Statehood will bring justice and equality to Puerto Rico, as well as the sovereignty that comes of being a state of the Union. Statehood will also guarantee U.S. citizenship not only for current U.S. citizens born in Puerto Rico, but for future generations. These are very important reasons to vote for statehood on November 5. But there is also the question of rice and beans. If you vote your pocketbook, you should certainly vote for statehood.
Increased federal funding
One of the most immediate effects of statehood would be to make individual residents of Puerto Rico eligible for more federal assistance. right now, Puerto Rico’s workers pay Social Security taxes in full but do not receive the same benefits as people living in the states. It is also much more difficult to get help with food and healthcare. The cutoff to become eligible for benefits is usually higher in Puerto Rico and the amounts given are smaller. States enter the Union on an equal footing with all the other states. These inequities would end.
As a state, Puerto Rico would receive a direct allocation of federal funds for various programs like infrastructure, education, and healthcare. These funds don’t go directly to individuals, but they will benefit all the residents of the Island.
Greater draw for investment
Improvements in infrastructure and opportunities will make Puerto Rico more appealing to investors. Right now, people setting up a multinational business in Puerto Rico are often drawn by shady tax dodges. They make their tax deductible investments in the states and wash their profits through Puerto Rico, adding little to the local economy in exchange for dodging federal taxes. They also contribute little to the territory’s tax revenue.
Stateside cities looking to entice manufacturing and entrepreneurs to their city focus on providing good driving conditions for workers, offering strong infrastructure and logistics, and providing a good pool of qualified workers. The businesses they attract invest in the local economy and provide jobs.
As a state, Puerto Rico will be in a position to welcome serious investors. Hawaii and Alaska saw increases not only in tourism after statehood, but also in construction, manufacturing, and other businesses. Puerto Rico has a long history of skilled manufacturing, a large pool of STEM graduates, and excellent quality of life to offer workers. We should expect to see the same post-statehood boom as other territories which became states.
Tax improvements
Puerto Rico has a weak tax base, with low labor force participation and much of the official GDP leaving the territory. The large numbers of people leaving the territory also contribute to the low tax revenues of the Island. At the same time, many residents do not receive the tax credits they would gain if they lived in a state and filed federal income tax forms.
With little income and corporate tax revenue, Puerto Rico must rely on the highest sales tax in the nation and high local income taxes.
As a state, Puerto Rico would receive more federal funds and have greater representation, bringing greater federal support. This would allow Puerto Rico to bring its sales tax and income tax back in line and relieve the burden on residents.
32 territories have already become states. All of them became more prosperous after statehood than they had been as territories. Puerto Rico can expect the same. Vote for statehood — send a clear message to Congress and demand admission for the great state of Puerto Rico!
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