Hawaii is a state and Puerto Rico is not because Congress and the Supreme Court placed the two territories into different legal categories almost immediately after the United States acquired both in 1898. Hawaii was classified as an “incorporated” territory headed for eventual statehood. Puerto Rico was classified as “unincorporated,” a category the Supreme Court invented in 1901 to let Congress govern it with fewer constitutional constraints. Hawaii’s classification put statehood on a timer that eventually ran out in 1959. Puerto Rico’s classification put statehood on a track Congress has never chosen to activate.
Everything else, from referendums to tax policy to partisan math, sits on top of that original split.
Same Starting Point in 1898, Different Legal Classification
The United States took control of both islands within months of each other. Congress annexed Hawaii by joint resolution on July 7, 1898, ending the short-lived Republic of Hawaii that American business interests had established after overthrowing Queen Liliuokalani in 1893.1National Archives. Joint Resolution to Provide for Annexing the Hawaiian Islands to the United States Spain ceded Puerto Rico, Guam, and the Philippines to the United States that same year in the Treaty of Paris ending the Spanish-American War.2Office of the Historian. The Spanish-American War, 1898
What happened next is where the two paths diverged. Congress passed the Organic Act of 1900 for Hawaii, creating a territorial government, extending U.S. citizenship to residents, and treating the islands as an incorporated territory where the full Constitution applied.3U.S. Capitol – Visitor Center. House of Representatives Amendment to S. 222, An Act to Provide a Government for the Territory of Hawaii (Organic Act of 1900) Incorporation signaled that statehood was the expected endpoint. The same year, Congress passed the Foraker Act for Puerto Rico. It set up a civilian government but kept most authority in the hands of a presidentially appointed governor and executive council, and it did not treat Puerto Rico as a territory on a path to admission.
The Supreme Court sealed that distinction in 1901. In Downes v. Bidwell, the Court held that Puerto Rico “is not a part of the United States” for purposes of the Constitution’s requirement that duties and taxes be uniform throughout the country.4Justia Law. Downes v. Bidwell, 182 U.S. 244 (1901) Downes was one of several decisions known collectively as the Insular Cases, which created the incorporated/unincorporated distinction out of nothing in the constitutional text. The reasoning was openly racial. Justice White’s concurrence said Congress needed flexibility because “grave questions will arise from differences of race, habits, laws, and customs” in the newly annexed territories. The dissent warned the majority was importing “a colonial system such as exists under monarchical governments” into American law. The majority prevailed, and Puerto Rico has been governed under that framework ever since.
Hawaii was never placed in the unincorporated column. That single classification choice, made at the turn of the twentieth century, is the foundation of every difference between the two territories today. Congress’s authority over territories under Article IV of the Constitution is nearly absolute, and no territory has a constitutional right to statehood.5Congress.gov. Article 4 Section 3 Clause 2 But incorporation created an expectation and a legal environment in which admission was a matter of when, not whether. Unincorporation created the opposite.
How Hawaii’s Path Opened
Hawaii’s territorial legislature started pushing for statehood early in the twentieth century and kept pushing for more than fifty years. Congress blocked it for most of that period, and the main obstacle was race, not law.
Hawaii’s population was majority Asian and Native Hawaiian. Southern Democrats in Congress treated statehood as a direct threat to the Jim Crow system, because Hawaii’s senators and representatives would almost certainly vote for civil rights legislation. A 1937 congressional investigation openly questioned the loyalty of Hawaii’s Japanese American population, which was the islands’ largest ethnic group, and the statehood campaign stalled. The white business class that ran Hawaii’s plantation economy was comfortable with territorial status for its own reasons: statehood would have empowered nonwhite residents politically and loosened their grip. For decades, Southern segregationists in Washington and white elites in Honolulu had aligned interests in keeping Hawaii a territory.
The Cold War shifted the political calculation. By the mid-1950s, the Soviet Union was using American racism as a propaganda weapon against decolonizing nations in Asia and Africa, and admitting a multiracial Pacific state became a way to answer that criticism. Hawaii’s military value, including the headquarters of the U.S. Pacific Command, added weight. Eisenhower’s Secretary of the Interior called Hawaii “the picture window of the Pacific through which the peoples of the East look into our American front room.”
The deal that finally passed was partisan. Democrats wanted Alaska admitted because they expected it to send Democrats to Washington. Republicans wanted Hawaii for the mirror-image reason. Linking the two broke the logjam. Alaska entered the Union in January 1959. The Senate passed the Hawaii Admission Act on March 11, 1959, the House passed it the next day, Eisenhower signed it on March 18, Hawaiian voters approved statehood in a June referendum, and Eisenhower issued the proclamation making Hawaii the 50th state on August 21, 1959.6Senate.gov. HI – Hawaii
None of this would have been possible if Hawaii had been classified as unincorporated. The underlying legal framework assumed statehood was the destination. The question was always about timing and politics, not about restructuring the territory’s constitutional status first.
Why Puerto Rico’s Path Never Opened
Puerto Rico’s legal track started differently and stayed different. The Foraker Act of 1900 did not extend U.S. citizenship. That came seventeen years later, in the Jones-Shafroth Act of 1917, which also restructured the government and added a bill of rights.7U.S. Capitol – Visitor Center. H.R. 9533, An Act to Provide a Civil Government for Porto Rico (Jones-Shafroth Act) The citizenship Congress granted was statutory rather than constitutional, meaning it was created by legislation and does not come from the Fourteenth Amendment. Congress has never revoked it and there is no realistic prospect it would, but the legal distinction matters: statutory citizenship exists at Congress’s discretion in a way that birthright citizenship inside a state does not.
In 1950, Congress passed Public Law 600, authorizing Puerto Rico to draft its own constitution. Puerto Rican voters approved the arrangement, a constitutional convention produced a document with a republican form of government and a bill of rights, and Congress approved it in 1952, creating the Commonwealth of Puerto Rico (Estado Libre Asociado). The commonwealth has significant control over internal affairs, including its own tax system, education, and local government.
Commonwealth status did not change Puerto Rico’s underlying legal classification. The U.S. Department of the Interior still lists Puerto Rico as both an unincorporated territory and a commonwealth.8U.S. Department of the Interior. Definitions of Insular Area Political Organizations The Supreme Court confirmed this in 2016 in Puerto Rico v. Sánchez Valle, holding that Puerto Rico’s sovereign power comes from Congress, not from the Puerto Rican people. The Insular Cases remain binding precedent despite decades of criticism from legal scholars and some sitting justices.
So the structural question of statehood for Puerto Rico has never been just a political fight about admission. It has also been an argument about whether to reverse a century-old legal framework that was explicitly designed to keep colonized populations at a distance from full constitutional participation.
What’s Kept Puerto Rico a Territory
Puerto Rico has held multiple status referendums, and statehood has won every vote since 2012. The 2020 referendum, the cleanest of the three recent votes, passed with 52.5% in favor. None of the results have been binding on Congress, and Congress has not acted on any of them. Several reinforcing factors explain the inaction.
Partisan math. Puerto Rico as a state would send two senators, four or five House representatives, and corresponding electoral votes to the federal government. Both parties have spent decades trying to estimate who those seats would favor, and neither has been confident enough to push hard. Republicans have generally been more resistant, and Democrats have not assembled the supermajority needed to clear Senate procedural hurdles.
The tax trade-off. Bona fide residents of Puerto Rico generally pay no federal income tax on income earned from Puerto Rican sources, though they do pay Social Security, Medicare, federal excise taxes, and customs duties.9Internal Revenue Service. Topic No. 901, Is a Person With Income From Sources Within Puerto Rico Required to File a U.S. Federal Income Tax Return Many islanders worry that statehood would add federal income tax obligations an already strained economy cannot absorb. Some members of Congress use the same fact in reverse, questioning why full federal benefits should extend to a population that does not pay federal income taxes. The Supreme Court endorsed a version of that reasoning in 2022 in United States v. Vaello Madero, upholding Puerto Rico’s exclusion from Supplemental Security Income.10Supreme Court of the United States. United States v. Vaello Madero
Local tax incentives. Puerto Rico’s Act 60 gives relocated businesses an effective corporate tax rate of 4% and allows individual investors to pay zero capital gains tax. Those incentives exist precisely because Puerto Rico is outside the federal income tax system. Statehood would eliminate them, which is a dealbreaker for parts of the island’s wealthiest population and for recent arrivals who moved specifically for the tax treatment.
Cultural identity. Puerto Rico is overwhelmingly Spanish-speaking and competes separately at the Olympics. Some residents worry statehood would erode that identity, and the question of English as an official language has surfaced in past congressional debates. Statehood supporters point to Hawaii, which kept its cultural identity after 1959.
Stalled legislation. The Puerto Rico Status Act passed the House in December 2022 on a 233-191 vote but died in the Senate. Versions were reintroduced in the 118th Congress, but no bill has advanced. As of early 2026, there is no active legislation with meaningful momentum.
What Would Have to Happen for Puerto Rico to Become a State
There is no automatic process. The Constitution gives Congress power to admit new states under Article IV but does not specify how. The usual sequence has been: the territory petitions Congress, Congress passes an enabling act authorizing a constitutional convention and referendum, voters approve the resulting constitution, and Congress passes a joint resolution of admission that the president signs. A proclamation finishes the process.
Once admitted, a new state enters on equal terms with the existing states under the Equal Footing Doctrine, which the Supreme Court has described as entitling every new state to “exercise all the powers of government which belong to the original states of the Union.”11Legal Information Institute (LII) / Cornell Law School. Equal Footing Doctrine Statehood cannot be revoked.
For Puerto Rico, the practical requirement is a Congress willing to pass an admission bill and a president willing to sign it. Everything else, including the referendums already held and the legal arguments over the Insular Cases, is pressure applied to that single political choice. Hawaii waited more than fifty years for that choice to fall its way. Puerto Rico has been waiting longer, under a legal classification designed to make the choice harder, and the wait continues.