Last Wednesday, April 26th, President Donald Trump made his position on Puerto Rico’s debt crisis clear when he tweeted:”Democrats are trying to bail out insurance companies from disastrous #ObamaCare and Puerto Rico with your tax dollars. Sad!”. Putting aside his grammatically “disastrous” structure, it is evident that the island is far from a priority for the new administration.
Democrats are trying to bail out insurance companies from disastrous #ObamaCare, and Puerto Rico with your tax dollars. Sad!
— Donald J. Trump (@realDonaldTrump) April 26, 2017
The Democrats want to shut government if we don't bail out Puerto Rico and give billions to their insurance companies for OCare failure. NO!
— Donald J. Trump (@realDonaldTrump) April 27, 2017
Puerto Rico, a US colony and one of the last remaining colonies in the world, is over $70 billion in debt, which would be approximate $20,500 per resident in a country with a 28,703.73 GDP. The United States Congress has enacted an Oversight Fiscal Control Board to guide Puerto Rico out of debt, while the Puerto Rican Government implements harsh austerity measures that directly harm Puerto Rico’s residents (who are Federal Tax-paying American Citizens) without guaranteeing economic growth, causing thousands of residents to have to flee the island amid a worsening the economy.
In 2000, government expenditures began to exceed revenues and Puerto Rico began to borrow money to pay for payroll and other operating expenses. When the liquidity crisis intensified, the terrible practice of paying debt maturities was used, with new issues. This would be the equivalent of paying utility bills with a credit card; essentially financing current expenses, with non-recurring income.
Currently, Puerto Rico has no resources to fund essential services such as healthcare, education, utilities, and transportation. The pension system is approximate $40 billion in debt affecting over 200,000 central government retirees and teachers, the demographics most affected by the economic crisis. This is a whole other monster the government has not yet faced.
Between the government and the pension system, the debt has reached over $110 billion in a small-time frame, with no significant long-term investment to show, and no economic growth. In addition, the government raised over $22 billion in taxes that have had no effect in lowering the debt or improving essential services.
Puerto Ricans are angry, understandably, and calling on the government to audit the debt. The last administration created The Commission to Audit the Debt, but this past month, the newly elected government slashed the bill. This has created civil unrest among the people, who are demanding their government provide answers on how we got to this point.
It is clear that the debt has to be repaid. However, as citizens of this island, we demand to know WHO issued this unlawful debt, WHY they issue it, and WHERE the money went. An Audit of the Debt would reveal which aspects of economists’ were ignored while the government funded operational deficits with debt issuance. The people of Puerto Rico NEED answers and the government will face the civil unrest come May 1st, as citizens hold a strike to make our voices heard.
