[News] As Puerto Rico Erupts in Protests and Governor Resigns, “La Junta” Eyes More Power

[Anti-Imperialist News]

https://theintercept.com/2019/07/24/puerto-rico-protests-ricardo-rossello-la-junta/ 



  As Puerto Rico Erupts in Protests and Governor Resigns, “La Junta”
  Eyes More Power

Kate Aronoff - July 24, 2019 <https://theintercept.com/staff/kate-aronoff/>
------------------------------------------------------------------------

_Embattled Puerto Rico_ Gov. Ricardo Rosselló announced his 
resignation July 24 amid massive protests on the island and around the 
world. A demonstration in the capital city of San Juan on Monday drew an 
estimated 1 million people — almost a third of the island’s total 
population — to protest a decadeslong economic crisis that peaked in the 
aftermath of Hurricane Maria. The unelected and Washington-appointed 
body now overseeing the island’s finances — the Fiscal Oversight and 
Management Board, called /la junta/ by Puerto Ricans — may use a 
democratic explosion in Puerto Rico to further curtail its democracy.

For protesters, leaked Telegram chats, published by the Center for 
Investigative Journalism 
<http://periodismoinvestigativo.com/2019/07/las-889-paginas-de-telegram-entre-rossello-nevares-y-sus-allegados/> 
earlier this month, were the final straw after years of a painful 
recession and austerity measures imposed by la junta following the 2017 
hurricane. In addition to the governor joking with his top staff about 
shooting San Juan mayor and gubernatorial candidate Carmen Yulín Cruz 
and calling former New York City Council Speaker Melissa Mark-Viverito a 
/puta/, or whore, the chats show that confidential information on 
government contracts and operations was being shared with ex-officials 
now working for corporate interests. Protesters erupted with anger over 
the fact that money which should have gone to hurricane recovery was 
being filtered toward lawyers and consultants close with the government.

Secretary of Justice Wanda Vázquez 
<https://www.noticel.com/ahora/gobierno/colmada-de-controversias-la-carrera-de-wanda-vazquez/912681653> 
is next in line for Rosselló’s seat when he steps down on Aug. 2, 
although, as an unelected official, she likely won’t enjoy much popular 
support. (Puerto Rico’s Constitution doesn’t include any provision for a 
special election, instead handing the governor’s office down to Cabinet 
officials — many of whom have already resigned amid scandals.) One of 
Vázquez’s close allies, Valerie Rodríguez Erazo, is the wife of Elías 
Sánchez, a longtime friend of Rosselló’s who has profited handsomely 
<http://periodismoinvestigativo.com/2019/07/el-saqueo-a-los-fondos-publicos-detras-del-chat/> 
from the governor’s time in office.

    “We have people rising up and saying they want to have power to make
    their own decisions.”

Now many fear la junta will use these rolling legitimacy crises as ammo 
in an ongoing push to have Washington amend the oversight legislation to 
grant them broader authority, like the ability to veto measures passed 
through the island’s legislature. The Washington Post editorial board 
recently called 
<https://www.washingtonpost.com/opinions/puerto-ricans-are-demanding-better-its-about-time-congress-and-san-juan-deliver/2019/07/19/c89eca92-a997-11e9-9214-246e594de5d5_story.html?utm_term=.8a4930c93bbb> 
for exactly that, writing that la junta’s “effectiveness has been 
hampered” and that “Congress should take steps to strengthen the board.” 
So far, presiding Judge Laura Taylor Swain, who is overseeing the 
bankruptcy proceeding, hasn’t accommodated board requests for more 
power, such as over day-to-day governance. And on July 24, at the urging 
of 60 civil society organizations and others, Swain ruled 
<https://caribbeanbusiness.com/judge-halts-puerto-rico-bankruptcy-process-for-3-months/> 
to put that legal process on hold for the next three months until the 
situation on the island is more stable.

“This is a moment when we have people rising up and saying they want to 
have power to make their own decisions,” Julio López Varona, a lawyer 
and San Juan-based organizer with Construyamos Otro Acuerdo and the 
Center for Popular Democracy, told me. “People are not in the streets 
because they want more federal control. They are in the streets because 
they want a say in their future.”

As one popular chant goes, “¡Ricky renuncia y llévate a la junta!” or 
“Ricky resign and take la junta with you!”

_Because Puerto Rico,_ unlike other municipalities, can’t declare 
bankruptcy, Congress passed the Puerto Rico Oversight, Management, and 
Economic Stability Act, or PROMESA, in 2016 to set up a bankruptcy-like 
procedure for the island, which is ongoing in the U.S. District Court 
for the Southern District of New York. PROMESA also handed broad 
authority over the island’s budget and finances to la junta, a group of 
officials appointed by the previous White House. The board includes 
Andrew Biggs — a resident scholar at conservative think tank American 
Enterprise Institute, former George W. Bush administration official, and 
longtime proponent of privatizing Social Security — and Carlos García, 
who in running Puerto Rico’s Government Development Bank helped engineer 
the debt 
<http://hedgeclippers.org/pirates-of-the-caribbean-how-santanders-revolving-door-with-puerto-ricos-development-bank-exacerbated-a-fiscal-catastrophe-for-the-puerto-rican-people/> 
he’s now tasked with reining in. The bank’s deals are underwritten by 
Santander, where he previously served as a top executive.

Another board member, Philadelphia-based lawyer David Skeel Jr., is one 
of the chief architects 
<https://www.thenation.com/article/meet-the-legal-theorists-behind-the-financial-takeover-of-puerto-rico/> 
of emergency control regimes like the one now in place in Puerto Rico, 
as Simon Davis-Cohen pointed out in The Nation. These arrangements — 
which typically involve empowering appointed overseers who commandeer 
municipal finances, wresting power away from institutions like city 
councils — have been tested on the mostly nonwhite residents of Michigan 
and Atlantic City, New Jersey, resulting in fights over public services, 
pensions, and union contracts that outside appointees deem lavish 
expenses. In an influential 2016 Yale Law Journal 
<https://www.yalelawjournal.org/pdf/a.1150.Gillette-Skeel.1237_pjjg35cu.pdf> 
paper, Skeel and co-author Clayton Gillette contend that “deep financial 
distress is emblematic of the failure of a city’s democratic processes. 
Displacement of those processes in an effort to restore the financial 
stability that a well-functioning democracy would pursue,” they add, 
“arguably is far less problematic than it might be with a city that is 
already providing the local public goods that localities are created to 
deliver.”

    While la junta and its supporters have consistently painted Puerto
    Rican governments past and present as financially irresponsible, the
    board itself is no paragon of fiscal restraint.

La junta may be quietly trying to make the case that Puerto Rico’s 
democracy is in need of displacing. While having been relatively mum 
about recent events, the body released a statement 
<https://www.elnuevodia.com/english/english/nota/oversightboardcallsforurgentsolutiontothecrisis-2507696/> 
on July 23 noting that “public outcry by residents of Puerto Rico over 
the last two weeks reflects a justified crisis of confidence in 
government institutions.” The board has not responded to The Intercept’s 
request for comment.

“I think they’re looking for an opening to take a larger role in terms 
of how Puerto Rico is run,” Sergio Marxuach, policy director at the 
Center for a New Economy, says of the oversight board. But, he notes, 
“They also suffer from a legitimacy problem. … People in Puerto Rico 
have lived through three very hard years” since PROMESA was enacted. 
“There have been austerity measures, programs have been cut, and schools 
have been closed. People have lost their jobs. There’s a lot of 
resentment against the board right now, but I think most of that anger 
is being channeled through the governor.”

And while la junta and its supporters have consistently painted Puerto 
Rican governments past and present as financially irresponsible — 
showering money onto outside consultants and spending beyond their means 
— the board itself is no paragon of fiscal restraint. One lawyer 
overseeing Title III bankruptcy negotiations invoiced 
<http://periodismoinvestigativo.com/2018/08/puerto-ricos-fiscal-control-board-parallel-government-full-of-lawyers-and-consultants/> 
the board $1.3 million in a single year. As of January, McKinsey and Co. 
had billed the board $72 million 
<http://nymag.com/intelligencer/2019/04/mckinsey-in-puerto-rico.html> 
for its role in the restructuring process, and more than $1 billion is 
earmarked to be funneled to lawyers, bankers, and consultants in the 
coming years. Should the board get more authority — for instance, in 
overseeing the already botched disbursement of federal recovery dollars 
— that figure may well balloon, with Puerto Rican taxpayers footing the 
bill.

    “The continued intervention of the U.S. hasn’t made life better for
    everyday Puerto Ricans. It’s made life better for people who are
    rich who can come to Puerto Rico and pay no taxes.”

The House Natural Resources Committee has jurisdiction over PROMESA, and 
the Democratic leadership of the committee has been clear that it 
doesn’t support la junta exploiting the situation for its own benefit. 
As a video released 
<https://twitter.com/nrdems/status/1153714764960411650?s=21> by the 
committee yesterday put it, “Chair [Raúl] Grijalva has stated that [la 
junta] should not view this as an opportunity to amass more unelected 
power over the lives of the residents of Puerto Rico. The committee will 
be talking more about its plans for amending PROMESA in the very near 
future.”

Amid rumors of Rosselló’s (now confirmed) resignation, Grijalva said in 
a statement on Wednesday morning that the “Puerto Rican people, not the 
Oversight Board or a hostile Trump administration, must take the lead in 
determining what comes next.” (Grijalva has joined Reps. Nydia 
Velázquez, Alexandria Ocasio-Cortez, and Tulsi Gabbard in calling for 
the governor to step down.) A representative for the minority Republican 
members did not respond to a request for comment.

Asked about attempts on the committee to expand the PROMESA board’s 
authority, Grijalva said, “Not from our side.”

“We’re circulating a draft of what we think are basic reforms and 
changes to PROMESA,” he continued, calling for greater accountability. 
“The last thing you wanna do, you don’t want this to be an excuse to 
amass more power to the control board.”

Rep. Rob Bishop, R-Utah, confirmed that there were efforts on the 
committee to expand the board’s authority. “PROMESA board has enough 
authority right now. All they need is the government of Puerto Rico to 
work with them, not against them. That’s all we need to do.”

Bishop said expanding authority of the board would be “superfluous.”

“They have enough authority to do what they need to do now. The only 
problem they had was the inability of the territorial government to 
actually work with them,” he said. “If they just work with them — and 
that’s what irks me the most. Because Puerto Rico has still a massive 
amount of potential. They have all sorts of ability. It needs to be 
developed. … The government will never have enough money just to bail 
out Puerto Rico. We’ve got to get Puerto Rico once again to attract 
private sector funding. And that’s why the board is so essential.”

_For protesters,_ it’s a tricky line to walk, much less to communicate 
beyond the island. “We’ve had corrupt governments and that is true. But 
you cannot evaluate the Puerto Rican government without looking at the 
constant and continued presence and intervention of the U.S. in Puerto 
Rico,” López Varona said. “The continued intervention of the U.S. hasn’t 
made life better for everyday Puerto Ricans. It’s made life better for 
people who are rich who can come to Puerto Rico and pay no taxes.”

“What we want to do,” López Varona added, “is to use the energy of the 
moment to bring forward demands that really move into a Puerto Rico that 
is for Puerto Ricans,” including protecting public services, auditing 
the debt, and declaring a state of emergency on gender violence. Within 
the next several months, it’s also possible that PROMESA board members 
will need to undergo Senate confirmations 
<https://www.courthousenews.com/justices-fast-track-challenge-to-puerto-rico-oversight-board/>, 
following a ruling that they were appointed incorrectly. López Varona 
and others hope to leverage support in the diaspora to use any potential 
hearings to draw attention to the illegitimacy of the board as a whole, 
not just individual members.

“We are not asking for a better control board,” he tells me. “We are 
asking for investment in Puerto Rico. What we need is a Marshall Plan 
that invests money in the island and community-initiated programs that 
are overseen in Puerto Rico — a real process of self-determination that 
can help Puerto Rico pave its way to whatever it chooses.”

*Update: July 25, 2019*
/This story has been updated to reflect Ricardo Rosselló’s resignation 
as governor of Puerto Rico late on July 24./

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