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Puerto Rico Extends Government Shutdown

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By MANUEL RIVERA
The Associated Press
Tuesday, May 2, 2006; 8:03 PM

SAN JUAN, Puerto Rico -- Hundreds of public-sector employees lined up to seek unemployment benefits Tuesday, as a partial government shutdown went into a second day with no sign of a resolution to Puerto Rico's fiscal crisis.

The workers _ among the nearly 100,000 thrown out of work by the shutdown _ were filing claims for much as $133 per week at one of the few non-emergency government agencies that has remained open.

They said they had not yet started to panic about the sudden loss of income but worried that if no budget deal is reached, Gov. Anibal Acevedo Vila may make good on his threat to furlough government workers until the fiscal year ends on June 30.

"I am up to my neck in debt," Angel David Salgado Rodriguez, a 21-year-old driver for the Housing Department, said as he waited to file his unemployment claim. "If this doesn't get resolved, I am going to look for another job on the side and fend for myself."

The shutdown began Monday, after the governor and the opposition-dominated legislature failed to resolve a stalemate over a $740 million budget shortfall.

Many basic functions of Puerto Rico's government _ such as obtaining building permits or a driver's license _ were unavailable because of the shutdown, which closed all the island's public schools.

Some 500,000 students stayed at home two weeks before the end of the academic year, and about 40,000 teachers suddenly found themselves out of a job.

"In big or small ways, this affects us all," said Magaly Rosario, a 21-year-old teacher and mother of two. "The uncertainty is huge."

Acevedo announced he would accept a sales tax lower than the 7 percent he had previously said was necessary to secure a line of credit and finish the fiscal year, but the House of Representatives and Senate did not send him a proposal.

The most obvious sign of the crisis was simply the reduced traffic on San Juan's usually clogged highways, but economists warned that a prolonged shutdown could ripple through the island's economy, possibly affecting consumer spending.

"We're getting dangerously close to a point of stagnation or recession if this goes on indefinitely," said Argeo Quinones, an economics professor at the University of Puerto Rico.

Puerto Rico's government is the island's largest employer, with some 200,000 workers. Many restaurants and other small businesses also depend indirectly on the public sector.

Members of the New Progressive Party, which controls the legislature, have blamed the governor for the crisis, saying he has failed to curb the growth in public-sector spending.


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© 2006 The Associated Press

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