PUERTO RICO IN CRISIS

72 billion in debt

150 schools have closed

There is only one pediatric hospital throughout the island

The government health plan is not paying hospitals & doctors

Government employees will not receive pay

How can anyone live like this?

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Puerto Rico is suffering a massive debt crisis.

Lin-Manuel Miranda joins John Oliver to call for relief.

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An article "Tax Policy Helped Create Puerto Rico’s Fiscal Crisis" written by Scott Greenberg and Gavin Ekins on June 30, 2015 almost 1 year ago.

The following are a few paragraphs from that article:

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.

"Not coincidentally, 2006 also marked the beginning of a deep recession for Puerto Rico, which has lasted until today. Puerto Rico’s high corporate taxes on domestic corporations along with low taxes on U.S. subsidiaries had skewed the Puerto Rican economy toward foreign investment from the U.S. When section 936 was repealed in 2006, foreign investment began to flee. Without a strong domestic corporate presence to fill the void, the economy began to contract, along with tax revenues."

Read the full article at http://taxfoundation.org/blog/tax-policy-helped-create-puerto-rico-s-fiscal-crisis

Now let's discuss the Jones Act....

Before the Jones-Shafroth Act, insular Puerto Ricans were not citizens of the United States. Subsequent to the Act, they immediately became U.S. citizens. The act also extended almost all U.S. laws to have the same force and effect in Puerto Rico as in the United States (the only laws excepted were those concerning internal revenues) including the National Defense Act of 1916 which established the composition of the U.S. military. Two months after Congress passed the Jones-Shafroth Act, that same Congress enacted the Selective Service Act of 1917 which based conscription "upon liability to military service of all male citizens." Through its passage, the Jones–Shafroth Act—via a combination of citizenship and the expansion of U.S. laws to Puerto Rico, including the aforementioned National Defense Act—imposed mandatory conscription into the U.S. military on Puerto Ricans, precisely at the moment that the United States entered World War I. As a result, more than 20,000 Puerto Ricans served in the U.S. armed forces during World War I.

The Merchant Marine Act of 1920 (P.L. 66-261), also known as the Jones Act, is a United States federal statute that provides for the promotion and maintenance of the American merchant marine.^[1] Among other purposes, the law regulates maritime commerce in U.S. waters and between U.S. ports. Section 27 of the Jones Act, deals with cabotage (i.e., coastal shipping) and requires that all goods transported by water between U.S. ports be carried on U.S.-flag ships, constructed in the United States, owned by U.S. citizens, and crewed by U.S. citizens and U.S. permanent residents.^[2] The Act was introduced by Senator Wesley Jones.

EFFECT: The Jones Act has a specific effect upon noncontiguous parts of the US, such as Puerto Rico, Hawaii, Alaska, and Guam as it prevents foreign-flagged ships from carrying cargo between the mainland and these locations.^[10] Foreign ships inbound with goods cannot stop any of these four locations, offload goods, load mainland-bound goods, and continue to U.S. mainland ports. Instead, they must proceed directly to U.S. mainland ports, where distributors break bulk and then send goods to US places off the mainland by U.S.-flagged ships.^[10]

https://en.wikipedia.org/wiki/Merchant_Marine_Act_of_1920

Now it's interesting how this law is still in effect since the United States can buy anything from anywhere. I recently went to a local supermarket in Florida and this is what I found.