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Six Months After Maria, Residents Resist Efforts to Turn Island into Privatized Bitcoin Playground

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On Monday, teachers across the island held a one-day strike to protest the plans to privatize the education system on Puerto Rico. Puerto Rico Governor Ricardo Roselló is pushing for privately run charter schools and private school vouchers. For more, we speak with Yarimar Bonilla, an associate professor of anthropology and Caribbean studies at Rutgers University and a visiting scholar at the Russell Sage Foundation. Her latest piece in The Nation is titled “6 Months After Maria, Puerto Ricans Face a New Threat—Education Reform.”

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: This is Democracy Now! I’m Amy Goodman, with Juan González. Our guests are Naomi Klein, senior correspondent for The Intercept, her new piece for The Intercept, “The Battle for Paradise: Puerto Ricans and Ultrarich 'Puertopians' Are Locked in a Pitched Struggle over How to Remake the Island”; we are also joined by Yarimar Bonilla, associate professor of anthropology and Caribbean studies at Rutgers University, a visiting scholar at Russell Sage Foundation, author of Non-Sovereign Futures: French Caribbean Politics in the Wake of Disenchantment and a founder of the Puerto Rico Syllabus, on this week, the six-month anniversary of Hurricane Maria. Juan?

JUAN GONZÁLEZ: Yarimar, Naomi was talking about this conference of—as more and more Bitcoin people are trying to relocate to Puerto Rico. Just yesterday, John Paulson, the hedge fund guy she talked about, whose hotel hosted that conference, opened a new hotel. And Governor Rosselló was there. It’s called the Serafina hotel, another luxury hotel, I guess, to lure more rich Americans to relocate to Puerto Rico. You have been covering this whole development of these vulture capitalists now that are personally descending on Puerto Rico to try to see what they can pick out in terms of their future winnings or profits. Could you talk about it?

YARIMAR BONILLA: Yeah. Well, part of what is most troubling is that these folks clearly have the ear of the governor. And so, as Naomi was talking about, the people at Casa Pueblo, who are doing all this innovation around solar power, and all the different community groups in Puerto Rico that have taken on the recovery directly, those folks are not—are not being turned to by the governor to think about what Puerto Rico needs right now. Instead, it is these blockchain communities and cryptocurrency communities and ex-pats, if you will, that are really, you know, having a say in what’s going to happen in Puerto Rico. And Governor Roselló has said that blockchain technology is going to be central to the recovery. And at the conference, he announced the creation of an advisory board.

And so, part of what excites this technology community is that relationship to the government, where the government has said, “We’re going to listen to you. We’re going to let you set the terms, not just of how we’re going to rebuild, but also the legislative framework that’s going to be put into place for dealing with these technologies.” And so, at a different conference that occurred right here in New York City, I was there, and I was able to witness that kind of recruitment and the way in which the blockchain leaders were saying, “This is where we need to be, because we can operate within an ambiguous framework. Given Puerto Rico’s colonial relationship to the U.S., not all federal legislation applies. And not only that, but we can actually set the terms and create precedents, legislative precedents, of how blockchain and Bitcoin and all these kinds of new technologies are going to be applied.”

JUAN GONZÁLEZ: I wanted to ask you, in terms of that—one of the things that people don’t understand is the original tax exemptions that were granted back in the '50s, ’60s and ’70s to corporations, exemptions from—that was federal tax as well as Puerto Rico tax. At least they provided jobs, supposedly, for Puerto Ricans. Now you're getting the recruitment of individual rich people, who maybe may have a few office personnel, but aren’t really producing anything other than financial management systems. And so they’re not really producing jobs, but now they’re exempt not only from federal taxes, which all Puerto Ricans are, but also from local taxes, as well.

YARIMAR BONILLA: Yeah. So, when Act 20-22 was originally passed by the previous administration, it did carry some requirements for job creation. But the current administration has lifted those. And so, at the conference in New York, they told folks, “Come. You are a firm. Just one individual can be a firm.” And there are now no employment requirements. So, a lot of folks who, like Naomi said, can, you know, work anywhere—all they need is their data, their laptop, some wireless, although they are concerned about the wireless technology in Puerto Rico—well, they can just relocate half the year and have huge tax breaks, not just at the federal level, like you said, but also at the local level. So, they’re not really inputting anything into the economy. And—

AMY GOODMAN: They have to live there 183 days a year?


JUAN GONZÁLEZ: Yeah, half a year plus one day.

YARIMAR BONILLA: Just half a year plus one day. And some folks have said, “Oh, but this is also going to help bring back the diaspora.” But that’s patently false, because I spend a lot of time in Puerto Rico, I looked into this, and you can’t qualify for it unless you’re a new resident. So, all the Puerto Ricans who have left and who might want to return and be part of the recovery, there is no incentives for those folks to come back.

AMY GOODMAN: And, I mean, the diaspora, the growth of this diaspora—200,000 Puerto Ricans have left. But I wanted to go to the American hedge fund billionaire Juan was just referring to, John Paulson, talking about Puerto Rico in 2016, two years before the storm.

JOHN PAULSON: I am optimistic about the long-term growth prospects for Puerto Rico. Has a perfect climate. It’s a very, very beautiful island. … You can essentially minimize your taxes in a way that you can’t do anywhere else in the world.

AMY GOODMAN: And this is Bitcoin Foundation chairman Brock Pierce talking about Puerto Rico last month.

BROCK PIERCE: I think that Puerto Rico is that perfect situation where amazing things can happen. It’s in these moments of where we experience our greatest loss that we have our biggest opportunity to sort of restart and upgrade. And so, it’s in these moments that we can experience those huge sort of changes that wouldn’t be possible otherwise. And so, Puerto Rico can become anything it wants. … We’re here to help Puerto Rico, the people and the place, be as—you know, restart as well as it can. And Puerto Rico will decide what it wants to will itself to be.

AMY GOODMAN: So that’s Bitcoin Foundation chair Brock Pierce, the child star who grew up and now lives in Puerto Rico, and, before that, John Paulson. Yarimar Bonilla, their significance, what they’re saying?

YARIMAR BONILLA: Well, part of what is striking to me about these folks is how they will come from the outside and say, “Puerto Rico can will itself to be anything it wants.” But they’re not Puerto Rican, right? And so—but the recruitment of these folks, the government represents it as the arrival of new “stakeholders.” And so, now you don’t have to be Puerto Rican to be a stakeholder, to have a say in the future. And Naomi points to this battle in her piece, when she talks about: Who gets to decide what will be the future of Puerto Rico? These new arrivals, that are here to benefit and profit from the recovery? Or the folks who have been working in their communities trying to envision alternatives for the future?

And the other piece in this puzzle is that while these new recruits are being welcomed and sought after and given a lead role in the recovery, thousands of Puerto Ricans are being encouraged to leave, because the delays in FEMA and the kind of programs that they’ve put into place are not helping Puerto Ricans rebuild. Six months after Maria, there are many folks who still are waiting for tarps. For tarps, you know? And so—and not to mention the problems of recovery.

And then, a scandal that is still to come and just starting to explode is this new program, Tu Hogar Renace, Your Home Reflourishes or something, where the Department of Housing has given these extremely lucrative contracts to contractors to do temporary repairs on homes. And so, this is going to be like the FEMA trailers, where people lived in these trailers, that were not fully habitable, much longer than they were meant to. So I think a lot of folks in Puerto Rico, who are not getting sufficient funds from FEMA to fully rebuild, they’re going to have these temporary fixes, where they give them like little hotel-size refrigerators and like a, you know, two-burner stove. And it’s something meant to just be temporary, until they can fully rebuild their homes, but these are folks that don’t have the funds to fully rebuild their homes.

JUAN GONZÁLEZ: And, Yarimar, you were mentioning this whole question of folks coming from the outside to determine the future. This has been happening now for some time, especially with his administration. You have the executive director of the control board, Natalie Jaresko, getting paid $635,000 a year. She’s a Ukrainian American who was brought in to run, actually, the finances of Puerto Rico. There’s an American running the school system. And you’re mentioning now also—

AMY GOODMAN: Non-Puerto Rican.

YARIMAR BONILLA: Non-Puerto Rican, right.

JUAN GONZÁLEZ: Right, yeah, a non-Puerto Rican American running the school system, from—I think she’s from Chicago.

YARIMAR BONILLA: Philadelphia.

JUAN GONZÁLEZ: Oh, Philadelphia.


JUAN GONZÁLEZ: And now there’s talk of a new PREPA.


JUAN GONZÁLEZ: Could you talk about the new PREPA nominees?

YARIMAR BONILLA: Yes. Yeah, so, there was Julia Keleher from Philadelphia and now Walter [Higgins]. I don’t know what state he’s from originally, but he’s a retired Navy captain, who is going to command a salary of $450,000 to run the electricity company. And with these nominees, people always say, “Oh, but that’s the salary that we have to give someone with those kinds of credentials.” But that argument is never made for Puerto Ricans who are—experience cuts and who have to, you know, have their pensions reduced, etc. And there was another nominee that went kind of under the radar, Brad Dean, who was appointed the head of this newly created public—no, private, nonprofit agency, funded by the government—if you can figure that out—created through special legislation that transferred responsibilities and resources from the government tourism industry to a private entity. So, that’s going to be in charge of marketing Puerto Rico.

And it’s interesting that these are very central and important agencies—I mean, education—for the Education Department to not be in the hands of a local Puerto Rican, and for even the marketing and the definition of self that is involved in the tourism campaign, for that to not be in the hands of Puerto Ricans. And now a critical aspect such as electricity, right? So, we’re seeing almost a kind of return to colonial rule, where you had, you know, foreign appointees sent to Puerto Rico. This is what Puerto Rico looked like, you know, when it was still under military rule, basically. So it’s really troubling to see how the current administration is recruiting non-Puerto Ricans to lead the recovery through all aspects.

JUAN GONZÁLEZ: Naomi, I wanted to ask you also, in terms of some of these cuts—I downloaded the most recent communication from the financial control board to the government of Puerto Rico. This was to the heads of the University of Puerto Rico about what it’s demanding in terms of cuts. They sent this letter last week. And they’re saying that, basically, that there have to be major tuition increases at the university, consolidation of campuses, closing of campuses, if necessary, reductions—a system of attrition imposed on any staff at the university, pension reductions at the university. Basically, it’s a complete—not dismantling, but certainly a huge austerity program for the crown jewel of the education system of Puerto Rico, which is the University of Puerto Rico.

NAOMI KLEIN: Right. And this was going on, once again, before Maria, but it was running into a huge amount of resistance. And this is, I think, the significance of the strategy that we’re seeing now, is you have all of these—all of these plans that they were trying to push through, including cutting the budget of the University of Puerto Rico in half, while, as you say, increasing tuition—so, people getting radically less but having to pay more—for the most significant educational institution in Puerto Rico, in which there’s a lawsuit going on right now where faculty members are making the argument that the University of Puerto Rico represents an essential service and that it is against the mandate of PROMESA to cut essential services in a way that essentially dismantles them. So, that’s going on, and that challenge is going on in court.

But the significance is that a few months before Maria hit, there was this historic strike, a student-led strike, at the University of Puerto Rico, that lasted for two-and-a-half months, that was—that really sparked this wave of anti-austerity resistance, that culminated in mass demonstrations on May 1st, 2017. Just a few months before Maria hits in September, you have 100,000 people on the streets saying no to austerity, demanding an audit of Puerto Rico’s more than $70 billion debt, saying that, in fact, upwards of 60 percent of that debt was accumulated under conditions that violated Puerto Rico’s constitution, was therefore illegal and should not be repaid. So, if that’s true, if this is an illegal debt, then PROMESA is also illegal, because it was created using the debt as an excuse to impose what Yarimar is describing as unmasked colonial rule, just handing down fiats by this board, appointed by the U.S. president, who is not elected by Puerto Ricans, and, you know, six of the seven members of the board don’t live in Puerto Rico. So it’s another example of exactly what we’ve been talking about, of Puerto Rico being ruled by non-Puerto Ricans.

But the point is, is that, before Maria, this was being forcefully and militantly challenged through this anti-austerity, anti-debt movement. And so, what’s being seen—what’s going on right now is that the hardship of Maria, this humanitarian emergency, is being explicitly exploited to try to push through these measures, actually, that they were having a lot of trouble getting through before Maria. This is why, in my piece, you know, I say this is a new strategy. This is sort of a shock after shock after shock doctrine. It’s not just, you know, what I’ve talked about and written about before.

AMY GOODMAN: And just to clarify, when you say “who do not elect the president of the United States,” Puerto Ricans on the island cannot vote for president of the United States. But when they move to the mainland—right?—hundreds of thousands of people who are moving, many of them to central Florida, for example, could change the voting patterns of Florida, they then can vote for president, right? They’re American citizens.

YARIMAR BONILLA: Yes, yes. And the governor has—this particular governor has been kind of banking on that. And he has been encouraging the diaspora to get involved in local politics, to, you know, vote out politicians that don’t have favorable policies for Puerto Rico. There’s a real interest, for him, to bring new stakeholders to Puerto Rico, while at the same time increasing the diaspora and solidifying it as a kind of political force.

AMY GOODMAN: Well, we’re going to continue this discussion after break. We’re talking to Yarimar Bonilla, who is an associate professor of anthropology and Caribbean studies at Rutgers University, and Naomi Klein, senior correspondent for The Intercept, is just back from Puerto Rico, wrote a major piece for The Intercept, “The Battle for Paradise: Puerto Ricans and Ultrarich 'Puertopians' Are Locked in a Pitched Struggle over How to Remake the Island.” Her latest book, No Is Not Enough: Resisting Trump’s Shock Politics and Winning the World We Need. This is Democracy Now! Back in a minute.

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