Billions, billions and billions... That 150 billion dollar we gave for the Iran nuclear program with no interest charge might of help.
2
Puerto Ricans can vote all they want in plebiscites; however, Congress has the ultimate say.
During hearings regarding the creation by Congress of Puerto Rico’s colonial form of government in June 1950, Rep. Fred L. Crawford from Michigan asserted Congress’ sovereignty over Puerto Rico. He said, "Congress retains all essential powers set forth under our constitutional system, and it will be Congress and Congress alone that ultimately will determine the changes, if any, in the political status of the island." Crawford further said, "As long as no actual change would be made in the United States-Puerto Rico relationship, we think the bill should be enacted. Puerto Rico can be a colonial possession and have a great deal to say about [its] own government under which Puerto Ricans live."
All of this took place while pro-independence advocates were being brutally repressed by the local and U.S. governments, including mass arrests and incarceration, surveillance, assassinations, and bombardments of pro-independence strongholds during an uprising in 1950.
In this atmosphere of fear and persecution Puerto Ricans voted in a plebiscite to “approve” the so-called current commonwealth. It was a political farce, as 387,016 voted in favor, 122,215 against, and 274,201 boycotted the plebiscite. Shameful!!
During hearings regarding the creation by Congress of Puerto Rico’s colonial form of government in June 1950, Rep. Fred L. Crawford from Michigan asserted Congress’ sovereignty over Puerto Rico. He said, "Congress retains all essential powers set forth under our constitutional system, and it will be Congress and Congress alone that ultimately will determine the changes, if any, in the political status of the island." Crawford further said, "As long as no actual change would be made in the United States-Puerto Rico relationship, we think the bill should be enacted. Puerto Rico can be a colonial possession and have a great deal to say about [its] own government under which Puerto Ricans live."
All of this took place while pro-independence advocates were being brutally repressed by the local and U.S. governments, including mass arrests and incarceration, surveillance, assassinations, and bombardments of pro-independence strongholds during an uprising in 1950.
In this atmosphere of fear and persecution Puerto Ricans voted in a plebiscite to “approve” the so-called current commonwealth. It was a political farce, as 387,016 voted in favor, 122,215 against, and 274,201 boycotted the plebiscite. Shameful!!
1
Another gift to Bankers, Wall Street and Hedge Fund managers, make bad loans and escape the failure through taxpayer contribution.
Let them bankrupt and let the money lenders suffer the consequences. Too Big To Fail? Maybe the one percent will then feel the pain of the 99%.
Let them bankrupt and let the money lenders suffer the consequences. Too Big To Fail? Maybe the one percent will then feel the pain of the 99%.
5
I'm assuming such a board with power over "structural" reforms, include government pensions? If so, it sounds like a relatively favorable path forward.
2
"Anti-democratic claims ring hollow in the face of Puerto Rico’s current predicament, which has led to sharp cutbacks in services that hardly reflect the desires of a majority of Puerto Rico’s citizens"
Oh you mean populism, cronyism and corruption have put PR in its current predicament but the majority of citizens don't want to take responsibility for this? Go figure.
Oh you mean populism, cronyism and corruption have put PR in its current predicament but the majority of citizens don't want to take responsibility for this? Go figure.
9
Despite their expertise as lawyers, the authors of this op-ed piece seem to forget the government of Puerto Rico cannot really set up a financial control board with "serious teeth" like the cities of Albany, New York, and Washington, D.C., once did. These cities operated under more forgiving charters or laws, whereas Puerto Rico has to follow a Constitution, ratified by Congress in 1950, that grants the sole power over money allocations to Puerto Rico’s Legislature.
Thus, any law giving a financial control board the power to allocate funds, apart from that reserved exclusively to Puerto Rico’s Legislature, would be unconstitutional. Moreover, amending Puerto Rico’s Constitution so as to allow the Legislature to create a board with such powers (even if the amendment were passed in a timely fashion) would be unlawful, for the amendment would be setting up a power outside that given by the citizen body to the individuals it elects and would no longer then “provide a republican form of government” as mandated by Congress back in 1950.
Only a financial control board created by Congress under the Territorial Clause of the U.S. Constitution would gave enough “teeth” to begin mending Puerto Rico’s troubled finances. Just giving back Puerto Rico’s municipalities the recourse they had to the Chapter 9 U.S. Bankruptcy Laws before 1982 won’t be enough. Such is the nature of Puerto Rico’s colonial reality.
Thus, any law giving a financial control board the power to allocate funds, apart from that reserved exclusively to Puerto Rico’s Legislature, would be unconstitutional. Moreover, amending Puerto Rico’s Constitution so as to allow the Legislature to create a board with such powers (even if the amendment were passed in a timely fashion) would be unlawful, for the amendment would be setting up a power outside that given by the citizen body to the individuals it elects and would no longer then “provide a republican form of government” as mandated by Congress back in 1950.
Only a financial control board created by Congress under the Territorial Clause of the U.S. Constitution would gave enough “teeth” to begin mending Puerto Rico’s troubled finances. Just giving back Puerto Rico’s municipalities the recourse they had to the Chapter 9 U.S. Bankruptcy Laws before 1982 won’t be enough. Such is the nature of Puerto Rico’s colonial reality.
3
This is just another lesson on the problems that everything Latino tends
to turnout to be. When will we learn? And why grab every
careless overspending entity's money problems?
Maybe Donald Trump is right after all...
but in any case let us help refugees, but not the money squandering
American taxpayer mooching Puerto Ricans. Nor the welfare gouging
school budget breaking illegal immigrants in the US.
When will we learn?
to turnout to be. When will we learn? And why grab every
careless overspending entity's money problems?
Maybe Donald Trump is right after all...
but in any case let us help refugees, but not the money squandering
American taxpayer mooching Puerto Ricans. Nor the welfare gouging
school budget breaking illegal immigrants in the US.
When will we learn?
5
What would be the alternative? If Puerto Rico cannot pay its bonds back there is a strong case that the federal government is responsible for those debts. Despite all legalese, Puerto Rico is a colony. They have no representation in Congress, cannot enter into any contracts with third nations, the inhabitants are subject to military draft and the whole history of the US domination since 1898 make this island a warden of the US.
While Congress is exceptionally crippled these days, I would welcome the sight of Bohner and McConnell seeing hedge funds and pension funds knocking on Congress' door to get paid.
But on the other hand I can't see this Congress even understanding that Puerto Rico is its responsibility and that immediate action is required.
While Congress is exceptionally crippled these days, I would welcome the sight of Bohner and McConnell seeing hedge funds and pension funds knocking on Congress' door to get paid.
But on the other hand I can't see this Congress even understanding that Puerto Rico is its responsibility and that immediate action is required.
1
Shed Puerto Rico. Let them out of the Jones act. And let them run their own country. Into the ground; that is what will happen due to the corrupt government 'employees' (most of the working population), and their abysmal ability to even keep track of the simplest of things, like where did tax revenues go?
The people are lovely and the island is beautiful, but they are mired in corruption that has gone on longer than decades/centuries.
Please, no debt forgiveness.
But I'm sure my words are lost on those progressives that believe the US it at the root of all evil and if we just gave money to everyone, we'd all just be happy people. The NYTimes has lost it.
The people are lovely and the island is beautiful, but they are mired in corruption that has gone on longer than decades/centuries.
Please, no debt forgiveness.
But I'm sure my words are lost on those progressives that believe the US it at the root of all evil and if we just gave money to everyone, we'd all just be happy people. The NYTimes has lost it.
18
There are several problems with the authors' assessments. First, there should be a control board, but the head should be a well known person, such as Bloomberg, who is larger than life, and would have the knowledge and authority to do what is needed. Second, the books of Puerto Rico are in such a state of disarray, that nobody really knows what the true story is. Third, each agency is so top heavy with inefficiency (yes, too many employees without any apparent function, that serious layoff's should be introduced immediately. In addition, PREPA is owed 1.5 billion dollars by the central government. Why should bondholders (at least 20% of bonds of Puerto Rico are held by the people of that island) be penalized when they in good faith (and with an investment grade blessing from the credit agencies) be penalized when no one is really able to come up with believable numbers.
Puerto Rico is a territory of the United States, and just as a parent is responsible for their children, so is Washington responsible for its territory.
A better solution would be to establish a control board with a very famous person at the head. Washington should then insure the debt by perhaps having the treasury issue bonds (at a fraction of the rate that Puerto Rico can obtain on its own), study the problem and come up with a working plan. Taxes are woefully under collected, and some segments do not pay for electricity usage. This all needs to be worked out before restructuring.
Puerto Rico is a territory of the United States, and just as a parent is responsible for their children, so is Washington responsible for its territory.
A better solution would be to establish a control board with a very famous person at the head. Washington should then insure the debt by perhaps having the treasury issue bonds (at a fraction of the rate that Puerto Rico can obtain on its own), study the problem and come up with a working plan. Taxes are woefully under collected, and some segments do not pay for electricity usage. This all needs to be worked out before restructuring.
10
Whether some famous guy or not is really of no consequence. The day after the announcement, the union leaders all came out screaming bloody murder. They will be fighting to the death on this control board. They know the pork will stop, once a board is agreed upon. No under the table deals.
As to the PREPA 1.5 Billion comment. It sound like you are owed and want your own carve out. See this is the big problem. Whether it is the unions, politicians, or Bond holders, or the 100,000's of people that are owed 72,000,000,000 - everyone has a sad story about being SPECIAL
As to the PREPA 1.5 Billion comment. It sound like you are owed and want your own carve out. See this is the big problem. Whether it is the unions, politicians, or Bond holders, or the 100,000's of people that are owed 72,000,000,000 - everyone has a sad story about being SPECIAL
1
Allegedly, Donald Trump went bankrupt four times, and I guess his creditors and the US government, let him off the hook, and he is still worth a few billion. The 3.6 million inhabitants of Puerto Rico deserve no less.
5
Much as it hurts to defend Donald Trump...the fact is HE has paid
taxes and will again, presumably.
And has at least put up some buildings. And doesn't cost billions
in welfare and schools.
taxes and will again, presumably.
And has at least put up some buildings. And doesn't cost billions
in welfare and schools.
7
Hey yeah, send us a few billion. We'll take it for sure. Just be ready to give us another few billion 5 year down the line.
4
If the Fed would deign to loan to Puerto Rico at near zero percent interest enough to pay off it debts the future would be much brighter in the island. It worked for the too big to fail Wall Street banks/investment casinos seven years ago and those guys were already rich.
4
Two things. One, the commercial and investment banks that were given loans under the TARP legislation paid the money back. Would Puerto Rico do that?
Second, I'm not aware of any situation in which the federal government bailed out a state government that had borrowed more than it could repay. California was left in that situation by its last Republican governor. Things got so bad that the state had to issue IOU's to its creditors because it didn't have cash. There was no federal bailout. Instead, Governor Brown and the legislature turned the situation around through a series of tax increases and spending cuts. The state now has a budget surplus. My understanding is that the Puerto Rico governor simply doesn't want to do what California did - he wants creditors to accept less than what they are owed rather than solving the problem solely by cutting spending and increasing taxes. Right?
Second, I'm not aware of any situation in which the federal government bailed out a state government that had borrowed more than it could repay. California was left in that situation by its last Republican governor. Things got so bad that the state had to issue IOU's to its creditors because it didn't have cash. There was no federal bailout. Instead, Governor Brown and the legislature turned the situation around through a series of tax increases and spending cuts. The state now has a budget surplus. My understanding is that the Puerto Rico governor simply doesn't want to do what California did - he wants creditors to accept less than what they are owed rather than solving the problem solely by cutting spending and increasing taxes. Right?
5
Yeah right ! That is a bozo idea. PR got into its problems PRECISELY because the Bond (triple tax free) money was so cheap an easy. The politics here are like most places, when the money is easy, the politicians try to out give each other - to there constituencies
4
For all that think independence is a solution to the islands problems,it's a fact that puertorricans have consistently rejected that status in all the plebiscites. The great majority of puertorricans are proud of their American citizenship.
5
Independence is at 3%. Even at some fairy tale 10% some think. It is a non-starter. Further, the other dreamers of a modified commonwealth (more rights, more control), just won't believe that it is unconstitutional.
The only solution to the "slavery" here (US Citizens without the right to vote in US elections) is Statehood. But it seems half of the boricua here want commonwealth and the right to complain about it.
The only solution to the "slavery" here (US Citizens without the right to vote in US elections) is Statehood. But it seems half of the boricua here want commonwealth and the right to complain about it.
1
Puerto Rico could fashion a program whereby mid east refugees get sanctuary on the island in exchange for Federal support.
2
A friend of mine went to Puerto Rico to establish a brand of her business. She gave up because the electric power was unreliable.
4
Thats not true.It is very expensive!
3
Why?
1
The government in PR has a history of corruption. The crime rate is one of the highest in the world. The U.S. has several laws that restrict the ability to do business with the rest of world. (Jones Act) The island is treated like" the red headed stepchild". As American Citizens, they are denied the rights available to the rest of the country. Did Puerto Rico do this to themselves? Absolutely. Did the federal government contribute to the problem? YES !
9
Let Puerto Rico become independent. FULLY indendent.
THeir own elections, their own constitution their own everything.
Do we need another sucker on our existence? Official or
non official like Israel? Good God, we are no longer rich. And will
be poverty stricken shortly.
THeir own elections, their own constitution their own everything.
Do we need another sucker on our existence? Official or
non official like Israel? Good God, we are no longer rich. And will
be poverty stricken shortly.
2
Like it or not, Puerto Rico is a Latin American nation and, as such, this group of islands would be economically best suited to become part of existing regional organizations like CELAC (Community of Latin American and Caribbean States), instead of remaining as a territory with no future to become a state of the Union. Puerto Rico will not be any such state given the potential economic and constitutional hurdles this relationship would create on both sides due to their linguistic and cultural differences. The congressional grant of Chapter 9 bankruptcy powers to Puerto Rico may become a desired remedy for the immediate future, although it would become a mere remedy if all parts do not realistically move to a political solution that is no longer seen as an abstract ideal, that is, Independence. With this deal, everyone wins.
7
If the rich and the elected officials of Puerto Rico ever actually paid their electric bills then maybe PREPA would not have to go belly-up. The crime here is that the rich folks and elected officials are simply running money out the back door here, knowing full well that the poor will get mercy at some point.
Couple that with public sector employees who are the islands only middle class and the very unproductive poor who are entitled to minimum wage and what you are looking at is a disaster that no one seems to see.
The issues here are structural, not financial...
Couple that with public sector employees who are the islands only middle class and the very unproductive poor who are entitled to minimum wage and what you are looking at is a disaster that no one seems to see.
The issues here are structural, not financial...
9
Absurd and obscene. The fact that there is "precedent" for a "control board" means nothing. We will not allow our democracy to be dictated by Wall street interests or those of the local elites and present dominant political parties, both corrupt to the core. It makes no difference whether the proposed board is "local" or appointed by Washington. We will not allow our democracy to be dictated.
Maybe if they start by taxing multinationals and megaretailers such as Walmart, Costco, Walgreens etc. (Puerto Rico has the highest density of Walmart/Wallgreens per sq mile of any US territory or the world for that matter) then that would qualify as 'sincerity' as well and would go a long way to creating a better fiscal situation. It would also help to tax the 1% which is hardly the case given that new "residents" are exempted from most taxes as long as they are millionaires/billionaire "investors" thanks to Act 20 and 22 of 2012. We have officially become a tax haven for super rich who "move" here from the US in order to avoid taxes in their own country, state and community.
So is this it? Is democracy to be violated just because of a fiscal problem? then why have elections? Why not make our obvious colonial subjugation and just appoint governors like in the old days? Just build some committee on congress that runs all our affairs to ensure we keep on being a profitable venture for the "leaders of the free world"...
The US invaded us in 1898, we didnt "ask" for it.
Maybe if they start by taxing multinationals and megaretailers such as Walmart, Costco, Walgreens etc. (Puerto Rico has the highest density of Walmart/Wallgreens per sq mile of any US territory or the world for that matter) then that would qualify as 'sincerity' as well and would go a long way to creating a better fiscal situation. It would also help to tax the 1% which is hardly the case given that new "residents" are exempted from most taxes as long as they are millionaires/billionaire "investors" thanks to Act 20 and 22 of 2012. We have officially become a tax haven for super rich who "move" here from the US in order to avoid taxes in their own country, state and community.
So is this it? Is democracy to be violated just because of a fiscal problem? then why have elections? Why not make our obvious colonial subjugation and just appoint governors like in the old days? Just build some committee on congress that runs all our affairs to ensure we keep on being a profitable venture for the "leaders of the free world"...
The US invaded us in 1898, we didnt "ask" for it.
6
Please spare us your self righteous indignation. PR has been given multiple opportunities to vote for independence or statehood and they have rejected those options. Deal with your public sector and govt. corruption for starters. Or just demand independence and go.
14
Puerto Rico is not requesting authorization to declare Bankruptcy. The requested amendment will allow PR's Public Corporations to do so. The PCs owe about 50% of the total $72Bn debt ant Chapter 9 is the right solution.
The five member oversight board works only if it has the teeth to enforce its mandate. The hedge funds knew what they were getting into when they bought PR Bonds over the last ten years. We should have no pity for them.
The Governor is taking the right steps, making the right decisions and trying to point this ship in the right direction. That is significant in itself. And he is doing so without any political gain. But the simple fact is that for this to work, he needs the Chapter 9 amendment.
Once restructured under the watch of a properly appointed Financial Review Board, the PCs should be sold to the private sector where possible. This restructuring would lower the debt load by more than 50%. Puerto Rico's future can be truly bright. But as a "Colony" of the USA, it needs a little help from Uncle Sam.
The five member oversight board works only if it has the teeth to enforce its mandate. The hedge funds knew what they were getting into when they bought PR Bonds over the last ten years. We should have no pity for them.
The Governor is taking the right steps, making the right decisions and trying to point this ship in the right direction. That is significant in itself. And he is doing so without any political gain. But the simple fact is that for this to work, he needs the Chapter 9 amendment.
Once restructured under the watch of a properly appointed Financial Review Board, the PCs should be sold to the private sector where possible. This restructuring would lower the debt load by more than 50%. Puerto Rico's future can be truly bright. But as a "Colony" of the USA, it needs a little help from Uncle Sam.
2
How fanciful: the idea that this Congress of Boehner & McConnell would pass something to ameliorate the debt problems of Puerto Rico. They've got their hands full right now, shutting the government down to make sure we all know they're still opposed to the existence of Planned Parenthood.
11
I agree with this writer.
http://seekingalpha.com/article/3504756-puerto-rico-does-not-need-a-fina...
http://seekingalpha.com/article/3504756-puerto-rico-does-not-need-a-fina...
As a federal territory, Puerto Rico is an instrumentality of the federal government. If the federal government authorized it to not pay its debts, by way of a debtor-friendly bankruptcy process, would that not be a taking? Would there not be a legal basis for a lawsuit in the (admittedly creditor-unfriendly) US Court of Claims? would the US government authorizing non-payment constitute a default on the federal debt?
1
It's more than that. The Fourteenth Amendment says the public debt of the United States shall not be questioned. This was when there were fears the Southern-led Democrats would control Congress and refuse to pay the Union's Civil War debts. Puerto Rico's government is a federal territory with no independent right to exist other than congressional authorization. This was settled in the Insular Cases; the Constitution does not follow the flag. Thus, Puerto Rico's the federal government's child and must pay off her debts.
1
Puerto Rico has always wanted to have its cake, eat it and not get fat. But the time has come for a drastic weight reduction because since the 1970s the island has been borrowing from Peter to pay Paul. The fiscal control board proposed by the governor would not have any teeth because it would be made up of the same people who put the island in the situation it is now. The only way it would work is if were appointed by Congress because federal funds are being misused constantly. The governor has painted himself into a corner by vowing not to fire a single employee from the bloated government payroll and that is precisely what has to happen. A major restructuring is needed because and island of 3.5 million doesn't need 78 municipalities in addition to 165 government agencies. Early in the 20th century U.S. officials suggested it be divided into eight counties and run as most U.S. states operate. Back when Teddy Roosevelt Jr. was governor and there was a deficit, he covered it out of his own pocket. This time, the U.S. won't be as generous.
19
Puerto Rico always wanted to have its cake and blah blah blah? How about the US corporations that make HUGE profits thanks to laws that allow them to set prices whereby consumers pay more for local products? US companies have been making A KILLING for decades, yet that's ok?!
9
Mr 49er, your home state of Massachusetts has 6.8 million people (about 2x Puerto Rico) and 351 municipalities (4.5x Puerto Rico).
2
Puerto Rico deserves a fresh start. We should pay its debts and then give the island independence. Puerto Rico was conquered by the U.S. during that fit of imperialism called the Spanish-American war. We ought to liberate this last American colony, and allow it to make its way in the world on its own.
23
I fully agree. But don't think for a second that an independent PR wont demand billions of dollars in aid forever in return for their "colonial oppression"
6
Next stop...Haiti deuce.
2
Why should the US pay the debts of Puerto Rico? They are the ones that got themselves into debt. They are the ones with too many government employees and entitlements.
Are you one that believes anyone that has not money should just get it from the "1%?"
Are you one that believes anyone that has not money should just get it from the "1%?"
3
The Constitution does not follow the flag. Thus, Puerto Rico's government is entirely a creature of the federal government. How is that federal government not responsible for these debts?
9
As a general matter, I support Gov. García Padilla's plan, largely because Puerto Rico's situation is desperate, a plan is needed, and his is at least as good as anyone else's.
But the task for Congress isn't that easy. This op-ed asserts that PR is treated as a state EXCEPT for an ability to use Chapter 9 of the U.S. Bankruptcy Code to declare bankruptcy. That's just wrong. U.S. states can't employ Chapter 9 to declare bankruptcy either -- only sub-divisions of states, such as counties and cities, can do so. Any rational interpretation of García Padilla's plan doesn’t actually call for bankruptcies of municipalities but of PR as a whole.
This presents a political challenge for Congress. On one hand, do they accord to PR access to a facility denied our states, or do they extend it to all of our states, as well. Note that many of our states are in pretty serious fiscal troubles, as well, and could benefit from an ability to restructure debt under Chapter 9 – Illinois and New Jersey are particularly precarious. But it becomes a political mess as Congress likely will stall on giving states, and PR, the ability to simply force massive haircuts on private borrowers to achieve fiscal balance while protecting public worker pension and union contract commitments.
It seems simple. It’s not.
But the task for Congress isn't that easy. This op-ed asserts that PR is treated as a state EXCEPT for an ability to use Chapter 9 of the U.S. Bankruptcy Code to declare bankruptcy. That's just wrong. U.S. states can't employ Chapter 9 to declare bankruptcy either -- only sub-divisions of states, such as counties and cities, can do so. Any rational interpretation of García Padilla's plan doesn’t actually call for bankruptcies of municipalities but of PR as a whole.
This presents a political challenge for Congress. On one hand, do they accord to PR access to a facility denied our states, or do they extend it to all of our states, as well. Note that many of our states are in pretty serious fiscal troubles, as well, and could benefit from an ability to restructure debt under Chapter 9 – Illinois and New Jersey are particularly precarious. But it becomes a political mess as Congress likely will stall on giving states, and PR, the ability to simply force massive haircuts on private borrowers to achieve fiscal balance while protecting public worker pension and union contract commitments.
It seems simple. It’s not.
13
You are correct sir and Pierluisi's bill specifies that it's only for the public utilities. As always the NYTimes wants to create "rights" where they don't exist. The other thorny issue is that this would be a due process issues with bondholder's who bought after 1982. that knowledge, that PR couldn't declare bankruptcy on those bonds was part of their calculus in buying them
3