Weekend Economists Volvemos a Puerto Rico May 22-25, 2015

[Demeter]

54. Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as Cuba rise

http://www.independent.co.uk/news/world/americas/puerto-rico-island-of-lost-dreams-people-are-leaving-the-debthit-territory-in-droves-as-near-neighbour-cubas-star-rises-10271083.html

Puerto Rico is billions of dollars in debt and its people are leaving in droves. But America is turning its back on the territory, focusing instead on its near neighbour Cuba, whose electorate want closer ties. David Usborne reports from San Juan...

The posh boutiques that once lined cobbled Calle Fortaleza are gone now, replaced by T-shirt and souvenir shops grasping for dollars from passengers swarming down the gangways of the Carnival cruise ships that dock here most mornings. Bars advertise “happy hours” lasting from noon till night, while old men pushing tatty ice-cream carts go mostly unnoticed. Old San Juan, the colonial gem of Puerto Rico’s capital San Juan, is tired but clinging on. Elsewhere on the island, the story is graver. Exhausted by a recession that has lasted for most of the past eight years and by talk of a possible default on government debt, Puerto Ricans are leaving in droves. Many who stay are jobless; doctors who haven’t been paid in months are downing their stethoscopes.

The pain that is Puerto Rico’s – and could soon be Wall Street’s if the debt crisis isn’t resolved – is poignant. Some blame its step-child relationship with America, neither a fully-fledged US state nor an independent nation. It hardly helps that Washington barely seems to care while at the same time it is suddenly lavishing attention on Cuba, its near neighbour to the west. The island has lost 20 per cent of its jobs since 2006. The unemployment rate stands at over 13 per cent. It’s no wonder people want to get out. “People who graduate from the university go straight to the airport and never come back,” lamented Christopher Torres, 25, an activist studying computer engineering at the University of Puerto Rico, who recently led a student protest against proposed spending cuts. Some 144,000 Puerto Ricans decamped for the US last year and a higher number may depart in 2015. A White House official privately described it as the biggest population displacement ever seen outside of a war. Among those packing their bags are disenchanted doctors. Victor Ramos, the president of the Physicians and Surgeons Association, noted in an interview that there are now only two paediatric neurosurgeons left on the island and also only two paediatric cardiac specialists. Of those one is 90 years old. “Last year we calculate that 361 doctors left the island, that’s one per day. This year we expect 500 or more.”

While the rest of the region and the US bounce back, the economic picture here could barely be more scary. Because successive governors, from either of its two main parties, have for years papered over budget deficits by borrowing, Puerto Rico now lies $73bn (£47bn) in debt, compared with the $18bn owed by Detroit when it declared bankruptcy. Moreover, while US laws allowed Detroit to get out of its hole by declaring bankruptcy they forbid Puerto Rico from doing the same. The debt hole is worse than anyone is admitting. Beyond what it owes to bond investors, the government is also facing a $34bn gap in money that should have been paid into the public workers’ pension system. If you reckon that its obligations therefore exceed $100bn that then translates into a jaw-dropping $100,000 in debt for every working person on the island.


THAT'S THE ULTIMATE, UP-TO-DATE SUMMARY OF OUR SUBJECT, ISN'T IT? AMERICA HAS NO BUSINESS TRYING TO BE AN EMPIRE....IT HASN'T THE NOBLESSE OBLIGE TO PULL IT OFF.

AMERICAN GOVERNMENT DOESN'T RECOGNIZE ITS RESPONSIBILITY FOR ANYTHING, ACTUALLY.

MORE BAD NEWS ABOUT PUERTO RICO AT LINK