'The Battle for Paradise': Naomi Klein on Disaster Capitalism & the Fight for Puerto Rico’s Future
Six months since Hurricane Maria battered the island of Puerto Rico, the island is the site of a pitched battle between wealthy investors—particularly from the technology industry—and everyday Puerto Ricans fighting for a place in their island’s future. The Puerto Rican government has pushed for a series of privatization schemes, including privatizing PREPA, one of the largest public power providers in the United States, and increasing the number of privately run charter schools and private school vouchers. For more, we speak with best-selling author and journalist Naomi Klein, author of “The Shock Doctrine: The Rise of Disaster Capitalism.” Her latest piece for The Intercept, where she is a senior correspondent, is “The Battle for Paradise: Puerto Ricans and Ultrarich 'Puertopians' Are Locked in a Pitched Struggle over How to Remake the Island.”
This is a rush transcript. Copy may not be in its final form.
JUAN GONZÃLEZ: It has been six months since Hurricane Maria battered the island of Puerto Rico. It was the most catastrophic storm to hit the island in over a century. As many as 200,000 people remain without power in what’s considered the longest blackout in U.S. history. Energy officials say some areas won’t have power restored until May.
On Tuesday, San Juan Mayor Carmen YulÃn Cruz tweeted, “Six months after Maria things are not what they should be. Thousands still w/o electricity due to neglect and bureaucracy. Our lives matter!”
The devastating storm has reshaped Puerto Rico in countless ways. The official death toll remains at just 64, but independent counts put the total number of fatalities at over a thousand. According to a recent study by the Center for Puerto Rican Studies at Hunter College in New York, more than 135,000 Puerto Ricans have fled to the U.S. mainland since the storm. Puerto Rico’s Governor Ricardo RossellÃ³ is moving to privatize PREPA, one of the largest public power utilities in the United States.
AMY GOODMAN: The governor is also pushing for privately run charter schools and private school vouchers. On Monday, teachers across Puerto Rico held a one-day strike to protest the privatization plan. Meanwhile, displaced Puerto Ricans protested Tuesday in Washington, D.C., outside the headquarters of FEMA, the Federal Emergency Management Agency.
Well, today we spend the hour looking at the future of Puerto Rico, which was already facing a massive economic crisis before the storm hit six months ago. We’re joined by two guests. From Toronto, best-selling author and journalist Naomi Klein, author of many books, including The Shock Doctrine: The Rise of Disaster Capitalism. She has just published a major piece for The Intercept on the future of Puerto Rico; it’s titled “The Battle for Paradise: Puerto Ricans and Ultrarich 'Puertopians' Are Locked in a Pitched Struggle over How to Remake the Island.” And here in New York, Puerto Rican anthropologist Yarimar Bonilla, who teaches at Rutgers University. She is founder of the Puerto Rico Syllabus.
We welcome you both to Democracy Now! Let’s begin with Naomi. You’ve just returned. You’ve just written this epic piece. Explain what you found and what you mean by your title, “The Battle for Paradise: Puerto Ricans and Ultrarich 'Puertopians' Are Locked in a Pitched Struggle over How to Remake the Island.”
NAOMI KLEIN: Good morning, Amy and Juan and Yarimar. It’s great to be with you.
So, what I’m referring to is that in this moment, when so much attention is focused on the failures of FEMA, the failures of the entire relief and reconstruction project—as it rightly should be, because this is an ongoing humanitarian emergency—we’re seeing the strategy that we’ve seen in many other disaster zones, that we’ve spoken about many times, which is exploiting that state of shock and distraction and emergency to push through a radical corporate agenda. You referred earlier to the plans to privatize PREPA, to open up Puerto Rico’s school system to charter schools and vouchers, at the same time as radically downsizing and closing 300 schools, on the back of already having closed more than 340 schools by exploiting the economic crisis in the past decade. All in all, we’d be talking about the closing of half of Puerto Rico’s public schools. So, a radical downsizing, deregulation and privatization of the state.
But that isn’t the only thing that’s going on in Puerto Rico. There is also a powerful resistance movement, that was really gaining ground before Maria hit, that was resisting this illegitimate debt, this previous shock doctrine strategy of exploiting the economic crisis to push these very same policies. But they aren’t just saying no. They are also proposing a people’s recovery process that would rebuild Puerto Rico in the interest of Puerto Ricans, a very, very different vision that’s grounded in food sovereignty, in growing much more of the food Puerto Ricans eat in Puerto Rico, by small farmers using agroecological methods; not privatizing Puerto Rico’s electricity system, but shifting to a decentralized, community-controlled model that is based on renewable energy—all kinds of other deeply democratic changes. And so, there’s this pitched struggle and a kind of race against time over whose vision for the island is going to triumph in this window.
JUAN GONZÃLEZ: Well, Naomi, you begin your piece talking about the town of Adjuntas up in the mountains of Puerto Rico and also about one of these grassroots organizations that even before the storm had already been pioneering at least electricity generation for their own center. Could you talk about that some?
NAOMI KLEIN: Sure, Juan. I mean, one of the things that I found most striking when I was reporting in Puerto Rico was, you know, we heard so much about what didn’t work. And almost everything didn’t work. The food system collapsed. The energy system completely collapsed and is still in a state of collapse.
But there were a few things that did work. And one of the things that worked in the community that you’re referring to was solar power. And there was—there is this community center in Adjuntas which is called Casa Pueblo. It’s been around for decades. It’s been at the center of a lot of major fights in Puerto Rico, against open-pit mining, against logging, against gas pipelines. But they’ve also been building their alternatives. And they’ve had solar panels on their roof for more than 20 years. And after Maria wiped out the electricity grid, it turned out that Casa Pueblo’s solar panels, rooftop solar panels, survived, survived the hurricane-force winds, survived the falling debris.
And so you had this beacon. Arturo Massol, who is the director of the board of directors of Casa Pueblo, described it as an energy oasis. So, in the midst of this sea of darkness, you have this community center that has light, the day after Maria, because their solar panels survived. And so, people came there. It becomes this hub of people-to-people recovery. They start handing out solar lanterns. And it becomes this kind of field hospital, where people plug in their medical devices. So this is, you know, very intensely practical. And we saw some similar things happening on farms, as well.
JUAN GONZÃLEZ: And, Naomi, this was a town that was—not only had no electricity and no water, but was completely cut off from the rest of the island for quite a while because of the roads washed out, right?
NAOMI KLEIN: As so many communities were, you know, outside of San Juan, particularly in the mountains, where roads were either obstructed by fallen trees and branches or by mudslides. So, yeah, completely cut off. It’s weeks before they receive any substantial aid.
AMY GOODMAN: Its founder got the Goldman Prize, is that right? The environmental prize in San Francisco. Him, his son and the community building this place that became this sunny satellite, just shocking, given what was around, the darkness around them.
NAOMI KLEIN: And it’s not the only example of this that I saw. I also saw an amazing example of this in the community of Mariana, in Humacao, where, you know, as—where an amazing mutual aid center was constructed, in the failure of FEMA, in the failure of the state to respond to this disaster. So people linked in with the Puerto Rican diaspora, got their own solar panels installed, and then this become—you know, while I was there, I witnessed an elderly man come in, plug in his oxygen machine, because this was still—and at this point, it was five months after Hurricane Maria—the only source of electricity in the region.
AMY GOODMAN: So, tell us about who the—what you call the Puertopians are.
NAOMI KLEIN: Well, Yarimar, I think, can talk about this, as well. The Puertopians, as some of them call themselves, are part of this influx of what the Puerto Rican government refers to as high-net-worth individuals, who they’ve been trying to attract as a way, a sort of backwards way, out of the ongoing economic emergency in Puerto Rico. So, in 2012, a couple of laws were passed to attract very wealthy people to Puerto Rico by giving them essentially the most favorable tax system in the world. And it’s particularly favorable if you happen to be Americans, because Americans who move to Puerto Rico are exempted from paying federal taxes.
But in addition to that, these twin laws, Act 20 and Act 22, mean that if you relocate to Puerto Rico for just half the year—so you can basically just skip winter, which I’m sure, to New Yorkers, sounds very appealing just about now—so you spend 183 days in Puerto Rico, and, in return, you don’t pay federal taxes. You don’t pay taxes on dividends. You don’t pay taxes—capital gains taxes on interest. And if you change the address of your financial services company or your cryptocurrency company, then you’d pay a 4 percent corporate tax rate. So, if you think about what’s just happened to U.S. tax law, where Trump has offered this huge tax reduction which brings the corporate tax rate to 20 percent, Puerto Rico is besting that with a 4 percent corporate tax rate. So they’re doing absolutely everything they can to lure high-net-worth individuals and these very mobile industries, that basically can do what they do from wherever they have access to data. And so, now there’s a big push to attract the cryptocurrency market to Puerto Rico.
AMY GOODMAN: Now, we don’t want to get into cryptocurrency, but if you could just briefly explain—since you write about cryptocurrency—Bitcoin and blockchain, just to give people a sense of what you mean?
NAOMI KLEIN: So, just last week there was a major conference in San Juan in one of the luxury hotels, the Vanderbilt Hotel, which is actually owned by one of these high-net-worth individuals who moved to Puerto Rico because of these favorable tax rates. And so they had this conference, which originally was called “Puerto Crypto,” and then, because of concerns about crypto-colonialism, they renamed themselves “Blockchain Unbound.” Essentially, what it was is a trade show for people who see the future of finance in currencies like Bitcoin.
And they are attracted to Puerto Rico because it holds out the promise that they can convert their cryptocurrencies into harder currencies while paying no taxes whatsoever. And so, that’s—so it was a combination of a trade show for cryptocurrencies and a kind of an advertisement for Puerto Rico put on by the Department of Economic Development and Commerce, pitching the island as this never-ending vacation where you can have this incredible tax holiday.
And part of the irony of this is that cryptocurrencies are one of the fastest-growing sources of greenhouse gas emissions in the world. It is an incredibly wasteful way to create money. It’s the sort of gamification of money. So, right now, Bitcoin uses as much energy in the creation of this currency as the state of Israel uses to—consumes energy. So this is a huge source of greenhouse gas emissions. And here you have Puerto Rico, battered by climate change and also unable to provide power to its own people, being—pitching itself as a hub for the cryptocurrency market.
AMY GOODMAN: We’re speaking to Naomi Klein, senior correspondent for The Intercept. Her piece for The Intercept—she’s just back from Puerto Rico—”The Battle for Paradise: Puerto Ricans and Ultrarich 'Puertopians' Are Locked in a Pitched Struggle over How to Remake the Island.” When we come back, she’ll be joined by Yarimar Bonilla, associate professor of anthropology and Caribbean studies at Rutgers University. Stay with us.