Author Topic: Frontline: Blackout in Puerto Rico  (Read 1138 times)

adroth

  • Administrator
  • Boffin
  • *****
  • Posts: 12344
    • View Profile
    • The ADROTH Project
Frontline: Blackout in Puerto Rico
« on: November 02, 2018, 03:35:42 AM »
Espisode 14, Season 36

More than seven months after Hurricane Maria devasted the US territory of Puerto Rico, more than 100,000 Americans are still without power, as part of the worst blackout in U.S. history. Frontline and NPR investigate how the federal response in Puerto Rico left millions of Americans in the dark for months -- and the storm before the storm: how Wall Street, Puerto Rico's government, and Washington fueled a debt crisis that left the island's economy in ruins and its infrastructure crippled even before Maria hit. The investigative team uncovered a trove of insider documents the show a government relief effort in chaos, struggling with key contracts, basic supplies, and its own workforce.

The film, produced with the Investigative Reporting Workshop at American University, uncovers a series of shortcomings after Maria, including how half of FEMA's staff on the island were trainees or unqualified, how contractors FEMA turned to failed to deliver hundreds of thousands of tarps, and how the Army Corps' temporary roof repair program was glaringly slow compared to other storms -- putting up just 439 roofs in the first 30 days after the storm compared to more than 4,500 in the first months after Irma in Florida.

Underpinning it all, Blackout in Puerto Rico delves into Wall Street's role in the island's economic demise -- a crisis that left it dangerously vulnerable to a storm like Maria -- and the relationship between Puerto Rico and the U.S., including how Congroess's withdrawal of a special tax break helped spur the Puerto Rican government's cycle of debt and borrowing. Gripping and riveting, Blackout in Puerto Rico is a must watch look inside the ongoing recovery effort in Puerto Rico -- and the economic crisis that devastated the island long before Maria



adroth

  • Administrator
  • Boffin
  • *****
  • Posts: 12344
    • View Profile
    • The ADROTH Project
Re: Frontline: Blackout in Puerto Rico
« Reply #1 on: November 02, 2018, 04:29:31 AM »
https://taxfoundation.org/tax-policy-helped-create-puerto-rico-s-fiscal-crisis/

< Edited >

Section 936 and Puerto Rico’s Nine-Year Recession

Throughout the modern economic history of Puerto Rico, one of the central drivers of its economic growth has been the United States tax code. For over eighty years, the federal government granted various tax incentives to U.S. corporations operating in Puerto Rico, in order to spur the industrialization of the island. Most recently, beginning in 1976, section 936 of the tax code granted U.S. corporations a tax exemption from income originating from U.S. territories.

In addition to section 936, the Puerto Rican corporate tax code gave significant incentives for U.S. corporations to locate subsidiaries on the island. Puerto Rican tax law allowed a subsidiary more the 80% owned by a foreign entity to deduct 100% of the dividends paid to its parent. As such, subsidiaries in Puerto Rico had no corporate income tax liability as long as their profits are distributed as dividends.

When section 936 was in effect, U.S. corporations benefited greatly from locating subsidiaries in Puerto Rico. Income generated by these subsidiaries could be paid to U.S. parents as dividends, which were not subject to U.S. corporate income tax under section 936, and were deductible from Puerto Rico’s corporate income tax.

Because of these generous tax incentives for business, Puerto Rico grew rapidly throughout the 20th century and developed a substantial manufacturing sector, though it remained relatively poor compared to the U.S. mainland. However, because section 936 made foreign investment in Puerto Rico artificially attractive – creating, in effect, an economic bubble – it left the island vulnerable to a crash if the tax provisions were ever to be repealed.

As it happened, section 936 became increasingly unpopular throughout the early 1990s, as many saw it as a way for large corporations to avoid taxes. Ultimately, in 1996, President Clinton signed legislation that phased out section 936 over a ten year period, leaving it to be fully repealed at the beginning of 2006. Without section 936, Puerto Rican subsidiaries of U.S. businesses were subject to the same worldwide corporate income tax as other foreign subsidiary.

< Edited >
« Last Edit: November 06, 2018, 05:24:24 AM by adroth »

adroth

  • Administrator
  • Boffin
  • *****
  • Posts: 12344
    • View Profile
    • The ADROTH Project
Re: Frontline: Blackout in Puerto Rico
« Reply #2 on: November 02, 2018, 05:02:11 AM »
Center for a New Economy

http://grupocne.org/

The Center for a New Economy (CNE) is an independent, non-partisan think-tank that advocates for the development of a new economy for Puerto Rico.

adroth

  • Administrator
  • Boffin
  • *****
  • Posts: 12344
    • View Profile
    • The ADROTH Project
Re: Frontline: Blackout in Puerto Rico
« Reply #3 on: November 02, 2018, 05:35:43 AM »
Interestingly, one of the disaster relief professionals in the documentary above -- who was also took part in disaster relief operations in Tacloban for Typhoon Haiyan / Yolanda -- mentioned that the Philippine response was significantly faster than the FEMA response in Puerto Rico.

Given how bad things already were in Tacloban, it gave an interesting perspective to the magnitude of the disaster in Puerto Rico.

====

https://www.cnn.com/2018/04/16/us/puerto-rico-blackout-second-largest-globally-trnd/index.html


« Last Edit: November 03, 2018, 07:07:59 AM by adroth »