Monday, December 7, 2015

WalMart and the Future of Puerto Rico

Puerto Rico is managed under USA laws.  It has a welfare culture that is now part of its DNA.  This was genetically engineered about 25 years ago, when massive tax breaks were given to USA big business  ...
 “They were very large incentives for folks who set up shop there, produced things there and resold them somewhere else. Over the years large Fortune 100 companies set up very big installations in Puerto Rico to research things and develop drugs. Pharmaceutical companies were there in droves, and some of them still are there. Those benefits were phased out and largely eliminated with some legislation in 1996. Many people point to that as the beginning of the end for their economy. When those incentives went away, those companies didn’t necessarily pull up stakes, but they didn’t make any further investments and they sort of let things trickle away. In the course of all these years, we’re starting to see the effect of that in a major way.”
Now,  It is a mess.
The increase comes as the U.S. commonwealth struggles to restructure $70 billion in debt, more than every U.S. state but New York and California. This week, the U.S. Supreme Court agreed to consider reinstating a law that would let Puerto Rico’s debt-ridden public utilities restructure their obligations.
After ramping up energy infrastructure to support the pharmaceutical industry and others given welfare, once the welfare is gone, so is the business activity.  So Puerto Rico passed a law that can apply to only one company, WalMart.
The new levy raised the estimated cumulative income tax on Wal-Mart Puerto Rico Inc. “to an astonishing and unsustainable 91.5% of its net income,” according to the company’s complaint, filed in federal court in San Juan Friday.
This strikes me as one of those wonderful mistakes, like making the Berlin Wall fall.  Walmart must ever grow its top line to support its model, and its bottom line to pay off investors.  This tax on the bottom line will enslave WalMart.  They can't quit, but they cannot make money?

When taxes no longer fulfill the obligations, then they need to tax more.  When there is no middle class to tax anymore, for WalMart wiped it out, then the hegemon only has WalMart to tax.    The revolution, at the outskirts, Puerto Rico, is starting to eat its own.

if Walmart were ever to fold, then there could be a small business renaissance in Puerto Rico (Rich Port) with small farmers selling quality eggs as they once did, but were driven oout of business by WalMarts low quality cheap eggs.

It is not only bad money drives out good, but bad eggs drive out good eggs.

Usury and malcredit is the mechanism for driving out the good and gaining personal accumulation at others expense.  BUT...  it only works with the victim's cooperation.

It will only get worse if the hegemon destroys Walmart and the victims are not ready to start up their own businesses.

Feel free to forward this by email to three of your friends.