Entrepreneurship or populism: the two routes for Puerto Rico

We are living decisive moments that will define many things with transcendental effects for our future. Large sectors are still unaware because daily the substantive matters compete with the latest scandal or gossip of the day, and gradually the important matters take a back seat.

Within this continuous clash of priorities, another great debate coexists about which economic ideology we will base our recovery process on in the medium and long term.

On the one hand, the temptation persists to remain tied to the old model, in which the political class markets the benefits that the government is the solution to all the country's ills (populism) or the challenge of building a society based on work, savings, investment and private initiative (entrepreneurship).

El sistema educativo tiene que cambiar su paradigma de promover una sociedad de empleados y asalariados hacia una mentalidad de empresarios y creadores de riqueza, escribe Gustavo Vélez (Ramón "Tonito" Zayas)

The educational system must change its paradigm from promoting a society of employees and wage earners to a mentality of entrepreneurs and creators of wealth, pens Gustavo Vélez (Ramón "Tonito" Zayas).

Populism and government bankruptcy

Although we may not realize it, daily we are immersed in a great debate around the two routes described above, and populism seems to be in the lead.

For decades, we were socially and economically programmed to depend on the State. Since Rexford Tugwell and Luis Muñoz Marín, the architects of the modern State (1948–1973), the government has become the epicenter of our lives.

In his populist feat and social revolution of the 40s and 50s, Muñoz Marín distributed parcels to the poor and gave shoes to the dispossessed in the fields, but along the way, he created the conditions to institute populism and make us dependent on the State.

The government has positioned itself as that "good" dad, and great benefactor that has to provide us with everything, from education, health, security, employment, and social benefits to alleviate poverty. The politicians who have administered the government discovered that it was easy to use public resources to buy votes, and favor their own, to perpetuate themselves in power, thus creating a dangerous vicious circle that precipitated us into insolvency and economic stagnation.

That same government borrowed without limits to try to maintain the level of expenses and maintain its role as a great provider of jobs, financing the interests of all those who in some way depended on it.

And in that interest that violated the most basic principles of public finances, the Commonwealth (ELA) went bankrupt in 2017.

We already know the results of the decadent and discredited populism in Puerto Rico and its inability to produce a sustainable and vibrant economy in the long term. However, without having the sealed on paper, the exit of the government from bankruptcy, populism continues alive and kicking in the narrative of the politicians of the day.

Entrepreneurship as an option

Faced with the failure of the State and with it the ability to finance populist measures, there is no other route than to build a society and an economy based on entrepreneurship and business initiative. Individual freedom and the promotion of self-effort as guiding principles of a new socioeconomic model supposes a complete reengineering of the prevailing thought during the second half of the 20th century and so far in the 21st century.

To begin the new route, the government must reconceptualize its mission in our lives and focus on being a facilitator of private initiative and creating the conditions for entrepreneurship to germinate and entrepreneurs to be the pillars of economic growth. In the second instance, the educational system must change its paradigm from promoting a society of employees and wage earners to a mentality of entrepreneurs and creators of wealth. Public and private schools must shift their curricula toward that mission.

In the third instance, we must change the vision and the narrative of seeing entrepreneurship as an expression of selfishness, but rather as the maximum expression of the freedom of the human being to build new things and create wealth.

Lastly, and perhaps most importantly, businessmen must get out of the stands and assume a more prominent role in the social and daily life of Puerto Rico. The Puerto Rican business class must connect with the people and summon them to a new journey of change, and the construction of a new social and economic project, in which we all have a role and we all win.

This piece appeared originally in Spanish in El Nuevo Dia

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