A significant segment of the Puerto Rican population, 36%, is unbanked. These households tend to be extremely poor, with an average income of $8,472, and headed by older single unemployed females with a less than average education. Close to 50% of all unbanked households are located in the greater San Juan area. This lack of financial access precludes unbanked households from enjoying benefits associated with asset accumulation which exist in addition to the benefits conferred by the ability to defer consumption and creates a major obstacle for the implementation of asset-based policies to reduce poverty in Puerto Rico.
Puerto Rico has to overhaul its anti-poverty strategy, moving away from programs that create dependency towards programs that promote self- sufficiency. Current government welfare programs are particularly ill-designed for working poor families. Moreover, regressive excise and Social Security taxes are detrimental to low-income families trying to make ends meet. An Earned Income Tax Credit Program is a promising route towards improving the standard of living of Puerto Rico’s low-income working families.
Equality and liberty, these two values lie at the heart of all democratic societies. Yet, the tension between them has caused endless debate. If the case for equality is pressed too hard in the name of “maximizing overall social utility” – for example, by taxing the well-off at punishing rates – liberty will inevitably be curtailed.
Numerous efforts have been commenced and countless strategies have been outlined yet, the question remains: have we accomplished any tangible results or moved forward with regards to strengthening and expanding Puerto Rico’s high technology sector?
In this policy brief we offer a brief summary of the asset building approach to social policy, review the arguments in favor of implementing asset building policies to reduce poverty, analyze current incentives in the Puerto Rico tax code that favor asset accumulation by the non-poor, and offer some policy recommendations to promote asset accumulation by the poor in Puerto Rico.
Most industry clusters have emerged on their own, even though a growing number of regions are now enacting economic development policies designed to foster industry cluster formation and expansion. Some have advised that this is the best approach for Puerto Rico to take in order to spur community renewal and revitalization. However, as policy makers in Puerto Rico commit to this strategy they must fully assess the benefits and drawbacks of industry clusters, identify the implementation challenges for Puerto Rico, and work towards decreasing the obstacles for the success of the approach.
There are two approaches to assessing the impact of the Internet. Cyber-optimists claim that the Internet is one of the most important innovations of the last century (or ever!) and will revolutionize the U.S. and world economies. Cyber-optimists tend to live in places like Silicon Valley, Austin, Texas, near Route 128 around Boston and in the Dulles Access corridor near my home in Washington, D.C. By and large, cyber-optimists are already plugged into the Internet world, and they think that if you are not also then you are not “with it”.
Estudio del Mercado de Internet: El perfil de los usuarios de Internet en Puerto Rico