In this paper we examine the establishment and operations of a CDA program in Caguas, Puerto Rico. This program affords us an opportunity to test whether asset-building policies can provide a new approach to social welfare in Latin American countries and Hispanic communities in the United States, a middle way between paternalistic, government-based social programs on the one hand and so-called neo-liberal approaches on the other. First we provide a brief summary of Latin America and Puerto Rico’s institutional heritage. We then make a case for implementing CDAs in Puerto Rico and Latin America based on and largely derived from John Rawls’s influential Theory of Justice. We believe this approach could be useful for policy advocates in Latin American countries due to the historical influence of social contract theories, especially that of Rousseau’s, in the political development of the region. We conclude with an analysis of the CDA program in Caguas and the lessons derived from our experience as advisors to the municipal government in setting up this program.
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