Puerto Rico’s Dance With Debt

Puerto Rico, a de facto colony of the US, is usually not in the news outside of the travel and style sections. But as it stumbles towards a September default deadline that threatens to shut down government operations, the island territory has been a fixture in the business press, with headlines like: “Puerto Rico Faces Tough Choices Ahead,” “Puerto Rico Power Authority Deadline Extended,” and “A Desperate Puerto Rico Raises $1.2 Billion in Short-term Financing.”

According to the neoliberal narrative, the rapidly intensifying economic crisis is an open and shut case: Puerto Rico, legally an unincorporated territory of the US, is caught in a debtor’s trap of borrowing to pay for essential operations. And now the bill is coming due. Bloomberg Business likens it to a “consumer using one credit card to pay off another.”

But the real story is more complicated, and more connected to Puerto Rico’s colonial relationship with the US. Over the years, the US has treated Puerto Rico as a laboratory for population control, conducted naval war games on the island nation for possible Middle East interventions, and used it as a pre-NAFTA staging ground for corporate megastores to develop consumer bases and exploit low-wage labor.

Read the rest here, at jacobin.org

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