My upstairs neighbor in Old San Juan is a gentleman who moved to Puerto Rico for the tax breaks. He’s part of an influx of colonial settlers that have arrived in Puerto Rico looking for fun in the sun and tax loopholes. He keeps a low profile and rarely interacts with the local community.
Gentrifying tax dodgers, like my neighbor, are permanently altering the social fabric and character of San Juan. This wave of gentrification began in 2012, when Puerto Rico’s pro-statehood government approved a series of tax incentives to attract high-net-worth individuals to the territory and boost the island’s bankrupt economy. The most notorious of these were Act 20 and Act 22, now existing collectively as Act 60. Under this law, beneficiaries receive a 100 percent tax exemption from federal and local taxes on all dividend and interest income.
The island’s elite benefits from the arrival of these investors. For instance, Blanca López Pierluisi, Governor Pedro Pierluisi’s daughter-in-law, is the current CEO of Corcoran Puerto Rico and the creator of the “most acclaimed real estate Facebook group in Puerto Rico, Act 20/22 PR Real Estate Guide.” After these laws came into effect, a steady stream of convicted felons, fraudsters, money launderers, and charlatans started trickling into the island to avoid taxes. After Hurricane María, cheap real estate and an abundance of federal recovery funds turned that trickle into a tsunami.
It is a great time to live in Puerto Rico if you are a foreigner with deep pockets. The tax loopholes are dizzyingly profitable, allowing vulture investors to gobble up real estate that Puerto Ricans have had to abandon or sell. These “newcomers”—a euphemism for colonizers—skew overwhelmingly white, male, and ultra-conservative.
They live in the most desirable parts of the island in exclusive gated communities with tone-deaf names, such as the Plantation Resort Residences. Health care is not a problem because they have access to a private hospital run in partnership with John Hopkins Hospital. They network in places like the former San Juan Children’s Museum, which Brock Pierce bought and converted into a crypto clubhouse.
When they make the news, it is often to feature their criminal behavior. One investor shot and killed a stray dog for interrupting his golfing session. YouTube star, Logan Paul, crushed rare turtle eggs with his golf cart on a protected beach.
For these profiteers, the history and culture of Puerto Rico are irrelevant. The island is just a sunny place to hide assets from Uncle Sam. In fact, many of these settlers admit that the island is a wonderful place to live, except for all of those pesky Puerto Ricans ruining their tropical tax haven.
These gentrifiers may not have to wait long before their dream of “a Puerto Rico without Puerto Ricans” becomes a reality. Crippling austerity measures implemented by a Financial Oversight and Management Board, whose members were appointed by the White House to oversee Puerto Rico’s finances and economy, are pushing Puerto Ricans out of their homes. The island’s public power grid was recently privatized and taken over by LUMA Energy. Privatization has brought constant power outages and skyrocketing energy prices. In the first quarter of 2022, Puerto Ricans will see a 16.8 percent increase in their energy bills.
There have also been price increases for toll roads, basic food products, and water supply. Moreover, in the midst of the pandemic, locals have to cope with a healthcare system that is woefully underfunded and understaffed. The fiscal oversight board, aided and abetted by the Partido Nuevo Progresista, Puerto Rico’s ruling pro-statehood party, is orchestrating an exodus of Puerto Ricans who can no longer afford to live on the islands—which in turn provides a steady flow of cheap labor for the mainland and brings us closer to the vision set out in a leaked Telegram chat of ousted former Gov. Ricardo Roselló: “I see the future and it is splendid. There are no Puerto Ricans.”
Puerto Rican history, however, records how many have already failed to carry out this colonial project. Puerto Ricans are notoriously hard to eradicate. A colonial possession since 1493, Puerto Rico has seen its fair share of hucksters and invaders. Comdr. George Clifford, 3rd Earl of Cumberland, attacked San Juan in 1598. In 1625, a Dutch fleet invaded under the command of the infamous privateer, Hendrijks Boudewijn. The English tried to invade again in 1797, this time by Lt. Gen. Ralph Abercromby. Legend has it that, the people of Puerto Rico, afraid that the Spanish garrison would be unable to repel the attack, took to the streets in a procession. Thousands of people carried religious objects and torches in the dead of night. Abercromby, upon seeing thousands of flaming torches, decided to retreat rather than face what he thought were massive reinforcements marching from San Juan.
In the end, however, Puerto Rico came under the control of the United States in 1898 after Adm. William T. Sampson bombed San Juan and Gen. Nelson Miles landed at Guánica with 1,300 troops. The island has been kept as a colonial possession to this day.
In 500 years of written history, sanjuaneros have withstood sieges, pirates, plagues, and bombardments—and somehow we are still here. San Juan belongs to its people. People like Ricardo Alegría, who fought to preserve its distinct architecture. Or like Pedro Albizu Campos, a leader of the independence movement, who was arrested at his home on the corner of Calle Sol and Calle Cruz for charges of conspiracy and sedition against the U.S. government. El Viejo San Juan belongs to my mother’s great-great-grandfather, imprisoned in a dungeon in El Morro for opposing Spanish colonial rule. It belongs to classical music lovers, who make the yearly pilgrimage to the Casals Festival. Or the old lady that goes to mass every Sunday, the piragüero that sells shaved ice on the street, the couples watching the sun set on the bay, the artesanos selling crafts on the street. It belongs to my nephew and my daughter, and all the children of Puerto Rico.
El Viejo San Juan will always belong to the people that love it. Love is what binds us to a place. I feel love all around me in Old San Juan. I love walking along the streets and hearing salsa float down from the balconies. I love that I am one block away from the blue expanse of sea—its beauty takes my breath away every time. I love the café near my place, where waiters in old-fashioned vests and bowties serve buttery mallorcas doused in sugar. I love that I have friends and relatives that live close by.
My community, filled with Puerto Ricans from all walks of life, will continue to fight for this island nation that we love dearly, until our last breath.
What my Act 60 neighbors do not understand is that they will never own Old San Juan. Sure, they can buy a house from a poor Puerto Rican family down on their luck. They can sign their names on the deed and change the locks on the door. Unlike Puerto Rican culture, the soulless capitalism they bring to the table is anti-community in nature.
But some things cannot be bought.
They cannot destroy the bonds of community and solidarity that Puerto Ricans have nurtured over the centuries. San Juan, in its essence, cannot be bought. Those of us that live here are merely custodians, preserving the city for the Puerto Ricans of the future. Old San Juan was here before we were born, and it will still be standing long after our bones have turned to dust.
The colonizers may be able to buy el Viejo San Juan, but it will never belong to them.
Featured image: Street art in San Juan, Puerto Rico (City On Fire/CC BY-NC-SA 2.0)