The Congressional, executive and judicial wings of the US government recently clarified for all, despite Washington’s claims to the contrary, that Puerto Rico is a colony of the US.

A law called PROMESA, passed by Congress with bipartisan support, including from most “liberals”, and signed by chief executive Obama on 30 June, creates an unelected seven-person control board that has sweeping powers to take over Puerto Rico’s economy. This has occurred during a major economic crisis on the island, whose government and utilities owe some $73 billion to US banks, hedge funds and similar institutions. The board will arbitrarily decide how the crisis will be dealt with.

During the debate, representative Luis Gutierrez of Illinois, of Puerto Rican descent, spoke against the bill, saying, “We’re engaged today in a wholly undemocratic activity in the world’s greatest democracy. We’re debating how we will take power from the people, who are virtually powerless already … Think about it. You are imposing a junta – because that’s what they’re calling it. There will be no difference between this junta and the junta of Pinochet in Chile, as far as the international community is concerned”.

Two recent Supreme Court rulings underscored his point. One concerned a criminal procedure, and asserted that Puerto Rico is not sovereign. The other voided a law passed by the Puerto Rican legislature to allow the island to declare bankruptcy, reaffirming a 1986 Congressional law that prohibited Puerto Rico from doing so, unlike the 50 states and US municipalities, which have that right.

Supreme Court Justice Sonia Sotomayor, who also is of Puerto Rican descent, dissented from both decisions. She wrote that without being able to restructure its debt through bankruptcy, Puerto Rico and its utilities “will be unable to pay for things like fuel to generate electricity, which will lead to rolling blackouts”. Other vital services “will be imperiled”, she continued, “including the utilities’ ability to provide safe drinking water, maintain roads, and operate public transportation”.

She added that Puerto Rico’s government “is left powerless and with no legal process to help its 3.5 million citizens”. In an interview on Democracy Now!, Carmen Yulin Cruz, the mayor of San Juan, the capital of Puerto Rico, said:

“What the Congress has done, what the president of the United States has done, what the judicial system has done, is that they have unveiled to everyone, the international community and everyone in Puerto Rico, that we are a colony of the United States.

“PROMESA is a broken promise to the people of Puerto Rico. They have turned their backs on the rights of Puerto Rican people, and they will not move forward an agenda which will help the development of the Puerto Rican economy.”

No wonder that a majority of people on the island strongly oppose this course.

In 1952, as the colonial revolution against direct imperialist control was in full swing, and the Cold War was intensifying with the US invasion of Korea, Washington didn’t want to admit it had a direct colony. Now it has no need of such niceties, although it still wants to fudge the issue a bit, not using the word colony but saying Puerto Rico has no sovereignty and that Washington controls its government.

“What people need to know”, Ms. Cruz continued, “is while in the US people are fighting to increase the minimum wage to $15 an hour, this colonial control board will lower the minimum wage in Puerto Rico for people 25 or under to $4.25 an hour.

“This colonial control board could sell our national resources. And this colonial control board will have sovereign powers to revoke anything that our next governor, our next legislature or any public official of the Puerto Rican government, elected by the democratic vote of the Puerto Rican people, will do. So, we have no voice, because we have been left voiceless by those that claim to be the beacon of democracy in all the world.”

Some hope that the control board will restructure the debt. Ms. Cruz pointed out that the board will decide “if – not when – our debt will be restructured. This is basically a control board for the hedge funds which lent money to Puerto Rico.

“It is important to note that … the Puerto Rican people will have to pay $370 million to this control board for it to be functional. So they are not only taking democracy away from Puerto Rico. It’s costing us money to inflict pain on our own people. And that is totally unreasonable.”

The debt crisis Puerto Rico finds itself in is the latest stage of its relation to the US. Washington conquered the island in its war with Spain more than a century ago. It had been a Spanish colony for four centuries before that. The first phase of US exploitation involved the domination of sugar plantations by US corporations. The second stage was the growth of US-owned industries, especially pharmaceuticals, which enjoyed big tax breaks from Washington. This began to come to an end in the 1990s, with the tax breaks completely phased out by 2006. The US industries then pulled out, and Puerto Rico has been in a recession since.

But the government of Puerto Rico, dominated by conservative pro-Washington figures, didn’t take the steps to free the island from US domination and embark on building up the economy on its own terms. This would have taken a massive struggle against the US. Instead, it met its needs by borrowing from US financial institutions.

Now Puerto Rico owes $73 billion, which the government admits it cannot pay back. As this became apparent, the value of the debt dropped and vulture funds bought the debt for a song. Now they are demanding full payment of the face value of the loans, which would mean they rake in super profits.

“We have our own responsibility for this crisis”, mayor Cruz concluded. The Puerto Rican central government was complicit with the US financers. “So there is a shared, silent cooperation that produced the perfect crisis. We have to reform our government. We have to restructure our priorities. And we have to restructure the colonial relationship between Puerto Rico and the United States.”

A good beginning for a new government representing the working people of Puerto Rico would be to default and refuse to pay the debt.