Puerto Rico Will Officially Default on a $422 Million Payment Monday

[jmotivator]

No, it's not "profligate spending" that caused this issue.

Of course it is the entire issue. Puerto Rico has run a government that is far more than they could afford for a long time, and borrowed money to fund it. Their investment of that borrowed money has been lost in bad management and poor spending choices.

 

[Deuce]

Of course it is the entire issue. Puerto Rico has run a government that is far more than they could afford for a long time, and borrowed money to fund it. Their investment of that borrowed money has been lost in bad management and poor spending choices.

That's just not an accurate presentation.

PR's revenue tanked. They were not lavishly spending without regard to what they could afford.

 

[jmotivator]

There's no defense here, this isn't a partisan issue. Nobody has any good reason PR shouldn't be able to use this process to get their debt under control.

It will work it's way out one way or the other. You can't squeeze blood from a turnip. Nobody can explain why the banks that loaned the money shouldn't feel the maximum pain for stupid investment either.

As I see it, both sides of this mess should suffer the consequences. Bailouts only ensure it will happen again.

 

[Deuce]

It will work it's way out one way or the other. You can't squeeze blood from a turnip. Nobody can explain why the banks that loaned the money shouldn't feel the maximum pain for stupid investment either.

As I see it, both sides of this mess should suffer the consequences. Bailouts only ensure it will happen again.

They aren't asking for a bailout. How many times does this need to be said?

You are clearly not familiar with the situation, but your opinion is strong anyway.

 

[Jetboogieman]

So is it going to cost the US taxpayer anything? Either way patching up bad policy just encourages it. Only thing I think I could accept is Puerto Rico being managed by an outside committee similar to when Detroit went under since they clearly can't handle themselves.

The situation is much more complex than that, but the Puerto Rican government does bear much of the blame of what happened, by raising money through issuing government bonds to predatory hedge funds that were local, state and federally tax free.

That's most of the problem and again, they are to blame for that reckless move.

However... This isn't some... Philosophical or theoretical discussion about deficits, people, human beings, are going to suffer immensely because of this, and Puerto Rico and only Puerto Rico was singled out as the only territory or state that is barred from Chapter 9.

I strongly believe, when your neighbours house is on fire, you don't haggle over the cost of your garden hose.

 

[jmotivator]

That's just not an accurate presentation.

PR's revenue tanked. They were not lavishly spending without regard to what they could afford.

LOL. They are $73 billion in DEBT and are about to default on their loan payment! Good grief, what more evidence do you need that they were spending more than they could afford?!

 

[jmotivator]

They aren't asking for a bailout. How many times does this need to be said?

No, of course not. Puerto Rico is only asking that they be allowed to not pay back all of their debt. The banks will get the bailout.

 

[Blue_State]

I don't understand why we're going to make people in Puerto Rico suffer.

No one is advocating that.

 

[Deuce]

LOL. They are $73 billion in DEBT and are about to default on their loan payment! Good grief, what more evidence do you need that they were spending more than they could afford?!

Hey this is fun, let's just change the other guy's words and argue about that.

Jmotivator, it's simply not true that PR put all their money in a pile and lit it on fire. Good grief, how could you possibly believe that?

 

[Deuce]

No, of course not. Puerto Rico is only asking that they be allowed to not pay back all of their debt. The banks will get the bailout.

They are asking for a tool of debt management that every single other state, territory, or city has.

Do you have a good reason they should be alone in this?

Next question:

Can you name any actions PR took to reduce their spending? Without going to google?

 

[jmotivator]

Hey this is fun, let's just change the other guy's words and argue about that.

Jmotivator, it's simply not true that PR put all their money in a pile and lit it on fire. Good grief, how could you possibly believe that?

Hah! So you blame me of twisting your words when I didn't as a setup to putting words in my mouth I didn't say. I said they borrowed and invested their money poorly, which they demonstrably did. They are deep, deep in debt without an ounce of product to show for it. Why did their economy tank? How did they spend the $73 billion? Why did they spend money as if they could file for Chapter 9 protection when clearly they couldn't?

They spent money recklessly and are now reaping what they sowed.

Also, spending all the money that your government takes in and then some is not sane money management, and you can't blame the economy tanking on their debt. They simply primed the bomb that has now exploded.

 

[Crovax]

We don't? We're the ones who are bickering over forgiving some of their debt. It's a real pain in the ass when you're not a currency issuer to deal with unemployment and other problems. Puerto Rico tried.

No Puerto Rico got addicted to issuing the toxic bonds, the only thing they have tried to do is weasel out of the consequences of their moronic policies.

 

[Deuce]

Hah! So you blame me of twisting your words when I didn't as a setup to putting words in my mouth I didn't say. I said they borrowed and invested their money poorly, which they demonstrably did. They are deep, deep in debt without an ounce of product to show for it. Why did their economy tank? How did they spend the $73 billion? Why did they spend money as if they could file for Chapter 9 protection when clearly they couldn't?

They spent money recklessly and are now reaping what they sowed.

Also, spending all the money that your government takes in and then some is not sane money management, and you can't blame the economy tanking on their debt. They simply primed the bomb that has now exploded.

Riiight. Loss of the majority of their manufacturing jobs doesn't affect anything! :lamo

 

[cpwill]

Spending money on interest payments is a far better use of your taxpayer's money instead of using it on infrastructure and schools.

If you take out a loan for a bunch more money, you can spend it on both!


Also, we should try hiking their minimum wage up to $12.50 tomorrow. That way, people will have more money to spend at the same time that we're pumping more back into the economy!

Guaranteed to work.

 

[Blue_State]

They are asking for a tool of debt management that every single other state, territory, or city has.

/snip

This seems like an easy fix, but it seems both parties are putting up a fight on this topic.

 

[KLATTU]

i thought they could just print the money and that they didn't have to worry about it.
they issue their own currency I do believe that isn't tied to anything.

ol wait you mean this is a myth created by people.

They should also raise that minimum wage, so people have more money to spend!!

 

[ludin]

They should also raise that minimum wage, so people have more money to spend!!

yep they should. if people were paid more they could then pay more in taxes and then they could make that 422m payment.
why not just make it 20 dollars an hour.

 

[jmotivator]

They are asking for a tool of debt management that every single other state, territory, or city has.

Which they didn't have, for whatever reason. They should have operated within the confines of the system they had rather than blow a fortune on the hopes someone would change the system.

Do you have a good reason they should be alone in this?

Well, first, do you have documentation that Puerto Rico is singled out? The Chapter 9 laws restrict protection to STATE municipalities, which disqualifies Puerto Rico and all other territories as well.

I have a guess as to why that is. the US territories have their own government and tax system separate from the Federal Tax system, and therefor operate autonomously, and should be expected to handle it's own debt autonomously.

Next question:

Can you name any actions PR took to reduce their spending? Without going to google?

Strange question and stranger demands. How about you tell me of such cuts... but only those that you didn't get from the internet. :roll:

 

[cpwill]

The situation is much more complex than that, but the Puerto Rican government does bear much of the blame of what happened, by raising money through issuing government bonds to predatory hedge funds that were local, state and federally tax free.

That's most of the problem and again, they are to blame for that reckless move.

However... This isn't some... Philosophical or theoretical discussion about deficits, people, human beings, are going to suffer immensely because of this, and Puerto Rico and only Puerto Rico was singled out as the only territory or state that is barred from Chapter 9.

I strongly believe, when your neighbours house is on fire, you don't haggle over the cost of your garden hose.

To be fully fair to the Puerto Rican government, we did our part in helping to screw them, though, as you say, it was still their own decision-making.

 

[cpwill]

They should also raise that minimum wage, so people have more money to spend!!

The more people we kick out of the workforce, the more of them can feel free to pursue their calling as artists, or poets!

 

[jmotivator]

Riiight. Loss of the majority of their manufacturing jobs doesn't affect anything! :lamo

And why did they lose the majority of their manufacturing jobs? And why didn't they diversify their economy such that their entire economy didn't depend so heavily on manufacturing jobs?

They were immensely short sited and ran their government as if the manufacturing sector would be there forever. No forward planning and no diversification can only end poorly.

 

[Mason66]

Puerto Rico Will Officially Default on a $422 Million Payment Monday - Fortune

This is no bueno. I was unaware that our territories did not have the same financial tools as our states. That sounds like an easy fix, but it will not stop the spending. Also, Puerto Rico hasn't released financial statements since fiscal year 2013. They need to get that out so we can see the damage.

Well then lucky it is a holiday and they can put off the consequences for 1 more day.

 

[Mason66]

We don't? We're the ones who are bickering over forgiving some of their debt. It's a real pain in the ass when you're not a currency issuer to deal with unemployment and other problems. Puerto Rico tried.

So is it your opinion that credit card companies cause suffering to the card holder when the bill cannot be paid?

 

[David_N]

And why did they lose the majority of their manufacturing jobs? And why didn't they diversify their economy such that their entire economy didn't depend so heavily on manufacturing jobs?

They were immensely short sited and ran their government as if the manufacturing sector would be there forever. No forward planning and no diversification can only end poorly.

So now you admit that the collapse of manufacturing is a large problem for Puerto Rico, and not the spending. Hell, your idea of "forward planning" requires spending if the government wants to encourage other jobs.

 

[David_N]

So is it your opinion that credit card companies cause suffering to the card holder when the bill cannot be paid?

Big difference between Puerto Rico and Billy, who has a credit card debt. When Puerto Rico is unable to spend to help its people, unemployment rises, poverty rises, children suffer.. It's a horrible thing, austerity is..