Puerto Rico is in a debt crisis of unprecedented proportions. Its debt to GDP ratio is 70% and the US government has stepped in with a new plan to try to restructure this debt and create an oversight board to help handle the situation.
A recent New York Times article brought an important perspective to this Puerto Rico economic crisis conversation: the potentially redundant and expensive mayoral system in the territory. The article discusses the 78 municipalities or municipios that provide local governance in Puerto Rico:
Municipios —with their mayors, employees and government offices — represent one of the island’s most intractable problems. What was once a venerable tradition has become a symbol of government bloat and deficit spending, a costly affliction that also stretches to myriad central government agencies and the legislature in San Juan.
For an island that is just 3,515 square miles with a population comparable to the state of Kentucky, is it prudent during a time of economic crisis to be paying mayors $70,000+ per year, much of it out of the central government’s coffers? The Times reports, “With jobs hard to find in Puerto Rico, smaller municipios are often the biggest employers in town” with extensive administrative offices and their own municipal police forces.
We, at Strong Towns, are big fans of local government. We believe in local government as a platform for strong citizens to collaboratively build prosperous places. Many Strong Towns members are mayors and local government administrators themselves. As the Times article explains, "In their defense, mayors say municipios are more nimble and often provide services more cheaply than the central government." Nonetheless, a local government that receives, in at least one example from the New York Times article, “more than 40 percent of its money […] from the central government” is hardly fiscally sustainable, especially under the current economic climate.
In light of the debt crisis, the Times reports:
[T]here are renewed calls to do away with a sizable number of municipios, most of which are ailing financially, by folding smaller ones into larger ones and creating regional hubs.
However, it remains to be seen whether that move would be politically feasible, or indeed, the best course of action long term.
(Top photo by Rachel Quednau)