Status Quo Defender To Head Puerto Rico Offices In The States… Democrat Crosses Aisle For Swearing-in Of New Resident Commissioner… Ex-Senator Active On Puerto Rico Issues Named To Bush Tax Panel… Hispanic Leaders Rebuke Puerto Rican Seeking Democratic Party Post

Jnauary 7, 2005
Copyright © 2005 THE PUERTO RICO HERALD. All Rights Reserved.

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Status Quo Defender To Head Puerto Rico Offices In The States

Independence Party voters gave Puerto Rico’s new "commonwealth" party governor his razor-thin margin of victory over his statehood party rival. Helping Governor Anibal Acevedo Vila win these votes was a platform pledging to immediately act to block U.S. statehood for the territory and to obtain national government powers for the Commonwealth.

Statehood was to be blocked by a political status convention that would, theoretically, enable "commonwealth" nationalists and independentistas to unite to edge out statehood votes in determining a status petition to the U.S. Government.

The national government powers Acevedo pledged to obtain through the convention included the powers to reject federal laws and to enter into international agreements as if Puerto Rico were a sovereign nation -- powers that federal officials have consistently said the U.S. Government cannot and will not cede to the Commonwealth.

Despite Acevedo’s status pledges and his recognition that the current governing arrangement for Puerto Rico is undemocratic because a government in which Puerto Ricans lack voting representation makes and implements their national laws, he selected a "commonwealth" party politician who is a staunch defender of Puerto Rico’s political status quo as head of the territorial government’s U.S. affairs agency.

Acevedo announced the appointment of former Senator Eduardo Bhatia as director of the Puerto Rico Federal Affairs Administration (PRFAA) this past week. Bhatia was defeated in the last election for mayor of San Juan in his second consecutive run for the office. He served in the territorial senate before his first failed run for San Juan’s city hall. He gained Washington experience as a PRFAA aide to then Resident Commissioner Jaime Fuster, another reactionary on Puerto Rico status issues, who now serves on the Commonwealth Supreme Court.

Puerto Rico is unincorporated territory of the U.S. but Acevedo, Bhatia, and Fuster contend that it is a "commonwealth" -- a non-existent status that takes its name from a word in the name of Puerto Rico’s local government ("Commonwealth"). They say that "commonwealth" insulates Puerto Rico from the U.S. government’s powers to govern its non-State territory in matters handled by State and local governments in the States.

Bhatia has made this case as the "commonwealth" party’s representative in numerous debates in the States regarding Puerto Rico’s status.

Puerto Rico’s new resident commissioner in the States -- the territory’s official representative to the federal government -- extended an ‘olive branch’ to Bhatia on his appointment even though the new resident commissioner is from Puerto Rico’s statehood party and a national Republican while commonwealther Acevedo is a nominal national Democrat. Luis Fortuno spoke positively about Bhatia’s service in the territorial senate and their personal relationship in saying that he would try to work cooperatively with Bhatia.

Bhatia, however, was not as conciliatory in remarks to a reporter. He said that the governor’s voice was the most important on the status issue.

The remark attempted to diminish the role of Puerto Rico’s Legislative Assembly as well as its resident commissioner on the issue. Statehooders hold most seats in each of the two houses of Puerto Rico’s legislature. Fortuno and the legislature’s incoming majority leaders have signaled their intent to advance the cause of a fully-democratic status for the territory chosen by the people of Puerto Rico. Their plans contrast with Acevedo’s plans to pursue an impossible status proposal through a coalition between leaders of the territory’s nationalist parties and groups.

As PRFAA director, Bhatia will control Commonwealth government funds traditionally made available to the resident commissioner to supplement the federal funding that goes along with the seat in the U.S. House of Representatives the resident commissioner occupies among his broader duties. Acevedo, however, has previously said that his administration will maintain the $550,000 a year allocation to the resident commissioner’s office that it was granted this year by the Calderon Administration.

Acevedo this week also said, however, that he will redefine PRFAA’s functions of the office in light of undefined challenges in Washington -- probably mostly his differences in views from Fortuno. He also recognized that he could not set Fortuno’s course. Previous governors have generally set the policies that resident commissioners have followed, although there have been differences on specific issues at times.

In selecting Bhatia, Acevedo unceremoniously dumped the woman in whose home he stayed during many of his resident commissioner visits to Washington. Mari Carmen Aponte had indicated her interest to stay on in the post of PRFAA director.

Bhatia’s selection could also mean new lobbyists in Washington for the territorial government. Bhatia, for example, is friendly with Thurgood Marshall, Jr. Marshall, son of the first person of African heritage on the U.S. Supreme Court is a Washington lawyer specializing in federal affairs. His government service included stints as then President William Clinton’s Secretary of the Cabinet and the Vice President Albert Gore’s Legislative Director.

Bhatia, interestingly, wanted to become the "commonwealth" party’s candidate for Puerto Rico’s resident commissioner in the States in the 2000 election -- a nomination that eventually went to Acevedo. Acevedo, in turn, had wanted to be the candidate for mayor of San Juan -- a post often considered to be a better steppingstone to the governorship than the resident commissioner’s office.

Gubernatorial candidate Sila Calderon, however, tapped Bhatia to replace her as San Juan’s mayor because she thought that he would draw more votes from Puerto Rico’s major metropolitan area to her ticket than would Acevedo. In the end, Acevedo won and Bhatia did not.

Democrat Crosses Aisle For Swearing-in Of New Resident Commissioner

The Democrat who is most senior member of the U.S. House of Representatives of Puerto Rican origin took the unusual step of going over to the Republican side of the House to take the oath of office this week with new Resident Commissioner Fortuno.

Rep. Jose Serrano, a very partisan Democrat, crossed party lines to signal that he will work with Fortuno in the best interests of Puerto Rico. He also sent a message that he approves of Fortuno’s goal of enabling Puerto Ricans to choose the territory’s ultimate status, although he has no preference between the options of nationhood and statehood for the territory and Fortuno is a statehooder.

Fortuno’s swearing-in was also made special by some 280 people traveling from Puerto Rico to be on hand for the occasion. Dozens more from the States brought the total number of participants in events related to the swearing-in to over 300.

The guests included: incoming Commonwealth Speaker of the House of Representatives Jose Aponte, a fellow statehooder; Governor Acevedo’s secretary of state-designate Marissa Pons; pro-statehood Commonwealth senators Norma Burgos, Roberto Arango, and Jose Garriga Pico; and pro-statehood Puerto Rico mayors Jose Pargas Ojeda of Florida and Pablo Crespo Torres of Anasco.

Ex-Senator Active On Puerto Rico Issues Named To Bush Tax Panel

President Bush today named a recently retired U.S. senator who had been active on Puerto Rico tax issues as Vice Chair of his tax reform advisory committee.

Bush appointed former Senator John Breaux, who had been a power on the Senate Finance Committee until his retirement from the Senate this week.

Breaux was the lead Senate sponsor during the past few years of the top federal priority of then Governor Calderon and then Resident Commissioner Acevedo: tax exemption for profits that companies based in the States receive from territorial subsidiaries organized as foreign operations. The proposal was rejected by the Finance Committee as well as the House Ways and Means Committee, the U.S. Treasury Department, and the White House.

Recognizing that the proposal would fail in the Finance Committee when he sought approval a second time at the request of Calderon and Acevedo, Breaux agreed with Democratic presidential nominee John Kerry on an alternative to benefit Puerto Rico. The alternative included income from Puerto Rico in a national nine percent tax cut for manufacturing income but Acevedo complained about the inclusion.

Acevedo’s complaint led to the eventual exclusion of the income from the tax cut, creating the current situation in which Puerto Rico manufacturing income is taxed at a higher rate than income from the States and the District of Columbia.

At Acevedo’s request, Breaux also successfully sponsored the inclusion of Puerto Rico income in a one-year, one-time 85% tax cut for income that companies take out of Puerto Rico and reinvest in the States. The provision, which is adverse to Puerto Rico’s economic interests because it will encourage disinvestment from the territory, also became law last year.

Breaux later endorsed the candidacy of former Governor Rossello over Acevedo, asserting that Rossello’s election would be better for Puerto Rico’s economy.

Although Breaux sponsored Calderon and Acevedo requests during the past four years, he championed Rossello proposals to benefit Puerto Rico before that. His selection by Bush to be the number two on the nine member advisory group may help Puerto Rico obtain new tax incentives for investment to replace incentives that expire at the end of this year.

Hispanic Leaders Rebuke Puerto Rican Seeking Democratic Party Post

Several Hispanic leaders this week strongly rejected requests for support from a prominent candidate of Puerto Rican heritage for a Democratic National Committee (DNC) vice chairmanship. The leaders wrote that they, instead, were supporting the candidacy of another person of Puerto Rican heritage.

The separate rebukes were sent to former DNC Hispanic Caucus Chair Nelson Diaz, who has also been Solicitor of the city of Philadelphia, PA and General Counsel of the U.S. Department of Housing and Urban Development. Among those sending the message were the second-ranking officer of the nation’s largest labor organization, the AFL-CIO, and a Georgia state senator.

They are among many Hispanic leaders supporting the candidacy of Washington lawyer Alvaro Cifuentes, Puerto Rico’s secretary of the governorship during the first term of then Governor Pedro Rossello (statehood) and the current chair of the DNC’s Hispanic Caucus.

AFL-CIO Executive Vice President Linda Chavez-Thompson wrote Diaz, "I regret that you have gotten into this race. I have given Alvaro Cifuentes my full endorsement and support and am working the labor delegates on his behalf. Alvaro has my support because of the work he has done as Chair of the Hispanic Caucus and how hard he has worked to increase the number of Hispanics at the DNC."

Georgia State Senator Sam Zamarripa wrote Diaz that Cifuentes "would be a terrific Vice Chairman of the DNC . . . he has a good base [of support] and I think it would be impractical for someone to secure enough votes to challenge him. It may be a good time to rethink your run."

It is unclear why Diaz entered to race with the lead that Cifuentes had already amassed. One Washington observer speculated that Diaz may have been prompted to do so by Puerto Rico commonwealthers.

The three Puerto Rico commonwealthers on the committee have not endorsed Cifuentes although the Washington lawyer has not used his national Democratic Party activities to gain an advantage for a Puerto Rican status choice and statehood over the commonwealthers’ positions in the DNC. Expected Puerto Rico Senate President Kenneth McClintock, a statehooder, is the only member of the territory’s delegation on the DNC to support Cifuentes.

Meanwhile, there were Puerto Rico angles this week in the contest for DNC chairman. Harold Ickes, who had been very helpful on territorial issues while Deputy Chief of Staff to then President Clinton, took himself out of the running.

Seeking territorial support was former U.S. Representative Tim Roemer. Roemer is the son-in-law of former U.S. Senator J. Bennett Johnston, who acted as a senator from Puerto Rico while in the Congress’ upper house and later was a lobbyist for the territory under then Governor Rossello.

As chairman of the lead Senate committee on territories issues, Energy and Natural Resources, Johnson devoted great effort to trying to enable Puerto Ricans to choose the territory’s future status. He fell out of favor with Puerto Rico commonwealthers when he could not agree to their proposals for autonomy from federal powers for the Commonwealth and recognized statehood as an option for Puerto Rico.

The "Washington Update" appears weekly.

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