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Puerto Rico is Out of Touch with Reality Over Debt Restructuring

I’ve mentioned previously that I think Puerto Rican government’s intransigent behavior is a huge barrier to resuscitating their moribund economy. This doesn’t seem like it’s going to change in the near future:

Puerto Rico’s governor said on Sunday he would submit a revised fiscal turnaround plan on Thursday to the island’s federally appointed oversight board, but the plan would not include labor reforms and pension cuts the board demanded.

Governor Ricardo Rossello also said the government of the bankrupt and hurricane-ravaged island would not allow the oversight board to usurp its legislative powers.

“The Government will not allow the takeover of these powers, and therefore cannot be compelled to implement many of the suggested revisions,” Rossello told the board in an April 2 letter made public with a press release.

The revised plan will exclude layoffs of public employees, the release said.

The comments appear to increase the likelihood of litigation between the local government and the board, which was appointed by the U.S. Congress in 2016 and is charged with approving a blue print for Puerto Rico’s turnaround.

Let’s unpack what’s really going on here, because the issue, like most issues, is being covered by the media with the intent to misinform and confuse the public.

Puerto Rico’s government is massively corrupt. They have been stealing and hiding money for years, and have badly mismanaged both their government and economy. An example of this is the government run electricity company, PREPA, being caught hoarding and stealing supplies. FEMA needed an armed security detail to retrieve the stolen goods from them.

Another example is the Puerto Rican government’s refusal to disclose accurate financial details to Washington. At one point, they were caught hiding billions of dollars. How much more stolen cash have these thieves absconded with or hidden away? There is a very good reason not to trust anything out of the mouths of the crooks running the Puerto Rican government.

Congress is therefore very reluctant to disburse money to Puerto Rico, with good reason. It is highly likely that Rossello and his cronies will simply steal the cash and then turn around and claim Trump and Congress didn’t give them enough money. The Puerto Ricans are able to get away with this, because the US media is eager to cover for them if it can spin this as a way to damage Trump and the Republicans.

I don’t know enough about the laws in Puerto Rico and regarding the territories to say for sure, but it’s highly likely that what the Puerto Ricans are doing is illegal and has been for some time. The DOJ and the FBI should be investigating this and seeking to prosecute the Puerto Rican leadership, but our politicized and corrupt law enforcement agencies are asleep at the wheel or too busy looking for evidence that Trump is a Russian spy.

Because our media and our law enforcement agencies won’t do their jobs, and because the Republicans refuse to air much criticism of Rossello for fears of being called racists, I see little chance for change in Puerto Rico in the near term.

The reason Caribbean islands such as Jamaica and Grenada have been able to clean up their debt nightmares is because they got serious about responsible government and spent years working out deals with creditors and implementing sustainable fiscal policies. The Puerto Ricans are going in the opposite direction, fantasizing of a mega-bailout from DC that will probably never come.

I fully support the control board forcing austerity on the territory, and hope they will not back down. Control of Puerto Rico’s finances should not be in the hands of the criminals running the territory’s government.

 
Doomberg

Written by Doomberg

I am Doomberg, one of the original founding members of Sparta Report, and have been here since the beginning. I am an insatiable news junkie and enjoy reading and writing about the US territories, the Caribbean, video games, smartphones, and of course conservative politics in general.

I also really like pictures of gas stations and claim full responsibility for the silly gas station motif. I'm presently trapped behind enemy lines in a blue state with no hope of escape! The ride never ends.

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