Unions reject US bill that seeks to impose Fiscal Oversight Board to Puerto Rico

23 May 2016
In a letter to US congressmen, trade unions complain that the proposal "provides no economic stimulus, and in fact takes money out of the economy by reducing the minimum wage and overtime protections".

Unions and federations of unions representing more than 50,000 workers in Puerto Rico (including two affiliated to Public Services International-PSI) released last Friday, May 20, a letter to US congressmen expressing their opposition to HR 5278, a bill presented May 18 in the House of Representatives that seeks to impose the island a Federal Fiscal Oversight Board with the aim alleged to solve its severe economic and fiscal crisis.

The organizations that sign the letter are: American Federation of Labor-Congress of Industrial Organizations (AFL-CIO), American Federation of State County and Municipal Employees (AFSCME), International Association of Machinists and Aerospace Workers (IAM), Service Employees International Union (SEIU), United Automobile, Aerospace and Agricultural Implement Workers of America International Union (UAW), United Food and Commercial Workers International Union (UFCW), United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union (USW). 

According to the unions, the HR 5278 – “Puerto Rico Oversight, Management, and Economic Stabilization Act”, or “PROMESA” – “provides no economic stimulus, and in fact takes money out of the economy by reducing the minimum wage and overtime protections”. The letter says: 

“Any restructuring package must also protect the accrued pension benefits of Puerto Rican workers and retirees, retain worker protections that apply to all working people in the U.S. including minimum wage and overtime protections, and preserve the democratic rights of the people of Puerto Rico. PROMESA is unacceptable because the bill fails to meet these basic goals.”

Through the letter, the unions urge the congressmen to oppose HR 5278 as currently written. And demand that the US Congress provides real solutions that allow Puerto Rico to negotiate a feasible debt restructuring plan.

The new bill replaces the HR 4900, which would have received great opposition from different groups of creditors because it is suspected to be a bailout. "In recent weeks there were intensive negotiations with the Democratic leadership and the Federal Treasury to produce a substitute bill that is acceptable to all parties", the economist Gustavo Vélez wrote on May 19 in the Puerto Rican newspaper "El Nuevo Dia".

Read the letter below (also attached):

May 20, 2016
 
Dear Representative:
 
We are writing on behalf of unions representing more than 50,000 people in Puerto Rico to express our opposition to H.R. 5278, the “Puerto Rico Oversight, Management, and Economic Stabilization Act” or “PROMESA.”
 
The people of Puerto Rico face an urgent humanitarian and fiscal crisis brought on by more than a decade of recession, excessive debt, and Wall Street demands for austerity. Congress must act immediately to provide a path for comprehensive debt restructuring and a return to sustainable economic growth for the 3.5 million U.S. citizens living in Puerto Rico. H.R. 5278 provides no economic stimulus, and in fact takes money out of the economy by reducing the minimum wage and overtime protections.
 
Any restructuring package must also protect the accrued pension benefits of Puerto Rican workers and retirees, retain worker protections that apply to all working people in the U.S. including minimum wage and overtime protections, and preserve the democratic rights of the people of Puerto Rico. PROMESA is unacceptable because the bill fails to meet these basic goals.
 
We urge you to OPPOSE H.R. 5278 as currently written. Congress must, however, get back to work immediately to provide real solutions that allow Puerto Rico to negotiate a feasible debt restructuring plan, protects Puerto Rican workers and retirees, and provides economic stimulus so that the territory may achieve economic growth.

 

American Federation of Labor-Congress of Industrial Organizations (AFL-CIO)

American Federation of State County and Municipal Employees (AFSCME)

International Association of Machinists and Aerospace Workers (IAM)

Service Employees International Union (SEIU)

United Automobile, Aerospace and Agricultural Implement Workers of America International Union (UAW)

United Food and Commercial Workers International Union (UFCW)

United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union (USW)

 

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