Opinion Editorial

Wednesday, March 4, 1998  

Puerto Rico a Legacy of Colonialism

Today, the House of Representatives is scheduled to vote on a bill that may lead to statehood for Puerto Rico, a Spanish colony that became a U.S. territory 100 years ago as a result of the Spanish-American War. The war came about because Spain was weak and its colonies were viewed as ripe for the picking. Colonies, in turn, were seen as great sources of wealth. War with Spain, therefore, presented itself as an easy way to acquire colonies and enrich the U.S. Spain's defeat gave American imperialists what they wanted and Cuba, the Philippines, Guam and Puerto Rico became de facto U.S. colonies.

Cuba and the Philippines eventually were given their freedom, but to this day Guam and Puerto Rico still have effective colonial status. In fact, when Great Britain gave up control of Hong Kong last year, the U.S. became the greatest colonial power on earth. In addition to Guam and Puerto Rico, other de facto U.S. colonies include American Samoa, the U.S. Virgin Islands and the Northern Marianas islands.

Economists have long criticized imperialism and colonialism. Economist William Graham Sumner of Yale was among the strongest critics of the Spanish-American War. He strenuously argued that our colonies were likely to cost us far more than we would ever gain. American taxpayers would have to finance large military expenditures for protection of the new possessions from other powers and to suppress rebellion. Indeed, as early as 1900, American troops were forced into a long and bloody campaign to control the Philippines. The brutality of that campaign differed little from Spain's actions in Cuba that helped ignite the Spanish-American War.

From an economic point of view, Sumner thought there was nothing to be gained from holding a colony that could not be achieved through free trade. "Conquests can do nothing for trade except to remove the political obstacles which the conquered could not, or would not, remove," he wrote in 1899. "From this it follows that the only justification for territorial extension is the extension of free and enlightened policies in regard to commerce."

A similar view was expressed by the great economist Joseph Schumpeter of Harvard in his 1919 essay on imperialism. He argued that "where free trade prevails no class has an interest in forcible expansion." The reason is because "the citizens and goods of every nation can move in foreign countries as freely as though those countries were politically their own." Thus Schumpeter believed, contrary to Lenin, that "capitalism is by nature anti-imperialist." (Lenin said imperialism is the highest stage of capitalism.)

Puerto Rico probably will vote to continue the status quo, under which it has all the benefits of statehood without any of the costs. Puerto Ricans are U.S. citizens and receive many welfare and other benefits from the federal government, but pay no taxes to the U.S. Treasury. Although they would pay taxes under statehood, Puerto Ricans would also become eligible for additional benefits, such as the Earned Income Tax Credit. On balance, it would clearly cost the U.S. Treasury dearly if Puerto Rico becomes a state. A 1990 Congressional Budget Office report estimated $3 billion in additional welfare benefits alone.

The debate over Puerto Rico is just further evidence that colonialism and imperialism are not paying propositions. Even Britain's great colonial empire was a money-losing enterprise, according to economists Lance Davis and Robert Huttenback. Puerto Rico has clearly cost American taxpayers far more than they have ever gotten in return. From their point of view, independence for Puerto Rico, not statehood, is the preferred option.




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