Costas Elena in his Harvard Thesis many decades ago. Is has become our biggest obstacle in our quest for equal rights. 

Fighting this Corporate monster has brought upon me the wrath and criticism of  many, including statehood leaders in Puerto Rico
Now,  finally, my long time claims of who obstruct Statehood for Puerto Rico, and of who RULE Puerto Rico's Government, and  who RULE the political and media spectrum which deal with Puerto Rico's issues, are seeing the light.
Nelson Denis is right on target when he goes back to the beginning of the 20th century regarding Puerto Rico's use as a Tax Haven for Corporations, who over a century later are to blame for Puerto Rico's desperate economic situation  and our constitutional and status limbo. 
Puerto Rico does not have self government... Puerto Rico is ruled by the CFC Regime who "rule and own" our peoples' lives,  order and select our political leaders and rule our political parties. 
We are now at a crucial moment. The US Congress is revising the Tax Reform Act and the CFC REGIME are using their enormous resources and lobbyists to sustain their use of Puerto Rico as an Offshore Tax Haven in detriment of Puerto Rico, Puerto Ricans and the US Tax Payers.
The message is : Puerto Rico must not be Coded in Section 933 of  the IRS as a Foreign Country. It is used for the US Trillion Dollar IRS tax evasion scam by the CFC's.(Controlled Foreign Corporations)
How the United States Economically and Politically Strangled Puerto Rico
Sunday, 24 May 2015 By Mark KarlinTruthout | Interview
The following is an interview with Nelson A. Denis, the author of War Against All Puerto Ricans: Revolution and Terror in America's Colony.
(Photo: Mike Fitelson)
Nelson Denis by Mike Fitelson
Nelson A. Denis: In 1897, Spain granted Puerto Rico a Carta de Autonomia (Charter of Autonomy), which gave the island the right to its own legislature, constitution, tariffs, monetary system, treasury, judiciary, shipping industry, international trading rights and coastal control. All of this was rescinded when the US assumed "ownership" of Puerto Rico as an unincorporated territory (ie, a possession) of the US, pursuant to the Treaty of Paris.
Since then, and continuing to this day, the US has denied all of the sovereign elements of the 1897 Carta de Autonomia. It lied to Puerto Ricans with respect to their de facto membership in American society: declaring them US citizens in 1917, then ruling that the US Constitution "did not apply" to Puerto Rico (Balzac v. Porto Rico, 1922) and, as such, the privileges and immunities of the US Constitution "did not exist" on the island, as an unincorporated territory.In the middle of page 58 of War Against All Puerto Ricans (Chapter 8) I identify Charles Herbert Allen, the very first US civilian governor of Puerto Rico, as the Green Pope. .......... more
If you read [John] Perkins' Confessions of an Economic Hit Man, you will recognize the type. Charles Herbert Allen was the first US economic hit man to run amok in Puerto Rico. His first and only "Governor's Report to the US President" was a naked, undisguised plan for economic exploitation of the entire island of Puerto Rico. 
Pages 57-58 contain Allen's specific language in this report: 
"Porto Rico is really the 'rich gate' to future wealth ... the yield of sugar per acre is greater than in any other country in the world ... the cost of sugar production is $10 per ton cheaper than in Java, $11 cheaper than in Hawaii, $12 cheaper than in Cuba, $17 cheaper than in Egypt, $19 cheaper than in the British West Indies, and $47 cheaper than in Louisiana and Texas."
(Additional racist and abusive language by Allen appears on pages 57-58.)
Within weeks of handing in this report Allen resigned his governorship, scurried up to Wall Street, and became a vice president of Morgan Guaranty Trust. He built the largest sugar syndicate in the world, and his hundreds of political appointees in Puerto Rico provided him with land grants, tax subsidies, water rights, railroad easements, foreclosure sales and favorable tariffs.
By 1907 Allen's syndicate, the American Sugar Refining Company, owned or controlled 98 percent of the sugar-processing capacity in the US and was known as the sugar trust. By 1910, Allen was treasurer of the American Sugar Refining Company, by 1913 he was its president and by 1915 he sat on its board of directors. Today his company is known as Domino Sugar.
By 1934, every sugar cane farm in Puerto Rico belonged to 1 of 41 syndicates, 80 percent of which were US owned. The four largest syndicates were entirely US owned and covered over half the island's arable land. These banks also owned the insular postal system, the entire coastal railroad, and San Juan's international seaport. As of 1950, the Pentagon controlled another 13 percent of the island. 
KARLIN: In your epilogue, you describe the economic conditions in Puerto Rico in 2015 as wretched in comparison to states on the mainland.  Yet, it is only infrequently that you read about conditions on the island in the US corporate mainstream press. Why do you think that is the case?
DENIS: I disagree. There are many recent articles in US corporate mainstream press about the Puerto Rican economy. Predictably, and often explicitly, they offer a common theme: that Puerto Ricans are incapable of managing their own affairs, and a US "intervention" will be required to straighten the mess out.
Most recently this "intervention" has taken the form of Act 22, which provides high-net-worth US investors with a 20-year tax exemption on all capital gains, interest and dividend income derived from their investments in the island. The prime beneficiaries of this tax giveaway are US billionaires such as John Paulson, who made $15 billion for his hedge fund by betting against the American economy and against the American homeowner, during the 2007 mortgage crisis.
Paulson is now leading the charge into Puerto Rico, buying up "distressed assets" all over the island, and leading a $500 million resort and condominium development in Dorado Beach.
Puerto Ricans are being subjected to gasoline tax hikes (two in the past year), skyrocketing water and electrical costs, a looming 11.5 percent sales tax (aka IVU), pension rollbacks, worker layoffs, water rationing, student tuition hikes, and small business tax hikes - in order to meet the interest payments (not even the capital payments - just the interest) on the $73 billion of public debt.
But Paulson and friends are receiving corporate welfare and tax havens of the highest order. The US business press are the carnival barkers for this economic freak show that is developing in Puerto Rico. They are extremely bullish on Puerto Rico tax-sheltered investments.
Given the corporate ownership of 90 percent of all US media, I would not be surprised if there were a high level of cross-ownership, undisclosed investments, and advertiser involvement behind many of these "authoritative" and "objective" pieces on Puerto Rico tax shelter opportunities for the superrich.
Here is an article I wrote on the subject, which contains multiple references (and links) to some of that business press - particularly near the end of the article: The History of Taxes in Puerto Rico
You may read the full article here: How the United States Economically and Politically Strangled Puerto Rico

Nelson Denis' book may be bought at TRUTHOUT