If you have your television on at any time, you've likely seen the "don't let Congress bail out Puerto Rico" ads. The claim is any move by Puerto Rico to declare bankruptcy is harmful to Americans on the mainland.
They just don't mention which Americans.
To pay back its creditors, Puerto Rico has resorted to extreme measures including delaying tax refunds to its citizens, increasing sales tax by more than 50%, and instituting massive cuts to education, healthcare, and social services. Unsurprisingly, Puerto Rico’s most disenfranchised populations (including Medicaid and Medicare enrollees, incarcerated people, and families with special needs children) are shouldering the burden of those measures.
The crisis is driving more Puerto Ricans off the island and onto the mainland, fueling an ongoing “population swap” in which unemployed, young Puerto Ricans leave the island in search of work, while hundreds of wealthy Americans move onto to the island because the “Millionaire’s Law” and other policies have turned it into a “fiscal paradise” for the wealthy. Indeed, 10% of the island’s population has left in the last ten years and today as many as 3,000 Puerto Ricans are fleeing each week. This massive depopulation has eroded the availability of services in Puerto Rico and shrunk its tax base, which the government relies on to pay for pensions, services, and its debt.
Meanwhile, wealthy financiers are flocking to the island to take advantage of tax exemptions and cuts on corporate taxes, personal income, and capital gains. At a recent investment conference, billionaire hedge fund manager John Paulson predicted Puerto Rico would become the “Singapore of the Caribbean” –that is, an extremely wealthy tax haven.
This report details how, in order to pay back its creditors, the Puerto Rican government has implemented a severe austerity budget that is is creating a humanitarian crisis on the island and threatening Puerto Ricans’ access to basic services including healthcare, education, and even electricity.
Meanwhile, the hedge funds that reportedly own nearly 50% of Puerto Rico’s debt continue using vulture tactics to win as big a payday as possible at the expense of Puerto Ricans.
The listserv "The Fu*king News" sums it up best:
Some of Puerto Rico's biggest creditors reportedly have been lobbying Congress to ensure that Puerto Rico pays their debts. Which sounds like an innocuous sentence until you add, "...instead of taking care of poor and elderly people."
....The House is considering legislation that would block Puerto Rico from using bankruptcy-style protection to renegotiate its debt payments, an otherwise common practice in bankruptcy law that's known as "winning" when Donald Trump does it.
...hedge funds and other financial firms that bought up Puerto Rico's debt have been lobbying Congress to make sure they get paid.
In other words, the hedge funds bet that Puerto Rico would pay off its debt and are now hedging that bet. They're called "hedge funds," people, it's IN THE F**KING NAME!
Legal analysts tell The F**king News that using money to pay Congress to make someone else pay you money because you claim you need the money more than other people need the money -- even though you have money to buy dinners for Congress and the other people don't have money to buy a TV dinner for their f**king kids -- is both technically legal and also America.
If they have the money to buy ad time to get Congress to deny help, they can afford to lose their investment.
In related news, New York City Employees Retirement System has just divested of all hedge funds, according to Reuters.
"Hedges have underperformed, costing us millions," New York City's Public Advocate Letitia James told board members in prepared remarks. "Let them sell their summer homes and jets, and return those fees to their investors."