Why the Federal Government Should Support Puerto Rico’s New EITC

Puerto Rico faces a host of daunting challenges, including chronically high poverty (especially among children), low labor force participation, over a decade of economic decline, an unsustainably high debt burden, and the lingering effects of the devastating hurricanes of 2017 that make its long-term prosperity harder to attain. To address these challenges, the Commonwealth needs a comprehensive economic package that centers around powerful tools such as the Earned Income Tax Credit (EITC).

Sick and Abandoned

For decades, Puerto Rico has received limited funding to run a bare-bones Medicaid program that fails to provide adequate care for 1.5 million people who depend on the program. It is time for Congress to stop nickel-and-diming Puerto Rico’s Medicaid program, and enact a permanent, comprehensive fix.

Puerto Rico’s Looming 2019 Medicaid Fiscal Cliff

Puerto Rico and its residents have experienced numerous crises and shocks in the last decades, including an economic depression dating back to 2006; a public debt crisis resulting in the largest municipal bankruptcy in U.S. history and a federally appointed fiscal oversight board pursuing deep budget cuts; a demographic crisis with population dropping by more than 600,000 residents since peaking at 3.8 million in 2004; and most recently, the devastation and cascading effects left by the hurricanes of 2017.

La burocracia de la reconstrucción

Los fondos federales para la reconstrucción después de un desastre natural se administran a través de un complicado entramado de programas, manejados por diferentes agencias y están sujetos a una multiplicidad de reglas y reglamentos. En términos generales, las dos agencias principales son la Administración Federal para el Manejo de Desastres (“FEMA”) y el Departamento de Vivienda y Desarrollo Urbano (“HUD”).