88% of those surveyed in the research "The Free Market in Puerto Rico 2022" said that the local economy is in a bad moment.
Photo: Noticel (Suministrada)
San Juan, Puerto Rico - Although in the past two years, the economic injection of federal funds that the island has received has managed to stop the crisis that has been dragging on for more than a decade, many Puerto Ricans understand that the economic situation in the country "is very bad" and that the direction it is taking is not favorable.
88% of those consulted in the survey "The Free Market in Puerto Rico 2022", conducted by the Institute for Economic Liberty (ILE), expressed that "the economic situation in Puerto Rico is bad or very bad". In fact, 92% said that "the direction of the island's economy is bad or very bad.
This was revealed today in a virtual round table discussion by Dr. Ángel Carrión Tavárez, director of Research and Public Policy at ILE; Dr. Luz N. Fernández López, a researcher at ILE; and Dr. Juan Lara, economist and professor at the University of Puerto Rico, who presented the report with the research findings.
"We all know that the economy has gone through a terrible crisis of more than a decade that ended in the bankruptcy of the government and the creation of the Fiscal Oversight Board, in addition to a spate of terrible events such as Hurricane Maria, earthquakes and the pandemic. Right now, we have had a two-year period of relative prosperity in the midst of a very prolonged crisis. It's kind of a positive bubble. We all know that this is due to the injection of federal funds into the economy," commented economist Lara.
"It is interesting that we highlight that this bubble moment when the economy is doing relatively well, it is not the free market that is providing that result," the expert stressed.
In Lara's opinion, the fact that despite the island's economic boom, the majority of those surveyed believe that the economy is in a precarious situation is due to the general knowledge that the good times we are experiencing are thanks to federal funds. But, above all, people are aware that a plan must be structured to keep the economy afloat once the federal funds allocated for the past emergencies are exhausted and that this plan has not even been thought of.
"What is going to happen when those federal funds are gone? What is going to allow the economy to keep moving forward? The consensus is that we have to have an economic development strategy and have a plan for how we are going to move the economy," Lara emphasized. "People see that Puerto Rico's economy is going in the wrong direction and do not foresee that this moment of growth and prosperity will last. It is very important to work on how to strengthen the private economy and free trade.
The survey, conducted among 550 people, also revealed that these adjustment measures or future plans to develop the economy should be decided taking into consideration the opinion of the people, not only what the government says or that the JSF should be the one to impose the next step.
For Dr. Carrión-Tavárez, the results of the research show the way forward for the free market to take a leading position in the island's economic future.
Among the actions to be taken, for example, Carrión-Tavárez said, is to evaluate the occupational licenses required in Puerto Rico.
"There are market failures, and those failures are preventing the principles of economic freedom and free markets from working. What needs to be done to correct that is to start taking action. Occupational licenses are a good example. Licenses exist for an important purpose, but operationally they become obstacles for people to enter the workforce," said ILE's Director of Research and Public Policy, while mentioning that there are 12 exclusive occupational licenses on the island.
Another important fact revealed by the survey was that 93% of those surveyed stated that they "prefer to earn a living by working". This result is in keeping with the stereotype perpetuated on the island that people like to "live off the bread and butter" or that "they are lazy".
However, he also revealed that it is time to evaluate social assistance programs to see how they can be adjusted so that they work for what they were created for, to be a momentary help and not a perennial way of life.
"It demonstrates the need to change the welfare system to one of economic mobility. It's impressive that such a high number say, 'I prefer to earn a living by working'. This shows us that something is wrong because these programs are not designed to make this a person's modus vivendi, but to assist them at a given moment," said Carrión Tavárez.
The study sought to measure knowledge of and affinity for free market principles in Puerto Rico. It covered the four main pillars of the free market: "Individual Freedom", "Rule of Law", "Right to Private Property" and "Limited Government", and topics such as "Puerto Rico's Current Situation", "Social Welfare" and "Meritocracy", among others.
This News article was originally published in Spanish in EyBoricua.com.