By Franklin D. López - @trueblue51
Former UPI and The Associated Press news writer
May 30, 2017 - Revised August 5, 2017
One of the biggest crime committed by men is to remain
passive and silent before injustice. This is more relevant when the nation that
projects to be the beacon of Freedom and Democracy, the United States of
America, builds a framework to deal with Puerto Rico’s debt with a clear and
aggressive economic and austerity policies that forces the population of the
U.S. Territory into a massive exodus to the states of the Union. Last June 27,
2016, the U.S. Congress and President Barack Obama approved and signed a law
called “PROMESA” (Promise) that effectively takes over the powers and autonomy
of the Puerto Rico government, including municipalities and all public
agencies.
“PROMESA” was approved, with bi-partisan support, in 6
weeks, a record breaking period to pass the complex ‘coup d'état’ legislation
greased by extraordinary donations by Wall Street hedge funds and bond holders
to the campaign coffers of members of Congress. I supported the approval of the
“PROMESA” legislation provided that the 3.4 millions American citizens living
in the territory are treated equally, like the citizens of New York City,
Washington, D.C. And Detroit. Their debt restructuring was done in part with
Federal grants, guarantees and strong economic development policies in order to
neutralize the contraction and devastating effects of austerity measures.
Yesterday the Federal Fiscal Board approved, unanimously,
cuts and measures reducing the work schedule of 150,000 public employees by 10%
and the pensions affecting 125, 000 between 5 and up to 25%. This was done by
the members of the Board knowing that Puerto Rico’s economy is in coma care and
that this decisions will ignite even more massive population exodus to the
United States from the territory.
These austerity measures were presented by
Natalie Jaresko, the Board’s $625,000 a year executive director and with an
abysmal record as a former Finance Minister of the Ukraine and the subject of
an extensive journalist investigation by Consortium News. (See How Ukraine’s
Finance Chief Got Rich at https://consortiumnews.com/2015/11/10/how-ukraines-finance-chief-got-rich/
)
This week it was announced by the territory’s Education Department that the
system has lost 55,000 students for the school year beginning August 6, 2017
and Puerto Rico has more than 300,000 houses units emptied causing the biggest
deflation of real estate values since the Great Depression.
 |
| PUERTO RICO FISCAL BOARD |
The Federal “Supervisory” Fiscal Board is integrated by 7
members of which four are Puerto Ricans. The four members of Puerto Rican origin
were appointed to diffuse and neutralize that Washington has effectively taken
over the day to day operations of the territorial government and giving the
impression that FSFB is “controlled” by a majority of Puerto Ricans.
In an interviewed with journalist the President of the
FSFB, Jose Carrión III, brother in law of the former Resident Commissioner of
Puerto Rico in Congress, Pedro Pierluisi 2009-2016 made a very revealing
statement. He said, “When I come to Washington and meet with staffers
The Puerto Rico government presented a fiscal plan at the
request of FSFB for the year 2017-2018. The FSFB also requested cuts for two
years of approximately $3.5 billions per year. Among those cuts the FSFB
included more than $ 1 billion in health care cuts for low income families and
education. In simple words, the FSFB is punishing the people of Puerto Rico for
depositing their trust to corrupt politicians in territorial election. In their
yearly report to Congress the Fiscal Board recommends using the Food Stamps,
rent subsidies under Section 8 and Temporary Assistance to needy family funding
to create a job tax credit efectively taking more than $ 1.4 billions from the
dying economy.
The Board decided to punish the people of Puerto Rico instead of
going after the investment bankers who promoted bond issues knowing that Nobel
Economic Prize winner, James Tobin warned against issuing additional debt in
November 1979.
The Fiscal Board should use the Assistant Attorney General under
the Obama administration who wrote a memo establishing a policy of going after
the culprits by imposing fines in the billions of dollars rather than
prosecuting the criminals. The Board should go after UBS, RBC, CityCorp, J.P.
Morgan-Chase, Banco Popular, Banco Santander and demand restoration and damages
for promoting bond issues that were designed to default. The Office of
Comptroller of Puerto Rico estimates that more than $ 22 billions have been
stolen by corrupt politicians since 1973 to 2016 based on the loss of 10% of
the territory’s annual budget! Just like investment bankers and bankers
responsible for the 2008 financial collapse none will be prosecuted criminally.
It seems that crime does pays!
The contrast in the restructuring of the debt and
economic crisis in New York City, Washington, D.C. and Detroit with the
disparate and discriminatory of Puerto Rico’s plan is unconstitutional. In a
meeting with Senator Tom Harkin (D-Iowa)in March 2010 he told me, “You know
Franklin that Congress has the power literally to discriminate against U.S.
Citizens in the territory. For example U.S. Citizens residing and retired in
the Republic of Costa Rica receive Supplemental Social Security income while
that benefit is denied to U.S. Citizens in the territory of Puerto Rico.” His
statement blew my mind! The three major cities that went through the debt
crisis received loan guarantees and multiple Federal funding to deal with
economic stimulus and development in coping with the challenges of serious
austerity measures.
The United States has given hundreds of billions of
dollars to the International Monetary Fund and the World Bank to provide
economic assistance and bail outs to countries like Portugal, Greece, Tunisia,
Italy, Ukraine and many others. The European Union Commission has demanded,
just like the FSFB, strong austerity programs together with bail outs. Some of
the countries received multiple bail outs.
See the table below.
Bail Outs given by the European Union through funds of
the IMF, WB & Others
The austerity measures and cuts demanded by the FSFB will
not solved the debt crisis neither the economic mess of the U.S. Possession.
Nobel Economic Prize winner, Mr. Joseph Stiglitz recently said that the
“economic fiscal and austerity demands by the FSFB will only deepens the
crisis.” This means that the population exodus will expand to biblical
proportions. There are 5.2 millions American citizens from Puerto Rican origin
residing in the United States.
This is a direct result of political, economic and social
policies implanted by Washington in establishing a colonial regime since the
invasion of the 1898 Spanish-American war. The Treaty of Versailles gave
primary responsibility to the well being of the citizens of the conquered
possession to the U.S. Congress. During 119 years, the U.S. Government
established a segregated, discriminatory and apartheid regime in the “enchanted
islands of Puerto Rico.” This disparate and colonial treatment has forced the
archipelago’s population to leave.
The FSFB members believe that they are creature of a
lesser god and that they are above the law.Adding injury to pain, today is the
320 day that the seven members of the FSFB have not complied with Section 102 of the Ethics in Government Act of 1978 (5
U.S.C. App.) by making public as mandated detailed audited financial
statements.
What is more fascinating in the formulation and structure
of the PROMESA Act and the FSFB. Both follows the same conduct adopted by the
George W. Bush and Barrack Obama administrations with financial crisis, big
bankers and the culprits that caused it.
That policy can be summarized in the following manner:
“Let’s bail out the to big to fail banks and let the people pay. No banker will
go to jail!” In Puerto Rico’s case tens of billions of dollars of public bonds
issues made with questionable financial statements and fraudulent financial
projections. The Security and Exchange Commission is presently conducting an
investigation of the 2009-2014 bonds issues made by the two previous
administrations. The FSFB policy is to squeeze as much tax monies from a decaying
and dying economy before injecting any Federal funds. They want the anemic
private sector to bear the responsibility of reviving a dying economy. They
want to increase the tax burden on the citizens of the territory.
The U.S. Government, by legislating PROMESA and creating
the FSFB and by demanding austerity, cuts and economic policies are coercing
and forcing the massive exodus of the Puerto Rican society to stratospheric
levels. Dismembering families and pushing them to seek “the American dream” in the
states of the Union. The International Criminal Court recognizes coercive acts
and public policies that forced massive numbers of population to move from
their place of origin. Specifically, Article 7 (1) (d) “Crime against humanity
of deportation or forcible transfer of population” classifies it as a crime
against humanity.
Where is the International community, Human Rights
organization and watchdogs while Puerto Rico as a society is dismembered and
force to leave their place of origin? There are primitive ways to destroy a
people and to force to flee. There are sophisticated political and economic
policies that can achieve the same objectives. The International Community is
in the same place watching the Syrian people being slowly destroyed by a civil
war sponsored by the major powers of the planet.
The People of Puerto Rico voted on June 11, 2017 and chose statehood. Every Puerto Rican that moves to the Union will cost the U.S Tax payer at least twice as much as servicing their needs in the territory. Statehood is the only way that we can bring Puerto Ricans back to fill the 332,000 empty housing units. In 2016 5,509 housing units were foreclosed. This year 17,000 are in the judicial foreclosing process.
When Hawaii entered the Union had a population 0f 620,000
and in 2015 it had 1,442,000. Only statehood will bring Puerto Rico back from
the brink of dying. But the Fiscal Board ignores what many presidential task
forces have concluded that the economy of Puerto Rico is linked to solving the
status issue. The Board’s coercive austerity measures, imposed by the powers
delegated by Congress, will continue to dismember the Puerto Rican family and
forcing them to move to the United States. This simply constitute a crime
against humanity. Is anybody in the International community listening?
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