Puerto Rico’s economy doesn’t depend on becoming the 51st state
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After the non-biding vote of Puerto Ricans to become the 51st state, we need to discuss the economic and political consequences if this becomes a reality
Whether or not Puerto Rico becomes the 51st state of the United States –something that, according to analysts, is far more difficult than what voters think–, it’s important to analyze the possible consequences of such event. While the Puerto Rican Governor, Ricardo Rosselló, bets heavily on the possibility of statehood and argues that the island needs it to have better economic chances, the majority of the U.S. Congress and the opposition in Puerto Rico have serious doubts about the economic significance and the effects it can have.
There’s a crystal clear argument when it comes to those in favor of Puerto Rico’s statehood: economic crisis and financial debt will, without a doubt, get better if the island becomes the 51st state. Governor Rosselló argues that, beyond the debt –which amounts for more than US$73 billion–, Puerto Rico will have better opportunities. That means increasing in growth and development. According to Fox Business, Rosselló stated that the monetary impact would be "the natural reaction of a stronger economy impacting a smaller one”.
In any case, evidently, the debt is the main point behind this debate and the non-biding plebiscite. While the statehood would allow Puerto Rico to negotiate the terms of the liability and bring different financial possibilities IGNORE INTO place, it would also mean more tax responsibilities.
As Colin Wilhelm –reporter from Politico– puts it: “Though it would mean increased access to federal health care funds and low-income tax credits, Puerto Ricans would also have to pay federal income tax on top of relatively high taxes to the local government”. Hence, it’s not all positive for those standing behind the idea of Puerto Rico’s change of political status.
Aside from the short-term consequences, becoming the 51st state could have a political and social downside. Luis Fortuno, former Governor of Puerto Rico, has said that his successor, Alejandro García Padilla, didn’t follow the spending policies previously indicated. In consequence, the island incurred in an even higher debt rate. The potential new political status of Puerto Rico could reduce the economic pressure and, therefore, induce irresponsible spending policies.
In spite of the excitement of Puerto Rican voters, it’s important to notice the low voter turnout; less than 25% of Puerto Ricans voted. This not only means that Governor Rosselló has a strong opposition, but also that the people aren’t so sure about the economic and political responsibilities that the statehood could entail.
It seems that becoming the 51st state is less important than finding stability through responsible policies and profitable economic sectors.
LatinAmerican Post | Juan Sebastián Torres
Copy edited by Susana Cicchetto
