Puerto Rico’s Governor, Alejandro Garcia Padilla, Declares that the Island’s Debt is Not Payable

War Against All Puerto Ricans: Revolution and Terror in America’s Colony

 

He finally did it.

In order to save Puerto Rico from a “death spiral,” Governor Alejandro Garcia Padilla announced that the island cannot pay the $73 billion public debt, in the manner that the US is demanding.

“This is not politics,” the governor said. “This is math.”

The announcement was immediately reported by the New York Times, which wasted no time in attacking the governor’s negotiating posture.

http://www.nytimes.com/2015/06/29/business/dealbook/puerto-ricos-governor-says-islands-debts-are-not-payable.html?emc=edit_na_20150628&nlid=56409569&ref=cta

The Times quickly noted that:

“The island has piled on more municipal bond debt per capita than any American state.”

“Debt relief on such a vast scale could raise borrowing costs for other local governments.”

“No American state has re-structured its general obligation debt in living memory.”

 

Thanks for Showing Some Gonads

First of all, it’s time to thank the governor for finally showing some…er…gonads.

He found them just in time.

A Republican congressman from South Carolina, Jeffrey D. Duncan, is trying to shove a “Financial Control Board” down Puerto Rico’s throat. 

This South Carolina “control board” feels like a scene from the film Deliverance…where a hillbilly rapes a frightened man, and makes him “squeal like a pig.”


Squeal like a pig, boy!

Thank you, Gov. Garcia Padilla, for not squealing like a pig.

But you are not out of the woods yet: the banjos in South Carolina are all tuned up, and the hillbillies are waiting for you.  So are the New York Times, Bloomberg News, and the Wall Street Journal.

We hope, Governor, that you are willing to battle for Puerto Rico. If you are, here is some ammunition.

 

Public Debt Hypocrisy

The debate over Puerto Rico’s alleged “public debt” is a complete hypocrisy…because the public debt of the US is much worse.

With its population of 3.6 million people, Puerto Rico’s debt of $73 billion translates into $20,278 for every person in Puerto Rico.

With a population of 320 million, the US public debt of 18.6 trillion translates into $58,125 for every person in America.

In other words, the US public debt is nearly three times higher per person, than the Puerto Rico public debt. To be exact, the public debt is 287% higher for each person in the US, than in Puerto Rico:

287% HIGHER PER PERSON IN THE UNITED STATES.

In addition, we must consider public debt as a percentage of Gross Domestic Product (GDP).

With a GDP of $104 billion, the public debt of Puerto Rico is 70% of GDP.

With a GDP of $17.7 trillion, the public debt of the US is 105% of GDP.

In other words, the debt-to-GDP ratio of the US is 50% higher than that of Puerto Rico:

50% HIGHER DEBT/GDP RATIO IN THE UNITED STATES.

Judging from these figures, it appears that Puerto Rico should establish a Financial Control Board to manage the U.S. economy – not the other way around.

 

Public Debt Around the World

Not only compared to the United States…but compared to the entire world, Puerto Rico’s public debt is nothing to be ashamed of.

In this month’s Harvard Magazine (July-Aug. 2015, pp. 10-12), in an article titled “Dealing With Debt,” managing editor Jonathan Shaw writes: “Today, the debt levels in many advanced economies exceed 100 percent of gross domestic product (GDP). In the United States, for example, government debt is currently 105 percent of GDP.”

http://harvardmagazine.com/2015/07/dealing-with-debt#article-images

Harvard Magazine then provides a helpful graph, to show this level of rapidly mounting debt, all around the planet:

PUBLIC_DEB-GDP_RATIO_GRAPH

The sloppy horizontal line on the right was drawn by me – to show where Puerto Rico’s “External debt as a percentage of GDP” falls, in relation to the other 22 “advanced economies.”

As you can see, Puerto Rico’s 2015 debt level is less than one-third of the debt levels in 22 other “advanced economies.”  These economies include the US, Japan, Germany, United Kingdom, Australia, France, and Canada.

Numbers do not lie.

Governor Garcia Padilla…do not let the US tell you that Puerto Rico’s public debt is “out of control.”  The numbers discussed above, and in this month’s Harvard Magazine, speak for themselves.

The Harvard Magazine figures are backed by two Harvard economics professors and the chief U.S. economist at Morgan Stanley, whose credentials and findings are all viewable here:

http://aida.econ.yale.edu/~nordhaus/homepage/documents/RRR_DebtCrises_JEP.pdf

See in particular, page 73 of the above-cited pdf.

The following paper is also useful:

http://www.imf.org/external/pubs/ft/wp/2013/wp13266.pdf

 

Compare Apples and Apples, not Apples and Colonies

The attempt by the New York Times to compare Puerto Rico’s debt to that of all other fifty states in the US is completely inapposite…since Puerto Rico is not a state, and has never been allowed the financial powers and privileges of a state.

Puerto Rico is a territory of the Unites States. It is a colony. It is not allowed to trade freely with any country other than the United States.

It is not even allowed to develop its own shipping industry – even though, as an island, shipping is critical to its survival.

Therefore, Gov. Garcia Padilla, when the New York Times trots out these trial balloons:

“The island has piled on more municipal bond debt per capita than any American state.”

“No American state has re-structured its general obligation debt in living memory.”

…Just feel free to ignore them. Puerto Rico is not a state.  The Times is trying to confuse the issue.

Don’t let them do it.

 

Show Some More Gonads

Gov. Garcia Padilla, you are approaching a historic moment. Over the next few months your words and actions, even your thoughts, will have a deep and permanent effect on the future of Puerto Rico.

You have allowed yourself, and the entire island, to be bullied into a corner.

Hundreds of thousands of Puerto Ricans have had to flee the island…while you were their governor.

It is time for you to protect, the Puerto Ricans that are still left.

Don’t let the hedge funds buy your public utilities. You’ll never get them back.

Don’t let John Paulson buy your coast line. He’ll ruin it with high-rise buildings.

Don’t let the New York Times bamboozle you. The numbers are on your side.

But most of all, don’t forget who you are.

You are the Governor of Puerto Rico.

Start showing it.

A governor with gonads

13 Comments on “Puerto Rico’s Governor, Alejandro Garcia Padilla, Declares that the Island’s Debt is Not Payable

  1. To the Town Square with Oscar
    Our National Hero
    With this slogan, we will meet in all of the 78 town squares in Puerto Rico and the diaspora on the 29th of each month protesting for the liberation of Oscar López Rivera, and for the decolonization of Puerto Rico. Click on the following link to watch a video by Edwin Chungo Molina, the creator of this campaign, explaining his idea: https://youtu.be/Azp6EV6b2L0
    United Partners for Puerto Rico Decolonization will be at the Bayamón Town Square from 2 to 4 PM. We invite everyone to join us with your shirt, flag, sign and flyers to inform the public about Oscar, and why he is in prison for the last 34 years?
    It is important that the public understands that our Puerto Rican political prisoner Oscar López Rivera has the international right to do whatever is necessary to decolonize Puerto Rico. The United States government is the criminal for maintaining Puerto Rico as its colony for the last 117 years!
    We invite you to 3 more peaceful protests that are scheduled permanently throughout the whole year.
    • On the Abolition of Slavery Day, Tuesday, March 22, 2016, from 6 to 8 PM, we will have our 3rd Oscar – Mandela March in Puerto Rico 2016. We will march from the Capitol Building to the United States Court House in Old San Juan.

    • On the day before the United Nations’ (UN) hearing on Puerto Rico decolonization, we will have the 3rd March for Puerto Rico Independence 2016. This march is organized by the Independence Dialogue Table, and we will march over the Dos Hermanos Bridge and through the Condado. We will give more information later.

    • On the very day of the UN hearing about Puerto Rico decolonization, usually on the Monday after Fathers’ Day, we will have our 3rd Oscar – Mandela March in New York City 2016. We will march at 9 AM from Hunter College to the UN. We will stay across the avenue from the UN all day to inform the public about Puerto Rico’s colonial relationship with the United States.
    These annual and permanent protests are necessary, because those who have Oscar in jail for his struggle to decolonize his homeland don’t believe in JUSTICE FOR ALL! http://www.TodosUnidosDescolonizarPR.blogspot.com

    Like

  2. An aide to the governor said the hedge funds’ debt proposal was too onerous. And the deal would only postpone Puerto Rico’s inevitable reckoning.

    “It will kick the can,” Mr. García Padilla said. “I am not kicking the can.”
    (NYT)

    as the world watches Greece and so many respect its current leadership playing hardball with a troika that has forgotten what democracy is all about, PR must stand with *long term* wisdom and strategy against goliath. this quote puts mr. padilla on record and we watch in hope.
    ‘the only thing we have to fear is fear itself.’

    Like

  3. Pingback: Puerto Rico Is Not On Fire | just a little over the line

  4. La deuda afecta de manera diferente a América Latina y a África, siendo está última la que lleva la peor parte a pesar que su deuda es menor que la latinoamericana, esto se debe a que a sus economías son débiles y sin estructura.

    El endeudamiento en la mayoría de países exige que para pagar de la deuda se reduzcan gastos de otras áreas, como infraestructuras y servicios sociales con los que se mejorarían las condiciones de vida de su población, a pesar de que son países en los que la situación de gran parte de la población hace que el gasto social sea imprescindible para el desarrollo del país. El esfuerzo de destinar importantes cantidades al pago de la deuda no logra reducir el importe total de ésta, que crece a un ritmo de 20% anual, lo que convierte el problema de la deuda en un círculo vicioso de nunca acabar. El pago de la deuda también es un obstáculo para que se alcance una estabilidad económica que permita atraer la inversión privada extranjera.

    La deuda incluso afecta la soberanía de los países deudores, ya que estos se ven obligados a aceptar los ajustes diseñados por sus acreedores.

    La inflación se encuentra estrechamente relacionada con el aumento de la deuda, esta se genera cuando un país gasta más de lo debido, lo que trae como consecuencia que se soliciten prestamos para reponer el dinero gastado, esto incrementa la deuda externa del pacs
    P.R. se encuentra endeudado desde el inicio .

    En el Peru , Alan García (1985 …): Durante el primer gobierno del Presidente Alan García, se declaró la deuda como impagable y se anunció que sólo se pagaría el monto equivalente al 10% de las exportaciones del país, esto originó que el Perú sea considerado un país inelegible y de alto riesgo.

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  5. EJEMPLO : ????

    El anuncio del presidente Alan García, en 1985, de que Perú no destinaría más del 10 por ciento de sus exportaciones al pago de la deuda externa, creó una expectación justificada en toda América Latina, e incluso más allá de la región. Sin embargo, pronto los detalles de esta iniciativa innovadora quedaron sin trascender fuera de Perú, ocultados por la reacción producida dentro del país ante otro tema, la llamada «nacionalización» bancaria.

    Like

  6. Nelson, even Laruche is calling the US-(NATO) global fascist regime a demonist plot led by the British and he is calling on US citizens to take the country back. His PAC is demonstrating in front of the UN today, Monday June 29,2015. Keep up the good work add expect to be the target of a character assassination campaign sooner than later.

    Liked by 1 person

  7. Reblogged this on It Is What It Is and commented:
    “Not only compared to the United States…but compared to the entire world, Puerto Rico’s public debt is nothing to be ashamed of.”

    So get things in the proper perspective …. it’s a ruse to steal Puerto RIco for the second time in history!!

    Like

  8. Puerto Rico has been going thru different governor thru out the years.Most have lined there pockets not think of its people.This brings us to today and now every one is turning its back.Meantime Puerto Rico is where everyone enjoyed the food the beaches and weather.Now that Puerto Rico is in the verge of bankrupt what are we as Puerto Ricans going to do to save our island.

    Liked by 1 person

  9. The time for Puerto Rico to become a republic has been long gone. It died with the demise of the Nationalist Party and its founder, Pedro Albizu Campos, in the early 1950s. When the U.S. citizenship was given to all Puerto Ricans by birth in 1917, it made almost impossible to break away from the U.S. Pretending that we are a “sovereign” nation has become the mantra of the Popular Democratic Party (PPD) and its creation: the Commonwealth State (Estado Libre Asociado – ELA). Statehood (U.S. 51st State) is the best future for Puerto Rico. As a state, P.R. will have two Senators and five House Representatives; this is real REPRESENTATION. Having voice AND vote in Congress is what historically brings home the bacon (or, rice ’n beans) for the 50 States. Right now, the atmosphere in Congress is not conducive to make the path to statehood an easy process. The Republican Party-led Congress will be against any pro-statehood bill for P.R. since the majority of the Puerto Rican population favors the U.S. Democratic Party and its policies. So, even if “bankrupt” Puerto Rico wants to become U.S. state, it is not a guarantee. We must hope that Democrats win the Presidency in 2016 and one or both chambers in Congress are for pro-statehood to gain any traction by way of legislative bills introduced by its members.

    Daniel Rivera
    San Juan Boricua living in Florida, 56 years old
    June 29, 2015

    Liked by 2 people

  10. Nelson- thank you so much for providing an objective and empowered pov on the debt situation in Puerto Rico. I am one of the island’s natives who chose to leave rather than stay on what seemed to be a sinking ship. I hope the governor reads what you’ve written and takes it into account to create some real change! In the future, when you make a reference to rape/sexual violence -especially when accompanied by a visual (however appropriate the comparison) please include a trigger warning for those of us who struggle with having survived sexual abuse/trauma on a daily basis. I hope you choose to remain conscious of this in your future articles, because I respect your work. Thank you!

    Like

  11. Nelson- thank you so much for providing an objective and empowering pov for the debt situation in Puerto Rico. I am one of the island’s natives who chose to leave rather than stay on what seemed like a sinking ship. I’m grateful for your advice to the governor and I hope he starts acting like change is possible! In the future: if you’re going to post an image referring to rape (however appropriate the comparison) please remember that there are those of us to whom this is an immense trigger due to being survivors of sexual abuse. I hope you choose to remain mindful of this because I respect your work very much. Thank you!

    Like

  12. This is what i am watering as gunpowder in all the forums and international policy …..

    The “debt” is illegal. If you’re looking for the Base Structure Report published in October 2014, the Department of Defense supports the control of 1 million 900 thousand peak and acres of land in Puerto Rico. Do not pay a penny. Are our lands.
    If you are looking for in various portals of that entity, Puerto Rico appears for the handling of communications, climate control, production of wireless power (confirmed in the report of the Working Group of White House of the 2012 US producer of energy called “HUB”,
    For the French islands, Caribbean, Central and South America), and in Arecibo, an anti-missile shield, with the Anvil as electronic brain of the Southern Command. There is to be well underground not to affirm the right of the Puerto Rican nation to be compensated. We must not nothing. Unemployment demand the military and that we are compensated by never contaminate us. Let us look at the reality: scientific brigades….
    We support John Kerry. He told Russia on 5 March 2014 that when one country occupied to another with military troops elections are invalid. In Puerto Rico all acts that commit the people are invalids. Carried out by prisoners illegal.

    Like

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