Northern Mariana Islands
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provider of tax revenues for the government, which also had to face mounting social problems. An esti- mated two thousand businesses closed down, teachers’ contracts were not renewed, and many other public ser- vices had to be scaled back. By year’s end, there was even serious talk of reducing work hours for government employees. Meanwhile, the legislature passed several measures affecting the presence of guest workers, and a seemingly coordinated campaign to close the garment industry down resulted in a spate of negative media publicity. This resulted in increased pressure for Congress to adopt legisla- tion to federalize immigration and the minimum wage, and even the customs territory of the Commonwealth. Governor Teno inherited a severely depleted treasury. The new adminis- tration found that the tax-rebate holding account (holding withheld tax money for eventual rebate to the tax- payers), which was supposed to con- tain $34 million, contained only $2 million. The missing $32 million has never been identified. In addition, the Northern Mariana Islands public auditor charged that the Mari- anas Visitors Bureau had misspent up Despite a more conciliatory and less to $12 million in illegal contracts, and confrontational administration in that the governor (Lang) had spent Saipan, relations between the Com- unappropriated millions on sole- monwealth of the Northern Mariana source contracts. The governor was Islands (cnmi) and Washington also accused of lending substantial continued to deteriorate. Third-term sums to the Tinian Casino Gaming governor Pedro P Tenorio (“Teno”) Commission to meet their salaries, inherited a major fiscal quagmire and to pay a “consultant” a total of from his predecessor, Froilan C Teno- $730,000 for four years plus benefits. rio (“Lang”), and the Asian financial The “consultant,” a convicted felon, crisis that started in October 1997 has yet to deliver any product. continued to batter the economy. To compound the problem, the The shrinking tourism sector left the Asian financial crisis hit the country garment industry as almost the sole harder than any other jurisdiction in 212 the contemporary pacific • spring 2000 the Pacific. Tourism dropped dramati- the original work force of 1,200 has cally from over 700,000 visitors in been reduced to around 800, and 1997 to around 450,000 in 1998. more are likely to be let go in the near Nearly all of the Korean-owned hotels future. The casino has been plagued have either closed or been converted by lawsuits filed by contractors, sup- to apartment facilities, while resorts pliers, and employees, and the govern- closed whole wings, reduced person- ment has been demanding past-due nel, or cut hours to cope with the taxes. The Commonwealth Utilities drop in traffic. Revenue from the Corporation briefly shut off the water 10 percent hotel room tax plunged, supply for nonpayment of bills. Par- leaving the Marianas Visitors Author- ticularly intriguing is the question of ity (formerly Bureau) with reduced what happened to the more than resources for publicity to attract $700,000 developer’s fee allegedly more tourists. A reduction in tourist paid by the casino to the government arrivals also meant a cut in commer- to offset infrastructure costs. The cial flights from tourist sources. The bank that funded the purchase of the domino effect has produced a drop in two high-speed ferryboats plying the revenues for the Commonwealth waters between Saipan and Tinian Ports Authority and reduced its ability threatened to repossess for lack of to upgrade port and airport facilities. payments, and the Commonwealth The luxury shopping mall in Marpi Ports Authority refuses to decrease owned by Japan Airlines now has the per passenger boarding fee for only a few shops still in operation. the run to Tinian. Air access to the Duty Free Shopping has reduced island is limited to small aircraft from working hours to 36 a week, and all Saipan and Guam. The Federal Avia- tourism-related industries still func- tion Authority has approved plans to tioning are asking for government extend the current World War II run- relief in the form of deferred or way to allow larger aircraft to come reduced taxes, exemptions from in, but work will not be completed various administrative requirements, for several years. It remains to be seen and even some form of subsidy. if the present casino can survive the Perhaps the most visible barometer drought. of the economic situation, the Tinian To complicate matters further, the Dynasty Hotel and Casino is barely Mayor of Rota, Benjamin Mangloña, clinging to life after completing its came out publicly proposing a local first year of operation in March 1999. initiative to approve a casino on Rota. It claims to be losing a million dollars Claiming it will resolve the economic a month for lack of clientele, and a crisis on Rota by requiring that 75 visit to the main gaming hall is an percent of the employees be US citi- experience in pity for the remaining zens; that no more than 100 rooms staff, who must stand in full uniform be allowed in the hotel, with overflow at empty tables for hours on end. Of clientele going to existing establish- the three five-star restaurants opened ments; and that a more efficient reg- a year ago, only one is still operating; ulating body than Tinian’s be estab- political reviews • micronesia 213 lished, Mangloña justified his reversal while the officers and crews of the of position on casinos by saying, “I boats were arrested and charged in don’t want my people to go to bed federal court with a variety of viola- starving.” Tinian, of course, took this tions of federal laws. announcement with a certain amount With the decline of the tourism of umbrage. A petition to put the sector, previously the largest revenue question to the voters on Rota was source for the Northern Marianas at filed on 2 July 1999 with over 600 over $150 million annually, revenues signatures, twice as many as neces- from the garment industry assumed sary, and half of the registered voters new importance. Although the indus- on Rota. try generates, on the average, $100 The Tinian Dynasty enjoyed its best million dollars annually in direct business of the year when dozens of and indirect taxes, it has long been federal agents from the Immigration a source of controversy. Most of the and Naturalization Service and Public factories are owned by Chinese or Health were on Tinian to process Chi- Korean companies, although some are nese boat people, who began to arrive owned by US companies, and all are in March 1999. The hotel was full almost fully staffed by Asian workers. of paying federal employees, and the A 20 percent “local hire” quota has casino received a contract to provide resulted in about 2,000 of the 15,000 daily meals to the 500 Chinese being workers being from the freely associ- held. The Chinese were from Fujien ated states, and a few are actually Province in Southeast China, and had from the commonwealth. The distinc- paid up to $10,000 to travel to Guam, tion between local hire and contract where they planned to request politi- worker is significant in that the cal asylum. Nearly five hundred made employer is legally required to pro- it to Guam before federal authorities, vide contract workers with medical aware that the commonwealth has no care, room and board, barracks-to- asylum provisions, determined that factory transportation, and other the military reservation on Tinian costs, with some deductions permissi- would be a better place to house any ble for room and board. Local hire new refugees. Four or five more Chi- employees do not receive these bene- nese boats were intercepted on the fits, and attempts to rectify the situa- high seas and diverted to Tinian. Each tion have been unsuccessful so far. of the leaking fishing vessels carried Allegations of sexual and physical from 75 to 120 Chinese passengers, abuse, payroll fraud, discrimination, frequently without adequate food, and fraudulent recruiting scams water, or sanitation. A tent city was reached an all-time high during the erected at the old b29 runway in year. The federal government consid- northern Tinian, and federal officials ers the garment workers “indentured came from Hawai‘i and the mainland servants” because they must work off to process and repatriate the intern- recruiting fees (paid in the country ees. The last of the 500 on Tinian of origin) before they can make any were repatriated in late June 1999, money for themselves, and they are 214 the contemporary pacific • spring 2000 not allowed to change their employ- indications of worker satisfaction. ment at will. Sometimes recruiting The fact that 20/20 teamed up with a fees amount to more than $10,000, a human rights advocacy group, Global sum hard to save when earning under Survival Network, indicated a preex- $3.05 per hour (after deductions).1 isting agenda. Working conditions have been tar- As a result of this widespread geted as substandard and inhumane, negative publicity, six new bills were and there have been organized efforts introduced in Congress to federalize to close down the industry on Saipan.2 authority over immigration and the These include monthly protests on the minimum wage, and in some cases to US mainland against retailers who eliminate the exemption for products have brand-name products made in manufactured in the commonwealth. Saipan (The Gap, Tommy Hilfiger, A seventh bill, a repeat of last year’s, etc), a billion-dollar class action suit was introduced by Senator Frank against the retailers, and movements Murkowski (R Alaska) and Senator in Congress to nullify the competitive Daniel Akaka (D Hawai‘i); it would advantage the factories gain by locat- phase in federalization over a period ing on Saipan.