Governor: Puerto Rico won't make $420 million debt payment

[fred v]

Last edited Sun May 1, 2016, 07:35 PM - Edit history (2)

Source: The Associated Press

SAN JUAN, Puerto Rico (AP) — Gov. Alejandro Garcia Padilla announced that Puerto Rico's government will not make a $420 million bond payment due Monday, after a failure to negotiate a legal or political solution to the U.S. territory's public debt crisis.

Garcia said Sunday that he had issued an executive order suspending payments on debt owed by the island's Government Development Bank, a default that will likely prompt lawsuits from creditors and could hurt future access to capital markets.

Island officials spent the weekend trying to negotiate a settlement that would have avoided the default but apparently came up short. The development comes as Congress has so far been unable to pass a debt restructuring bill for Puerto Rico.

"Let me be very clear, this was a painful decision," Garcia said in a speech. "We would have preferred to have had a legal framework to restructure our debts in an orderly manner."

He said Puerto Rico's government could not make the payment without sacrificing basic necessities for the island's 3.5 million residents, including keeping schools and public hospitals open.



Read more: http://bigstory.ap.org/article/8209eadba027426d8607bdce21c9c08b/puerto-rico-governor-warns-new-default-crisis-worsens

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Can't say I blame him for the decision he's made. See below:

[Chicago1980]

1. 420....

The irony.

[sofa king]

5. The problem implicitly suggests the solution.

[truedelphi]

2. Thanks for mentioning this.

I GUESS as soon as the big Ol' Pols can figure out how to do this to us, it will happen here.

[mountain grammy]

3. This was an excellent segment by John Oliver..

Where is the fucking mainstream news? Zero coverage on this.

[TomCADem]

9. Because The Dems Support Debt Relief and Republicans Oppose It...

...God forbid that an actual clear point of difference be addressed by the mainstream media.

[LiberalArkie]

4. Good for them. Pull an Iceland and get it over with.

[muriel_volestrangler]

11. Iceland never defaulted on government debt

What Iceland did was to refuse to take over private bank debt, but instead let those banks go bust, while nationalising the bits of them needed for a financial system. It was never about government debt.

[Sam_Fields]

6. PR Should dissolve the commonwealth and make the Feds pay the debt.

[Akicita]

10. The Feds? You mean us. I don't mind paying more taxes to help PR out but only after strict

reforms are made so they can't do this again. Otherwise we are just throwing our money away and setting a very bad example for all the cities and states who would love for us to bail them out for their mismanagement and corruption.

[abelenkpe]

7. Wish the candidates would all be asked about this situation

and how they would handle financial crisis should they happen here.

[TomCADem]

8. Bernie and Hillary Have Long Supported Allowing PR to Declare BK...

...since last year:

http://www.huffingtonpost.com/2015/07/07/hillary-clinton-puerto-rico_n_7742468.html

http://thehill.com/policy/finance/271016-puerto-rican-crisis-roils-2016-race

However, as noted by John Oliver, the hedge fund industry has been running an add campaign to oppose this move, and the Republican presidential candidates have vigorously opposed debt relief for Puerto Rico even as it becomes ground zero for the Zika virus in a U.S. territory.