(Published in Workers World newspaper Nov. 24, 2005.) As Wall Street orders more austerity Unions mobilize in Puerto Rico By Tom Soto San Juan, Puerto Rico For a week, starting Nov. 6, three important mobilizations of workers and their families took place here in the capital of this Caribbean nation, which was invaded by the United States in 1898 and has since been ruled as a colony. Demonstrators numbered in the thousands in what may well be a harbinger of what is to come. The marches revealed the developing struggle against the layoffs of public employees, against the government’s refusal to negotiate wage increases with public employee unions, against the skyrocketing cost of living, against efforts to privatize state-owned corporations, and against the continuing cutbacks of services by the colonial government. In September 2004, Moody’s Investor Services and Standard & Poor’s - two of Wall Street’s bond-rating houses - had announced they were downgrading the credit-worthiness of Puerto Rico’s government bonds. Moody’s pointed to a government debt of $39.4 billion and a current budget deficit in fiscal year 2005. Throughout the summer and fall, the P.R. government has been imposing layoffs on public employees through early retirement plans. It recently repeated threats to lay off public employees en masse. Wall Street pushing for more Under the direction of the Wall Street investment houses, the government has implemented an austerity plan to keep Moody’s and Standard & Poor’s from further downgrading the bond ratings. Representatives of these two firms and of the Puerto Rican client government are scheduled to meet on Nov. 22. The austerity measures carried out thus far have hit the workers and the poor hardest. Electricity rates have risen 100 percent, bus fares have increased by 300 percent, highway tolls by 43 percent, car registration fees by 100 percent, tuition fees for the public universities by 40 percent, and water usage rates by 74 percent — with another 74 percent increase to take effect next year. These government-sponsored increases have ushered in a period of spiraling inflation, promoting further increases in the prices of all basic foodstuffs and other necessities of life. On Nov. 10, in a barely publicized meeting, Puerto Rico’s secretary of the treasury, the director of its Office of Management and Budget, and the president of Puerto Rico’s Development Bank met with 50 attorneys representing Wall Street investment houses. As a result of this closed-door meeting, Wall Street demanded that, before it would approve Puerto Rico’s credit-worthiness, the Puerto Rican Legislature must approve a new tax code imposing a 9 percent “consumer tax” on the working public. Puerto Rico has never had a sales tax because of the low salaries here – which on average are one-third of those in the U.S. Per-capita income here in fiscal year 2004 was $12,947. In this atmosphere of fiscal and debt crisis, the P.R. government has been adamant that it will not negotiate wage increases with public employee unions. Teachers’ union takes lead On Sunday, Nov. 6, thousands of teachers wearing bright yellow T-shirts identifying their union, the Federation of Teachers marched militantly through the narrow streets of Old San Juan, gathering at the Plaza de Colón, marching to the Capitol Building where the Puerto Rican Legislature is housed, and then to the governor’s seaside mansion. The demonstration numbered many thousands, whose lead banner said: “If you can read this, give thanks to a teacher — We demand justice for teachers.” Their yellow flags and banners drew the attention of service workers, residents, shopkeepers and tourists. Their chants, demanding retirement after 25 years’ service and 15 children per classroom, echoed off the buildings. The protest was so large that when the front of the march reached the governor’s mansion, the end was still leaving the Plaza de Colón. The Federation of Teachers is the largest union in Puerto Rico, with some 32,000 members. Its president, Rafael Feliciano, told the crowd at the governor’s mansion: “The Federation is ready to struggle ... for just salaries, and we demand that our schools give our students a quality education, that they have adequate facilities and the necessary resources, so that Puerto Rico can lift itself up, strengthening our culture and being an example for all of us.” He explained how the union had prepared its negotiating proposal for six months, but when delegates sat down to negotiate, the Department of Education had no proposal, meaning, “They have no plan to improve the educational system.” Feliciano pointed out that the Department of Education wants to eliminate parent, teacher and student participation at the local school level. He stressed that “more than 90 percent of our bargaining contract is directed at bettering the educational system. It is not a contract to enrich ourselves but to lift the education system of our country.” Referring to the government’s refusal to even consider salary increases, under the guise of the current fiscal crisis, Feliciano said: “It is irresponsible to say there is no budget for salary increases for teachers because we are negotiating a contract to take effect over the next budget, not the present one.” Electrical workers oppose privatization On Nov. 9, the Electrical Industry Workers Union pulled out its membership in a one-day strike to demand that the government stop outsourcing the jobs of union members to private contractors and stop any effort to privatize the state-owned Electrical Energy Authority (AEE). Early in the morning, workers began to gather at the main office of the AEE in Santurce, to later march to the Capitol Building and to the governor’s mansion. Behind a banner reading, “United we can stop the privatization of the AEE,” the 4,500 workers - more than 95 percent of the entire union membership - literally took over the four-mile route. They were led by 300 motorcycles bearing the blue-and-yellow flags of the union. For years the union has been campaigning against the sale of this state-owned corporation to private industry, such as occurred with the sale of the Puerto Rico Telephone Co. in 1998. This week the Legislature, under the pressure of the growing movement, approved a bill opposing privatization of the AEE, and several legislators spoke at the rally. Agustín de Jesus, participating in a contingent of retirees, told this reporter: “Although we welcome the expression of the Legislature opposing privatization, you can never trust these capitalist politicians. Only the continued unity and mobilization of the workers can safeguard against privatization.” That same day, the governor’s office issued a statement claiming that the government had no intention of privatizing the Electrical Energy Authority. On Nov. 10, the Federation of Workers of Puerto Rico, which is affiliated to the AFL-CIO, held a demonstration in front of the governor’s mansion. Unions urged members to bring their shoes, and they made a pile of them in front of the mansion. “If [Gov. Acevedo Vilá] were to put himself in the shoes of the public employees, who are threatened by a reduction of wages and by layoffs at a time when the inflation indexes have skyrocketed, he would have a different view,” said José Rodríguez, president of the Federation. The ongoing fiscal and debt crisis, the threatened layoffs and the refusal of the government to consider wage increase for public employees, the inflation in the prices of all basic commodities — all these factors are pushing the class struggle to the fore. Thus far the organized labor movement is holding its own and preparing for future battles.□ The author's email address is: commentstomassoto@yahoo.ca To access Workers World newspaper clique here.