In 2007, Naomi Klein challenged the neoliberal notion of competitive economic growth in her book Shock Doctrine: The Rise of Disaster Capitalism. In that book, she documents the economic forces that take advantage of catastrophes to institute corporate economies with the most minimal of regulations. “Disaster capitalism” is premised on radical laissez-faire goals that are essentially two-fold: 1) to achieve corporate privatization and windfall profits; and 2) to diminish the public commons and social safety nets through austerity.
Puerto Rico has always had a colonial relationship with the United States, since when it was acquired by the US as a territory in the Spanish-American War of 1898. However, in 1950, it became a commonwealth and since then it has been teetering between a colony, a state and independence, as far as holding plebiscites. Nonetheless, its relationship to the US remains essentially colonial in terms of its limited political power and its economic dependence on Congress, as well as US economic pressure and manipulation.
In the aftermath of Hurricane Maria in the fall of 2017, the financial vultures moved in in full force. They are nicknamed “Puertopians” by Klein. Their goal, she explains in her new book, The Battle for Paradise: Puerto Rico Takes on the Disaster Capitalists, is to create a utopia for the super-rich at the expense of the island’s residents. “Rather than transforming [the] infrastructure so that it truly serves the public interest,” Klein writes, “they argue for selling it off at fire-sale prices.” As in other examples of disaster capitalism, the economic libertarian wants to squash a system “in which the wealth of the island is carefully managed by its people.”
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The book consists of essays from The Intercept on Klein’s post-Maria travels to Puerto Rico. Hurricane Maria left a catastrophe as it lashed through Puerto Rico, but it also left the island as a target for the vulture capitalists. Invited to the island by a group dedicated to creating a sustainable society, Klein found the sides were drawn: the for-profit centralized exploiters vs. the advocates for a decentralized sustainable economy. She discovered a strong “desire for people to exercise collective sovereignty over their land, energy, food and water.” Aligned against that populist economic notion are forces determined to consolidate the economy in favor of the rich.
The Financial Oversight and Management Board was created by Congress in 2016 to oversee the reduction of more than $70 billion worth of debt in Puerto Rico. It consists of seven people with presidential appointments, but only one of them lives in Puerto Rico. The board has authority that supersedes the Puerto Rican State House, particularly on economic affairs and debt repayments. It has gained increased power to favor Wall Street, hedge funds and the super wealthy, and to impose austerity measures on the populace. Klein points out that those who live on the island do not have any representation in Congress and cannot vote for president unless they live on the mainland. The economic decisions are being made as they would be in a colonial relationship.
Unlike a state, Puerto Rico cannot declare bankruptcy. Instead, Congress and the Financial Oversight and Management Board treat the island like an experiment in Ayn Randian economics. The wealthy and corporations get huge tax breaks, plus vulture capitalism and privatization opportunities. The 3.5 million people of Puerto Rico get austerity.
When a disaster causes massive loss and upheaval, it creates new opportunities for vultures. In this case, it involves the status of the Puerto Rican water system post-Maria:
Previous attempts by Wall Street financiers and government officials to privatize Puerto Rico’s water system have produced “disastrous results,” but private equity vultures are exploiting the death and destruction caused by Hurricane Maria to plow ahead with yet another privatization effort — one that environmentalists warn could further imperil the island’s public water infrastructure.
“While the water system urgently needs repairs and upgrades following the destructive Hurricane Maria, privatization is not the answer,” declared Food & Water Watch Executive Director Wenonah Hauter on Tuesday after Puerto Rico’s Public-Private Partnerships Authority officially kicked off the process of partially privatizing the Puerto Rico Aqueducts and Sewers Authority (PRASA), a government-owned entity responsible for water quality and management.
“Responsible, public control of the system is the best way to ensure that every person on the island has access to safe and affordable water and that PRASA operates in the service of the people, not in the service of profits,” Hauter added. “With the privatization of Puerto Rico’s water authority, we expect Wall Street profiteers and corporate water operators will seek to extract wealth without addressing the long-standing issues with the commonwealth’s water system.”
This, in essence, represents the onslaught of predators Puerto Rico faces on a number of fronts. The Puerto Rico Electric Power Authority (PREPA), which is $9 billion in debt, is a prime target for privatization. Puerto Rico Gov. Ricardo Rosselló, who is friendly with the powers in Washington, DC, and Wall Street, supports making the privatization move.
For those stalwarts promoting renewable energy, this presents a formidable obstacle, as Klein comments: “After all, private companies from Nevada to Florida have successfully pressured their state governments to put up roadblocks to renewables, since a market in which your customers are also your competitors (able to generate their own power and sell it back to the grid) is distinctly less profitable. Rosselló’s fiscal plan already floats the idea of a new tax that would penalize communities that set up their own renewable micro-grids.”
Installation of local solar energy offers an example of creating self-sufficiency on an island of abundant sun, symbolized by the work of a nearly 40-year-old organization, Casa Pueblo. Meanwhile, Organización Boricuá de Agricultura Ecológica de Puerto Rico “is a 28-year-old grassroots organization that works and promotes agroecology within the food sovereignty struggle.” It is focused on the work of creating a largely self-sustaining Puerto Rico, Klein details. In her excursions, she found other people and groups working to create an island that is sustainable from the bottom-up. In fact, during her stay in Puerto Rico, she was part of a gathering that formed the JuntaGente network to unite the various groups battling for a Puerto Rico that can decide its own destiny.
Even Klein, however, qualifies that “the trouble is that movements, unlike capital, tend to move slowly.” She also notes, “The tremendous impact of the storm has disassembled life for millions of people, making the reconstruction of the pre-storm, anti-austerity coalition a herculean challenge.” Klein is inspired, nonetheless, that in Puerto Rico, they “are not beginning to build this movement for self-determination” from scratch.
The harm done to Puerto Rico before and after Hurricane Maria has a long history, as Klein observes: “Colonialism itself is a social experiment, a multilayered system of explicit and implicit controls designed to strip colonized peoples of their culture, confidence, and power. With tools ranging from the brute military and police aggression used to put down strikes and rebellions, to a law that once banned the Puerto Rican flag, to the dictates handed down today by the unelected fiscal control board, residents … have been living under that web of control for centuries [including the years as a colony of Spain].”
Certainly, Donald Trump’s minimal assistance to Puerto Rico after Hurricane Maria, as compared to his aid to communities hit by recent hurricanes on the mainland, embodies this colonial attitude. His contempt for the crushing needs of the island and whirlwind visit to San Juan in which he tossed out paper towels further emphasized his disdain — and racism.
There is a high-stakes conflict at play, Klein writes,
The Puertopians dream of a radical withdrawal into their privatized enclaves. [JuntaGente and its supporters] dream of a society with far deeper commitments and engagements — with each other, within communities, and with the natural systems whose health is a prerequisite for any kind of safe future …
For now, these diametrically opposed versions of utopia are advancing in their own parallel worlds, at their own speeds — one on the back of shocks, the other in spite of them.
Klein was clearly captivated by the long-term commitment and passion of Puerto Ricans who want to regain control over the island’s destiny. However, a vast powerful array of predators specializing in disaster capitalism are assembled against them.
Will the islanders defeat the odds of the “shock doctrine”?