Category 4 “Economic Hurricane” Hits Puerto Rico

It’s been over 100 days since Hurricane Maria hit Puerto Rico, and now in the midst of disaster relief efforts, the island is confronted by the impact of the new tax bill passed by the GOP last month. Congressmember Nydia Velazquez calls it an “economic hurricane” because it screws over a slowly recovering Puerto Rico. 

The bill taxes 12.5% on any income created by patents and licenses from foreign companies outside of the United States. Even though Puerto Rico is a commonwealth and its residents are U.S. citizens, Puerto Rico is often treated as a foreign territory when it is convenient for the U.S. – and the tax bill is no exception.

Now companies in Puerto Rico are confronted with a decision to begin paying this tax or move their business elsewhere. Given multinational corporations’ general aversion to paying taxes, and the fact that Puerto Rico’s infrastructure was decimated in the hurricane, it’s likely that the island will lose thousands of jobs, throwing the population into even deeper poverty. Without medical supply manufacturers and pharmaceutical companies, two of the largest employers on the island,  over 200,000 Puerto Ricans will become unemployed, increasing the 10.6% unemployment rate, which already is more than double the U.S. average.

Even before Hurricane Maria, Puerto Rico was grappling with a $70 billion debt, and Puerto Ricans were leaving the island to seek employment and shelter elsewhere. Gretchen Velez, who was a college student and had never left Puerto Rico prior to the hurricane, is now one of 22 new workers at Dakota Provisions and earns $10 an hour deboning turkey in frigid South Dakota. Many low-wage factories in the U.S. are recruiting on the island, covering the cost of flights until workers can pay them back from their low-salary jobs. U.S.- based companies are capitalizing on the urgency of unemployment while Puerto Rican lives are in the hands of the U.S. government.

As feminists and activists, we know that increased unemployment and poverty exacerbated by climate disasters disproportionately impacts women. Before Hurricane Maria, 43.5% of Puerto Ricans were living in poverty. In Puerto Rico, as in many Latin American and Caribbean countries, low-income women are often employed in low-wage caregiving positions through the informal economy, without benefits or workers’ protections. Now dealing with the aftermath of the hurricane and the impending impact of the tax bill, migration to the island is likely to become increasingly feminized as women make up an even larger proportion of migrants seeking jobs on the mainland.

Puerto Ricans deserve more than what the U.S. government and corporate America is providing them. This economic impasse means that Puerto Ricans will likely continue relocating as climate refugees to the U.S. mainland, accepting low-wage jobs and poor living conditions and leaving the Puerto Rican economy to fall to pieces. Congress claims there will be a comprehensive relief package introduced in 2018, but given how slow recovery efforts have been, I am doubtful that full recovery will happen soon.

Header image credit: Ricardo Arduengo/ AFP / Getty Images