The twenties and thirties for everyone in the world was not as lucrative as it was before that time. What seemed an economic boom with industrialization of nations, turned into an economic crash by 1930. Puerto Rico got a double dose of the economic blues when not only the world went into a depression, but also natural disasters destroyed their island and their industries. Since the United States were not in good economic standing themselves, they could not help out Puerto Rico as much as the island needed, but at least attempted. Because of this helping hand, no matter how small it seems, Puerto Rico slowly regained their internal economics and in the end came out with a plan to make the island more economically stable.

The start of 1920 had the appearance of economic and social growth of the island. In 1918, an earthquake rumbled all through the west coast of the island causing great damage. Because of the earthquake, the Puerto Rican government decided to liquidate some of their assets, mainly bonds, to create an “era of economic development” (61). They created millions of dollars to be put towards schools, hospitals, roads, bridges, irrigation, and hydroelectric expansion. They also encouraged the needlework industry, which became the second largest industry on the island by 1940 creating up to twenty million dollars and employing fifty thousand women. In 1925, they started the construction of the new capitol building. By 1926, the University of Puerto Rico and Columbia University of New York opened the School of Tropical Medicine, the only school of its kind in the Americas.

The island seemed to be booming with “progress.” It didn’t last long, only until 1927, and then the economic downfall began. In 1927 the sugar crop industry reached an all time low, going from twenty-three cents a pound to three cents a pound. The industry was damaged badly by prohibition in the United States. Sugar is the main ingredient in Puerto Rican rum and alcohol. Soon after prohibition, in 1921, the sugar industry stopped making money. This small fact was not a huge one until 1927 when the impact became clear and companies started going out of business. With all the “progress” going on in the island the drop in sugar prices seemed secondary.

The downfall of progress didn’t stop with the fall of the sugar industry, but just began. In 1928, the first of three hurricanes to strike the island hits. Hurricane San Filipe blew the island into turmoil. The industries that made up the economy of Puerto Rico were mainly agricultural, all of which were destroyed by the hurricane. The island felt the largest loss ever from a hurricane, estimated at eighty-five million dollars. Help was on the way -- this time. The American Red Cross came to the rescue soon after with aid and support and congress followed creating “the Hurricane Relief Commission providing six million dollars, largely for rural construction” (63).

Because of the extent of the hurricane damage, the relief was not quite enough so in March of 1929, the leaders of the Republican and Socialist parties on the island asked for an island loan of one-hundred million dollars to help the public debt and provide a chance for industrialization and health education. They were denied their request.

The year of 1929 was a landmark year for the world. It was the beginning of the Great Depression. The markets plummeted and every country tried to save their own. Because of the market crash and the inability to buy as many Puerto Rican products in the past, the island’s economy slowed to a stand still. Unfortunately, two more hurricanes would strike the island in 1931 and 1932. The hurricane in 1932, Saint Ciprian, devastated the island once again causing over forty million dollars in damage and killing two hundred people. Relief from that hurricane would not come for a whole year, when congress approved and implemented the Puerto Rican Emergency Relief Administration (PRERA). They were given a credit of only nine hundred thousand dollars, but it was the start of a new policy towards the island. Shortly after, congress hired the Puerto Rico Policy Commission to make a study of the island and its problems. They were found to be “progressive landlessness, chronic unemployment, and implacable growth of the population” (64).

Though the world would not see the end of the depression until 1938, Puerto Rico began its assent to economic stability. The prohibition had ended in 1930 which, once again, created jobs and profit from the sugar industry as well as the rum, alcohol, and beer industries. By 1938, exports of rum and alcohol created over three million dollars and almost seven hundred thousand gallons of rum and alcohol. In 1934, the lottery was re-legalized, creating money to help combat tuberculosis and provide charitable services to the poorest people on the island. From 1938 to 1939, the lottery created a million dollars towards their cause.

Further help for Puerto Rico came from the United States in the form of the Puerto Rico Reconstruction Administration. The PRRA was a program that created projects that provided relief and work relief to the Puerto Rican people. Along with this program, the five hundred-acre law was implemented, recognizing that much of the land was in the hands of just a few absentee American owners. The lands were reduced to five hundred acres an owner, giving the people a chance to have their own farms. The PRRA had grand goals and objectives, all of which were outlined in a letter written by President Roosevelt on August 1, 1935. “Diversification of agricultural production will be sought by the program in order that the island may approach a self sustaining status. Cheap and available electric power, good roads, reforestation, and adequate housing are also essential.” Along with these goals, President Roosevelt backed up the plan with sixty-six million dollars for its proper operation. By 1939 the emphasis of work relief shifted to rural rehabilitation for the PRRA.

President Roosevelt had many great ideas for the whole United States, and recognized that Puerto Rico was no less important. He realized that the island needed to become more self-sufficient and independent of American markets. Before the depression, the Puerto Rican diet consisted mainly on food imported from the United States. Because of the PRRA, the island started growing more of their own food, learning how to become self-sustaining farmers. The economic crisis was on its way to recovery by 1939, the world started to regain their old ways of life, but for Puerto Rico the old ways had to be lost. Their culture was saved, but their ways of living changed. They may not ever be the richest island around, but they’re learning how to take care of their own as best as they can.

Compared to other Latin American nations, many of the problems that Puerto Rico faced during these times, other countries faced at one time. The difference between Puerto Rico and other Latin American countries is that Puerto Rico has the United States. They are their own little country, but have the helping hand of the United States to help them when they’re down. Other countries who gained their independence faced economic crisis at one time or another, some are still feeling the effects of those times. Those countries had to help themselves, with little or no help from neighboring nations. Their crops may be destroyed, their exports no longer bought, their government out of money and they have no one to turn to. The same things could and did happen to Puerto Rico and the United States helped them out as much as they were able to. During the Great Depression the money was tight all around the world, yet Puerto Rico was not forgotten when their island was damaged by hurricanes and their monoculture crops were no longer making money.

Because of the United States, Puerto Rico was able to make one of the fastest economic comebacks in history. Their success in the present time, compared to other Latin American countries, is evidence that a helping hand is sometimes better than gaining national independence.

Quotes were cited from:

Puerto Rico: A Guide to the Island of Boriquen. Puerto Rico Reconstruction Administration. The University Society, Inc., New York. 1940.