The real source of Puerto Rico’s woes

A protester holds aloft a Puerto Rican flag during a demonstration outside the governor’s mansion in San Juan, Puerto Rico, on January 23, 2020, after a warehouse full of emergency aid was discovered undistributed to those in need. | Ricardo Arduengo/AFP via Getty Images

A broken governance structure, climate disasters, and the legacy of a colonial past have combined for a perfect storm.

After a disaster strikes, once the dead have been counted and the immediate damage stops, recovery is almost always the first question. How do we build things back to the way they were or even better?

For Puerto Rico — where over 3 million people were left without electricity and 760,000 without clean water after Hurricane Fiona flooded the archipelago last month — talking about solutions yet again can feel like déjà vu.

It’s no wonder. Hurricane Fiona hit Puerto Rico in mid-September, right before the fifth anniversary of Hurricane María, the Category 4 storm that led to the death of thousands of people in 2017 and knocked out the power grid for many islanders for nearly a year. In the immediate aftermath of María, politicians, NGOs, and economists rushed to craft potential solutions to make Puerto Rico more resilient against future climate events, ranging from privatizing the electrical grid to Federal Emergency Management Agency (FEMA) funding approximately $28 billion for construction and economic revitalization projects. Yet despite the damage and the death toll, only $5 billion of that money was actually disbursed and spent. And four-fifths of that went not to broader resiliency for future disasters but to emergency relief, according to the New York Times. That pattern holds true for other federal funds, such as the Housing and Urban Development department (HUD), too.

Alejandro Granadillo/AP

Homes are flooded on Salinas Beach after the passing of Hurricane Fiona in Salinas, Puerto Rico, on September 19.

So when President Joe Biden visited the island Monday to announce $60 million in flood protections, he emphasized that Puerto Rico will receive “every single dollar promised.” There will also be a “grid recovery modernization team,” led by Energy Secretary Jennifer Granholm, to help usher Puerto Rico toward progress, Biden said. Biden’s trip provided a clear contrast to the previous administration’s efforts. When former President Donald Trump visited after María, he threw paper towels into a crowd of hurricane survivors. Later, he told New York Times journalist Maggie Haberman that he saw the island as a place with “absolutely no hope.”

Beyond Trump’s opposition to funding disaster recovery, a major reason why Puerto Rico’s uptake on adaptation plans has been slow lies with the unique bureaucratic obstacles it faces because of its territorial status and pre-existing debt. Despite the money it did ultimately receive, Puerto Rico’s infrastructure is no better today than it was before María. In fact, it’s even worse. While Fiona was a much smaller storm than María, the hurricane revealed just how vulnerable the island remains. “Given that our collective ability to overcome these events has actually diminished since Hurricane María in 2017,” Raúl Santiago-Bartolomei, a professor of urban planning at the University of Puerto Rico, Río Piedras, told me by email, “both federal and local government policies in these areas have proven to be failures.”

Puerto Rico’s vulnerability to hurricanes goes beyond its location on a highway of tropical storms. The island is a poor place by any calculation — with a median household income at $21,000 and a poverty rate hovering around 40 percent, Puerto Rico is twice as poor as Mississippi, the most impoverished American state. And poverty is what can help make natural disasters so deadly and dangerous. But much of the reason why Puerto Rico is so poor boils down in large part to the long-term consequences of colonialism, which has held the territory back from making progress.

Evan Vucci/AP

President Joe Biden, with first lady Jill Biden, delivers remarks on Hurricane Fiona, in Ponce, Puerto Rico, on October 3.

Although Biden likely has a better-intentioned game plan in mind for Puerto Rico’s recovery than his predecessor, the problems on the island run much deeper than poor electricity infrastructure and sea walls. According to activists and scholars in Puerto Rico and in the diaspora, adaptation plans alone won’t be enough to improve the lives of everyday people living on the island. There will need to be a major reevaluation of the colonialist underpinnings — the debt crisis and Puerto Rico’s political structure, for one — in order for any kind of climate-resilient infrastructure to happen.

Puerto Rico’s political landscape, explained

From its 400 years as a colony of Spain to its ceding to the US after the Spanish-American War in 1898 to its organization as a US territory in 1917, there hasn’t been a moment where Puerto Rico has been independent as a nation-state. That might be surprising for almost half of Americans, who did not know that Puerto Ricans were US citizens at all, according to a 2017 survey by the Morning Consult.

In fact, Puerto Ricans have been American citizens since the Jones-Shafroth Act was signed by President Woodrow Wilson in 1917 (which also meant that Puerto Rican men were eligible for conscription — convenient timing given the US entrance into World War I that year). The act also established the Puerto Rican Senate, which has 27 elected members who work to pass laws. Despite having citizenship, Puerto Ricans have never been able to vote in general presidential elections and have no voting representative in Congress. Puerto Ricans also do not pay federal income taxes, but they do have to pay, and are eligible for, social security and Medicare taxes.

While Puerto Rico has power over its internal affairs — which are delegated through its own executive, judicial, and legislative branches — the US has control over its foreign relations, commerce, trade, and more, as long as there is a US law that supersedes Puerto Rican law. The same is true for states, but without voting representatives in Congress or a voice in presidential elections, Puerto Rico doesn’t have a say in federal laws that may impact its operations. Congress is also the only body that can change Puerto Rico’s political status from a territory into a state or into an independent nation, which again means that decision would be taken — or not — without the will of Puerto Rican voters.

That’s all intentional, said Jorell Meléndez-Badillo, a professor of Latin American and Caribbean history at the University of Wisconsin-Madison. “You will see that the reason why Puerto Ricans were not granted statehood [at the time] was precisely because the United States — including the president, congressmen, and academics as well — did not think that Puerto Ricans were fit to govern themselves.”

This ethos of paternalism has influenced almost every aspect of Puerto Rican politics since. Starting in the 1970s, the Puerto Rican government embraced a neoliberal approach to foreign investment. In addition to granting citizenship, the Jones-Shafroth Act made Puerto Rico’s bonds — which are essentially loans from an investor to a government or company — tax-free at the local, state, and federal levels. Because Puerto Rican bonds aren’t taxed, unlike most bonds from the state or federal government, they were more appealing to investors — so Puerto Rico used them as a strategy to fund its expenses.

So the territorial government received money from foreign investors (US investors are considered foreign), and, in return, Puerto Rico agreed to pay these investors back with interest on their investment. But the island’s ability to repay investors was hampered, since the US limited other ways the island could grow economically. Its agricultural industry was hampered by the 1920 Jones Act, which required that the transportation of goods between two US ports must be done with American-owned and operated ships. Puerto Rico, being an island, depends on ships — and Jones Act-compliant ships are expensive. And Operation Bootstrap, led by the Puerto Rican government with support from the mainland, replaced the island’s predominantly agriculture and textile industries with manufacturing in the 1940s. But once corporations left the island for cheaper labor abroad, islanders mass-migrated to the mainland for work.

Over the course of almost five decades, the island accrued more than $72 billion in bond debt, leading to a major debt crisis in 2014 that left little room for any government spending that wasn’t directed toward repayment. The crisis came at the heels of a decade-long recession, but peaked when several creditors downgraded Puerto Rican bonds to “junk status.” Investors no longer wanted to funnel money into Puerto Rico, and it had no way to fund itself, or to pay back returns. “Since 2006, we knew that the debt that Puerto Rico was accruing was unpayable,” Meléndez-Badillo said. “So this is basically the legal and economic infrastructure of Puerto Rico that has been collapsing for two decades now.”

In response to the crisis, US Congress passed the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA) in 2016. Its main action was to establish a fiscal committee, appointed by the president, to restructure Puerto Rico’s crippling debt.

Xavier Garcia/Bloomberg via Getty Images

A demonstrator confronts riot police officers during a protest against austerity measures in the Hato Rey neighborhood of San Juan, Puerto Rico, on May 1, 2018. Puerto Rican demonstrators battled police on San Juan’s streets as they marched against proposed cuts to retirement benefits and looser labor laws as the bankrupt island sought to reduce its debt.

The policy was widely supported by Congressional politicians across the aisle in Puerto Rico. After six years of work, the board finished restructuring the debt in March 2022 and Puerto Rico exited what was essentially bankruptcy and resumed repayments to bondholders. The board will remain in power until Puerto Rico has four consecutive balanced budgets. The seven president-appointed members do not all live in Puerto Rico and are not all Puerto Rican.

While PROMESA has been touted as a potential model for other states by publications like the New York Times, it has come at a great cost to people living on the island. In order to balance the budget, the board implemented austerity measures that led to hundreds of public schools closing and pension cuts for the elderly. Known colloquially as “La Junta,” the board has “severely hindered” access to essential services and “extended its reach beyond fiscal policy,” said Santiago-Bartolomei, the urban planning professor. Today, any political moves made by the Puerto Rican government that require spending must have the fiscal board’s approval.

“These sets of policies have substantially reduced local government capacity, which was made readily apparent in the aftermath of Hurricane María, the 2020 southern earthquakes, the Covid-19 pandemic and, now, Hurricane Fiona,” Santiago-Bartolomei said.

The disaster capitalism of it all

Because of the sheer amount of destruction caused, Hurricane María slowed down Puerto Rico’s efforts to repay its existing debt. It also created opportunities for cheaper land and profit-making, and infrastructure projects for non-Puerto Rican investors with resources — the most obvious example being the 2021 privatization of the electricity grid by LUMA Energy, an American-Canadian company.

As Vox’s Umair Irfan wrote last month, Puerto Rico’s public utility company, PREPA, was already bankrupt by the time Hurricane María hit. Eleven months with no power only eroded trust in a company that was already rife with mismanagement and allegations of corruption against it. LUMA came in at a time when faith in the electricity grid was already low. That faith has gotten lower among Puerto Ricans, who faced an increase in blackouts (to the point where reggaetón artist Bad Bunny wrote a chart-topping song about it), even as Puerto Ricans were charged more for less reliable electricity.

Even before Fiona made landfall, it was clear that the electricity grid had no ability to withstand the stress of another storm. (The attorney general of New York is now calling for an investigation into LUMA after the failures last month.) “In the five years since Maria, people’s lives have even been more devastated by things like the energy privatization,” said Sarah Molinari, an anthropologist studying how communities organize in the face of disaster in Puerto Rico.

Puerto Rico’s “public-private partnership” strategy to attract foreign investors to assist in recovery efforts goes beyond LUMA, too. The individuals and corporations who have moved to Puerto Rico in the last year, incentivized by friendly tax laws, tend to invest in tourism rather than infrastructure. As a result, Puerto Ricans are being displaced because of rent increases, in large part because beneficiaries have been purchasing properties all across the island for short-term rentals.

“The resulting disparities from local residential displacement, lack of affordable housing, and decreasing access to jobs, services, and opportunities likely outweigh any [economic] benefit”, said Santiago-Bartolomei.

Both the tax laws and LUMA’s privatization were intended to bring outside income to the island to help it financially recover from the debt crisis and Hurricane María, but the implementation has faltered, according to experts. The gentrification has further turned Puerto Ricans against Governor Pedro Pierluisi, whose delayed denouncement of LUMA’s continued blackouts only increased public anger.

Ricardo Arduengo/AFP via Getty Images

People protest outside LUMA Energy headquarters in San Juan, Puerto Rico, on April 8.

It’ll be difficult to move away from dependence on non-Puerto Rican entities to fund the island, since both LUMA and Act 60 — the tax law — are advocated for by La Junta. “The number one strategic approach is to reinforce a dependence on the tourist economy and these outside investment schemes,” said Marisol LeBrón, co-editor of Aftershocks of Disaster: Puerto Rico Before and After the Storm.

The prioritization of non-Puerto Ricans, time and time again, is a historical pattern. What had always felt subliminal was brought to the forefront in 2019 when Governor Ricardo Rosselló’s incendiary group chat with other Puerto Rican elites was made public, leading to mass protests. In the Telegram app messages, Rosselló and his allies had mocked hurricane victims, gay people, and women — reigniting resentment in everyday Puerto Ricans who were already struggling with recovery. Rosselló resigned after two weeks of escalating protests.

“I see the future” and it’s wonderful, wrote publicist Edwin Miranda in the chat. “There are no Puerto Ricans.”

Reimagining Puerto Rico’s future

After María struck, Puerto Rico did create plans to rebuild infrastructure in a way that would be better prepared for climate impacts, but its government — hampered by La Junta and debt — had a slow and mangled response. It seems likely that the response after Fiona will be similar. To be certain, that’s not the fault of Puerto Ricans themselves. The island’s government has operated the only way it knows how to at this point: under the colonial rules instituted by the US. You can’t succeed when you’re set up to fail.

It’s moments like these when calls for statehood seem pretty appealing — support for statehood skyrocketed after María — but LeBrón urges other possibilities, such as independence. “A lot of people are like, ‘This is exactly the reason why Puerto Rico needs statehood,’” LeBrón said. “As if there’s not a water crisis in Mississippi right now, as if this didn’t happen during [Hurricane] Harvey, or through the wildfire season in California. Citizenship is not going to shield Puerto Ricans, just like it didn’t for other marginalized groups, from total government neglect.”

But there is hope for community action. People organized mutual aid groups after María and they worked to remove Rosselló from office in 2019. In 2020, after reports that Rosselló’s replacement, Governor Wanda Vázquez, allegedly knew about unused emergency aid left in a warehouse after María, Puerto Ricans returned to the streets. They wheeled out a literal guillotine to the streets in front of the governor’s mansion. (Vázquez was recently charged with bribery.)

Molinari, the anthropologist studying communities, told me that collective rage had been building for years. “It wasn’t new, but it was a manifestation of their anger, a continued activation of the ways we saw people coming together right after María,” she said. “It’s something to keep an eye on. People’s anxiety and anger is very high right now after Fiona. This might open up another political moment, where all kinds of possibilities and horizons are on the table.”

The fate of Puerto Rico, however, shouldn’t all be left to individuals. The current approach isn’t going to bring new jobs or money, and it certainly isn’t going to reshape the systemic problems plaguing the archipelago on its own. Both the US and Puerto Rican governments must take action to reinstate local power away from La Junta. Santiago-Bartolomei suggests instituting a Puerto Rico Development Authority, like the one proposed by the Center for a New Economy (a nonpartisan Puerto Rican think tank), to help improve governance issues. Such a group could have representatives from local and federal agencies, as well as the civil sector, to prevent the “austerity regime” we’re seeing implemented now by the fiscal board.

Meléndez-Badillo echoed the sentiment of needing economic projects that are based on community and solidarity, not on individual, colonial logic. But for right now, the focus should be on survival.

“Survival in Puerto Rico is a political act,” he said. “We need to rephrase Miranda: I see the future and it’s beautiful. It’s a Puerto Rico full of Puerto Ricans.”