The Teachers Mutiny

T’was the week before Christmas and…

“…we had a coup d’état,” in the words of Jaime.

Who should know, being a lawyer and an astute observer. So what happened? Well, the governor of the island called a special session of the legislature to pass a “reform” of the teachers’ retirement system, which currently has almost 40,000 pensioners. This follows a move in April to reform the government workers retirement system, which caused protests across the island.

It’s not the chickens but rather the eagles come home to roost; since 1952, governments have had two or three essential strategies to reduce unemployment. The first was legitimate—manufacturing, especially pharmaceuticals. That Valium you mother chugged down to tide her through your terrible twos? Thanks, Puerto Rico!

The other modes were a little less kosher….

“He shipped ‘em all off to New York!” sputtered Mr. Fernández, when someone suggested that Luis Muñoz Marín—a close relative of the devil, in the eyes of Mr. Fernández—had reduced unemployment.

The other solution? Put everybody on the government payroll, give them one task to do, and pay them substantially less than the private sector. So you had an enormous government; if memory serves... well wait. Here’s a graphic:

So everybody knew for years that we were heading for disaster. And thus the last governor passed legislation that slashed 30,000 government jobs. Last April, the present governor took the machete to the government retirement system and raised taxes. And now, it’s the teachers’ turn.

There are two reasons for this. First, the system is broke; here’s what the president of the Senate, Eduardo Bhatia, had to say:

To have a retirement system you have to square the end of the month and it is broken. For every dollar you have to give a person who retires today there are 17 cents in the piggy bank. The question is where the other 83 cents go, and that is the decision we have to make as a country. Are there additional 83 cents in the General Fund? No, not there,’ said the Senate leader.

Put it another way—the norm is to have a plan 80% funded, we are only at 17%.

The other factor at play? A little company called Moody’s, which has our credit rating one notch above junk, and is watching Puerto Rico closely.

Well, “watching” may be generous. Moody’s, in fact, has Puerto Rico quite securely by part of a gentleman’s most prized anatomical possessions. And Cate Long, writing for Reuters states it openly: she wrote, “Moody’s identified this reform as one of the factors that will compose its review of Puerto Rico.”

So what happened? The governor sent legislation to one of the two teachers’ unions on the island, and they erupted. And as you can see in the video below, they not only protested but broke the doors to the Senate and charged in. So soon, the entire island was glued to their televisions, watching as hundreds of chanting teachers gathered in the capitol.

Damage? $55,000. One part of which may have been a senator’s chair, on which, according to The New Day, a child was permitted or possibly urged to urinate. Oh, and a security official got bitten, though the attacker didn’t draw blood.

And what did the Senate do? Well, they got the hell out of Dodge City, which in this case meant retreating into an adjacent room, the Hall for Illustrious Ladies. They continued the debate until seven PM, when they adjourned.

To make a sorry situation worse, the teachers do not receive Social Security, and so their pension is the only thing they have.

The reaction from the guv? He came out and called it “reproachable,” which seems a bit mild, given the damage done and the precedent it sets.

You can argue—the teachers should have seen it coming; it was clear that the system was unsustainable. It’s also true that we have a very expensive government, and that our legislators make a killing, both when they’re in office and when they come back as “advisers.” Nor does it help that—according to Mr. Fernández—the Department of Education has the highest proportion of non-docent versus docent personnel in the country.

The saddest thing? According to an analysis by Joanisabel González in the print edition of El Nuevo Día, “Lo increíble es que Puerto Rico entrará en esta nueva parte del ciclo sin garantías de que escapará a la degradación crediticia”.

Simple translation! Even if we do this—and the House has in the last hour just passed the legislation—it may not be enough.

Anybody Got 70 Billion Out There?

I know that I was reading it at 3:45, because that’s when I sent it off to myself in an email. Bloggers do that, since a large part of my day now is spent wondering what, if anything, there might be to write about. The problem? Much of what seems perfectly splendid in the middle of the night looks a bit different in the colder light of day.

And you don’t really want to know, do you, that Puerto Rico is on the brink of financial doom? Why? Because for decades, every governor of either party has followed essentially the same strategy: hire as many people as you can, pay them marginally, allow them to do as little as possible, and borrow money to pay for it all. So what happened?

Well, the chicken came home to roost, and the Washington Post reported yesterday we’re 70 billion bucks in debt. Cancel that—I just checked the headline, and it’s not even “70 billion,” it’s “at least 70 billion.” That makes us number three in the nation—behind California and New York. We do, however, easily trump little Detroit, who went bankrupt at a mere 18 billion. Pikers, obviously.

Nor is that the only problem for today—everybody is leaving the island; in the years from 2006 to now, we’ve lost 138,000 people, most of them to the mainland, and most of them professionals. And why not? Salaries are low, crime is high, and the quality of life? Well, the Post also reported that our murder rate is six times higher than the national average.

Right—so what’s the solution? Well, here’s what we can’t do—go bankrupt, since apparently cities can but states cannot. Nor can we simply say “screw you” to the investors that have bought all our bonds, since the constitution stipulates that investors get paid before retirees and public employees. So what to do? Here’s the Post on the subject:

The situation is being closely monitored by the White House, which recently named an advisory team to help Puerto Rican officials navigate the crisis.

How bad are things on the island? Worse, apparently, than I thought. Here’s Caribbean Business:

The GDB-EAI (Government Development Bank—Economic Activity Index) had returned to growth in December 2011 for the first time since Puerto Rico’s recession began in 2006. It showed small but consistent year-over-year gains for nearly a year before beginning to retreat again last October. Since then, it has been on a steadily steepening decline: falling 0.7 percent in November, 2012, 1.3 percent in December, 2012, 1.8 percent in January, 3.1 percent in February, 3.1 percent in March, 3.5 percent in April and 3.4 percent in May, 4.5 percent in June, 5 percent in July, and 5.4 percent in August.

So our projection for the local economy in 2014? Instead of the minute growth projected originally, it’s now predicted that we will shrink by .8% next year. And if that’s not gloomy enough, consider the statement made by somebody at Moody’s—one of the three credit rating firms that has us one step from junk status:

“Further weakening of economic growth could result from the additional corporate and sales taxes, as well as increased tax compliance and enforcement measures,” Moody’s said. “Despite the increase in much-needed recurring revenue for the commonwealth, weaker economic conditions would also increase negative pressure on the rating.”

A friend who was the press secretary to two governors told me a story, once, about the governor who charged his cabinet to go home, think long and hard about the situation on the island, and come back the next day with a plan of action. So they all did, and returned with in-depth analyses and ideas. At the end, only one man was left who hadn’t spoken.

“Governor,” he said, “I thought about it a lot, and I came to one conclusion….”

“And that is?” asked the governor.

“Estamos jodidos,” the advisor replied.

We’re screwed.

And that was in the good old days!

Guarding the Palace

Right—there’ll be no shirking here. Previously, I had the doubtful responsibility of buffing up the English language skills of 500 Wal-Mart associates. Before that I was a nurse. Then there was the cello, to which I’ve recently returned. And now?

Defender of Buckingham Palace!

It seems that The Queen’s Guard—the one that gets changed every day, you remember—is completely slipping up. Because take a look at the picture below!

Yup—it’s a firework exploding against Buckingham Palace.

OK, having taken on Putin (see here and here) and won, a few days ago—he now assures us that he’ll welcome LGBT folk with open arms and vodka bottles—I was all in the mood for a nice quiet time. But no, with the slackers apparently overtaking the Guard, somebody has to step up to the plate. What if the queen had been strolling on her balcony?

So I turned to The Guardian for the dope, and discovered that the protest was part of a worldwide demonstration against austerity cuts; here’s what they had to say on the topic:

Similar events were staged in cities in Japan, Australia and New Zealand in opposition to austerity cuts, corruption and an increase in state surveillance.

Well, the event attracted hundreds of people, of whom 11 were arrested. In addition to the fireworks directed at the palace, a fire was started near the gates of the building, and the Lord Nelson Column in Trafalgar Square sustained damage. And apparently things got a bit heated—here’s more from the Guardian:

Ceylan Hassan, 24, a university graduate, who was among the protesters in London, said: "They started shouting 'move back, move back', but we had nowhere to go. The police started pushing us, screaming 'move back, move back'.

"There was a fire on the right hand side of the monument and people started throwing things."

OK, so I absorbed that, but then the question became: who was Anonymous, apparently the group behind the protest? And what were they all about?

In fact I don’t know—or rather, they don’t. But here’s what Trent Peacock (love the name, by the way), an Anon (as they call themselves) had to say, as cited in Wikipedia:

We [Anonymous] just happen to be a group of people on the internet who need—just kind of an outlet to do as we wish, that we wouldn't be able to do in regular society. ...That's more or less the point of it. Do as you wish. ... There's a common phrase: 'we are doing it for the lulz.'

Lulz, according to that Wikipedia entry, is “entertainment.” But the group’s idea of entertainment includes hacking—for some of its members—and they’ve gone after some really worthy targets, including Scientology and the Westboro Baptist “Church.” Here’s Wikipedia on the subject:

Several attacks by Anons have targeted organizations accused of homophobia. In February 2011, an open letter was published on AnonNews.org threatening the Westboro Baptist Church, an organization based in Kansas in the US known for picketing funerals with signs reading "God Hates Fags".[83] During a live radio current affairs program in which Topiary debated church member Shirley Phelps-Roper, Anons hacked one of the organization's websites.[84] After the church announced its intentions in December 2012 to picket the funerals of the Sandy Hook Elementary School shooting victims, Anons published the names, phone numbers, and e-mail and home addresses of church members and brought down GodHatesFags.com with a DDoS attack.[85] Hacktivists also circulated petitions to have the church's tax-exempt status investigated.[86] In August 2012, Anons hacked the site of Ugandan Prime Minister Amama Mbabazi in retaliation for the Parliament of Uganda's consideration of an anti-homosexuality law permitting capital punishment.[87] 

Good work, guys!

Anons also supported the Occupy movement in its early days, and have protested stock exchanges and major corporations; they also were active in the Arab Spring.

For all this, the group attracts attention, if not notoriety. In 2012, Time Magazine named them on the 100 most influential people; according to Wikipedia, the NSA agreed. Here’s what it says:

In 2012, Public Radio International reported that the US National Security Agency considered Anonymous a potential national security threat and had warned the president that it could develop the capability to disable parts of the US power grid.

I report all of this dispassionately—it’s hard to get a finger on this group’s pulse. But one thing I’ll say: we’re skating quite rashly on the thinnest of ice. The 1% is getting unimaginably rich, and worse, frightenly isolated. The rest of us are forming a collective time bomb of unemployment, poverty, and disenfranchisement.

Anybody remember the French Revolution?