Puerto Rico Debt Restructuring Requires Decolonization, Not More Colonialism

Puerto Rico’s future needs to be in Puerto Rico’s hands and Sovereignty would allow that.

By Javier A. Hernandez, LA Progressive

Early last month, a debt restructuring plan was imposed on Puerto Rico by the unelected Fiscal Control Board (La Junta) and approved by an American judge, but this Fiscal Control Board also went so far as to say that Puerto Rico’s status problem cannot be resolved until these debt and fiscal issues are dealt with first. While the members of the Fiscal Control Board and other U.S. media outlets celebrate and sugarcoat this “success”, actual Puerto Rican experts and organizations (whose voices are usually ignored) have strongly opposed this “debt restructuring plan” yet have been disregarded time and again by the Fiscal Control Board.

The Fiscal Control Board not only refused to audit Puerto Rico’s public debt (which is a crass irresponsibility), but also declined to consider the legal doctrine of “odious debt”, particularly when one reasons that a non-sovereign colonial territory like Puerto Rico does not have authority to emit debt in its own name (because it’s not sovereign), thus any and all public debt emitted by Puerto Rico is actually American public debt.

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Of course, even though the U.S. government has repeated asserted that Puerto Rico is not sovereign, it is apparently “sovereign enough” to emit its own SEC-approved debt, violate its own constitutional debt limits, and then fall victim to vulture funds who bought Puerto Rican bonds knowing full well that Puerto Rico could not realistically pay it back. The Fiscal Control Board never audited the debt and refused to consider the doctrine of “odious debt”.

Americans also need to know that the Fiscal Control Board is detested in Puerto Rico because most Puerto Ricans consider its members merely appointed foreigners who are out to impoverish Puerto Rico with severe austerity measures for decades to come in order to placate bondholders who made bad investing decisions. The U.S. Congress, through PROMESA, even forces Puerto Rican taxpayers (who are already struggling to get by) to fund the Fiscal Control Board and pay their exorbitant millionaire salaries.

In regard to Puerto Rico’s future, saying that Puerto Rico has to “wait” to resolve its status problem until the fiscal situation improves is disingenuous when one considers the ugly reality that most of Puerto Rico’s political, economic, and fiscal problems are the direct result of colonialism and the nefarious policies that not only limit Puerto Rico’s voice and political power, but also its economic development. The problematic “elephant in the room” that American officials and politicians refuse to acknowledge is colonialism (euphemistically called “having territories”) and nothing will change in Puerto Rico until that is addressed. It’s like waiting for a slave to miraculously become a millionaire as a precondition to grant him/her their freedom.