Historical research is continuing to illuminate the causes for failure of the “commonwealth” model of territorial government in Puerto Rico. To more fully understand how autonomy led to insolvency of the “commonwealth” it is important to accurately describe the breakdown of the federally instituted “commonwealth” regime in a more granular way.
For example, based on misconceptions about the constitutional nature of “commonwealth” fabricated by autonomists in order to usurp federal powers, beginning in 1961 local leaders from Puerto Rico contrived to convince President Kennedy that “commonwealth” was a political status legally different from territorial status. Ultimately, this ideological hoax by autonomists led JFK to sign an executive order exempting Puerto Rico from policy and fiscal oversight by the Department of the Interior.
That order by JFK reversed a 1934 decision by FDR transferring administration of U.S. territories from military to civilian authorities in the Department of Interior. At the time JFK exempted Puerto Rico from its oversight and annual budget reviews, the Interior Department was responsible for ensuring minimal budgetary discipline in all federal territories with local governments organized under federal territorial statutes.
That includes Puerto Rico, Guam, American Samoa, U.S. Virgin Islands and Northern Mariana Islands. To this day the Interior Department has a strong record ensuring compliance with fiscal and policy oversight. Puerto Rico alone went without federal oversight due to the JFK executive order ending federal fiscal accountability.
In the 1961-1963 period, the Governor of Puerto Rico was the principal ideological oracle of the “autonomy” hoax. The charismatic island leader promised to campaign among ethnic Puerto Rican voters in Illinois, New York and elsewhere, as well as raise political contributions from the oligarchs in the territory, for JFK’s re-election in 1964. All the governor wanted in return was removal of the “commonwealth” from Department of Interior oversight for the territories.
The governor urged and JFK eventually acceded to direct White House management of “bilateral” relations, consistent with “autonomy” for Puerto Rico. This was based on the hoax that “commonwealth” was a status different than the other territories which were ostensibly still in a “colonial condition” and ruled by Interior Department’s “neo-imperialist” territorial overseers.
History proved JFK wrong. That “diplomatic” coup by the Governor ending Department of Interior oversight was not enough to prop up the Potemkin village realities of the “commonwealth” regime. Despite heavy subsidization by Congress, including federal tax exemptions for U.S. corporations in the states not available to local corporations in the territory, the “commonwealth” failed to deliver a standard of living close enough to the 50 states.
The state of developmental arrest that ensued under “commonwealth” was fatal. The ratio of successes to failures, satisfaction to disappointment, were too negative to sustain denial of equal rights of U.S. citizenship that come only with statehood.