Vol. 73/No. 17      May 4, 2009

Fortuño signed the “Fiscal State of Emergency Law” March 9. “We all must confront the reality of a bankrupt government,” he claimed in a televised speech. “It’s up to all of us to put our house in order.” He said that $5 billion destined for Puerto Rico as part of Washington’s so-called stimulus plan is not enough.

Puerto Rico is a U.S. colony. Official unemployment there is 14.7 percent. About 218,000 people—21 percent of the island’s workforce—work for the government, the largest employer.

Under “Phase I” of the law, government workers are encouraged to “voluntarily” quit their jobs in exchange for one to three months’ severance pay, one year of medical insurance, and possibly access to some portion of their pensions. Workers with 20 years’ seniority are asked to take a 10 percent pay cut in the form of two unpaid days off each month.

The wages and benefits of all public workers will be frozen starting in July and union contracts essentially torn up.

If not enough workers quit or take the cuts before July 1, Fortuño threatened that “Phase II”—laying off 30,000 workers or more—will begin. Teachers, firefighters, and cops, the law states, will not be laid off.

But Darnes Fernández, service director of the Federation of Teachers of Puerto Rico, said in a phone interview that several thousand teachers could also face layoffs. These include new teachers still on probation and teachers who are “transitory,” that is, without a permanent classroom.

The law institutes an $11.15 tax on every 100 cigarettes and additional taxes on alcoholic beverages. These hikes are permanent. Fortuño announced that he was taking a 10 percent salary cut and temporarily increasing some taxes on businesses.

“This law was passed without any public hearings,” Roberto Pagán, president of the Puerto Rican Workers Union (SPT), affiliated to the U.S-based Service Employees International Union, told the Militant. “It is the biggest attack on working people here in decades.”

Fortuño is also pushing a bill that calls for forming “public-private” alliances for highways and ports and other government services. “They want to privatize the services that working people need,” Pagán said.

Some 27 percent of the budget goes toward paying interest on debt to banks and other capitalist moneylenders. That will not be touched under the new law.

Many companies have already laid off workers across the island. The pharmaceutical industry has cut more than 3,000 jobs since mid-2006.

“We are not going to allow workers to be sacrificed while rich and large interests remain untouched,” said José Rodríguez, a leader of the Puerto Rican Workers’ Federation (FTPR), March 1, before the law was passed.

Dozens of school employees led by the Federation of Teachers of Puerto Rico demonstrated outside the Department of Education April 3 to protest the law. Hundreds of government workers organized by the SPT marched through the streets of Old San Juan April 8, carrying crosses to protest the coming layoffs.

Hundreds of workers from a half dozen unions protested April 15 in front of the Treasury Department in San Juan.

More protests are planned leading up to actions on May 1 by a variety of unions and union federations.  
 
 
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