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Rafael Torrens: Proposed Antitrust, Minimum-Wage Bills Would Do More Harm Than Good
Levitt Homes president & CEO lambastes legislators for proposing laws that would worsen islands investment climate; asks Gov. Calderon not to sign them
By JOSE L. CARMONA
June 17, 2004
For Rafael Torrens, president & CEO of Levitt Homes and former president of the Puerto Rico Homebuilders Association, the new antitrust and minimum-wage laws being considered by the Legislature wouldnt improve the islands fragile investment climate.
"The members of the Puerto Rico Homebuilders Association believe these bills are antibusiness and would only create more problems for local businesses," Torrens, who is a member of the association, told CARIBBEAN BUSINESS.
Senate Bills 2788 (the new antitrust law) and 2771 (to amend the Minimum Wage Law) are two of the most damaging of the more than 20 antibusiness bills that the 14th Legislative Assembly intends to approve before the session ends June 30 (CB May 27 and June 3).
The antitrust bill, presented by Senate President Antonio Fas Alzamora, would require prior approval by the justice secretary of any merger, acquisition, or expansion that falls within broad parameters subject to the determination of government bureaucrats. For example, any merger or acquisition between two companies with a combined market share of 30% or more, or in which assets of any one of the companies involved exceed $25 million, would fall in this category.
Meanwhile, Senate Bill 2771, filed by Fas Alzamora and other senators, intends to give the labor secretary the power of the now-defunct Minimum Wage Board to establish mandatory decrees. If passed, the bill would give the labor secretary not only wide discretion in establishing mandatory decrees by industry, but also the discretion to exempt specific businesses within each industry from complying. The bill would also eliminate the courts power to revise the secretarys determination, making those determinations final.
There is no reason, said Torrens, for the Justice Department to be involved in deciding how and which businesses can be sold, or for the labor secretary to determine how much an employer should pay an employee.
"Theres already an antitrust law and a minimum wage law in Puerto Rico that protect employees. It is unheard of for the government to intend to determine how much an employer should pay employees under the capitalist system of free enterprise," said Torrens. "These are laws that go totally against our free-enterprise system, and Homebuilders members are totally against them."
Torrens characterized both laws as crazy, adding he couldnt conceive how someone who believes in the democratic system of government that we live in could come up with such laws.
"These laws, in my view, are socialist in nature and are more common in totalitarian governments. They have no place in our society and will cause more harm than good," said Torrens.
The new antitrust law, said Torrens, would cause business owners to liquidate their firms if they arent able to sell their businesses, merge them with others, or expand them, leaving scores of employees out of jobs.
As for the proposed minimum wage law, Torrens indicated businesses have good years and bad years. If the labor secretary establishes a mandatory decree forcing businesses to pay higher salaries based on revenue in a good year, he wondered what would happen to that company during a bad year.
"Are they going to allow companies to pay their employees lower wages during a bad year? If they want businesses to pay higher wages during good times, they should allow them to lower wages during bad times as well," said Torrens.
If these two laws and others like them are passed, Gov. Sila Calderon shouldnt sign them into law, said Torrens.
This Caribbean Business article appears courtesy of Casiano Communications.