29.11.2017

Zimbabwe – an alternative view

Or: Zimbabwe, Western arrogance, ignorance, and dump propaganda.

Western media is jubilating. The Washington Post, owned by Jeff Bezos, with 100 billion US$ the worlds richest man, writes:

For 37 years, it was the official newspaper of Robert Mugabe. Then, this month, the staff of the Zimbabwe Herald got an impossible assignment: They would have to cover the downfall of their benefactor.”

And: “Suddenly, a newsroom that had been the mouthpiece of the regime was without a censor.”

The Zimbabwe Herald, supposedly freed of dictatorial censorship, writes:

The resignation marked the end of an era for an African political icon. Admired by many in Africa as a liberation icon, Mugabe offered a message of hope and unity to millions of his compatriots when he became the first black prime minister of newly independent Zimbabwe on April 18 1980.

He did not disappoint on his promise during the greater part of his 37 years in power, delivering a free education system that was the envy of many of Zimbabwe’s neighbors and far afield, as well as announcing a much vaunted policy of reconciliation with the white population of the country soon after independence.”

And:

Under his rule, Zimbabwe remained one of the countries with high literacy rates in Sub-Saharan Africa, averaging above 90 percent of the population over the greater part of the past 30 years.

Since independence in 1980, the Zimbabwean government has always prioritized education by giving it one of the highest allocations in its national budgets. Figures from the Zimbabwe National Statistical Agency show that the literacy rate has consistently risen over the past 25 years despite economic challenges faced by the country, rising from 80.38 percent in 1992 to 97,6 percent in 2014.

Mugabe is also credited with the program to give land to landless Zimbabweans that was pursued by the government since 2000. Over 300,000 families benefited from the land reform program, an exercise Mugabe said was meant to address the historical inequalities in the ownership of natural resources.

Under the economic indigenization program, introduced in 2010, Mugabe made sure that indigenous Zimbabweans benefited from the exploitation of natural resources of the country. Widely resisted by some foreign investors but greeted with enthusiasm from locals, the program required foreigners to surrender at least 49 percent of their shareholding to Zimbabweans.”


This is still not what Western commentators would like to hear and the Washington Post consequently headlined an article: “Zimbabwe’s New Leader Stirs Fears That He Resembles the Old One.”
Robert Mugabe was in the concluding months of his presidency, with elections scheduled in mid-2018.

He had joined the national liberation movement in his country at a young age while working as an educator and youth leader in that former settler colonial outpost that the British called Rhodesia. During the late 1950s and early 1960s, he lived, worked, and studied in the West African state of Ghana, which was then the fountainhead of Pan-Africanism under Dr. Kwame Nkrumah.

After being imprisoned by the British for a decade in the 1960s and early 1970s, Mugabe relocated to Tanzania and Mozambique to work full time as a leader of ZANU. He led the negotiations for the Lancaster House agreement which paved the way towards nonracial, democratic elections in Southern Rhodesia in 1980, resulting in his installment as prime minister. By 1985, Zimbabwe had become a republic with ZANU-PF as the leading political party.

A land redistribution program enacted in 2000 was met with stringent Western sanctions and a merciless economic war against Zimbabwe. Mugabe was not deterred, and the program, popularly referred to as “the Third Chimurenga,” has been a cornerstone of domestic policy since then.

In 2009, Mugabe signed the IEEA (Indigenization and Economic Empowerment Act ) into law, aiming to place 51 percent of companies into the hands of black Zimbabweans. This indigenization policy is a blue print for the post-colonial states in Africa, who all suffer from a dominance of foreign capital over the national and regional economies.

Cut off from Western trade, Zimbabwe relied on South Africa, the SADC (Southern African Development Community), the AU (African Union), Mozambique, China, Russia, Cuba, and other states who were not afraid of US/NATO scorn.

Mugabe served as chair of the AU in 2015, advancing the cause of economic integration and independence from Western states. This year, he presented a one million US$ fundraising check to the AU, setting an example for individual state commitment to the continental body.
Recent divisions within ZANU-PF came to a head after Vice President Emmerson Mnangagwa, nicknamed “the crocodile,” in early November was relieved of his duties. He represented the old guard, called Lacoste group, and was at odds with the Generation 40 group, led by Jonathan Moyo and Saviour Kasukuwere.

At least 100 other party officials were being examined for possible expulsion from both party and government, but the Lacoste group was not defenseless. Mnangagwa, who had close ties to military brass, plotted his comeback.

ZDF (Zimbabwe Defense Forces) head General Constantino Chiwenga held a press conference along with 90 other military officers at which he threatened intervention if the purges did not cease.

Immediately after the press conference tanks moved into Zimbabwe’s capital Harare and the ZDF seized the main television station. Maj. Gen. S.B. Moyo went on television saying that there had not been a military coup and the military was only targeting “criminals” surrounding the president.
The government before had attempted to snuff out the coup plotters and had dispatched a police paramilitary unit to arrest General Chiwenga upon his return from China. However, military intelligence caught wind of the plan and when Chiwenga’s plane arrived, a team of soldiers dressed in National Handling Services uniforms got inside the airport and chased the policemen away. The army then immediately attacked the police at the parliament building and seized the police paramilitary camp and armory.

The first casualty of the long planned coup was Mugabe’s head of security, Albert Ngulube. He was grabbed right at Mugabe’s gate and taken to a detention facility where he was brutally beaten. Secretary of Youth Affairs Kudzai Chipanga and his wife were forced to strip naked and sit on the floor at a police station. Kudzai Chipanga was severely beaten and forced to apologize on TV for criticising General Chiwenga. When an army unit attacked the home of finance minister Ignatius Chombo, it shot dead his three guards.

There were demonstrations in Harare, celebrating the coup, but they were not as massive as Western media portrayed them. The demonstrators were people with time at hand, unemployed for sure, but also rioters, hooligans, people who would take any chance to make a noise, to rampage, to let steam off.

In the absence of Robert Mugabe’s supporters, who had fled to neighboring countries or gone underground, ZANU-PF voted to expel the president and all known Generation 40 members from the party.

Mugabe was given the deadline November 20 to step down from office, which passed. The pressure on him was increased, with Senator Monica Mutsvangwa of Manicaland Province presenting an impeachment resolution to the parliament. After that Mugabe finally gave in and resigned.

Both the SADC and the AU expressed concerns over the coup in Zimbabwe, because under Mugabe the country had been an ideological and political base for Pan-Africanism and anti-imperialism on the continent. Alpha Conde, president of Guinea and African Union chief, said “it is a shame, Mugabe has to leave through the back door.” Conde called Mugabe an African hero. “Mugabe will never be forgotten, he was a great fighter.” There are reports that neighboring Zambian President Edgar Lungu was willing to militarily intervene in Zimbabwe and place his troops under Mugabe’s command.
Needless to say, that the Western press is delighted by the downfall of Mugabe.

The New York Times writes: “After nearly four decades in power, Zimbabwe’s ruler, Robert Mugabe, resigned in the wake of a military takeover. How did the notorious strongman manage to keep his opponents at bay for so long?

The BBC writes: “So, will Emmerson Mnangagwa be able to take Zimbabwe’s economy off life support and at least start to put it on the road to recovery? Analysts are very skeptical that a quick solution is even feasible. The euphoria that has gripped the nation has certainly raised hopes that the future will be brighter, but if that improved sentiment is to deliver economic dividends, the government needs to make some drastic reforms.“

Britain, the former colonial power, was quick to advise the new government in Harare on how it should proceed:

Foreign Minister Boris Johnson called the resignation in a Twitter post “a moment of hope for the people of Zimbabwe.” This echoed the remarks of British Prime Minister Theresa May, who said that the sudden removal of Mugabe would “forge a new path free of the oppression that characterized his rule. In recent days we have seen the desire of the Zimbabwean people for free and fair elections and the opportunity to rebuild the country’s economy under a legitimate government.”
African countries in the second half of the 20th century tried to counterbalance political and economic pressure of the neocolonialist powers, wielded by trade wars, World Bank, IMF (International Monetary Fond), and bribes to the local “comprador class,” with increased ties to the USSR, but after the dissolution of the USSR they were again fully exposed to Western economic pressure and subversion.

Libya’s Muammar Gaddafi stepped in with his plans of a “Gold Dinar,” to replace the US Dollar, and an “African Development Bank.” China also stepped in, followed in distance by a resurgent Russia.

Of all African countries, Zimbabwe is the most logical target for Chinese and Russian investment. China and Russia vetoed all UN Security Council sanctions on Zimbabwe.

In 2015 and 2016, loan packages negotiated between China and Zimbabwe included 5 billion US$ for free aid and interest-free loans. China pledged to train 200,000 technical personnel and provide 40,000 training opportunities for African personnel in China. The aid intends to modernize agriculture with technological expertise, machinery, training, and teams of experts.

China is financing the expansion of the Hwange coal power plant and the Kariba South hydro power plant. China also pays the installation of fiber-optic cables for a high-speed Internet system and has built a pharmaceutical distribution center in Harare (Pharmaceuticals and Chemical Distributors Pvt Ltd.), in order to provide medicine to all hospitals and clinics at affordable prices. The country’s new parliament building in Harare was paid with Chinese money (46 million US$).
The Beijing Automotive Group produces with two local partners Grand Tiger pickup trucks assembled from kits. Chinese companies built a 150 million US$ expansion of Victoria Falls International Airport, upgraded Zimbabwe’s busiest highway, and supplied wildlife monitoring gear.

A Chinese company built the National Defense College in Harare, which opened in 2014 and was financed with an interest-free 98 million US$ loan. The college trains soldiers, intelligence operatives, and police from Zimbabwe and other Southern African countries.

Mugabe’s move to nationalize Zimbabwe’s diamond mines and revoke licenses from Chinese mining companies though caused tensions and maybe was a contributing factor to his downfall.

Russia’s biggest economic commitment to date is an agreement in 2014 to invest 3 billion US$ in Zimbabwe’s largest platinum mine. The project includes the installation of a refinery to add value, thereby creating more employment and secondary industries. The Darwendale operation near Harare is expected to produce 600,000 ounces of platinum a year when it reaches capacity.
China’s investments in Africa are a threat to Western dominance, especially because the investments focus on infrastructure and the development of indigenous industries, thereby making the countries less dependent on Western imports.

US Americans don’t offer infrastructure development to African nations, how could they, when they are not even able to keep their own infrastructure intact, with roads, bridges, dams, the electricity grid, water and sewage systems, Amtrak, the NYC Metro, and other vital installations in decay and urgently needing repair, updating, replacement.

Americans are not great in infrastructure, but what they can do easily is sending their special operation forces. US military involvement in Africa has grown substantially over the last decade, with troops in Somalia, Niger, Mali, Nigeria, Uganda, the building of a huge military base in Djibouti (Camp Lemonnier), and the formation of AFRICOM (US Africa Command). The Pentagon has confirmed that there are 6,000 US soldiers stationed throughout Africa.

China can’t yet make up for the former USSR’s power but it seems willing to protect its investments and partnerships with military force, for example by supplying weapons, equipment, and funds to the African Union’s military unit, or by deploying Chinese troops to South Sudan for protecting the oil pipelines, which have been sabotaged by US-supported rebel forces. China also has set up its first military base overseas in Djibouti, giving Chinese troops the opportunity to keep an eye on the main US AFRICOM base there.

To sum it up: China is a very welcome and highly needed counterweight to Western dominance and while some privately owned Chinese companies may exhibit chauvinism or even various forms of exploitation towards their African workers, usually Chinese engagements are not as damaging and adhere to higher moral standards then the ones of Western companies.
Will Zimbabwe continue on the path of economic independence or again become a colony of Western powers?

At the moment it can go either way. The factional struggle between the ZANU-PF old guard and the Generation 40 group has been decided by the army, which supported Emmerson Mnangagwa.

Mnangagwa received military training in China in 1963, soon after he joined the fight against white minority rule in then-Rhodesia. He and his friend General Chiwenga always kept close ties to Beijing.

Mnangagwa has wowed to fight corruption and has issued a three-month ultimatum for the return of funds siphoned out of the country by individuals and corporations. Since 2009 Zimbabwe is using the US dollar as its main currency, which has led to massive smuggling of dollars to offshore accounts. It is estimated that 2 billion US$ are illegally held in foreign bank accounts.

One has to wonder if the new president is the right man to fight corruption. Mnangagwa certainly has amassed a fortune himself during his political carrier and is rumored to be a millionaire or even billionaire.

It is also doubtful wether he is right man to keep Zimbabwe free from foreign influence. He let know that he has communication channels opened with IMF, World Bank, African Development Bank, European Union, and other international financiers that until now have shunned Zimbabwe.

In a 2015 interview with Chinese TV, Mnangagwa stated: “You cannot say there are areas of our economy which we are happy with… We have to see how we can create an investment environment which will attract the flow of capital. We must know that investment can only go where it makes a return so we must make sure we create an environment where investors are happy to put their money because there is a return.

While Mnangagwa’s key ally and former finance minister Patrick Chinamasa declared during international negotiations that he had “fallen in love with the IMF and World Bank.” 

Eddie Cross, economic secretary of Morgan Tsvangirai’s opposition party, praised Mnangagwa as “a business man who understands business.”

Cross deems it necessary to remove the Indigenization Act, give autonomy to the Reserve Bank, and pay compensation to the white farm owners who were expropriated during the land reform.

Western agencies are cautiously hopeful. IMF mission chief for Zimbabwe Gene Leon: “While growth in 2017 will be boosted by the bumper harvest due to the exceptional rainfall, the challenge is to sustain growth going forward in a context where macroeconomic stability is threatened by high government spending, the foreign exchange regime is untenable, and the pace of reform inadequate.” 

Reform according to the IMF means: “… to rebalance the economy towards one where growth is driven by the private sector.” (Which is of course only possible by cuts to the public sector and by privatizations.)

Former Minister of Finance Tendai Biti chimed in: “We have to make peace with London, Brussels and Washington. We have to find the boys and girls with money.”
There is certainly a comprador class who is just waiting to facilitate an international looting operation and the vultures of the global financial system are on high alert, waiting for risk free investment opportunities, hiked up debt repayments, new usury loans, and privatizations at fire-sale prices.

They will have a hard time to compete with Chinese money and gain a foothold in Zimbabwe, they will most likely be blocked and outmaneuvered. Which is a reassuring prospect but doesn’t mean that everything will be fine. 

Chinese investors may be not as wicket and vicious as their Western counterparts, after all, they have to stand up to their reputation of fairness and benevolence, but that is no guarantee they’ll act in the best interest of the targeted country.

Chinese tobacco company Tianze has given interest-free loans and training to farmers, many of whom work on land seized from white farmers, to help beef up production and help fill cigarette demand back home. This provides a livelihood for sure, but growing tobacco to make other people sick is not ecological, is a waste of resources.

When the Chinese government decides that something has to be done because cancer rates go through the roof, they will restrict smoking and African tobacco growers will have to learn something new. Maybe they will go back to subsistence farming, which would not be a bad move, as climate change in the coming years inevitably will cause droughts, crop failures, and severe famine. Food will become precious!

By the skewed benchmarks of mainstream economists, who measure only output and profit, ignoring ecological destruction and social injustice, large industrial farms are more productive than the small plots the Zimbabweans got in the land reform process.

Even that is debatable, as the Michael Lipton study has shown,
http://unctad.org/meetings/en/Presentation/SUC_GCF2013_18-03-2013_Michael-LIPTON_Study.pdf
(If the huge consumption of fuel for farm machines, synthetic fertilizers, and agrochemicals in industrial farming practices are taken into account, intensive subsistence farming is superior. It also causes less soul depletion and less chemical contaminate of soil, water, food.)

But this discussion is moot and the arguments are of no concern for the industrialists, the movers and shakers of our world. They exploit the lands riches at home and abroad, and if an area is exhausted, drained, used up, they move on to the next place.

They don’t have to worry. They will be fine on their remote islands and superyachts. Smartphones for the masses, pure, wholesome food and clean water for the rich elite.

Robert Mugabe knew that all, he was an intelligent and highly educated man. Does Emmerson Mnangagwa know it also? Or will he sell out the country for short term gains and his short term fame?

Related:

19.11.2017

Puerto Rico two month after

Two months after Hurricane Maria, mainstream news reporting has died down, though many Puerto Ricans are still without vital infrastructure.

Only 40 percent of the population has electricity, and about 14 percent of the island still doesn’t have access to clean drinking water. Where hospitals faced extensive storm damage, the only medical care available is emergency treatment.

Right now the island is experiencing miserable conditions with heat (34 degree Celsius) and pouring rain, causing new flooding.

There is price-gouging on staples like rice and water, on all other basic necessities, on power generators, and on airline tickets. Cell phone service is spotty, most landlines are dead. Long queues for food and gas are common, suicides are frequent. There are burglaries, looters are stealing batteries from cars and are stripping copper from fallen power lines for resale on the black market.

The official death toll is 55 but that’s just people whose deaths have been verified by autopsy. Carmen Yulin Cruz, mayor of San Juan said the death toll could be as high as 500. 472 more people died this September compared to the same time last year.

According to authorities Hurricane Maria and Irma destroyed 70,000 households completely. 2,000 people are still living in hundreds of shelters across the island.

The distribution of tarpaulins, considered a standard first emergency response by aid workers, has not happened smoothly. FEMA (Federal Emergency Management Agency) said it has provided 70,000 tarpaulins to local authorities and has 100,000 more in a warehouse. Samaritan’s Purse, an NGO, said it has given out 42,000 covers.

There’s no doubt that this is not enough because an estimate 240,000 houses suffered partial or complete damages. People have to buy tarpaulins in the few open hardware stores. In San Juan tarpaulins are being sold at inflated rates of up to 125 US$.

80 percent of the 60,000 households requiring roofing still have none and living conditions are terrible even if the roof is temporarily fixed because everything is sodden and brown smears from the flood water are everywhere.
No municipality in Puerto Rico has any money to build the infrastructure that’s needed, but  aid from FEMA is typically conditioned on a cost-sharing agreement that would require Puerto Rico to match a quarter of expenses. That share was reduced to 10 percent this month.

Governor Ricardo Rossello is universally viewed as incompetent. His emergency-response agency AEMEAD, meant to knit seven security agencies into a fast-response team, is hampered by resignations, inexperience, and bureaucratic infighting.

At a panel discussion in San Juan by the territory’s financial oversight board, economist Jose Villamil said the population could decline to less than 3 million, another, Juan Lara, said the economy could contract by 15 percent in this fiscal year. A third put the estimated storm damage at 115 billion US$ — a sum equal to a year’s economic output.

Everybody who can, leaves

People who have relatives on the main land, who are well qualified to get a job easily, and who can afford it financially, leave for good. An estimated 200,000 residents will leave the island annually as a result of Hurricane Maria. This is only the intensification of an already existing trend, because in the last decade migration from Puerto Rico to the main land was approximately half a million, 12 percent of the island’s population. Around 700,000 Puerto Ricans live in New York City and all together there are five million Puerto Ricans on the mainland, compared to 3.4 million on the island.

The young, educated, wealthy leave, while the poor, the pensioners, the old, sick, or disabled stay. The ensuing demographic change will have severe economic repercussions.
Puerto Rican population density in 2016 was reported at 385 people per square kilometer, and with this number it is the third most densely-populated area in the USA. As it stands now, the island will not be able to support this high number of people in future.

In comparison the population density in Cuba is only 100 people per square kilometer.

Many on the island feel that they are not part of the USA and that they are treated like second-class citizens. Governor Rossello asked for 94 billion US$ in federal aid, but the Trump administration seems completely uninterested in the matter.

Emergency management director Abner Gomez resigned and Lt. Gen. Jeffrey Buchanan, who leads the military relief effort, is also leaving. Buchanan announced that troops would wind down operation as all roads are cleared. He conceded in an interview, that the land component of the military’s response could have been more robust and that he should have pushed for more resources like helicopters and logistical supplies.

The military helicopters which were deployed are now pulled out.

Car country

There is no public transport system, nearly everybody owns a car. There are 614 automobiles per 1,000 people, compared to 38 cars per 1000 people in Cuba. And unlike Cuba, where 50 year old vehicles are kept running with ingenious tinkering, Puerto Rican cars include luxury brands, Porsches, Ferraris, BMWs, you name it.

The fancy cars of course need an equally luxurious road network. There are 289 kilometer roads per 100 square kilometer, more like in most European countries. In Cuba there are 55 kilometer roads per 100 square kilometer.
Most roads are lined now with broken trees, mud, and other debris. The military came in and just pushed it all to the side to re-open the roads as quickly as possible. Clearing the roads though was only a partial fix because many are washed away or have disappeared in giant sinkholes. There are 3,500 reported incidents of hurricane damage to roadways, with repair costs estimated at 250 million US$. Highway 2, the vital 143-mile artery between San Juan and Ponce, was also damaged with eastbound traffic squeezed into a single westbound lane and westbound traffic detoured. It has been fixed now, but there are damaged roads and bridges all over the island and the longer the repairs take, the more costly they get, as relentless Caribbean rain continues to erode damaged stretches of highway, particularly those buried by mudslides.
Reconstruction is hindered because there is still no power, not enough trucks, no electrical light, and only intermittent cell phone service.

With much of the population cut off from power and communication, the island is forced to divert hundreds of trucks and drivers to help bring supplies to needy citizens. Few vehicles are left to transport the equipment and materials needed to fix infrastructure.

An environmental catastrophe 

Puerto Rico’s water and sewer authority PRASA has just 125 trucks to service the island’s 3.4 million residents. Additional vehicles were requested from FEMA as well as from the US Army National Guard but have not arrived yet.

Men, women, children are collecting water from open springs and from the sides of the mountains. The authorities have warned against using the water for drinking purposes, saying it may be contaminated. Some people are exploiting the elderly and the disabled by selling them gallons of potentially contaminated water collected from these points.
Those who have water report that it often appears grayish-brown coming out of their faucets. Water treatment plants depend on electricity and because of the frequent blackouts they can stop working at any moment. People have been advised to boil tap water or use purification tablets, but without electricity there is no boiling and purification tablets are hard to get by.

Medical workers report waterborne diseases across the island, especially gastrointestinal illnesses, most often involving fever, vomiting, and diarrhea. There is also the danger of disease-carrying mosquitoes, who find an ideal breeding ground in puddles from the flooding and in water that has pooled in hurricane debris. The mosquito population has exploded and people who are camping outside become prey to mosquito-borne diseases. There is also a leptospirosis outbreak with 74 reported cases, caused by contaminated water entering the bloodstream through cuts and sores.

The island’s 18 ‘Superfund’ sites — areas so polluted that the US EPA (Environmental Protection Agency) deems them hazardous to human health or the environment — posed a potential risk even before the hurricane hit. Twelve of these sites sit on karst, a geological formation made of porous rock that allows toxic chemicals to flow down from the surface into groundwater.

Rotting debris can be still seen outside almost every property, as though the hurricane had only just happened. Only 7 percent of the debris has been cleared and two month after the storm municipal workers are still removing the heaps of discarded furniture, appliances, and other household paraphernalia which residents have cleared from their ravaged homes. 
The garbage heaps raise public health concerns as they attract rodents and mosquitoes, but the municipalities don’t know where to put the garbage. There is little to no room left in Puerto Rico’s landfills and even before the hurricanes most of the islands 29 operating landfills were beyond capacity and nearly half had been ordered closed amid concerns over risks to soil and groundwater.

The Toa Baja landfill for instance was scheduled to be permanently close by 2014 but is still operating. In April, the EPA ordered the municipality of Toa Alta to permanently stop disposing waste by the end of 2017 because the landfill has reached capacity. The agency said one of the most urgent concerns is the landfill’s leachate collection system, which is not functioning (leachate is a liquid generated by decomposition of waste material). According to the EPA, “The Toa Alta Landfill sits on top of Puerto Rico’s North Coast Limestone aquifer system, a potential source of drinking water.”

Another problem is the separation of toxic waste. Crews are working from dawn to dusk to separate dangerous things like paint cans, household cleaners and televisions from benign materials, but time pressure and the sheer magnitude of the task may undercut the efforts.

Electricity, ”lifeblood of civilization”

Without electricity refrigerators and freezers don’t function, affecting what people eat and drink. Electric stoves, washing machines, computers, ATM machines, tools, industrial equipment become useless. There’s no air conditioning, no fans to alleviate the tropical heat. Without working traffic lights, crossings and busy intersections are prone to accidents. Without lighting, offices, workshops, restaurants, and other businesses must close at dark, adding to Puerto Rico’s already high unemployment rate.

Even in areas with power, residents must deal with daily blackouts. San Juan had two massive power outages in November, reminding of the challenges the island continues to face. According to the public electric power company PREPA, there was a technical failure in unit 7 at the San Juan Central plant, later on unit 8 went out of service. The island-wide power generation collapsed from 50 to 22 percent (of capacity before the storms). Several medical centers lost power. Power generation is 40 percent at the moment, but the number constantly changes.

31 of the 78 municipalities still have no power at all.

Fixing the power grid admittedly is a difficult task, because Puerto Ricans consume 5310 kWh per person per year. Though this is much less than on the mainland, where 12,077 kWh are used, Cubans in comparison only need 597 kWh per person per year.

Companies and affluent folks fill the gap with power generators, one can hear the sound of these generators all over the island, disturbing the sleep of neighbors. But generators cannot be used in many places, because pouring rain and floodwaters make it dangerous to switch on any electrical devices.
The head of PREPA, Ricardo Ramos, testified before the US House Natural Resources Committee, in a hearing which amounted to another step towards the privatization of the power utility. Ramos has resigned since amid questions about slow repairs in the hurricane’s wake and a controversy over a 300 million US$ contract awarded to Whitefish Energy Holdings, headquartered in Interior Secretary Ryan Zinke’s Montana hometown. Whitefish was billing the Puerto Rican public power company 319 US$ an hour for linemen, nearly 17 times the average paid to Puerto Rican electrical workers.

The deal was canceled after it faced scrutiny and outrage, but a 200 million US$ contract with Cobra Acquisitions LLC, which may be as scandalous, is still in place. Cobra Acquisitions LLCI is a subsidiary of the Oklahoma-based fossil fuel company Mammoth Energy Services. With the help of FEMA, Cobra negotiated a 15 million US$ upfront payment from PREPA and it will be paid biweekly. The initial contract is for 120 days of work, though Cobra stated repeatedly that they expect that to be extended. Like Whitefish Energy Holdings, Cobra Acquisitions LLCI is a small, previously unknown company with no experience in storm damage repair.
PREPA is currently 9 billion US$ in debt and pays more than one billion US$ a year to off-island oil and gas companies. It is completely dependent on imported oil, generating 47.4 percent of its power from that source alone.

Yet even as the utility’s leadership has acknowledged that its fiscal sustainability relies on a transition away from oil, its plan has been to transition not to distributed renewables — which are more resilient to storms — but to centralized natural gas. Just 3.3 percent of Puerto Rico’s electricity is derived from clean energy, but nearly a third comes from natural gas. PREPA’s future plans include the construction of a 400 million US$ liquid natural gas import terminal.

Disaster capitalism, a proven concept

The ports, the power grid, the highways, the road system in general, the water and sewage systems all need to be rebuilt and improved. Hospitals and schools have to be repaired or even completely replaced. Rebuilding and mending the destruction caused by Hurricanes Irma and Maria will cost an estimated 110 billion US$.

Until now Congress has approved a 5 billion US$ loan, a pittance, compared to the 94 billion US$ Governor Rossello has called for. Private investors will step in, not in an act of charity and welfare, but to extort high profits either in form of interest payments or as road tolls, fees, increased electricity, water, and sewer rates.
Puerto Rican authorities held a public hearing advancing the “New Government of Puerto Rico Act.” Among drastic austerity measures, it calls for “authorizing the Governor to reorganize, externalize, consolidate and suppress agencies, programs, and services of the Executive branch.”

This would give the Governor dictatorial power to close or sell off public agencies in order to ensure payments to the bondholders of the island’s 74 billion US$ debt. An already existing 10-year fiscal plan aims to reduce the number of public agencies from 130 to 35 and to cut 2.75 billion US$ in expenditures annually.

Obama’s PROMESA (Puerto Rico Oversight, Management, and Economic Stability Act), effectively removed the financial powers of the Puerto Rican government and the autonomy of its 78 municipalities. The by PROMESA installed 7 member financial control board has ordered strict austerity.

Cuts to the public-education system, the appointment of an “emergency manager” to control the electric grid, furloughs, pension reforms, and the winding down of GDB (Puerto Rico’s Government Development Bank) are possible options. The dismantling of GDB would mean, that millions of dollars of municipal-tax revenue which GDB held in trust would be used to pay GDB’s creditors.

On the other hand, the financial control board has developed a plan that would wipe out 79 percent of the territory’s annual debt payments, yet this plan meets strong opposition from hedge funds (the so called “vulture funds”), and banks — it has to be seen if it can be realized.

Education is the key

In Puerto Rico, like in many other impoverished and bankrupt areas, this headline doesn’t mean, what one thinks at first glance, it rather means: “the education system is the key to the privatization of public services.”

Most of the schools that are open still have no electricity, 140,000 students have no school to attend. All together 932 schools have reopened, out of a total of 1,132. It’s expected that a large portion of those remaining closed will not open again, for that is one of the windows of opportunity that Puerto Rico’s officials seek to further the wholesale privatization of the education system. Puerto Rico’s secretary of education, Julia Keleher, already tweeted last month that the transformation of New Orleans after Hurricane Katrina into an all-charter school district was a “point of reference.”

The transformation of schools into charters would allow the entry of private corporations, seeking to profit from cost cutting by reducing teachers’ wages and benefits, including pensions.
The teachers unions have accused Keleher of deliberately keeping many of the island’s schools closed, even after teachers and other volunteers cleared them of debris and cleaned them. Earlier this year Keleher closed already 179 schools, which had less than 250 students, to save 7 million US$. 27,000 students were forced to change schools and 2,700 teachers were sacked. Students from rural districts and mountainous areas now have to travel long distances to other schools.

Teachers unions in response to the privatization plans organized protest marches and sit-ins, 21 teachers were arrested during a protest in San Juan.

Privatization goes together nicely with the gutting of labor protection and social spending. 

Andrew Briggs, member of the financial control board, listed the barriers preventing Puerto Rico’s recovery, including: “Minimum wage laws, labor rules requiring just-cause termination, paid sick days for employees, paternity leave, and overtime pay.” In this sense, he said he hoped the hurricane would incite some changes, “like the alcoholic who hits rock bottom.”
In the first article about the Hurricanes Maria and Irma
(https://mato48.com/2017/09/27/cuba-and-puerto-rico-a-tale-of-two-islands/a comparison was made between Puerto Rico and Cuba. Cuba’s recovery went smoothly while Puerto Rico is still a mess with no end in sight.

Cuban authorities admittedly have it a lot easier, because all infrastructure is on a much lower scale, so consequently less damage occurs and less has to be repaired. Compared to Costa Rica Cuba has only a quarter of the population density and a fifth of the road density, Cubans use only 11 percent of the electricity and own only 6.2 percent of the cars per capita.

It has certain advantages to be a territory of the worlds richest nation and Costa Ricans, spoiled with cheap energy, commodities, goods, eagerly espoused the prevalent lifestyle of Western industrialized nations, commonly called “consumerism.”

They also were lured by cheap credit, accumulating debts which became unsustainable.

Cubans on the other hand are used to a scarcity of resources. A consumerist lifestyle is out of the question, as the land, isolated for 57 years by the US embargo, can provide not much more than the bare necessities. Austerity is an integral part of life, but it is accepted because the burden is shared equally and there is a climate of solidarity, cooperation, and national pride.

Cubans who don’t share these social principles have long since left for Florida.

In Puerto Rico something similar would happen, leading to a smaller, more equal, just, and compassionate society, but the overlords in Washington and New York have other plans. Puerto Rico will be exploited, sucked dry, pushed into debt slavery, turned into a sweatshop zone. It will still not resemble Haiti, it will still be nominal richer that Cuba, but many will suffer, will be stressed out, and the less fortunate will be pushed aside, abandoned and ignored.

On the various global happiness indexes Cuba surely has surpassed Puerto Rico by far.