The House of Representatives voted in favor of “Puerto Rico Status Act” in mid-December, led by Rep. Raúl Grijalva (D-Ariz.). The bill, which is largely symbolic, could be brought back to the attention of the new Congress. If signed into law, the measure could spark a drastic change to the island’s economy.
The bill would require the U.S. government to conduct a plebiscite for the island’s residents, allowing them to democratically decide whether they would like Puerto Rico to become the 51st state, an independent country, or remain a commonwealth. Previous non-binding referendums A slight majority of voters now favor statehood.
Grijalva’s act received unanimous Democratic support in the House, and 16 Republicans crossed the aisle to vote in favor of the bill, including outgoing Rep. Liz Cheney (R-Wyo). Supporters of the bill view It was an important step in eradicating American colonialism.
“Invaded by the United States during the 1898 Spanish American War, Puerto Rico has remained in a state of colonial limbo that flies in the face of the anticolonial values upon which the American Republic was founded,” said Rep. Nydia Velázquez (D-N.Y.) in a press release After the bill was passed in the House. “The time has come to fully decolonize Puerto Rico.”
This argument is not convincing to Yaron Brook, a Puerto Rica resident and Chairman at the Ayn Rand institute. When asked about the congresswoman’s perspective, Brook told The Epoch Times, “I don’t buy it.”
He believes the island’s inhabitants are better off today than they would have been had the United States granted them independence after the Spanish-American war in the late 1890s. Brook says that colonialism does not inherently cause evil. Instead, Brook encourages people to ask the question: “Are human beings living better lives under this system or not?”
Brook, who is also a hedge fund manager based in Puerto Rico, warned that both statehood and independence could have detrimental effects on the island’s economy.
“Those who want to be a state, basically want to be a state because they want more welfare,” He added that welfare will make residents less productive and dependent over time. Recent study found Many U.S. states offer higher unemployment rates and other benefits than the national median household Income.
Brook noted that more than 25% of Puerto Rican workers are already employed. employed By the government. “There’s a bloat of bureaucracy. Real jobs need to be created here.”
Economist and fellow Puerto Rico resident Peter Schiff, founder of Euro Pacific Asset Management, echoed Brook’s opposition to statehood for the island, emphasizing the added tax burden that would come with it.
“Imagine owning a business in the state of Puerto Rico. 37 percent federal Income tax, 15.3 percent self-employment tax, 3.8 percent Obamacare tax, 33 percent state income tax, and an 11.5 percent sales tax,” Schiff wrote on Twitter December 15. “Plus, since Puerto Rico has more debt per capita than any other state, state taxes will likely be raised.”
Brook believes in free markets but does not believe that independence is possible given the political climate. Based on the island government’s track record and the rhetoric originating from prominent secessionists, Brook believes independence would move Puerto Rico “in the direction of more statism, more government intervention.”
The advocates of Puerto Rican self determination argue that there is a moral imperative.
“For far too long, however, the people of Puerto Rico have been excluded from the full promise of American democracy and self-determination,” said Rep. Steny Hogue (D-Md.), speaking on the House floor in support of the bill. “We owe it to Puerto Ricans to bring an end to their island’s 124-year-old status as a U.S. territory.”
Brook follows in the steps of Ayn Rand (an early 20th century philosopher and writer), but does not consider democracy an end in itself. “I’m not big on referendum and the people deciding,” He told The Epoch Times.
“Thankfully the people did not decide on the American Constitution,” He also mentioned the Constitutional Convention of 1787. “They decided through representatives, but they didn’t decide directly. Who knows how that vote would have gone?”
Brook suggested Puerto Rico should hold a convention on the subject.
Brook admitted that he supports the status quo but acknowledged the pitfalls of the current governance system. While he is generally in favor of lower taxes and less regulation, Brook criticized the island’s legal system for disproportionately favoring the wealthy.
“There’s a lot of tax breaks for special deals, but what they don’t do is tax breaks for Puerto Ricans, which is the sad part.”
Zero percent Asset holders find capital gains and dividends attractive, but over half of American assets are owned or controlled by the top 1% of the population. Average Puerto Ricans are unaffected by these tax breaks but are still required to pay the island’s 10.5 percent sales tax.
“Don’t give me any tax advantages,” Brook said. “Just make it attractive for Puerto Ricans so that I want to become a Puerto Rican.”
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