Rocío Zambrana

Colonial Debts
Rocío Zambrana

“[H]ay que organizar el pesimismo.”

—Rafael Bernabe quoting Walter Benjamin quoting Pierre Naville

“To articulate what is past does not mean to recognize ‘how it really was.’
It means to take control of a memory, as it flashes in a moment of danger.”
—Walter Benjamin

In a 1929 critical encounter with Surrealism, Walter

Benjamin distinguishes between the optimism of social-democratic
progressivism and the “organization of pessimism” found in Pierre
Naville’s Surrealism. The gradus ad parnassum of bourgeois resistance
is optimism. It “promises” a future society in which “all act ‘as if
they were angels’ and everyone has as much ‘as if he were rich’
and everyone lives ‘as if he were free.’” In contrast, Naville makes
the organization of pessimism “the call of the hour.” To organize
pessimism, Benjamin suggests, is to “expel moral metaphor from
politics.” It is to “discover” the space of political action as “the one
hundred percent image space.”
To organize pessimism is to labor from the concrete conditions
that compose actuality. It is to bet on what is possible from the
actual. The opposite of pessimism is not optimism, Rafael Bernabe
wagers. It is hope. Optimism, like utopia, draws from abstraction. It
bets lacking a ground. It lacks not a reason (Grund), but contact with
conditions here and now. It is therefore naïve. Pessimism, in contrast,
draws from catastrophe. It knows that the detritus left by a down
turn—κατά (down) στροφή (turning)—are tasks. To organize, to
articulate, to form alliances guided by such tasks is hopeful, then.
Pessimism excises moral metaphors that turn us away from the

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tasks at hand, from alliances in need of articulation. It clears the
political space for the construction of new images that respond to
actuality. It thereby makes possible responses to the specific dangers
exhibited by the present.
How we name phenomena matters. To discover the space of
political action as one hundred percent image space, lacking in a
type of moral imagination that turns us away from the material
conditions of the here and now, requires proper naming. Naming
contributes to the construction of reality, aiding or hindering our
capacity to track possibilities within actuality. Three concepts
are helpful in naming Puerto Rico’s current predicament, where
economic, political, and environmental catastrophes intersect.
Images that guide the organization of pessimism, I suggest, these
concepts have the potential to generate a hopeful space of political
action. First, debt ought to be understood as an “apparatus of
capture,” one that functions as a form of “coloniality.” Second,
“colonial exceptionality” describes the administration of the
political economy of Puerto Rico through declarations of states
of emergency. Third, “slow death” and “slow violence” name the
extensive unfolding of multiple catastrophes in Puerto Rico.
Debt
Currently, Puerto Rico has 74 billion dollars of bond debt and
49 billion dollars in unfunded pension obligations. Puerto Rico’s
123 billion dollar debt is the largest municipal debt in the history
of the United States. Clarifying how such debt was accrued requires
an audit. I’ll come back to this. Tracking how it could have accrued,
however, requires an understanding of Puerto Rico’s political
economy as an unincorporated territory of the United States.
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Colonial Debts
Rafael Bernabe notes that Puerto Rico’s status as an
unincorporated territory has promoted an economy “dominated
by external capital.” Throughout the twentieth and twenty-first
centuries, external capital has determined which sectors have been
fundamental to Puerto Rico’s economy—whether sugar industries
before the Second World War or industries of high investment, such
as pharmaceuticals, from the 1980s to the present. This orientation
has resulted in an economy based on unilateral specialization aimed
at exportation. This, in turn, has created the need to import the great
majority of what is consumed in Puerto Rico, including food. Today,
Puerto Rico imports around 85% of what it consumes.
In this political economy, profits generated in the island
necessarily “escape.” The “flight of profits” reaches around
35 billion dollars a year. Puerto Rico’s annual revenue is around
10 billion dollars. The flight of profit impedes growth and
employment, since those profits are not reinvested in the local
economy. Now, unemployment has been a permanent fixture of
Puerto Rico’s economy. This was the case even in times of post-war
expansion, when it was considered a showcase for democracy and
capitalism during the Cold War. The reduction of employment during
these decades was offset by a massive migration to the United States.
Before hurricane María, unemployment in Puerto Rico stood at 13%.
Only 40% of the population was part of the workforce, which is to
say, 60% of the population was neither working nor seeking work.
44.3% of the population lived below the poverty line. In the context
of the debt crisis, between 2011 and 2013, for example, Puerto Rico’s
population decreased by fifty thousand people annually.
Puerto Rico’s territorial status has generated conditions of
capture through taxation. Bernabe underscores that its political
economy has been based on a strategy of foreign investment through
tax exemption. Although the Federal Government provided tax
incentives since 1921, tax exemption became the basis of economic
growth after the Second World War and with the project of
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industrialization. This strategy sought to capitalize on Puerto Rico’s
territorial status. Because Puerto Rico is not a state, Congress
exempted corporations operating in the island from paying federal
taxes. Combined with low wages, profits soared. Puerto Rico could
also issue debt with great ease. Bonds issued by the government are
triple tax exempt regardless of where the bondholder resides.
Section 936 of the Internal Revenue Code, in effect since
1976 and progressively eliminated from 1996 to 2006, gave U.S.
corporations exemption on income earned whether from production
or interest on local bank deposits. The elimination of Section 936 sent
the island into recession. 2006 saw the first government shut down
due to the fiscal crisis. Rather than revisiting taxation laws to address
the flight of capital, the Puerto Rican government responded to the
crisis by issuing more debt. Acts 20 and 22 of 2012 attempt to reboot
the island’s status as a sort of tax haven, allowing American investors
to pay zero tax on U.S. income if they spend at least 183 nights there
annually. At the same time, regressive taxation has been instituted as
a means of addressing the crisis. A sales tax implemented in 2006, for
example, is currently at 11.5%. Tax exemption for the rich and taxation
for the poor is a heightening pattern.
Maurizio Lazzarato argues that debt functions as an apparatus
of capture, predation, extraction. Neoliberalism can be understood as
a set of economic policies that sought to shift the cost of social (re)
production to populations, deploying a version of the liberal ideology
of personal responsibility. Debt crises intensify the neoliberal project
on two counts. While neoliberalism turns the state into an apparatus
of capture that serves the rich, corporations, and creditors, debt
succeeds in shifting the cost of social (re)production from the state
to populations. Debt expands and intensifies this shift. It expands
the shift by externalizing not only the cost of social (re)production
but also the debt of banks, firms, and states. It intensifies the shift
by burdening individuals who must take on debt to meet basic needs
such as housing, healthcare, and education, and who must bear the
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Colonial Debts
burden of public debt through taxation and austerity. This expansion
and intensification establish that neoliberalism and authoritarian
governments are “perfectly compatible.”
Forms of subjectivation within debt crises draw from the value of
personal responsibility central to neoliberal ideology. Yet a new form
of subjectivity—the “indebted man”—appears. Neoliberal subjectivity
is no longer a matter of homo economics as entrepreneur, no longer a
matter of creativity, flexibility, and self-responsibility. It is a matter
of assuming and repaying debt—debt accrued in consumption as
well as debt shifted onto populations through taxation and austerity.
The entrepreneurial subject is necessarily an indebted subject. It can
only function as “human capital” by taking on debt. Indebtedness,
however, is conceived as a form of abject subjectivity. The “indebted
man” is a failed neoliberal subject, a failed enterprise. Indebtedness is
tantamount to culpability, then. The subject of debt is the subject of
guilt, bound to the fate of capital by its own failures.
In Puerto Rico, the debt crisis intensifies a political economy
built on the flight of profits. It binds individuals and populations
to the fate of capital by establishing that they are failed economic
agents parasitic on federal “handouts.” In Puerto Rico, however,
indebtedness is not only the fate of failed neoliberal subjects. It is
the fate of failed colonial subjects, who affirmed cultural autonomy
while reaping the benefits of U.S. economic prosperity with the
creation of the Estado Libre Asociado in 1952. As a mechanism
of capture, then, debt is a form of coloniality, as Aníbal Quijano
points out. Minimally, colonialism refers to a form of politico-
juridical subordination. Coloniality, by contrast, refers to the race,
gender, and class hierarchies produced by a colonial history but that
exceed colonialism as a politico-juridical project. Anyone seeking to
understand Puerto Rico’s predicament should track both. That debt
is a form of coloniality that feeds on Puerto Rico’s colonial status
becomes clear when we look at the austerity measures implemented
in response to the debt crisis.
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PROMESA
The Puerto Rico Oversight, Management, and Economic Stability
Act (PROMESA) is a United States federal law passed in 2016.
Through PROMESA, the U.S. Congress instituted a Fiscal Control
Board composed of seven unelected members to oversee a debt
restructuring process. The seven members, six men and one woman,
were appointed by then President Obama with the help of a list
compiled by Congressional members. Because Puerto Ricans in
Puerto Rico have no representation in Congress and are unable
to cast a presidential vote, many argue that the institution of the
Fiscal Control Board represents the collapse of democracy in the
island. PROMESA overrides any law or regulation, including
Puerto Rico’s Constitution, understood to be incompatible with the
debt restructuring and repayment process. Additionally, conflicts
of interest have been noted in the case of various Board members.
In May 2017, Puerto Rico filed for bankruptcy under Article III
of PROMESA, placing its fate in the hands of U.S. District Court
Judge Laura Taylor Swain.
Lack of transparency is a main feature of the evisceration of
democracy in Puerto Rico. Puerto Rico’s debt holders, some have
thought, are small, individual bondholders—rookie investors who
trusted their savings to financial firms. The most aggressive players
demanding debt repayment in court, however, are vulture funds.
These hedge funds specialize in high-risk troubled assets near
default or bankruptcy and pursue means such as litigation to reap
profits. Puerto Rico Law 97 of 2015 established a commission to
audit the debt. Puerto Rico’s Senate dismantled the efforts in 2016,
arguing that the audit would be a misuse of resources. The Senate
maintained that an audit would be best pursued in the context
of bankruptcy proceedings under Article III. A citizen audit is a
common demand within citizen, student, and worker resistance to
the Fiscal Control Board. Frente Ciudadano por la Auditoría de
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Colonial Debts
la Deuda is currently moving forward with a citizen audit, despite
challenges accessing records.
The institution of a Fiscal Control Board intensifies colonial
exceptionality: the political and economic administration of the
territory through declarations of states of emergency. While
declarations of states of emergency were used to criminalize and
repress anti-colonial movements in Puerto Rico throughout the
twentieth century, José Atiles-Osoria notes, the 2006 declaration of
fiscal emergency and the ensuing government shut down initiated
the use of this measure for government administration. 2009 is a
particularly important year on this score. Seeking to secure good
standing in the eyes of credit agencies, Puerto Rico’s government
declared a state of fiscal emergency. This declaration allowed the
government to pass Law 7, which implemented austerity measures
that included government worker layoffs, a reduction of the
University of Puerto Rico’s budget, and an increase in privatization.
Colonial exceptionality clarifies further the work of debt as
a form of coloniality. The institution of the Fiscal Control Board
and the deployment of its austerity plan intensifies it. The Board
is tasked with achieving “fiscal responsibility” and “access to capital
markets” irrespective of social costs. It achieves these aims by repaying
creditors. It seeks to do so implementing a fiscal austerity plan,
in addition to pursuing the privatization of anything that is not
considered an “essential service.” What constitutes an essential
service remains unclear. The Board, however, will establish priorities
unilaterally and lacking citizen participation. In March 2017, the
Board approved a 2017–26 austerity plan. The plan makes serious
cuts to Puerto Rico’s public service budget, impacting health care,
pensions, and education.
Ariadna Godreau-Aubert tracks the relation between
debt, austerity, and coloniality in what she calls a “pedagogy of
the indebted woman”. “The colony,” she says, “is what happens
in repeated acts of capture.” “Indebted life,” she adds, “is the
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continuation of the colonial condition.” Austerity disproportionately
impacts upon cisgender and transgender women, especially women
of color, who comprise the majority of the population living in
poverty. A pedagogy of the indebted woman centers women’s
racialized body as the site for understanding the work of austerity.
Women are at the same time “not counted on” in terms of the
decisions regarding budget cuts that impact every aspect of her
life and “counted on” to assume the gaps in care, labor (physical,
emotional), time, resources (her body, material needs). A pedagogy
of the indebted woman, then, tracks the distribution of precarity
by colonial exceptionality. It thereby tracks the deepening of race/
gender/class hierarchies that comprise coloniality.
María
On Sept 20, 2017, María, a category 4 hurricane, made landfall
in Puerto Rico. Debilitated by Hurricane Irma just two weeks prior,
Puerto Rico’s infrastructure collapsed. The electrical grid, water and
water filtration systems, and the telecommunications network were
compromised. Throughout the days, weeks, and indeed months
that have followed, we have witnessed a humanitarian crisis unfold.
Difficult mobility or outright isolation due to debris and flooding;
limited communication; water, gas, and food shortages abound. Four
months after María, for instance, 40% remains without electricity.
Many homes have not received tarps from the Federal Emergency
Management Agency (FEMA), compounding damages from
subsequent rains and flooding. It is estimated that 52.3% of Puerto
Ricans will be living in poverty as a result.
The intersection of climate change and ongoing forms of
coloniality increase vulnerability to disaster in the Caribbean. Puerto
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Colonial Debts
Rico is not alone in managing a humanitarian crisis as a result
of Hurricanes Irma and María. Disaster damages are amplified
by protracted and incomplete recoveries. The economic response
to the catastrophe is telling. Rebuilding costs in Puerto Rico are
expected to reach between 45 and 95 billion dollars. Initially, the
Fiscal Control Board authorized the use of 1 billion dollars for
hurricane relief when Puerto Rico’s Treasury Department declared
a balance of 2 billon dollars. Subsequently, the U.S. Senate passed
legislation that extends emergency credit to Puerto Rico. In other
words, the U.S. offered Puerto Rico more debt. This measure is
included in the Senate’s efforts to provide 36.5 billion in hurricane
relief for affected areas across the U.S., including 18.7 billion to
replenish FEMA’s funds. In November, Governor Roselló requested
a 94-billion-dollar relief package.
Bankruptcy proceedings have been postponed. While most of
the island has been offline, however, bondholders have continued
to submit motions in the bankruptcy case. Financial firms have
formed alliances in their efforts to secure repayment. Furthermore,
the Jones Act of 1920 was suspended for a mere 10 days. The Jones
Act restricts maritime commerce in U.S. waters and between U.S.
ports by establishing that goods transported between these must
be carried on ships built, flagged, and crewed by the U.S. The
Cabotage Laws, which raise the cost of commodities in Puerto
Rico considerably, have generated obstacles for humanitarian
efforts responding to the hurricane. Note as well that the tax
reform spearheaded by the GOP would place a 20% tax on goods
manufactured by subsidiaries of U.S. corporations on foreign soil.
Puerto Rico is deemed foreign for these purposes. This tax would
crush the pharmaceutical industry and other manufacturers based in
Puerto Rico, further compromising its economy.
The United States Army and the National Guard took over
relief efforts, appointing as commander, indeed as “emergency
manager,” Lieutenant General Jeffrey Buchanan. In November,
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however, Buchanan resigned, citing an end to the humanitarian
crisis and a move towards rebuilding. Héctor Pesquera, secretary
of Puerto Rico’s Department of Public Safety, has taken over
emergency duties. Alarmingly, the rescue and relief efforts have
been plagued with mismanagement and lack of transparency,
including an assessment of the dead. The official count is
currently 62. The Center for Investigative Journalism in Puerto
Rico, however, has revealed that around 1,000 more people died in
the 40-day period after the hurricane than during the same period
last year. The majority of the deaths were individuals over 50 in
hospitals and nursing homes. Migration to the U.S. has peaked as
well. Commercial flight data indicates that between September 20
and November 7 approximately 100,000 people left Puerto Rico,
compared to 89,000 in the whole of 2015. More than 168,000
people have flown or sailed out of Puerto Rico to Florida since
the hurricane.
El desastre no es natural. This is one of the main slogans of La
Colectiva Feminista en Construcción in the wake of María. The
catastrophe that Puerto Rico currently faces stems from forms of
precarity, and their unequal distribution, amplified but not caused
by the hurricane. As Godreau-Aubert puts it: “When we speak of
disasters, it is important to underscore that the human rights crisis
that we are living in Puerto Rico since decades is not natural. It is
the result of colonialism, inequality, and austerity, which enriches
some and impoverishes the rest.” The notion of disaster capitalism
has been seen as apt for understanding Puerto Rico’s current
predicament. It points to the intensification of logics of capture
through exceptionality when people are in “shock,” merely seeking
to survive. Lauren Berlant’s notion of “slow death” and Rob
Nixon’s notion of “slow violence,” however, make visible significant
aspects of the multiple catastrophes in Puerto Rico lost in the
analytics of exceptionality.
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Colonial Debts
Slow death refers to the “physical wearing out of a population,”
to “its deterioration as a defining condition of its experience
and historical existence.” It therefore tracks experiences that are
“simultaneously at an extreme and in a zone of ordinariness, where
life building and the attrition of human life are indistinguishable.”
Slow death thrives in an “environment,” then, through structural
conditions that compose the ordinary. Material and social conditions
under financialized capitalism and its crises, such as debt crises, can
be understood accordingly. Capitalism does not “produce rest or
waste.” Rather, it produces and sustains slow death. Nixon extends
this analysis by elaborating the slow violence distinctive of slow death.
Slow violence is “incremental and accretive,” its effects “overspill clear
boundaries in time and space.” It therefore enjoys relative invisibility,
and generates representational challenges. It is disclosed in its
intensity in the context of a crisis. Crises, then, disclose the extensive
nature of a catastrophe. While María intensifies the humanitarian
crisis in Puerto Rico, the latter should be understood extensively—
backwards and forwards in time.
Organizing Pessimism
In quoting Benjamin quoting Naville, Bernabe seeks to distill
the element of hope found in Benjamin’s rejection of optimism.
When there are few bases for optimism, when extensive
catastrophes are disclosed in their intensification, “hope can be
nourished by pessimism.” Bernabe ends his piece with a call
“against decomposition.” He recalls Lenin’s observation that what
is necessary is not always possible. Conditions might be ripe for
change; yet political struggles might not be articulated in light of
them. In such cases, pessimism can lead to decomposition, perhaps
even “putrefaction.” Precisely because decomposition is a real
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possibility, the organization of pessimism is the call of the hour. concrete conditions here and now, while tracking their position
To seize what is disclosed in a catastrophe in order to address the within systems of oppression that reach far and wide. It has the
dangers revealed therein is to form alliances that subvert modes of capacity to address division, fragmentation, and disarticulation
capture, exceptionality, and the slow violence of slow death. within catastrophes by articulating subversive resistance to capture,
When Naville made the organization of pessimism the call exceptionality, and slow death.
of the hour, the space of political action was cleared from moral
images for the generation of a one hundred percent image space.
“This image space,” Benjamin stresses, “can no longer be measured
out by contemplation.” Understanding debt as a mechanism of
capture, one that should be understood as a form of coloniality,
tracks shared histories and anti-capitalist struggles world wide.
Tracing the intensification of colonial exceptionality by specifying
its impact on the indebted racialized woman makes visible sites
of resistance to precarity within Puerto Rico and across the U.S.
Slow death and slow violence allow us to grasp the extensive
nature of intersecting catastrophes, pointing to the necessity of
structural change rather than immediate remedies. These concepts,
then, center anti-capitalist forms of resistance that address the
racial/gender hierarchies, the forms of coloniality, maintained by
this economic system. They thereby clear the space for political
action that addresses the dangers here and now. They facilitate the
organization of pessimism.
Political isolation is the hallmark of optimism, political
alliance the lifeblood of pessimism. Drawing from catastrophe,
pessimism makes possible tracking common projects, articulating
shared responses. Critical responses to climate change, the
eradication of economic structures that breed inequality, debt
cancellation, dismantling racism and heteropatriarchy are
overlapping goals guiding multiple resistance movements in
and beyond Puerto Rico. Beyond decolonization, decolonality
is a capacious project that admits such alliances. It seeks to
dismantle race/gender/class hierarchies at work within and beyond
the colony. It has the potential to ground political alliances in

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