Statement on the Insular Cases and the Doctrine of Unincorporated Territory: The Insular Cases are the Tip of An Imperial Iceberg

Roberto Ariel Fernández

(Este escrito es una versión, con modificaciones mínimas, de una ponencia que el autor le sometió el 12 de junio de 2023 a la United States Commission on Civil Rights, una agencia del gobierno estadounidense).

Rivers of ink have been spilled about the Insular Cases (1901-1922), a series of decisions by the United States Supreme Court which provided legal clothing and legitimation to the American overseas imperial enterprise. I will herein discuss, not the cases and the so-called “doctrine of unincorporated territory,” but the historical, economic, political, cultural, and sociological factors that have determined American domination over Puerto Rico –which are often neglected or outright ignored. The legal discourse embodied in the cases is but one of several ideological bases of that domination. A brief discussion of the cases will be followed by the bulk of my statement.

The Cases and Its Significance

In the Insular Cases, the U.S. Supreme Court inaugurated the concepts of incorporated and unincorporated territory. Incorporated territories are basically those destined for admission as states of the union. Unincorporated territories are overseas colonies which have been treated by Congress and the U.S. government in general as being destined to remain so indefinitely. According to those decisions, the rights of the inhabitants of the latter type of territories are mostly the province of Congress, and they do not necessarily enjoy the same rights bestowed on the inhabitants of incorporated territories or those of the states. The “right” to participate in the political decisions, as citizens of the U.S. polis, is denied to those living in Puerto Rico.

The task of studying the degree of legitimacy of U.S. domination in Puerto Rico requires us to pause and analyze the role of the courts in the construction of a discourse which has given legal sanction to the colonial regime. Since 1900, U.S. and Puerto Rico courts have been at the service of the status quo and of the task of giving legal clothing to the colonial state of affairs, with the Insular Cases as the foundation of the judicial discourse.

The first significant opinion was the concurrence of Justice White, in the second of the cases, Downes v. Bidwell, 182 U.S. 244, 287-344 (1901). White copied many of his arguments from the pages of the Harvard Law Review, adopting therefrom the incorporated/unincorporated territory duality. The result has been that Puerto Rico “belongs to, but it is not part of, the United States.”

As a scholar has observed, “This legal and political construction established an area of political and socio-legal indeterminacy, or what might be described as the configuration of a permanent state of exception.” José Atiles-Osoria, Colonial State Terror in Puerto Rico: A Research Agenda, 5 State Crime Journal 220, 223 (2016).

Professor Rivera Ramos has observed the irony of pretending to root colonialism in the United States Constitution. He points out that the ideology of the rule of law “has legitimated American rule or buttressed American hegemony in two fundamental ways.” Efrén Rivera Ramos, The Legal Construction of Identity: The Judicial and Social Legacy of American Colonialism in Puerto Rico 236 (2001). First, the ideology of the rule of law, “as a powerful element of the idea of legitimacy in the American political and constitutional order, compelled the American governing elites to obtain an authoritative statement from the highest tribunal of the land sanctioning their decision to install a colonial regime in the territories acquired after the Spanish – American War.” Id.

Thus, Rivera Ramos concludes, “the primary function of the constitutional doctrine of territorial incorporation developed by the Supreme Court in the Insular cases” was “to justify” the U.S. exercise of colonial power “by reference to law.” Id. Consequently, “[s]ince then, the exercise of congressional power over Puerto Rico has been justified with reference to the notion that the Constitution sanctions it. The law of the metropolitan state itself has become the justificatory basis for the exercise of imperial power.” Rivera Ramos, supra, at 237.

Constitutionalism and Capitalist Expansion

When the original politico-structural arrangement of the United States of America –the Articles of Confederation of 1783– proved to be inadequate to the capitalist interests of the time, the ruling elites drafted a constitution. The document that emerged from Philadelphia on September 17, 1787, was designed to allow the expansion and concomitant wealth amassment that climaxed in 1890 with the “closing of the frontier” –a euphemism for the final stage of a genocide; and in 1898, with the acquisition of “overseas” colonies.

            The wealthy elite that founded the United States of America clothed the new country as a republic. However, that elite did not pretend it to also resemble a “democracy.” Most people could not even vote back then. Slavery was not abolished until 1865, while women and “free negroes” were, at best, second-class citizens, and so-called “Indians” were an obstacle to be quashed. The dictum of equality included in the Declaration of Independence was in reality limited to “white” men of property, preferably of “Anglo-Saxon” extraction. Oligarchical rule and the absence of democracy is a foundation that helps explain much of the evolution of American global capitalism and domination, as well as the current American and global crisis.

Capitalist Constitutionalism

            The United States Constitution protected slavery, while bestowing considerable power to plantation slave owners and the southern states. The northern elites needed those southern folks – both their wealth, and their cooperation in creating the governmental structure that they wanted and required for their cherished financial growth. The Constitution created a common market via its commerce clause, while giving the new federal government exclusive power to acquire territories that would or would not become states.

The Constitution also gave to the national government exclusive power over monetary policy, bankruptcy and maritime law, foreign relations and trade, and treatises. It included protection for the enforcement of contracts, and a supremacy clause declaring that federal laws and the Constitution are the highest law of the land, to be enforced by a federal judiciary. It also created the presidency, bestowing the president with significant powers, not only as chief executive and chief of state, but also as the “commander-in-chief” of the armed forces.

From the outset, the federal monopoly over official violence would be at the service of economic expansion. Nothing and no one would stop the drive toward more wealth, which required more territory and new markets. Obstacles from home and abroad –“Indians,” Mexicans, whoever– would be crushed by the United States Army, Navy, and Marines. The Draconian measures approved during the two world wars and the post-911 “war on terror” illustrate that domestic, totalitarian tactics have already been rehearsed, from the Sedition Act of 1918 – still in the books – to the 2001 Patriot Act.

The Spanish-American War was fought when the effects of the Great Depression of 1893 were still lingering. That was no coincidence. A frightened American elite needed new markets, fast. Commander-in-Chief William J. McKinley obliged, giving them a “splendid little war,” at the end of which the United States became a full-blown empire. It is no coincidence that military strategists, notably Alfred T. Mahan, had been urging for coaling stations, naval bases in the Caribbean and the Pacific, and the modernization of the Navy. Imperialism, military intervention, and the expansion of capitalism are joined at the hip.

The domination of the United States would mostly be an economic hegemony, enforced by military might, which it exercised not only over its colonies – Puerto Rico, Guam, the Philippines, Samoa, Hawaii, and the Virgin Islands – but also over China and the Far East, Mexico, Central America, the Caribbean, and South America. During the first four decades of the 20^th century, United States armed forces invaded and occupied Mexico, Cuba, Nicaragua, Haiti, the Dominican Republic, Guatemala, and other countries to protect the interests of United Fruit, Standard Oil, and other American corporations and banks. In an instance of inconsequential candor, General Smedley Butler – who fought in the Philippines, China, and Central America – wrote that he had been “a high – class muscle-man for Big Business, for Wall Street and for the Bankers; a gangster for capitalism.” See Oliver Stone & Peter Kuznick, The Untold History of the United States xxxii (2012). And so he was, as well as countless other officers and soldiers, from the birth of the country to the present day.

            The First World War was about who was going to dominate the new imperial era, which began in the 1880s with the carving of Africa by the European powers, and in 1898 with the United States prevailing in the Spanish-American War. Imperialism on both sides of the Atlantic was the doing of restless capitalists, who steered governments toward aiding their economic penetration outside the borders of the limited markets of their respective nation-states. That penetration required armies. The Second World War –which was the continuation and conclusion of the War of 1914, after a 20-year truce– was about who was going to call the shots in the post-imperial world. The late colonies would still be dominated, but, who would be their main master?

            Woodrow Wilson was clear-headed enough to know that his job was to support American capitalist expansion, that is, new opportunities for yet more profits. The invasions he ordered during his two terms, and the participation in the European war known as World War I, followed from that primal role of the U.S. government, facilitated by the Constitution of 1787. Saintly Franklin Delano Roosevelt was also aware of that role, and had no qualms about installing and supporting tyrants in countries where American corporations had been wreaking havoc for decades – usually with U.S. or “local” soldiers as their enforcers. About the first of the Somoza dynasty in Nicaragua, FDR is reported as having quipped: “He may be a son of a bitch; but he’s OUR son of a bitch.” That he did not actually say it would be irrelevant.

American Capitalism Goes to Puerto Rico

            It is that historical scenario that explains the American imperial venture in Puerto Rico. Even before July 25, 1898, when the U.S. invaded Puerto Rico, American businessmen and politicians were already counting on its annexation as a locus for economic expansion and speculation. Among them were Boston financiers (what else is new?), who arrived in Puerto Rico immediately after the signing of the Armistice of August 12. One of them, John Dandridge Henley Luce (1855–1921), was a close friend and brother-in-law of then Massachusetts Junior Senator, Henry Cabot Lodge (1850–1924). On July 15, ten days before the invasion, Luce wrote to Lodge: “As an imperialist, you may not be surprised that I wish to be in the front row of colonial expansion! In short, I am very anxious to go to Porto Rico [sic].” Muriel McAvoy-Weissman, Brotherly Letters: The Correspondence of Henry Cabot Lodge and J.D.H. Luce 1898-1913 at 99, in stahttps://revis.upr.edu/index.php/hs/article/download/4054/3515.

            Luce and his partners wanted, the letter went on, “to get, if possible, the Secretary of the Treasury to make us a U.S. government depository.” Lodge obliged, assisting them in having their newly – created bank appointed as the fiscal agent of the U.S. military government in Puerto Rico. After President McKinley himself intervened, all deposits of the U.S. military government in Puerto Rico went to their bank. By 1899, they had enough money to buy the Central Aguirre Sugar Estate, then comprised of 2,000 acres. Their venture initiated a trend – surviving to this day – of using the island for making money and fleeing the site with most of the loot. Puerto Rico has been a source of cheap land and cheaper labor, a tax haven, a place with home-grown engineers, technicians, and administrative staff – able, disciplined, but cheap workers – at the service of American corporations and their profits.

            Indeed, Puerto Rico has been an American tax haven since 1900, in four sometimes overlapping capitalist-exploitative stages: the sugar monoculture (1900-1940, when cane workers were literally among the wretched of the Earth); the industrialization by tax incentives (1946-2006, with not only tax incentives, but cheap labor galore); the tripled-exempt-from-taxes government bonds (leading to the current debt hell); and the present era of the John Paulsons and Brock Pierces of this life (made possible by Puerto Rico so-called Laws 22 and 60, enacted by pro-statehood Puerto Rico governors/legislatures, in order to have access to new forms of easy money for their bottomless, corrupt selves).

Politics is self-rule, that is, government by consent, relying on deliberation, persuasion, and compromise in search of the common good. But, capitalists are relentless in their expansion mania. In 19^th century Europe, the capitalists – the “bourgeoisie”– began to undermine politics (or its possibility). Arendt expounded on how the European bourgeoisie abandoned its preference for leaving government to the aristocrats, prompting the imperialist expansion of the late 19^th and early 20^th centuries. Capitalism yielded imperialism, beginning with the “scramble for Africa.” Thus began the era of globalized capitalism. See Hannah Arendt, The Origins of Totalitarianism (1951).

It has been essential to ponder whether capitalism’s logic, an eternal drive for expansion, is antithetical to politics and inconsistent with the geographical and human limits of the nation-state. Arendt said that such antithesis and inconsistency are unavoidable. She argued that the nation-state is ill-suited for expansion, for “imperialism,” because it is “based upon a homogeneous population’s active consent to its government.” Arendt, supra at 125. Hence, in the case of conquest, it would have “to enforce consent rather than justice, that is, to degenerate into tyranny.” Id. After all, genuine consent “cannot be stretched indefinitely, and is only rarely, and with difficulty, won from conquered peoples.” Arendt, supra at 126.

The wealthy and the aspirants to be wealthy saw in the limits of the regulatory nation-state an obstacle to be eliminated, but not before they used it as their instrument for enabling their cherished economic expansion all over the globe. Moreover, capitalism may ultimately prove incompatible with democracy – at odds with the common good to which democracy is supposed to aspire or enable. We are, arguably, living at the dawn of a Totalitarian Plutocracy because, as Arendt wrote, “only the unlimited accumulation of power could bring about the unlimited accumulation of wealth.” Arendt, supra at 137.

Beginning in 1898, the U.S. acquisition of “overseas territories” is only intelligible as a new stage in capitalist expansion, out of what Arendt called “economic necessity.” The logic of capitalism as we know it is unlimited expansion, and the nation-state proved too limited, its population too small, for such a monster. Pedro Cabán expounded on it, pointing to the economic dislocations and political disorders that took place in the United States during the last decades of the nineteenth century. Pedro A. Cabán, Constructing a colonial people: Puerto Rico and the United States 15-25 (1999). Cyclical crises prompted American “titans of industry”, financiers and policymakers to embark in economic expansion outside the geographical limits of their nation-state, the expansion that we call “imperialism.” Exactly the same dynamic was taking place in Europe, and the response was also the same: Imperialist expansion to make capitalist sprawl possible.

After 1898, the Puerto Rican economy and institutions were reorganized to meet the economic and strategic interests of the United States. Lodge’s brother-in-law was among the first of countless capitalists who, to this day, go to the Island to make money by paying little or no taxes, paying lower wages than those they would have to pay elsewhere, and failing to reinvest the profits in Puerto Rico.

At the turn of the 20^th century, the obliteration of any chance of autonomous economic development yielded an impoverished army of agricultural workers, from which the mostly-American sugar companies drew their underpaid, underfed hands. It was a peonage system, already implemented in the Southern U.S. after 1865, which for decades kept a significant portion of the African – American population in a state of pseudo slavery.

By 1930, Puerto Ricans were poorer and more exploited than they had been under Spanish rule. The post-WWII modest reforms, and a new wave of American investment, this time mostly industrial instead of agricultural, are explained by the post-war boom, the Cold War, and the pressures of the anti-colonial movement. The model of industrialization by invitation, which included tax exemptions and almost guaranteed profits, began to fail as early as the 1960s and ultimately collapsed. See, e.g., Miguel A. Rivera Quiñones, Post Colonial Colonialism in Puerto Rico: Inequality, Capital, and Social Transfers, in (Post-)colonial Archipelagos: Comparing the Legacies of Spanish Colonialism in Cuba, Puerto Rico, and the Philippines 224; 228 (Hans Jürgen-Burchardt & Johanna Leinius ed. 2022). As Morales explains, the industrial investment was gradually substituted by toxic financial products, spearheaded by Puerto Rico’s municipal bonds, which featured an attractive triple tax-exemption. Ed Morales, Fantasy Island: Colonialism, Exploitation, and the Betrayal of Puerto Rico (2019).

Deprived of the means for autonomous, self-propelled economic growth, Puerto Rico’s government became the Island’s main employer, while ultimately falling in the debt trap to just keep operating. To be sure, its financial collapse was accelerated or made worse by bad policies, many of them neoliberal in nature, as well as by the outright corruption of a ruling elite alienated with neoliberalism and sporting a deep, monstrous contempt toward their fellow Puerto Ricans.

Wall Street sold to their clients more Puerto Rican bonds that the Island’s government could ever repay. Ed Morales describes how, when the speculative bubble burst in the form of default, austerity was mandated to provide investor remedy. Morales, supra, at 72. Austerity, the medicine prescribed by the Fiscal Board created by Congress already had the foreseeable effect of deepening the depression of an economy that was already in dire straits.

Hurricane María was only one among several causes of Puerto Rico’s devastation, a storm which began to gather decades ago. The Fiscal Control Board is administering the worse of all pills, in what in all likelihood will be the finishing blow to the hope of a recovered and stronger Puerto Rico. As in 1899, the response of the U.S. government to the havoc brought by María and by the Fiscal Board has been to help as little as possible, while ultimately Puerto Ricans will foot the bill. In 1900, the U.S. government imposed tariffs to Puerto Rican products, making the Island’s population pay many times over the meager hurricane relief they received after the devastation of an 1899 storm. Today’s “austerity,” and the carving out of the Island for the benefit of the John Paulsons of this life, is a case of history repeating itself, with a vengeance.

Power Asymmetry and Colonial Stasis

Beginning with the Foraker Act of 1900, three congressional bills enacted into law organized the structure of the Puerto Rico “local” government. Besides allowing Puerto Rico voters to elect a House of Delegates, a Resident Commissioner to represent them in Congress, and some members of an Executive Council, the Foraker Act established the basic legal framework of American domination, including plenary federal legislative power over the archipelago and its people.

            The Jones Act of 1917 kept the governor as a presidential appointee, but allowed voters to elect the members of a bicameral legislature. It included a massive naturalization provision. American policymakers of that era did not care to hide their impetus for that citizenship measure: tightening the grip over the colony. See, e.g, Cabán, supra, at 198-203.

            The Jones Act was amended in 1947 to allow Puerto Ricans to elect the governor, which they did in the 1948 election. Act 600 of 1950 turned the provisions of the Foraker and Jones Acts that defined American hegemony into the Federal Relations Act, and delegated to Puerto Ricans the devising of a new structure for its “local” government, subject to congressional approval. That structure, the Estado Libre Asociado or Commonwealth of Puerto Rico, turned 70 in 2022.

Meanwhile, Congress is the sovereign in Puerto Rico, as it has been since the Treaty of Paris of 1898. That was reiterated in the 2016 decision in Commonwealth of Puerto Rico v. Sánchez Valle, No. 15-108, 579 U.S. ___ (2016), wherein the U.S. Supreme Court held that Congress is still the sovereign in Puerto Rico, with plenary power over “the territory.” The limited powers of the commonwealth government derive, said the Court, not from popular sovereignty, but from Congress, which is the ultimate source of that government’s authority.

In a 2017 report, the Congressional Research Service affirmed that, “if Congress chose to alter Puerto Rico’s political status, it could do so through statute. Ultimately, the Territory Clause of the U.S. Constitution grants Congress broad discretion over Puerto Rico.” See Political Status of Puerto Rico: Brief Background and Recent Developments for Congress, in https://crsreports.congress.gov/product/pdf/R/R44721. Congressional bills aimed at meaningful reform of the colonial status, or at putting an end to it, have never been enacted into law. The reality is that domination over Puerto Rico has never been a problem for the United States. Therefore, no “solution” to colonialism has ever come from the American government.

Power asymmetry yields inertia, while colonialism, a variant of power as domination, has not been altered by more than 120 years of the “tricks of the weak.” The main tactic displayed by the Puerto Rican people and politicians, coming from a worldview of powerlessness, has been claiming decolonization (or, more modestly, additional governing powers) by invoking the moral and democratic principles on which the American polity is supposedly built. That has never worked, of course.

“Nationhood” and “nationality” are cultural terms. Puerto Rico is a nation, because Puerto Ricans recognize themselves as unique among the peoples of the world; and are deemed by the rest of the world as such, and recognizably so – with our art, literature, music, worldview, collective personality, struggles and quirks. Calling the United States “our nation,” as pro-statehood politicians like governor Pierluisi and resident commissioner González are fond of doing, repeats a 125-year pattern of pro-statehood so-called “leaders” who, by acting as sycophants of the United States while decrying that it keeps us as a colony, have never had leverage with Congress – because, after all, they are unconditional cheerleaders and allies of the empire.

For these people, not only is the United States “our nation,” but there is no such thing as “the People of Puerto Rico” anymore. According to them, we are now “American citizens living in Puerto Rico.” I do not consider myself a “nationalist,” but I cannot deny or hide the fact that we are Puerto Ricans, not fellows who happen to live in a “godforsaken” archipelago in the Caribbean, although one that is craved by American hoarders and displacers.

Last, But Not Least

Since 1898, and for 125 years, Americans and U.S. officials and legislators have regarded Puerto Ricans as a distinct people (while also feeling superior to us). That’s another (unneeded) indication of our nationhood. Now, we are being displaced and wiped out: Genocide without gas chambers.

Wealthy Americans, crypto dudes, hedge – fund billionaires like John Paulson, and others (all of them tax dodgers for which a new type of tax haven was legislated by the pro-statehood administrations in the island), are buying the real estate on the cheap; closing access to the beaches (in violation of Puerto Rico law but, who cares?), building new monstrosities in what is supposed to be protected ecological sanctuaries and historical sites like Old San Juan (also unlawful, and certainly unethical, destructive and barbaric).

Meanwhile, too many Puerto Ricans have been leaving the archipelago. That migration is mainly due to the economic and social impoverishment caused by more than one century of capitalist exploitation and underdevelopment, which has been accelerated in the last twenty years by new forms of exploitation and displacement, the poor health services, and the destruction of public education, including the deliberate and criminal obliteration of the ex-jewel of the crown – the University of Puerto Rico. Those of us who have stayed put are clinging desperately to the last remains of hope and optimism.

            For members of Congress, Puerto Rico and Puerto Ricans are – have always been – invisible. That has been the default position for more than 120 years. Members of Congress, dead and alive, have never been inclined to become aware of the realities and consequences of perpetual American domination over Puerto Rico. They have the resources to receive briefings and reports on the matter, but that can hardly substitute for organic awareness and deep understanding.

The federal government’s studies and reports about Puerto Rico – including those by the Congressional Research Service – touch upon the legal (“constitutional”) issues, and the policy implications of keeping Puerto Rico as a colony or reforming the current state of affairs. From the Puerto Rican perspective, however, those aspects are the proverbial tip of the iceberg.

Such historical indifference and ignorance of most members of Congress pale in significance when compared with a more insidious and harmful type of ignorance: the kind that makes humans deem themselves individually and culturally superior to other humans and peoples. In the United States, that ignorance is founded in notions of exceptionalism, as well as national and racial preeminence. Imperial domination, I propose, is at the heart of that pernicious sense of superiority.

Racist or racialized otherness is a mark of ignorance indeed, and has always been an important feature of the outlook of most American members of Congress and policymakers. That worldview is the outcome of a culture with intractable maladies.

For Puerto Ricans, the tutelage of Congress has been, and will continue to be, an obstacle to the attainment of delayed justice, and of a shot at prosperity. The main hurdle, however, has been and continues to be American capitalism, which in Puerto Rico has always meant exploitation at the service of profits for a few Americans, and fewer Puerto Ricans at the top of the pecking order. As in the 50 states, capitalism has yielded a consumeristic, solipsistic ethos that nullifies all attempts toward shifting to alternative worldviews and praxes –more attuned to community ties, sustainable development, social solidarity, and cultural depth and creativity.

Puerto Ricans are not Americans, they do not feel as such, and Americans have never seen us as such. The time is decades overdue to decolonize Puerto Rico. The current policy is the same that has existed since 1900: inertia, continuing economic exploitation; and cultural, social, spiritual and ecological devastation.

Treating the political subordination of Puerto Ricans as a “civil rights violation” is inadequate, misleading, and ineffective. It also hides the fact that U.S. imperial/capitalist domination over us is a structural, complex phenomenon, rooted not only in economic and political impetus, but also in ideological and mythical gambits, including the American sense of exceptionalism and racial and/or racialized and/or racist superiority. That sense of superiority goes unmentioned today, but it was articulated in Downes v. Bidwell, supra, with what nowadays can be perceived – ironically enough – as refreshing candor. Moreover, it hides the monstrosity of imperialism, and of the capitalist exploitation of the Puerto Rican people, who are a distinct, worthy nation deserving dignified and fair treatment.