On September 19, Gov. Garcia Padilla shocked all of Puerto Rico with the announcement that he was “leasing” 34,500 acres of public land to the owners of Don Q Rum. The governor claimed this would “reduce up to $300 million a year” in federal excise tax payments to the US.”
But documents filed with the SEC show the exact opposite. The 34,500 land grant will INCREASE the payments to US interests…and both the US and Puerto Rican governments are lying about the “benefits to Puerto Rico” from this 34,500 acre plantation…
A plantation that may have thousands of indentured servants, all getting $4.25 an hour.
WHAT FEDERAL EXCISE TAX?
The first lie of Gov. Garcia Padilla, was his definition of the “federal excise tax.” As of 1917, the federal excise tax on rum is returned to the Puerto Rican government.
This was part of the Jones-Shafroth Act of 1917, which made Puerto Ricans “citizens” of the US, just one month before the US entered WWI.
When 18,000 Puerto Ricans were drafted and sent off to war, at least their rum was not being taxed!
The point is…Puerto Rico does not pay federal excise tax on its rum. So when the governor claimed that his 34,500 land grant would “save Puerto Rico $300 million a year in excise tax payments,” the governor was lying.
THE REAL TRUTH
The real truth is this…
In June 2005, during the PPD administration of Gov. Anibal Acevedo Vila, a series of bonds were issued by the Puerto Rico Infrastructure Financing Authority. The bonds allowed Puerto Rico to borrow $1,332,962,916 ($1.33 billion dollars).
Page 1 of the bond financing instrument is very clear:
“The Bonds are payable solely from…federal excise taxes imposed on rum and other articles produced in Puerto Rico.”
Page 20 shows a table of excise tax receipts, during the years 2000-2005, which totaled over $1.7 billion.
Page 22 states that the Serallés family is the second-largest producer of Puerto Rican rum, and that “Serallés has been producing rum in Puerto Rico since the mid 1800s.”
The last three pages show the 30-year repayment schedule of these bonds…all to be paid from the excise tax on rum, which is being pledged to the bondholders.
WHAT IS REALLY HAPPENING
Eleven years later, in 2016, the government of Puerto Rico is broke.
It is defaulting on almost all of its bond payments…which is why the US is sending in a Financial Control Board.
And so, in order to generate more excise tax revenue, the Gov. Garcia Padilla took public land, and converted it into a private, for-profit use by the Serallés family.
The 34,500 acres will enable Puerto Rico to increase their payment to the bondholders, for this $1.33 billion debt created in 2005, by Gov. Anibal Acevedo Vilá.
If the Financial Control Board succeeds in lowering the minimum wage of young workers to $4.25, Puerto Rico will return to the 1930s…with sugar cane plantations paying starvation wages, and calling it “economic development.”
What is really happening, is the creation of indentured servants…all working for absentee landlords.
GEORGE ORWELL LIVES AGAIN…IN PUERTO RICO
The Puerto Rican government owns a TV station called WIPR TV.
On September 19, this government-owned station reported on this 34,500 deal.
A reporter read a Telepompter, and claimed that the 34,500 land grab would keep federal excise taxes (taxes on rum imports) in Puerto Rico.
With an Orwellian flourish, the editors added applause – and “oohs and aahs” – when the reporter said it.
You can view this at 1:32 – 1:40 of this clip:
Then this internet press release – also from the government-owned WIPR – announces that $300 million per year in US federal excise taxes (taxes on rum imports) will now stay in Puerto Rico, thanks to this deal!
But it is all a lie.
Gov. Garcia Padilla is privatizing 34,500 acres of public land in Puerto Rico. He is enriching the Serallés family, and servicing the financial speculators on Wall Street.
Please review the 2005 bond instrument…particularly the page numbers provided above.
Just like Orwell’s 1984, the people of Puerto Rico are being told that black is white…and that Big Brother loves you.
For a history of the War Against All Puerto Ricans, read the book…
Si prefiere ver la página web en español por favor visite: http://www.guerracontratodoslospuertorriquenos.com