Monday, November 18, 2019

[Editorial] See No Evil, Hear No Evil

By on January 25, 2019

Editor’s note: The following originally appeared in the Jan. 24-30, 2019, issue of Caribbean Business.

There was a time in Puerto Rico’s economic development—in our heyday—when the University of Puerto Rico (UPR) was the crown jewel of an island touted as the Shining Star of the Caribbean because it had transformed from poorhouse to industrial powerhouse for all the world to see. In those early years of Operation Bootstrap, the program for Puerto Rico’s industrialization, an army of New Deal economists worked tirelessly with one goal in mind—raising the standard of living of all Puerto Ricans. To that end, they worked tirelessly charting a course with raw data knowing that the education of Puerto Ricans would help lift this island out of poverty.

Over the course of a generation, Puerto Rico’s standard of living nearly doubled according to a 1957 cover story in Time magazine on then-Gov. Luis Muñoz Marín. The numbers are staggering: Gross product grew from $287 million in 1940 to $1.2 billion in 1957; average family income went from $660 in 1940 to $2,400; and business profits jumped from $99 million in 1940 to $367 million in 1957. And the University of Puerto Rico was touted the world over as a respected institution of higher learning.

My, how mightily we have fallen. At this writing, the University of Puerto Rico’s 11 campuses are under show-cause status, which requires the UPR Governing Board to file reports with the Middle States Commission on Higher Education (MSCHE) to make a case to keep MSCHE accreditation. The onus is now on the UPR board to file these reports to keep the MSCHE Good Housekeeping Seal of Approval because—in blown deadline, after blown deadline—it failed to file audited financial statements to transparently present the institution’s fiscal position. In failing to do so, the UPR Governing Board came off less as able technocrats armed to lead an institution beyond the 21st century and more like procrastinating freshmen—we call them prepas (no relation to the bankrupt power utility)—asking for extensions on term papers. The lack of transparency exposed the UPR to an assault on its integrity as the Middle States policy wonks believe “the institution’s internal planning is deficient and, due to budget cuts, funding is insufficient.”

Thus, the “See No Evil, Hear No Evil, Speak No Evil” mantra driving worst practices in accounting has brought us to our own Spaghetti Juncture—a tangled morass of driverless vehicles on thoroughfares to nowhere. That is a crying shame, because the truth is that the UPR Mayagüez campus continues to turn out talented scientists, many of whom are recruited by leading international conglomerates, and the UPR Río Piedras and Bayamón campuses form competent physicians and professionals who contribute to Puerto Rico’s society.

Sadly, the focus is on fiscal capacity thanks largely to the culture of austerity being driven by the Financial Oversight & Management Board created by the Puerto Rico Oversight, Management & Economic Stability Act (Promesa). As it has done with all of Puerto Rico’s government agencies and public institutions, the O-Board has imposed a fiscal plan for the UPR. There is fat to cut and budget reductions to make. The sooner the UPR presents audited financial statements, the sooner it can chart a course to financial stability [2018 audited statements are due in March].

The UPR Governing Board’s Ostrich culture—heads buried in sand—will not do the trick. And that dictum holds true for our education in grades K through 12. It is important to know where our children stand at all levels. The Annie E. Kasey Foundation’s KIDS COUNT, “a national and state effort to track the status of children across the United States,” recently reported that 13 percent of Puerto Rico’s youths (under age 18) are not in school and not working—that is the highest percent in the entire United States and its territories.

It is no coincidence that 56 percent of our children live in poverty; that 53 percent live in households whose parents lack secure employment; and more than 25 percent do not finish high school. Puerto Rico also lags on the collegiate front—only 60 percent finish their undergraduate degrees.

By contrast, leading jurisdictions with thriving economies have indicators nearly 75 percent lower than Puerto Rico on the socioeconomic scale—Rhode Island has only 3 percent of their youths out of school or not working; New Hampshire has only 8 percent of their children living in poverty. The fact that many of Puerto Rico’s youths are under threat of becoming part of a lost generation is no secret. It is a crime.

The sooner we deal with that sad reality, the sooner we might commence the climb back to the lofty place this island held on the world stage. The sooner we can return to that perch—an island that created jobs at an exponential rate, an island of skilled laborers studied the world over by countries that are now at the top of the world’s economic ladder. No more hiding; our children deserve better.

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