Puerto Rico has endured decades of looting and austerity from the finance sector who then used the pretense of Hurricane Maria to impose radical financial policies on the island, dismantling the statistics agency that would track how those reforms punished the people of Puerto Rico, while filling the streets with armed, anonymous mercenaries.
Puerto Rico was drowning in both debt and seawater, and America threw it an anchor (a bipartisan anchor at that). But not everyone was willing to destroy the lives of Puerto Ricans to help billionaires add another zero to their balance sheet: since 2017, both Elizabeth Warren and Bernie Sanders have been demanding that the American citizens in Puerto Rico be afforded the aid and dignity that any mainlander would expect. (I am a donor to both Elizabeth Warren and Bernie Sanders’ 2020 election campaigns).
Now, Elizabeth Warren has added another plank to what is fast becoming the best platform in the 2020 Democratic nomination race: debt relief for Puerto Rico, eliminating the island’s antidemocratic “manager” and restoring its elected democratic leadership, and allowing it to write off its debts while preferentially paying off the government bonds used by Puerto Ricans themselves as retirement savings, while sending offshore looters to the back of the line to get redemption from their bonds.
This legislation would give U.S. territories like Puerto Rico the option to terminate their debt if they meet certain criteria, like being struck by a disaster, suffering major population loss, and staggering under overwhelming debt. The Territorial Relief Act would give Puerto Rico a shot at getting out from under its crushing debt load and building a future for itself.
My bill would also set up a fund so that certain holders of Puerto Rican bonds would be compensated when those bonds are terminated. Pensions would be left intact. Puerto Rican residents, individual investors, and credit unions are among the groups that could use the fund. Vulture funds and bond insurers would not get a penny from this fund.
And my bill would require an independent audit of Puerto Rico’s debt. Everyone needs to know exactly how big the hole is, how much of the debt ended up being issued in the first place, whether it was legally issued, and what it’s going to take to fix it.
My plan to provide comprehensive debt relief to Puerto Rico [Elizabeth Warren/Medium]