Puerto Rico Debt Forgiveness: A Moral Imperative Or Economic Recklessness?
During an interview on the Sean Hannity Show last week, President Donald Trump offhandedly alluded to forgiving Puerto Rico’s $74 billion of debt.
This comes only weeks after much of the U.S. territory was destroyed by Hurricane Maria, already without out resources because of an Obama-era austerity regime. In the wake of the storm, Trump tweeted about the money Puerto Rico “owed to Wall Street and the banks [that], sadly, must be dealt with.”
Much of Puerto Rico’s debt is owed to municipal bonds held by private investors, so a federal debt forgiveness may not even be possible.
In an interview with Bloomberg, finance expert Stephen Ratter said that even the possibility of debt forgiveness “undermines the whole notion of stable capital markets and the government respecting it.”
After the hurricane, 85 percent of Puerto Rico is still out of power, and only 28 percent of cell phone towers work. Twenty-five of Puerto Rico’s 67 hospitals are working without power, and the Puerto Rico Aqueduct and Sewer Authority says only about half of the islands 3.4 million citizens have potable water.
To discuss the economic and humanitarian issues around Puerto Rico, we’re joined by Yarimar Bonilla, a founder of the Puerto Rico Syllabus, associate professor of anthropology and Caribbean studies at Rutgers University, and a visiting scholar at the Russell Sage Foundation.