22
ECONOMY
Thursday, MARCH 31, 2016 |
SMART MONEY
Puerto Rico has not even scratched the surface of what is possible.
Focus on the Signs that Give Us Confidence By Nicholas Prouty
The following is a speech delivered by Nicholas Prouty at the Puerto Rico Investment Summit held at the Puerto Rico Convention Center Feb. 11 & 12. A few years ago, the Governor of Puerto Rico and I received invitations from President Clinton to participate in the 20th Anniversary of the Summit of the Americas. While we were in Miami, the former President complained to me that when it came to Alejandro García Padilla, life was unfair. That although, he and the Governor could each get on the cover of the New Republic for their commitment to democratic ideals, only Gov. García Padilla could command the cover of GQ! I have been asked to share my thoughts on Puerto Rico’s future. I am completely locked into the evolution of this amazing island for three reasons: First, it is where my daughter’s fondest memories will be made, that is when she reaches my age and looks back on the images of her childhood, our life in San Juan and our weekends snorkeling in the pristine waters off Fajardo will be front and center; second, because a large part of my business depends on what happens here, locally; and third, because I see a bright future, a
Historians will look back upon this period, at THIS moment, and write books on how Puerto Rico became one of the great turnaround stories. historic exercise in evolution and transformation. You are going to hear from the panelists [at the Summit that day] that Puerto Rico made history at mid-century when it embarked on a successful process of industrialization and quasi-political autonomy. That was nation building. Historians will look back upon this period, at THIS moment, and write books on how Puerto Rico became one of the great turnaround stories.
For many, that future is hard to envision—so many factors remain undecided but most sensible people seem to agree that Puerto Rico will only emerge from this situation as a result of restructuring, reforming, economic growth and greater clarity on the status issue. Bear in mind that this situation is decades in the making and it will take time, discipline and some creativity to sort out. However, in the meantime, this Acts 20/22 program exists and its impact on
both your family’s financial future and the lives of everyday Puerto Ricans could be amazing. You know, maybe, these unresolved questions do not matter, but if you are like me, moving to Puerto Rico because of a favorable tax rate, great schools and the same legal protections afforded to any other American, frankly it still is not enough. You would have to be convinced that Puerto Rico has a future. Who wants to move to a place filled with despair, resentment and hostility? I don’t live in a bubble, so that stuff has an impact on me—I walk the dog at night, I go out for coffee. If I am constantly bombarded by negativity, I will feel uncomfortable and I will go somewhere else. As a businessowner, however, I am guided by an unwavering belief—that every problem has a solution. And when I apply that same logic to Puerto Rico and look at the underlying trends guiding the island’s future—it is clear that Puerto Rico will emerge from this crisis. It will emerge not because it deserves to—nobody deserves anything in life—or because Washington will write some big fat check. It will emerge because of overlooked fundamentals—fundamentals that go straight to the very nexus of the transition from an old economy to one grounded in service and knowledge. And you know, I guess I would be truly worried about Puerto
Rico if I really thought the island had tried everything and nothing worked. Puerto Rico has not even scratched the surface of what is possible. This is not about austerity nor is it about a bailout. Those are false choices presented by disingenuous actors. A vast majority of the island’s food is brought in by ships from Jacksonville, Fla., despite some of the most fertile soil and abundant precipitation around—the problem is not the natural resources or the people. I mean I have hundreds of employees here and they work hard, are solutions-oriented and are interested in lifting the island. The central gap has been a lack of vision, the creation of a permanent bureaucratic class, and an unwillingness to hold people accountable, measure results—fortunately, we have seen all those problems before—just ask Rudy Giuliani and Mike Bloomberg—all those problems have simple solutions. So let’s focus on those signs that give me such confidence. I will begin with the 20/22 investors. The very fact there are more than a thousand of us here is the best validation that the program works— that Puerto Rico works. It is a huge force pushing the economy and, in many ways, we have become our own self-fulfilling prophecy. —Nicholas Prouty is the founder & CEO of Putnam Bridge