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Puerto Rican vote needs context, researcher says, but statehood would dramatically influence island's economy

Wednesday, June 21, 2017



LAWRENCE — After Puerto Rican voters recently overwhelmingly supported statehood in a plebiscite election, the results still leave political and economic questions for the island, according to a University of Kansas lecturer who grew up in Puerto Rico.  

Bob Augelli, director of the KU School of Business Multicultural Business Scholars Program, can discuss issues surrounding Puerto Rico's push for statehood and the economic conditions on the island. Augelli was born in Puerto Rico and his mother and her family are Puerto Rican. His father, John Augelli, was a former professor and chair of the Department of Geography, KU dean of International Studies and founded the KU Center for Latin American & Caribbean Studies in 1961.

"The critical context has to do with the percent who voted," Bob Augelli said. "It was a 23 percent turnout, and the reason you had such an overwhelming victory for pro-statehood is the other two major parties boycotted the election."

Of the two other major parties, one advocates for independence, and the other for maintaining the current relationship with the United States.

Still, the Puerto Rican government led by Gov. Ricardo Rosselló's New Progressive Party, which strongly wants statehood, is expected to lobby Congress seeking to push for official statehood. Augelli said Puerto Rico's $72 billion debt is likely making the issue more urgent for the economic health of the island.

Puerto Ricans are U.S. citizens who can travel back and forth to the United States, and there are more native Puerto Ricans living on the U.S. mainland than the island.

"What has happened dramatically since 2006 is the tendency for the young, upwardly mobile professionals to leave the island," Augelli said. "That has resulted in an every-increasing economic crisis because we have an older population not contributing to the tax base."

Other than the political influence of increased representation in Congress, Puerto Rican statehood likely could have economic consequences as well. Augelli said the historic political divisiveness surrounding statehood among different factions in Puerto Rico generally makes international companies nervous.

Also, the 1917 Jones Act puts the "law of cabotage" in effect in Puerto Rico requiring everyone in Puerto Rico to buy goods from a U.S.-owned ship staffed with a U.S. crew. The added costs of sending international goods to the U.S. before they can be sent to Puerto Rico, which is mandated by law, drives up prices of goods in Puerto Rico. For example, an automobile costs about 40 percent more when purchased on the island than on the mainland, Augelli said.

It's unclear if Puerto Rico's current push for statehood will be successful, he said, but the government appears ready to use the June vote as an impetus for change with Congress. One potential advantage could be the number of Puerto Ricans who have migrated to New York, New Jersey and Florida. Representatives of large Hispanic populations in general could also seek to support the move, he said.

"All of us love Puerto Rico. Any of us who has moved to the states has done so for economic opportunity, but our hearts stay in Puerto Rico. That's something you could say pretty much across the board," Augelli said. "The reality is that Puerto Rico more than anything is a U.S. colony. We can call ourselves a free, associated state, but we can't control our economy, ports, trading partners and our currency, all of which are variables that would play a major role in addressing the economic crisis."

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