An Entrepreneurial Future for Puerto Rico?

A new study from the University of Puerto Rico offers some tentative predictions for Puerto Rico’s economy in 2018. The Puerto Rico Economy Report, prepared by Prof. José Caraballo at the Census Information Center of University of Puerto Rico’s Cayey campus, lays out a best case and a worst case scenario.

The worst case, the report says, would be if federal funds for Puerto Rico’s disaster recovery total $5 billion or less. If this were combined with continuing movement off the Island, the tax changes in the current tax bill, and no restructuring of debt would make 2018 another tough year for Puerto Rico.

The best case scenario would be seen, according to the authors, if the Sanders-Warren “Marshall Plan” were funded by the federal government, along with elimination of Puerto Rico’s debt and seeing people move from the states to Puerto Rico to return population numbers to higher levels.

The report goes on to recommend diversification of exports, tax reform that addresses income inequality, use of renewable energy, and private sector rebuilding of the Island.

In an optimistic note, the report suggests that the closing of multi-national businesses will open up business niches for entrepreneurs. Local startups could replace businesses that took their marbles home after Hurricane Maria. These new local businesses, the report suggests, could work with stateside Puerto Ricans to develop exports.

“It remains to be seen if the private sector takes better advantage of the opportunities and generates the jobs that are so badly needed to improve the economic outlooks for 2018,” Caribbean Business quotes Prof. Caraballo as saying.

The report may be right about the opportunity for entrepreneurs. When it comes to the best-case scenario, however, the report is wrong. While it is difficult to predict the possible outcomes for any of the options mentioned in the report, there is one important option which was not included: statehood for Puerto Rico. If Puerto Rico is admitted to the Union, we can expect a much better outcome. As a state, Puerto Rico will no longer be crippled by healthcare inequity, would no longer lose population at the current rate, and would receive the kind of funding needed to improve the infrastructure.

Most of the recommendations of the Task Force on Economic Growth in Puerto Rico would automatically come into play along with statehood. None of these recommendations has been followed so far.

As for entrepreneurs, they would benefit in the 51st state from the extensive federal support for small businesses which doesn’t currently reach Puerto Rico.

The time for small changes is up. The time to wish for “enhanced commonwealth” or federally subsidized independence is over. It’s time for statehood. Join us.

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