DISASTER CAPITALISM ECONOMY PUERTO RICO The Bankers Behind Puerto Rico’s Debt Crisis

Sep 2013
46,155
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On a hill
The commonwealth’s financial woes didn’t happen by accident—they were the result of decades of public immiseration and private gain.

By Michelle ChenTwitter JUNE 8, 2017

Centuries ago pirates prowled the Caribbean brandishing scabbards and rifles; today, they wield fat checkbooks on Capitol Hill.

Puerto Rico’s economic crisis has now washed the burden of its colonial legacy onto Washington’s doorstep. Congress has been trying to contain the island’s ballooning debt under the hardline austerity program of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). But since the program is governed by a control board run by the same financiers responsible for driving the debt crisis in the first place, the island continues to sink into poverty while its creditors feast on the spoils.

https://www.thenation.com/article/bankers-behind-puerto-ricos-debt-crisis/
 
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Sep 2013
46,155
37,246
On a hill
Puerto Rico illustrates the most extreme form of neoliberal restructuring that has been imposed on many US cities following the recession. Detroit was similarly devastated by what University of California–Berkeley’s Haas Institute calls “financial governance,” a modern-day plutocracy that drives “the systemic political neglect of entire groups of people and places.” Puerto Rico, however, is even more constrained, since municipalities can at least seek formal bankruptcy relief.
It looks like trump is using the current disaster to further the neocon agenda. I can only imagine how frustrating it must be for Puerto Ricoans.
 
Feb 2011
17,039
6,083
Boise, ID
The commonwealth’s financial woes didn’t happen by accident—they were the result of decades of public immiseration and private gain.

By Michelle ChenTwitter JUNE 8, 2017

Centuries ago pirates prowled the Caribbean brandishing scabbards and rifles; today, they wield fat checkbooks on Capitol Hill.

Puerto Rico’s economic crisis has now washed the burden of its colonial legacy onto Washington’s doorstep. Congress has been trying to contain the island’s ballooning debt under the hardline austerity program of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). But since the program is governed by a control board run by the same financiers responsible for driving the debt crisis in the first place, the island continues to sink into poverty while its creditors feast on the spoils.

https://www.thenation.com/article/bankers-behind-puerto-ricos-debt-crisis/
This article is scattered and meandering, it makes vague accusations of conspiracy without detailing the evidence.

When your credit is shot and you can't tax your citizens enough to do what needs to be done (because they have nothing to tax), options are extremely limited. High-risk bonds are, in some cases, perhaps the only way to access capital for desperately needed projects. What other option is there (or was there)?

And if Puerto Rican management took on bad debt, and that should simply be magically "relieved" by Congress, why aren't the authors behind these diatribes pointing out the inherent moral hazard?

Beyond that though, this article has Big Labor written all over it. Notice the characterization of the Detroit bankruptcy as merely being the fault of financiers, according to (surprise) UC Berkeley (never Democrats or labor unions, no not at all!). Notice the reference to a report issued by AFL-CIO. The narrative is simple: make it seem like this problem has absolutely nothing to do with unions. Why do they work so hard to create this narrative? Because if you look at what unions actually do when the shit is hitting the fan, what they demand, it's obvious they are feeding into the problem as much as possible. They have no solutions in a debt crisis or budget crisis. Just vague accusations against management. And that mirrors this article. It's always this way when state and municipal public sector budgets are going up in flames.
 
Feb 2011
17,039
6,083
Boise, ID
I would also like to point out that it is nonsensical to characterize Puerto Rico as engaging in "austerity." Puerto Rico is a US territory that is not monetarily sovereign. They do not issue their own fiat currency. It doesn't make sense to label fiscal reality as "austerity" at state and municipal levels. When there isn't enough money to fund the expenditures in state or municipal government, that's just the way it is. Cutting spending is a literal necessity, not an optional act of austerity. It is quite stupid (but probably effective with a lot of people) to misapply terminology more applicable to national governments to state and local levels. It's all part of the narrative against whoever "management" is so that labor unions can continue denying the havoc they wreak on public sector budgets.

I have to admit I didn't even bother to notice the author until I was through the article. Michelle Chen. Go figure.
 
Nov 2006
54,624
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The commonwealth’s financial woes didn’t happen by accident—they were the result of decades of public immiseration and private gain.

By Michelle ChenTwitter JUNE 8, 2017

Centuries ago pirates prowled the Caribbean brandishing scabbards and rifles; today, they wield fat checkbooks on Capitol Hill.

Puerto Rico’s economic crisis has now washed the burden of its colonial legacy onto Washington’s doorstep. Congress has been trying to contain the island’s ballooning debt under the hardline austerity program of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). But since the program is governed by a control board run by the same financiers responsible for driving the debt crisis in the first place, the island continues to sink into poverty while its creditors feast on the spoils.

https://www.thenation.com/article/bankers-behind-puerto-ricos-debt-crisis/
The referendums on statehood, independence or to remain a territory have been going on for decades and independence always loses horribly. Your article says they may "renew their cry for independence" and that is ridiculous, independence never seems to get 10% of the vote and there has never been a cry for it.
 
Mar 2015
30,348
15,752
Mad Prophet
Some of you people have absolutely no clue about Puerto Ricans. They are very religious and quite conservative, yet they are often demonized by the right wingers in this country. The problems of Puerto Rico have mostly to do with crooked government. Your answer to the lack of support from the United States is to fault them and piss on them every chance you get. It's fucking sad.
 
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Sep 2013
46,155
37,246
On a hill
I would also like to point out that it is nonsensical to characterize Puerto Rico as engaging in "austerity." Puerto Rico is a US territory that is not monetarily sovereign. They do not issue their own fiat currency. It doesn't make sense to label fiscal reality as "austerity" at state and municipal levels. When there isn't enough money to fund the expenditures in state or municipal government, that's just the way it is. Cutting spending is a literal necessity, not an optional act of austerity. It is quite stupid (but probably effective with a lot of people) to misapply terminology more applicable to national governments to state and local levels. It's all part of the narrative against whoever "management" is so that labor unions can continue denying the havoc they wreak on public sector budgets.

I have to admit I didn't even bother to notice the author until I was through the article. Michelle Chen. Go figure.
Whats wrong with Michelle Chen?
 
Feb 2011
17,039
6,083
Boise, ID
Some of you people have absolutely no clue about Puerto Ricans. They are very religious and quite conservative, yet they are often demonized by the right wingers in this country. The problems of Puerto Rico have mostly to do with crooked government. Your answer to the lack of support from the United States is to fault them and piss on them every chance you get. It's fucking sad.
Who's being demonized? It's not unheard of that state and local level governments and the economy around them can decline and fail. When this happens, there are no easy answers, and those governments can't intelligently be accused of "austerity" as if deficit stimulus were their easy answer. It's obviously not, given their non-sovereign currency.

None of this makes the ordinary people that live there bad people.
 
Feb 2011
17,039
6,083
Boise, ID
Whats wrong with Michelle Chen?
On a personal level, perhaps nothing, but professionally, she writes extremely pro-union narrative for well-known very-far-left sources. The agenda in this article might as well be from the mouth of Richard Trumka. The agenda here is to cast blame in every direction except organized labor wherever public sector budgets are getting crushed.
 
Jul 2015
33,238
24,682
Florida
The commonwealth’s financial woes didn’t happen by accident—they were the result of decades of public immiseration and private gain.

By Michelle ChenTwitter JUNE 8, 2017

Centuries ago pirates prowled the Caribbean brandishing scabbards and rifles; today, they wield fat checkbooks on Capitol Hill.

Puerto Rico’s economic crisis has now washed the burden of its colonial legacy onto Washington’s doorstep. Congress has been trying to contain the island’s ballooning debt under the hardline austerity program of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). But since the program is governed by a control board run by the same financiers responsible for driving the debt crisis in the first place, the island continues to sink into poverty while its creditors feast on the spoils.

https://www.thenation.com/article/bankers-behind-puerto-ricos-debt-crisis/
And wait'll you see the NEW LAYERS of graft, corruption and outright stealing that will get piled on.
 
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