As I approached the bridge from the airport on my first day in
That’s right, friends, Novartis. As in the gigantic pharmaceutical company that produces some of our favorite prescription meds, like Gleevec. As in the gigantic pharmaceutical company that sued
Oh and by the way, sorry if this bothers you, Novartis, but maybe you should get your goddamn flags off of
Anyway, how upsetting?! And it wasn’t just Novartis, but as I saw the first flag and felt my stomach turn, I put my head down.
“You fly drug company flags next to your country’s flag?” I asked my driver.
“Of course. We have a lot of drug companies here,” she answered. I sighed. This was going to be a long 2 months.
How important are pharmaceuticals to Puerto Rico's economy?
According to the Pharmaceutical Industry Association of Puerto Rico website, the pharmaceutical industry accounts for 30,000 direct (and allegedly 100,000 indirect) jobs on the island and a mighty 26% of Puerto Rico's employment in manufacturing. That's a lot of manufacturing. The website goes on to say that the average wage for production workers is among the highest salaries paid in Puerto Rico, and that the pharmaceutical industry accounts for a whopping 24% of Puerto Rico's gross domestic product. The Puerto Rico Industrial Development Company notes that there are more than 60 pharmaceutical plants on the island, and that in 2003, Puerto Rico was the world's largest international shipper of drugs, with 24.5% of total shipments. 16 of the top 20 drugs sold in the United States are from Puerto Rico. Most of the big pharma boys have some kind of representation in Puerto Rico, and for the most part they are spread around the island, although there are none in San Juan proper (there are a few in Carolina though, maybe I ought to pay them a visit).
Phew, that's a lot of facts.
So why, exactly, do so many drug companies operate out of Puerto Rico?
Maybe they just think that Puerto Ricans are a hardworking people deserving of steady jobs. OR MAYBE there's some ECONOMIC INCENTIVES to moving your big business down to this tiny island?Let's have a look:
1. First, let's review PIAPR's own description of the incentives of operating out of Puerto Rico. Looks like we're chock full of income tax caps, especially for "pioneer industries" (huh?), something called "super-deductions," accelerated depreciation on building costs, a whole boatload of exemptions, payroll incentives and special deductions, etc.
Basically, because of the weirdness of Puerto Rico's commonwealth status, companies in Puerto Rico get all the good stuff from operating "in the United States," but they also get the tax benefits and incentives of being a "foreign company." Sneaky drug companies!
2. The workers! Here's a real shocker, Puerto Rico has one of the lowest minimum wages in the United States. Even Guam's is higher. True, those in the pharmaceutical industry probably aren't making minimum wage, but they aren't making as much as if the company were operating out of Connecticut. The Puerto Rico Industrial Development Company proudly claims on it's website that "wage rates are typically 20% to 30% lower than those on the mainland for the same position." How totally fair! I mean, what a bargain for a bilingual workforce that trails only Japan for the fewest number of work days lost due to labor disputes and that is also well educated (Puerto Rico is currently 9th in the U.S. in terms of engineering degrees awarded).
To recap, the drug companies get an intelligent, bilingual, and hard working workforce who rarely complains, and they get to pay them significantly less.
3. Puerto Rico has been trying to make it very easy for big companies to come down here, allowing for some of the previously mentioned tax incentives and also ensuring adequate technology and communications capabilities.
Summary: Puerto Rico is pretty desparate to improve the economic situation on the island, so they are opening the doors for big corporations. Meanwhile it's hasta la vista, Mom and Pop's lechón stand and Buenos días, Burger King, if you catch my drift.
Not to mention that with the economic slowdown, a few plants have closed down, leaving Puerto Rican families and towns in complete destruction due to their economic dependence on these foreign companies.
4. Puerto Rico's prime location and accessibility by boat or plane makes it an ideal place for shipping drugs worldwide.
No argument here, Puerto Rico is in a pretty sweet spot!
Okay, so it should be very clear to you that I have serious, deep-seeded, some might argue pathological issues with drug companies, which may make this entry seem pretty biased. And I'm okay with that, because it's my blog and I get to be as biased as I want! :P
But in all seriousness, I recognize that bringing jobs to Puerto Rico is an important endeavor, and I am certain that there are many families on the island that benefit greatly from their presence. But I don't think it is fair to exploit Puerto Rico's political situation and especially their workers, who deserve the same respect given to any mainland worker. For all of the things that Puerto Rico gives to them, they ought to be giving back to Puerto Rico. Why don't you save all the money you waste on the ridiculous plastic junk you hand out to doctors and open up some safe parks and playgrounds for Puerto Rican kids? Just a thought.
And Puerto Ricans, get those flags off of your bridges. You have a beautiful culture and a rich heritage, let's display that instead.