In October 1975, US President Gerald Ford told Mayor Abe Beame that he would extend no assistance to the City of New York, and that he’d veto any congressional bailout funds for New York City. On October 30 the New York Daily News published one of its most famous headlines:
Now 40 years later, Pres. Obama is telling Puerto Ricans the same thing, with one major difference.
It is much more unjust.
Unjust because Puerto Rico is not the financial and media capital of the world.
Unjust because Puerto Rico is a US colony.
Unjust because by 1930, Puerto Rico was already a factory worked by peons, fought over by lawyers, bossed by absent industrialists, and clerked by politicians – Uncle Sam’s second-largest sweatshop.
Unjust because the US controls Puerto Rico’s shipping, banking, currency, international trade, consumer prices, currency, import/export quotas, judicial code, and legislative authority.
Unjust because, unlike every state in the US, Puerto Rico is specifically prohibited from any Chapter 9 bankruptcy or debt re-structuring.
Unjust because for 95 years, since passage of the 1920 Merchant Marine Act (the Jones Act), Puerto Rico has not been able to develop a shipping industry, or establish any control over the price of consumer goods that pour in from the US ships.
Unjust because Wall Street demanded “fiscal responsibility” from Puerto Rico in order to avoid “Junk Bond” downgrading of its public debt. Then after 33,000 workers were fired, and water rose by 67%, and electricity hiked to 29 cents per kilowatt, and property taxes spiked, and gasoline taxes rose twice in one year, and SBC (small business corporation) taxes rose by 39%, and teacher pensions were cut, and 120 schools shut down…Wall Street still designated the island’s debt as “Junk Bonds.” In other words: Wall Street lied, then hiked the premium payments, and now they want to collect.
Unjust because AIG and half of Wall Street engineered the Mortgage Crisis of 2007. They profited trillions of dollars from their white collar crimes, no one went to jail, millions of Americans lost their homes…and the US government gave AIG a $182 billion bailout.
Despite all these injustices, Pres. Obama will do nothing for Puerto Rico. Perhaps he’ll entertain everyone with a little salsa.
But when all the dancing is done, Obama will not want to upset the municipal bond markets. He will hide behind the courts, the bankruptcy laws, and the US Congress.
The stakes are very high…too high for a lame duck president with waning influence and a “legacy” to burnish.
No, the fight against this injustice will be a lonely one. But it can be won.
Fighting in one corner: Wall Street revenue, the Oppenheimer Fund, broker’s fees, trader’s commissions, churned accounts, and year-end bonuses.
Fighting in the other corner: the human rights of an entire island, the last colony on earth.