Social Security

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On Feb. 4, 2019, Chief Judge Gustavo Gelpí of the U.S. District Court of Puerto Rico ruled that U.S. citizens on the island are entitled to the same social security supplemental payments, or Supplemental Social Income (SSI), as citizens who reside in the mainland.

More than a year later, the federal government has not taken the necessary steps to ensure that all U.S. citizens have equal access to financial aid and government benefits.

While similar in name, the SSI differs from the Social Security (SS) program. Economist Antonio Rosado explained that the SS is a benefit that employers and workers pay throughout the employee’s work life. That is, SS is a type of worker’s insurance that is deducted from their income. This retirement plan applies to all retirees regardless of their place of residence.

“By contrast, the SSI is financed with the federal government’s regular revenue. It comes from personal income taxes, corporate taxes and other federal taxes,” Rosado told THE WEEKLY JOURNAL.

Another distinction from the regular SS is its eligibility. In order to apply for the SSI, an applicant must be at least 65 years old or be blind or disabled; have limited income and resources; and be a U.S citizen, a national of the U.S. or an immigrant who meets certain applicable requirements. Even if an individual was an SSI beneficiary in the mainland, if they relocate to a non-incorporated territory, with the exception of the Northern Mariana Islands, they lose their right to continue receiving this supplemental income.

The Case That Sparked Debate

Judge Gelpí dismissed a plaintiff from the federal government in favor of defendant José Luis Vaello-Madero.

The defendant lived in New York from 1985 to 2013 and received SSI benefits due to a disability. However, after he moved to Loíza, Puerto Rico in 2013, he was removed from the program. He continued receiving his routine payments until 2016 when the Social Security Administration learned of his relocation. The agency then proceeded to demand that he returned all payments issued in that three-year span, a total of $28,081.

In his ruling, Judge Gelpí asserted that Congress cannot discriminate against the U.S. citizens in Puerto Rico, arguing that the federal entity cannot deny the liberty protected by the Due Process Clause of the Fifth Amendment. This, in spite of the powers conferred in Article IV of the Constitution, which allows Congress to enact the regulations needed to govern unincorporated territories.

“[Article IV], however, is not carte blanche for Congress to switch on and off at its convenience the fundamental constitutional rights to Due Process and Equal Protection enjoyed by a birthright United States citizen who relocates from a state to Puerto Rico. Congress, likewise, cannot demean and brand said United States citizen while in Puerto Rico with a stigma of inferior citizenship to that of his brethren nationwide. To hold otherwise would run afoul of the sacrosanct principle embodied in the Declaration of Independence that ‘All Men are Created Equal,’” Gelpí stated.

“Dramatic Impact” On Local Communities

The case of U.S. v. Vaello-Madero is currently before the Court of Appeals for the First Circuit of Boston.

“If the Circuit of Boston determines that yes, that it doesn’t matter that he had moved to Puerto Rico and is receiving benefits, that will open a window of opportunity here for impoverished Puerto Ricans. We are talking about poor folks, and this supplemental payment is highly significant. We are talking about a dramatic impact,” Rosado said.

The most recent data from the U.S. Census Bureau indicates that 43.1 percent of Puerto Rico residents live in poverty.

THE WEEKLY JOURNAL asked Rosado if this statistic could hinder the island’s probability of achieving access to the SSI program, but the economist argued that the court would only assess a case from a legal standpoint and not its financial implications.

“If [the court] follows Judge Gelpí’s stance, it will definitely rule that the fact that we are U.S. citizens who for some reason reside in Puerto Rico, that shouldn’t exempt us from receiving the SSI… The fact that he lives in Puerto Rico does not affect his status. That is what’s in talks right now and at any moment the Court of Appeals will release its opinion on this case,” the economist noted.

Meanwhile, Resident Commissioner Jenniffer González, Puerto Rico’s representative in Congress, introduced last year a bipartisan bill to extend the SSI program to Puerto Rico, the U.S. Virgin Islands, Guam and American Samoa.

Puerto Rico Contributes to U.S. Treasury

An argument that has been used in favor of excluding U.S. citizens in Puerto Rico to the SSI benefits is that most residents do not have to pay most federal personal income taxes, which are some of the main funding sources for the supplemental income program. However, Rosado pointed out that residents are eligible for Medicaid, so—although Puerto Rico lacks fund parity in this tax-funded benefit—the SSI is “a special case” in favor of this argument.

Moreover, Rosado dismissed a common claim that Puerto Rico receives more federal financial aid than the amount it contributes to the U.S. government.

“That is a matter of measurement. Here, for example, American companies that are established in Puerto Rico and have an income of $30 billion a year return it to the United States and pay federal corporate taxes. It would be difficult to convince me that Puerto Ricans are not making a contribution to the U.S. government’s treasury,” he affirmed.

With more than five million Puerto Ricans living stateside, the economist said that U.S. politicians will feel political pressure to reduce the gap that restrains Puerto Rico’s equal access to government benefits and fund parity. Failing to address these issues would only result in a growing and continuous migration chain from the island to the mainland, thus affecting states’ economies in the process.

“What they need to understand is that this is a problem of necessity; this is not a problem of where you live. The solution is to go to Florida, New York, Texas or Arizona to receive these benefits because that is what will happen,” Rosado said.

Read the ruling on the case of U.S. v. Vaello-Madero:

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