Calderon’s War Against Poverty: Is Big Government Approach The Best Way To Cure The Problem?

by John Marino

August 23, 2002
Copyright © 2002 THE PUERTO RICO HERALD. All Rights Reserved.

. JOHN MARINOGov. Calderón’s bold $1 billion initiative to bring infrastructure and new housing to 1 million residents in 686 impoverished communities across the island calls for serious debate.

Unfortunately, the political opposition has so far shown itself to be not up to the task.

Calderón’s plan, announced Monday in a special address to the Legislature, is the fulfillment of the governor’s long-time concerns of what she has dubbed "Special Communities," neighborhoods where Puerto Ricans have lived in abject poverty for decades.

With it, she has stepped decidedly down the path of the tradition of her Popular Democratic Party, attempting to present herself as a cross between commonwealth founder Luis Muñoz Marín and the beloved San Juan Mayor Felisa Rincón de Gautier, while at the same time invoking President Lyndon B. Johnson’s Great Society efforts to wipe out poverty in the United States.

The program would be financed with a $500 million grant by the Government Development Bank and a $500 million long-term bond issue, which is earmarked to be spent over the next five years.

Much of the money would be used to bring or improve water and electrical service to the communities, build 20,000 new homes and improve roadways. Government spending would also spike to improve health and educational services and social programs.

No one denies that poverty stubbornly remains throughout the island — despite the mammoth steps the commonwealth has taken over the five decades since its founding. And the massive public investment the plan calls for will no doubt serve to stimulate a sluggish economy, creating an estimated 30,000 jobs in construction and other areas.

But questions remain whether this big government approach is really the best way to cure the problem.

The governor deserves credit for unveiling this plan — and setting the table for debate. The Puerto Rican Independence Party, with its socialist roots, has embraced it. But the pro-statehood New Progressive Party saw fit to boycott the message and has yet to appear willing to discuss the plan on its merits.

That’s unfortunate because the Calderón plan does raise many questions.

Will improving water and electrical service, as well as providing new homes to the impoverished really lift them out of their poverty over the long term?

Would the money be better spent in an attempt to revolutionize the cash-starved Education Department or public security agencies?

Is the plan condemned to failure by continuing to penalize the middle class and workers struggling to improve their station in life?

This is the same governor who slashed capital gains taxes in half for the wealthy and island corporations. And remember Puerto Rico’s wealthy do not face the same burdensome inheritance and property taxes that their counterparts in the United States face.

The poor in Puerto Rico, meanwhile, are already catered to. There is ample public housing, utility rate grants, free public health care, and a bonanza of federally funded nutrition, child care, job training and health programs.

A question can fairly be asked whether Calderón is paying too much attention to the extremes of Puerto Rican society, both at the top and at the bottom, and not enough to those struggling to get by who form the middle class.

She is after all the same governor who last year put off implementing a so-called "marriage tax penalty" repeal that would have granted $80 million in relief to working families across the island.

And Puerto Rico currently lacks a tax incentive similar to the federal Earned Income Tax Credit, which provides a wage supplement to low-income workers that offsets income taxes they would normally owe.

Wouldn’t using a portion of the $1 billion earmarked in Calderón’s anti-poverty plan to provide tax incentives for the poor to work their way to the middle class ensure the plan’s overall success?

It is an issue tailor-made for the NPP opposition to seize upon, but this week the party has shown itself to be spinning hopelessly out of control.

Former Gov. Pedro Rosselló finally spoke out about the corruption by officials in his administration, but wasted the opportunity to lash out against what he called the "triumvirate of terror": the Popular Democratic Party, federal prosecutors and some segments of island media, which he said were conspiring to kill the island statehood movement.

Such paranoia was topped by NPP President Carlos Pesquera who claimed — with a straight face — that La Fortaleza aides were tapping the phones at party headquarters to eavesdrop on his conversations and those of other party officials.

Perhaps sensing popular support for the Calderón plan, the NPP is loath to critique it. Indeed, the smattering of criticism against the plan has been taken up by assertions that the public investment it calls for is really not all that much.

One thing is clear: with federal prosecutors continuing to indict former Rosselló administration officials and their supporters in corruption scandals, the Puerto Rican public has little tolerance for complaints about the supposed "persecution" of the Calderón administration against statehooders.

This low-level of political debate is unfortunate, not only for hopes of improving the lot of the poor in Puerto Rico, but for hopes of improving island society as a whole.

Calderón has challenged her opponents with a bold $1 billion plan. The NPP must confront the plan on its merits, or it will cease to be a force in the public debate over island policy issues.

John Marino, City Editor of The San Juan Star, writes the weekly Puerto Rico Report column for the Puerto Rico Herald. He can be reached directly at: Marino@coqui.net

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