Tourism is a Fickle Bitch

We talked about Cuba a while back. There was a reason. In the 1950s the Cuban Revolution blew that island wide open. Fidel Castro and his band of independentistas ripped up the fabric of injustice and authoritarian leadership in favor of a communistic form of government. The United States had recently won World War II, single-handedly I might point out (tongue firmly affixed in cheek!), and we were now deeply involved in a Cold War with Russia. Well, the USSR but most Americans still thought of them as Russkies. East versus West. Atheistic Commie Pinkos versus God-fearing Americans. Us versus Them. What better time to make a bold, political distinction between the capitalistically-inclined, pacifistic Puerto Ricans and the brash young, poverty-stricken, freedom-fighters who’d gone to the dark side? Especially from a touristic point of view. Where would you rather spend your annual vacation? A tropical island where luxury and self-indulgence reign supreme or an island rocked by hand-to-hand combat in the streets where entire neighborhoods go boom in the night?

Puerto Rican officials were canny, however. They realized tourism giveth and tourism taketh away. It giveth the big bucks and it taketh away the cultural dignity of the people. Other Caribbean islands, such as the Virgin Islands and Bahamas, relied on tourism for up to eighty percent of their revenue. The Puerto Rican powers that be decided to limit Puerto Rican dependence on tourism to five to ten percent of revenue. For the rest they counted on attracting industry to the island through the magic of tax incentives and a pliable work force.

Puerto Rican tourism grew from ten-thousand folks a year in the early fifties to over five-hundred-thousand by the mid-sixties and over a million by the early seventies. The government accomplished this by building a new airport, named after the first elected governor of Puerto Rico, Luis Muñoz Marín. The Muñoz government legalized casino gambling on the island but limited it to hotels with over 200 rooms, of which there were only two when the legislation passed. They invited Pablo Casals to come live on the island which was the birthplace of his mother. The wheels of government were grinding at a relatively breakneck pace. Unfortunately, the pesky natives who lived in the slums weren’t necessarily in favor of inviting all those snobby northerners in for tea and crumpets. Sometimes you just get tired of being looked-down-the-nose at.

There were four distinct political philosophies in Puerto Rico at the time. At one end of the spectrum were those who wanted legitimate statehood. At the other end were those who favored total independence. Reference Cuba above. A third segment of the population, by far the most vociferous, favored Commonwealth status. And a fourth faction, decidedly in the minority, was tickled pink with the way things were. Commonwealth status won and the rest of the population became disgruntled.

With Commonwealth status came limited self-government. Puerto Rican officials acquired the power to tax, regulate and subsidize the Commonwealth’s economy. Washington still retained control over the island’s judiciary and military. But it was better than nothing. At least on paper.

Now the Puerto Rican government was able to float bonds to fund the burgeoning economy they envisioned. That was a good thing. It put Puerto Ricans in control of their own destiny. But it was also a bad thing, depending on the benevolent nature of the bond holders. Go read up on the Sword of Damocles. Now imagine the fragile horsehair from which the deadly sword dangles represents the good will of the folks on Wall Street. I rest my case.

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