Friday, February 3, 2023

Proposed Fiscal Control Board Viewed with Political Apprehension

By on December 17, 2015


The proposed Federal Board for Fiscal Control, presented by Republican Sens. Orrin Hatch (Utah), Chuck Grassley (Iowa) and Lisa Murkowski (Alaska), which includes powers that override the Puerto Rico Constitution and decides the budgets of local government agencies, has been received with caution by diverse political sectors on the island.

The proposal from the chairs of the federal Senate committees on Finance (Hatch), Judiciary (Grassley) and Natural Resources (Murkowski), which would be a sort of supervising entity between the local and federal governments, would also have the ability to revoke financial decisions made by the governor and the legislative and judicial branches.

The governor & Popular Democratic Party president, Alejandro García Padilla, has held back from criticizing the proposals because he understands that its presentation allows the start of discussions regarding Puerto Rico’s fiscal problems.

“We can’t wait any longer. We aren’t looking for an economic rescue from the federal government, but the tools needed to finish the economic recovery work [of Puerto Rico],” the governor said.

Without going into an evaluation of the measure, the governor said, “what we are looking for…is a mechanism to solve the problem, not to postpone it.”

The resident commissioner & NPP president, Pedro Pierluisi, said he would combat the proposal but also would take the opportunity to see that the issue about the island’s financial crisis reaches Republican senators and representatives.

He pointed out that there are ongoing negotiations regarding the proposed Fiscal Control Board to adjust it to Puerto Rico’s political and judicial realities because, as it now stands, the board would “usurp our fiscal powers.”

For the president of the P.R. Senate, Eduardo Bhatia, and the speaker of the P.R. House, Jaime Perelló, the proposals presented before the U.S. Senate are unacceptable; however, they recognize that the action represents an interest by federal legislative spheres to attend to Puerto Rico’s critical fiscal situation.

“I don’t have any problems with Congress legislating a fiscal control board, but that board has to guarantee the full participation of the people and protect [Puerto Rico’s] Constitution,” Perelló said.

Meanwhile, Bhatia said, “It is shameful that Congress made such an indignant proposal…. Not a single Puerto Rican should accept a fiscal control board with so many powers over Puerto Rico… basically in exchange for an allocation of funds whose sole purpose is to ensure payment to bondholders in the short term, and leaving other future initiatives to consider up in the air.”

He added, “One of the most significant failures of both proposals is imposing a fiscal control board [on Puerto Rico] without giving us all the tools we need to get over the crisis.”

The former House speaker & current New Progressive Party (NPP) spokeswoman, Jenniffer González, said she agreed with Sen. Grassley’s expressions when he said “Puerto Rico’s fiscal problems are the result of excess spending and poor management.”

For the former House president & leader of the local Republican Party, the proposal demonstrates that Congress not only mistrusts the efforts of the Puerto Rico government, but also the conduct of the Legislature because the proposed board would review all laws approved by the local Legislative Assembly.

“Markets, Congress and the federal government are aware of what is happening here, and to instruct the board to review our legislation is another acknowledgment of the lack of precision in legislative matters with the current Legislature. They have shamefully placed us in receivership,” González said.

For Ricardo Rosselló, a contender for nomination as the NPP’s gubernatorial candidacy, “the assistance plan has some conditions we don’t agree with, but we will continue the dialog and negotiations to reach a viable solution that allows Puerto Rico to attend to these problems with real solutions that don’t destroy our credibility and allows us to recuperate and improve our economy,” he said.

He added that the proposed board, or other entity, should respect the autonomy of the government of Puerto Rico and provide a five-year term to achieve the objectives of the government reform.

“Although we don’t have elective positions, we work to achieve the best outcomes for our island, because if we continue on the current political leadership’s path to bankruptcy, taxes and nonpayment, we will fall into an economic abyss that will be difficult to rise from in the coming decades,” Rosselló said.

The former candidate for governor & secretary general of the Puerto Rican Independence Party, Juan Dalmau, said this proposal, far from effectively confronting Puerto Rico’s fiscal and economic crisis, makes it worse because it doesn’t provide an effective mechanism to resolve it.

“This is the most recent colonial humiliation, previously concealed by the commonwealth’s alleged fiscal autonomy, which is now manifested in all its crudeness with a receivership of the [U.S.] government over Puerto Rico’s financial affairs that this represents. This is a throwback to the days of the military government after the invasion in the late 19th century,” he said.

Meanwhile, political analyst & former Popular Democratic Party senator, Marco A. Rigau, reacted indignantly and upset about Puerto Rico’s political class related to its position on this issue. “I feel ashamed about the Puerto Rican political class,” he said. “That this political class is willing to subject itself to indignation in exchange for money is beyond words.”

As one who studiously follows Puerto Rican politics, he said that accepting this proposal “is to deny all the century-long struggles for more self-government…and a lack of creativity to come up with politically dignified proposals. It is to elevate indignity to the level of principles,” he said.

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