Puerto Rico in Crisis: Government Workers Battle Neoliberal Reform

Yarimar Bonilla and Rafael A. Boglio Martínez

On October 15 a one-day general strike paralyzed Puerto Rico’s political and economic capital of San Juan. About 200,000 demonstrators, according to organizers, poured into the streets to protest the economic and labor policies implemented by the conservative administration of Governor Luis Fortuño. Launched in response to the administration’s decision to lay off more than 17,000 government workers in September, the strike culminated a series of protests held since the spring against the governor’s recovery plan for the struggling island economy.

The layoffs are part of a broader governmental reform project outlined in the highly contentious Public Law 7, passed on March 9. Conceived as the island’s economic recovery plan, the law declared a state of economic emergency, enabling Fortuño to “restructure” public employment in ways that would otherwise be illegal: unilaterally suspending union contracts, overriding labor laws in order to dismiss public-service workers, and denying those who remain employed the job protections guaranteed in their union contracts. The immediate consequences of this plan were widely understood to be dire, since the government is Puerto Rico’s largest employer and the island’s unemployment rate in July was already 16.5%, according to the Department of Labor.

The popular challenge to Fortuño’s agenda began May 1, when massive mobilizations of labor unions, political parties, and other interest groups took place in protest of Public Law 7. On June 5, the growing discontent became apparent as a crowd of between 40,000 and 100,000 came together in a demonstration organized by a new coalition of unions, religious leaders, and community organizations called All Puerto Rico for Puerto Rico (Todo Puerto Rico por Puerto Rico). The work stoppage of October 15 was also organized by the All Puerto Rico coalition, as well as by the labor leaders of the Broad Front of Solidarity and Struggle (FASyL), another new organization mobilized in response to Fortuño’s agenda.

Numerous acts of protest and civil disobedience took place during the weeks leading up to the general strike. The most iconic act of these took place two weeks before the general strike, when Roberto García Díaz, a disgruntled former employee of the now closed Roosevelt Road military base, hurled an egg at Fortuño during a press conference. Much like the shoe thrown by an Iraqi journalist at George W. Bush, the egg incident, popularly known as Fortuño’s huevazo, became a widely recognized symbol of discontent. García, who came to be known as the tipo común, or common guy, was greeted as a celebrity during the general strike, and numerous protesters carried signs alluding to his egg; some even dressed up as superhero eggs.

The rising discontent and increased mobilization leading up to the work stoppage created a climate of public repression. The week before, 10 campuses of the University of Puerto Rico were shut down to prevent protesters from using the facilities to organize. Other forms of general intimidation were also employed to hamper a rapidly growing movement that was galvanizing cross-sectional support, with the government going as far as threatening to use provisions of the USA Patriot Act to persecute protesters as “terrorists.” These preemptive threats did not, however, deter the demonstrators from taking to the streets; in fact, many of them rallied enthusiastically with the “terrorist” label on their placards and T-shirts.

Despite the seriousness of the crisis facing Puerto Rico, the demonstrations on October 15 had a festive atmosphere. Participants were dressed in colorful costumes and custom-made T-shirts (some of them portraying dismissal notices), waved handmade signs and banners poking fun at the administration, and many of them brandished effigies of Fortuño. Few altercations with the police took place, although university students blockaded Puerto Rico’s busiest expressway, Highway 52, burning tires and refusing to move for five hours, until Rafael Cáncel Miranda, a well-known nationalist activist and former political prisoner, persuaded them to relent.

The protesters set out from eight different points of departure in San Juan—including the university, the main public hospital, the Department of Labor, the largest local bank, the national arts theater, and other government and corporate economic centers—and converged at the island’s largest mall, Plaza las Américas.

“The selection of Plaza las Américas as the gathering point showcased a key predicament of neoliberalism: that if there are no jobs, there can’t be shopping,” says Arlene Dávila, a New York University professor of anthropology and author of Latino Spin: Public Image and the Whitewashing of Race. “When the prerequisite for a consumer society disappears—a job, a salary, the type of job security that allows people to make big purchases—only social strife and inequalities remain.”

The demonstration was notable for its wide range of participants, including artists (protesting reduced funding for the arts), university professors, students, environmentalists, lawyers, senior citizens, gay rights activists, and several other labor unions, including the Puerto Rican Union of Workers (SPT), an affiliate of the Service Employees International Union (SEIU). Solidarity with the work stoppage extended to the diaspora, with protests registered in New York by the local Puerto Rican community. SEIU leaders also expressed support and are, together with the SPT, lobbying the U.S. Congress to reconsider federal aid funds in light of the layoffs.

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Officially described as a “special law declaring a state of emergency and establishing a plan for fiscal stabilization to save the credit of Puerto Rico,” Public Law 7 was presented as a comprehensive response to the economic and fiscal problems facing Puerto Rico. It is the central legislative element of the island government’s attempt to close a $3.2 billion budget deficit and to keep Puerto Rico’s public bonds from reaching junk status among rating agencies. To accomplish this, the law calls for cutting the 2009–10 government budget by $2 billion; reducing government payroll through a series of incentivized layoffs and voluntary resignations; and suspending job benefits, including previously negotiated bonuses and pay raises. It thereby targets over-employment in the public sector and over-spending, which are commonly perceived by Puerto Rican elites as the most important economic problems facing the island government.

The Fortuño administration presented the law as both a short-term response to the fiscal crisis (most of the law’s provisions are set to expire in 2011) and as a brave, necessary set of measures based on the sound principles of fiscal responsibility and work efficiency. Yet the declaration of a state of emergency embedded in Public Law 7, and the reforms that the declaration makes possible, betray the law’s underlying intention: to implement a long-term reform project consistent with Fortuño’s publicly asserted neoliberal ideology.

Moreover, the law is a pretext for creating a smaller public sector by reducing government jobs and clearing the way for the consolidation and privatization of government agencies. Public Law 7 set the stage for Public Law 29, which creates a legal framework for government jobs to be subcontracted to private companies. Following the model being replicated in Europe, North America, and Latin America known as the “public-private partnership,” Puerto Rico’s government-owned properties will be leased to private companies and public projects subcontracted for up to 50 years. These measures, though claimed to be temporary, will likely have a long-term effect on labor rights and policies in Puerto Rico by significantly eroding the public sector, its economic viability, and its labor protections.

In short, Fortuño and the businessmen in his administration’s inner circle are taking advantage of the current confluence of economic problems in Puerto Rico to deal a deadly blow to both the credibility and efficacy of the state, as well as to labor benefits and guarantees.

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While the protests and work stoppages enjoyed ample participation from numerous organizations, unions have undeniably played the leading role in this protest. As well they should. Unions are still the crucial actors called to defend and transform the social pact regarding labor conditions, benefits, and guarantees. But the process of organizing the protests has also exposed the weaknesses of Puerto Rico’s labor unions—their internal divisions, their inability to mobilize support outside San Juan, and their failure to confront the private sector.

The general strike’s eight points of departure and the two separate public stages set up by the FASyL and the All Puerto Rico coalition at the end point of the October 15 demonstrations reveal more than just strategy: They also demonstrate fissures between the labor unions and the leadership organizing the events. The very existence of these two coalitions exposes serious differences within the Puerto Rican labor movement. One of the main divisive issues is Public Law 45, passed under the Pedro Rosselló administration in 1998, which allowed central government employees to unionize but denied them the right to strike—a crucial part of unions’ bargaining power.

Some unions denounced the law as a neoliberal farce, while others chose to lobby for it, arguing that it allowed them to organize new workplaces. The ideological split over Law 45 is echoed in the split between the two main coalitions: The unions that make up the All Puerto Rico coalition, most of them affiliated with North American counterparts, favored the unionization of public employees under Public Law 45, while the FaSyL’s more radical unions did not. Moreover, the leaders of both organizations have publicly disagreed over labor-organizing tactics and the need to publicly confront the government, both recently and in the past. These conflicts among the leadership trickle down to the rank and file, often creating an atmosphere of resentment between organizations.

Although the events in San Juan rallied large numbers, unions have not been able to successfully mobilize protests in other parts of the island, where demonstrations have been more sparsely attended. And there is even less participation in the local work groups created to develop strategy and provide logistical support for events. This is partly because demonstrating in the capital city affords workers more anonymity than is available in small towns, but also because local labor unions have in recent decades neglected local organizational and leadership development, focusing their energies instead on acquiring fringe benefits for workers, rather than building solidarity and support for a broad-based workers’ movement.

In general, Puerto Rican union organizers face a very complex challenge: Since most unionized workers on the island are in the public sector, they end up clashing most directly with the state, the very institution they are trying to defend against privatization. Battles with the private sector have been mostly limited to struggles against government outsourcing to private companies.

The choice of the Plaza las Américas mall as the convergence point for the October 15 demonstrations was partly an attempt to shift the confrontation toward the private sector. But it did not solve the fundamental problem of confronting the state, whose administration changes with each electoral cycle, while the big interests of the relatively more permanent capitalist class remain unchallenged.

These problems notwithstanding, all the protests and work stoppages carried out so far, especially the event on October 15, have been considered successes in terms of turnout and the lack of violence. Although the government postponed some of the layoffs until January, it has showed no signs that it will back off from its reforms.

Meanwhile, numerous government workers have begun appealing the government dismissals in court. Several groups of workers, including educators, firefighters, and others are arguing that they are exempt from Public Law 7 or that the firings should be nullified because their rights to due process, including proper notification and administrative hearings, were violated. The firefighters’ union has already received a positive response, including temporary injunctions against dismissals and even reversals of them.

In the months to come, workers and activists will likely continue pushing back against the administration’s neoliberal agenda. How the Puerto Rican labor movement will confront the many challenges ahead remains to be seen.


Yarimar Bonilla teaches anthropology and Caribbean studies at the University of Virginia. She is writing an ethnography of the labor movement in the French Antilles. Rafael A.Boglio Martínez teaches social work and social sciences at the Metropolitan University in Puerto Rico. He is writing a dissertation on the contribution of NGO community-development projects to social change in Puerto Rico.

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