Letter from the President—We Must Support Puerto Rico
With so many challenges facing the Latino communities of the mainland United States, one might think that Latino leaders should avoid getting involved in Puerto Rico’s complex economic crisis. But the truth is that the challenges facing Puerto Rico’s economy not only affect the 3.5 million United States citizens who live on the island or the 5 million American citizens of Puerto Rican descent living in the mainland U.S. No, it affects all 55 million Latinos and indeed, the nation itself.
Puerto Rico is $72 billion in debt and neither the island nor its authorities or subdivisions can avail themselves of any remedies under Chapter 9 of the U.S. Bankruptcy code. The island's political and legal status in relation to the United States precludes it from seeking assistance from the International Monetary Fund. The Governor of Puerto Rico says that these debts are “unpayable” under the current repayment timelines, yet Puerto Rico has the political will to address this challenge. In the last several months it has made deep and painful cuts to government services and it has just imposed a punishing tax increase. What it lacks are the tools necessary to provide a full array of options to stabilize its economy and provide an orderly path to pay its creditors.
That’s where Congress and the White House come in.
Senators Richard Blumenthal of Connecticut and Chuck Schumer of New York have introduced a bill, the “Puerto Rico Chapter 9 Uniformity Act,” which would remove one of the major obstacles preventing Puerto Rico’s recovery, namely its inability to avail itself of the bankruptcy protections to which all other cities and states in the U.S. have access. Congress should approve the bill and send it to the White House, where President Obama has already indicated a willingness to support legislation that would help Puerto Rico work its way out of this crisis.
Beyond allowing Puerto Rico to avail itself of bankruptcy laws, there are other things Congress and the White House should do, including investing federal funds for health, clean energy and other urgent needs on the island, as well as eliminating economically crippling policies like the well-documented Jones Act shipping requirements that unreasonably cost the island billions.
The reasons behind the island’s current economic woes are complex and frustrating: poor management, inequities in federal funding, the Great Recession, and the complicated relationship between the United States and Puerto Rico, to count just a few. Frankly, identifying causes and casting blame is beside the point. The situation on the island has reached its nadir and only decisive action from Congress and the White House will save Puerto Rico.
Putting Puerto Rico on solid economic footing won’t be easy and won’t happen quickly. But taking a hands-off approach to the island’s current crisis is not an option we can accept. Puerto Ricans need our help, and we simply don’t forsake our own. The U.S. has a practical and moral obligation to support and protect Puerto Rico during this time of great need. For more information on our advocacy work to ensure economic justice for Puerto Rico and its people, please contact our Vice President for Policy and Government Relations Jose Davila.