Puerto Rican student movements are gearing up for a struggle against the neoliberal austerity plan that organizers say will hit Puerto Rican people hard in the name of servicing a crippling debt load that has been likened to a payday lending scheme and some argue is likely partially illegal.
Last month, 12 top University of Puerto Rico board members, including the president resigned and students at the Rio Piedras campus staged a 48-hour walkout to protest the fiscal control board’s plans for multi-million dollar budget cuts, local media reported.
Austerity measures approved by the board are set to slash the budget of the University of Puerto Rico by US$450 million by 2021.
Under pressure from the Puerto Rican people, Governor Ricardo Rossello argued in a written report to the board that the estimated budget cuts needed to be updated in light of newly proposed economic plans not previously taken into consideration.
The administration's measures include reallocating money cut from planned healthcare cuts to the university, generating revenue in the university through offering training to public employees and monetizing the university’s patents by working with Puerto Rico’s Science and Technology Trust.
Although Rossello is working to reduce the heavy-handed budget cuts for the UPR by as much as half, he is also facing intense scrutiny on the island for not doing more to stand up to the fiscal control board and predatory lenders. The governor has garnered criticism for scrapping the audit process shortly after it released its preliminary findings, and Rossello’s allied have filed a bill to overturn a law mandating such an audit.
The UPR, the island’s main public post-secondary education system with a total of 11 campuses and 70,000 students, has already been the target of US$348 in cuts over the past three years, and the prescription for more austerity has been a flashpoint for resistance.
Cuts to the UPR are only one symptom of a broader crisis rocking public services and institutions across the island as the Obama-appointed federal control board — approved by congress last year with the controversial PROMESA bill — orders Puerto Rico to tighten its belt further to deal with its nearly US$73 billion debt.
A coalition of concerned Puerto Ricans, the Citizen’s Front for the Audit of Public Debt, delivered a 100,000 signature-strong petition to officials demanding an audit of the island’s debt as a precondition for cuts and debt restructuring.
“The authorities should have nothing to fear from an audit,” Citizen’s Front spokesperson Eva Prados said in a statement. “But before essential services are hacked in the name of debt payments, citizens have a right to know what exactly they are paying for, or where all of that money went.”
An initial audit report found that up to US$30 billion of Puerto Rico’s more than US$70 billion debt load was issued illegally.
In a mind-boggling report by the ReFund America Project found that nearly half of the debt the island owes is not borrowed funds, but interest on bonds underwritten by Wall Street firms, who are raking in big profits from predatory lending schemes. The report argued that large chunks of Puerto Rico’s debt are illegitimate and shouldn’t have to be paid back.
As for the UPR cuts, even Moody’s Investors Service predicted Monday that the full $450 million would come as a “dramatic negative,” causing a US$157 million operating budget that would be “difficult for the university to absorb.”
Nearly half of Puerto Rico’s population lives in poverty, while unemployment is nearly twice the average of the rate in U.S. states.
Puerto Rico’s ability to deal with its debt crisis has been crippled by the fact that it is a colony of the United States, which bars the island from filing for bankruptcy. Critics argue that the PROMESA bill and fiscal control board — which can override the local government in making decisions on the economy and debt restructuring — lays bare Puerto Rico's lack of independence.