Showing posts with label bankrupt. Show all posts
Showing posts with label bankrupt. Show all posts

Wednesday, March 7, 2018

Cost Of Housing Has Soared So High Americans Are Sliding Into Poverty


Housing prices in the United States continue to rise at unprecedented rates, forcing many into poverty. This worsening epidemic is explained well in a video by The Money GPS and it’s been engineered this way.


As nations increase taxes and regulations, the price of complying also goes up. Many of these hikes are passed onto to those who are already living paycheck to paycheck forcing them to live in poverty. “You came here for the truth, so let me unveil that for you,” says Money GPS.


 


Severe damage to the nation’s economy can occur when people don’t have disposable income. “People are spending a larger and larger share of their income on their housing. This is something they can’t avoid. It’s not as if they are buying a home and can be renting instead, we are talking about people who rent their homes. It’s very serious,” The Money GPS says.


“There’s definitely an issue with the amount that people spend on shelter, electricity, food, and other basic essentials…we have a big problem on our hands. It’s not being addressed and the bubble just keeps getting larger…they keep saying there’s a limited supply [of housing options].”


“The median asking rent for vacant rental units is consistently rising. when you rent prices continuously increasing specifically for vacant rental units.” All this is happening as the rate of homeownership declines as well. So perhaps there is some correlation between market saturation and prices, but we fail to account for the fact that property taxes put a heavy burden on homeownership and those taxes are passed on to renters in the form of higher rents.”


But the YouTube channel Bull Boom Bear Bust says this is all just a part of the global elitist’s plans to force more people into rentals and out of homeownership. According to the description of their video about this issue, it is becoming more and more clear that the central banking fiat currency system was designed to extract wealth from the poor and middle class and further enrich bankers that are creating a nation [sic] of debt servants.



“It’s a global plan,” says the narrator of the video. “These disasters and downturns in the economy are opportunities for the big money and big investors to come in and actually buy these homes.” He then discusses the reasons banks have for not foreclosing on properties right away, and it’s as simple as a wealth transfer from the middle and lower classes to the billionaires and investors:


“A reason why in some cases the banks don’t foreclose on the property right away, not only to keep the home off the market, but it also keeps the financial responsibility of the property onto the previous homeowner. So things like back due property taxes and fines for failure to keep the property up, banks don’t want to take on that responsibility, so technically in many cases, they’ll not take immediate foreclosure proceedings and in some cases, years and then the unpaid debt can come back and destroy the previous homeowner’s credit, and not hurt the bank.”


“This whole system…of the middle class being wiped out and the poor getting poorer, the increase in homelessness, the increase in people going into more and more debt, the shift from home ownership to home occupied to financial companies and institutions and investors owning these homes. This whole system has been engineered from the top down.”


He continues to explain that it all goes back to the Federal Reserve and was designed to break the average family while benefiting those already at the top. We often refer to these people as elitists. They are the politicians who are bought and paid for by corporations who push laws and regulations on the middle class that they themselves are exempt from and can profit immensely by doing. The entire system has been rigged to transfer wealth to the elites in the government and the deep state who pulls the strings.

Wednesday, February 28, 2018

In 2017, The US Government “Lost” $2.2 Million—Every Single Minute

trillion

In spite of taking in a record-breaking amount of taxes in 2017, the US government managed to lose a whopping $1.2 TRILLION dollars, or $2.2 million—every single minute of 2017.


The post In 2017, The US Government “Lost” $2.2 Million—Every Single Minute appeared first on The Free Thought Project.

Thursday, February 15, 2018

The Military Industrial Complex Strikes Again: War Spending Will Bankrupt America

The Military Industrial Complex Strikes Again: War Spending Will Bankrupt America | military-spending | Economy & Business Military Special Interests US News


By John W. Whitehead, Rutherford Institute | 


“Why throw money at defense when everything is falling down around us? Do we need to spend more money on our military (about $600 billion this year) than the next seven countries combined? Do we need 1.4 million active military personnel and 850,000 reserves when the enemy at the moment — ISIS — numbers in the low tens of thousands? If so, it seems there’s something radically wrong with our strategy. Should 55% of the federal government’s discretionary spending go to the military and only 3% to transportation when the toll in American lives is far greater from failing infrastructure than from terrorism? Does California need nearly as many active military bases (31, according to militarybases.com) as it has UC and state university campuses (33)? And does the state need more active duty military personnel (168,000, according to Governing magazine) than public elementary school teachers (139,000)?”— Steve Lopez, Los Angeles Times


Mark my words, America’s war spending will bankrupt the nation.


For that matter, America’s war spending has already bankrupted the nation to the tune of more than $20 trillion dollars.


Now the Trump Administration is pushing for a $4.4 trillion budget for fiscal year 2019 that would add $7 trillion to the already unsustainable federal deficit in order to sustain America’s military empire abroad and dramatically expand the police state here at home. Trump also wants American taxpayers to cover the cost of building that infamous border wall.


Truly, Trump may turn out to be, as policy analyst Stan Collender warned, “the biggest deficit- and debt-increasing president of all time.”


For those in need of a quick reminder: “A budget deficit is the difference between what the federal government spends and what it takes in. The national debt, also known as the public debt, is the result of the federal government borrowing money to cover years and years of budget deficits.”


Right now, the U.S. government is operating in the negative on every front: it’s spending far more than what it makes (and takes from the American taxpayers) and it is borrowing heavily (from foreign governments and Social Security) to keep the government operating and keep funding its endless wars abroad.


This is how military empires fall and fail: by spreading themselves too thin and spending themselves to death.


It happened in Rome. It’s happening again.


Not content to merely police the globe, in recent decades, America has gradually transformed its homeland into a battlefield with militarized police and weapons better suited to a war zone.


Since taking office, President Trump—much like his predecessors—has marched in lockstep with the military. Now Trump wants $716 billion to expand America’s military empire abroad and billions more to hire cops, build more prisons and wage more profit-driven war-on-drugs/war-on-terrorism/war-on-crime programs that eat away at the Fourth Amendment while failing to make the country any safer.


Even the funds requested for infrastructure will do little to shore up the nation’s crumbling roads, bridges, railways, highways, power grids and dams.


No matter how your break it down, this is not a budget aimed at perfecting the Union, establishing justice, insuring domestic tranquility, providing for the common defense, promoting general welfare, or securing the blessings of liberty for the American people.


No, this is a budget aimed at pandering to the powerful money interests (military, corporate and security) that run the Deep State and hold the government in its clutches.


So much for Trump’s campaign promises to balance the budget and drain the swamps of corruption.


The glaring economic truth is that at the end of the day, it’s the military industrial complex—and not the sick, the elderly or the poor—that is pushing America towards bankruptcy.


As investigative journalist Uri Friedman puts it, for more than 15 years now, the United States has been fighting terrorism with a credit card, “essentially bankrolling the wars with debt, in the form of purchases of U.S. Treasury bonds by U.S.-based entities like pension funds and state and local governments, and by countries like China and Japan.”


The illicit merger of the armaments industry and the Pentagon that President Dwight D. Eisenhower warned us against more than 50 years ago has come to represent perhaps the greatest threat to the nation’s fragile infrastructure today.


Having been co-opted by greedy defense contractors, corrupt politicians and incompetent government officials, America’s expanding military empire is bleeding the country dry at a rate of more than $15 billion a month (or $20 million an hour)—and that’s just what the government spends on foreign wars.


That does not include the cost of maintaining and staffing the 1000-plus U.S. military bases spread around the globe.


Incredibly, although the U.S. constitutes only 5% of the world’s population, America boasts almost 50% of the world’s total military expenditure,  spending more on the military than the next 19 biggest spending nations combined.


In fact, the Pentagon spends more on war than all 50 states combined spend on health, education, welfare, and safety.


War is not cheap.


Although the federal government obscures so much about its defense spending that accurate figures are difficult to procure, we do know that since 2001, the U.S. government has spent more than $1.8 trillion in the wars in Afghanistan and Iraq (that’s $8.3 million per hour).


That doesn’t include wars and military exercises waged around the globe, which are expected to push the total bill upwards of $12 trillion by 2053.


Mind you, these ongoing wars—riddled by corruption, graft and bumbling incompetence—have done little to keep the country safe while enriching the military industrial complex—and private defense contractors—at taxpayer expense.


Just recently, for example, a leading accounting firm concluded that one of the Pentagon’s largest agencies “can’t account for hundreds of millions of dollars’ worth of spending.”


Just consider the fact that it costs American taxpayers $2.1 million per year for each soldier deployed in Afghanistan.


Imagine what you could do with that money if it were spent on domestic needs here at home.


Unfortunately, that’s not going to happen anytime soon, not as long as the money interests in Washington keep calling the shots and profiting from the spoils of war.


War has become a huge money-making venture, and America, with its vast military empire, is one of its best buyers and sellers. Not only does the U.S. have the largest defense budget, it also ranks highest as the world’s largest arms exporter.


The American military-industrial complex has erected an empire unsurpassed in history in its breadth and scope, one dedicated to conducting perpetual warfare throughout the earth.


For example, while erecting a security surveillance state in the U.S., the military-industrial complex has perpetuated a worldwide military empire with American troops stationed in 177 countries (over 70% of the countries worldwide).


In the process, billions have been spent erecting luxury military installations throughout the world.


For example, the U.S. Embassy built in Iraq, dubbed “Fortress Baghdad,” covers 104 acres and boasts a “city within a city” that includes six apartment buildings, a Marine barracks, swimming pool, shops and 15-foot-thick walls. Camp Anaconda in Iraq, like many U.S. military bases scattered across the globe, was structured to resemble a mini-city with pools, fast food restaurants, miniature golf courses and movie theaters.


While most Americans can scarcely afford the cost of heating and cooling their own homes, the American government spends $20 billion annually just to provide air conditioning for military installations in Iraq and Afghanistan.


In essence, what we’re doing is “we’re air conditioning the desert over there in Afghanistan, Iraq, and other places,” noted retired brigadier general Steven Anderson, a former chief logistician for Gen. David Petraeus in Iraq.


Think about that for a minute.


There’s a good reason why “bloated,” “corrupt” and “inefficient” are among the words most commonly applied to the government, especially the Department of Defense and its contractors.


For instance, a study by the Government Accountability Office found that $70 billion worth of cost overruns by the Pentagon were caused by management failures. To put that in perspective, that equates to one and a half times the State Department’s entire $47 billion annual budget.


Fraud is rampant.


A government audit, for example, found that defense contractor Boeing has been massively overcharging taxpayers for mundane parts, resulting in tens of millions of dollars in overspending. As the report noted, the American taxpayer paid:


$71 for a metal pin that should cost just 4 cents; $644.75 for a small gear smaller than a dime that sells for $12.51: more than a 5,100 percent increase in price. $1,678.61 for another tiny part, also smaller than a dime, that could have been bought within DoD for $7.71: a 21,000 percent increase. $71.01 for a straight, thin metal pin that DoD had on hand, unused by the tens of thousands, for 4 cents: an increase of over 177,000 percent.


Price gouging has become an accepted form of corruption within the American military empire.


And if you think gas prices at home can get high, just consider what the American taxpayer is being forced to shell out overseas: once all the expenses of delivering gas to troops in the field are factored in, we’re paying between $18-30 per gallon for gas in Iraq and Afghanistan.


Incredibly, despite reports of corruption, abuse and waste, the mega-corporations behind much of this ineptitude and corruption continue to be awarded military contracts worth billions of dollars.


The rationale may keep changing for why American military forces are in Afghanistan, Iraq and elsewhere, but the one that remains constant is that those who run the government are feeding the appetite of the military industrial complex.


What began in 2001 as part of an alleged effort to root out al Qaeda has turned into a goldmine for the military industrial complex and its army of private contractors.


Just consider: the Pentagon in 2008 spent more money every five seconds in Iraq than the average American earned in a year.


Yet Congress and the White House want taxpayers to accept that the only way to reduce the nation’s ballooning deficit is by cutting “entitlement” programs such as Social Security and Medicare?


As Martin Luther King Jr. recognized, under a military empire, war and its profiteering will always take precedence over the people’s basic human needs.


Simply put, we cannot afford to maintain our over-extended military empire.


“Money is the new 800-pound gorilla,” remarked a senior administration official involved in Afghanistan. “It shifts the debate from ‘Is the strategy working?’ to ‘Can we afford this?’ And when you view it that way, the scope of the mission that we have now is far, far less defensible.”


Or as one commentator noted, “Foreclosing the future of our country should not be confused with defending it.”


Inevitably, military empires collapse.


As Cullen Murphy, author of Are We Rome? and editor-at-large of Vanity Fair writes:


A millennium hence America will be hard to recognize. It may not exist as a nation-state in the form it does now—or even exist at all. Will the transitions ahead be gradual and peaceful or abrupt and catastrophic? Will our descendants be living productive lives in a society better than the one we inhabit now? Whatever happens, will valuable aspects of America’s legacy weave through the fabric of civilizations to come? Will historians someday have reason to ask, Did America really fall?


The problem we wrestle with is none other than a distorted American empire, complete with mega-corporations, security-industrial complexes and a burgeoning military. And it has its sights set on absolute domination.


Eventually, however, all military empires fail.


At the height of its power, even the mighty Roman Empire could not stare down a collapsing economy and a burgeoning military. Prolonged periods of war and false economic prosperity largely led to its demise. As historian Chalmers Johnson predicts:


The fate of previous democratic empires suggests that such a conflict is unsustainable and will be resolved in one of two ways. Rome attempted to keep its empire and lost its democracy. Britain chose to remain democratic and in the process let go its empire. Intentionally or not, the people of the United States already are well embarked upon the course of non-democratic empire.


I would suggest that what we have is a confluence of factors and influences that go beyond mere comparisons to Rome.


It is a union of Orwell’s 1984 with its shadowy, totalitarian government—i.e., fascism, the union of government and corporate powers—and a total surveillance state with a military empire extended throughout the world.


As we have seen with the militarizing of the police, the growth of and reliance on militarism as the solution for our problems both domestically and abroad affects the basic principles upon which American society should operate.


We must keep in mind that a military empire will be ruled not by lofty ideals of equality and justice but by the power of the sword. Those in the military are primarily trained to conduct warfare, not preserve the peace.


Here’s the kicker, though: if the American empire falls and the American economy collapses—and with it the last vestiges of our constitutional republic—it will be the government and its trillion-dollar war budgets that are to blame.


Of course, the government has already anticipated this breakdown.


That’s why the government has transformed America into a war zone, turned the nation into a surveillance state, and labelled “we the people” as enemy combatants.


For years now, the government has worked with the military to prepare for widespread civil unrest brought about by “economic collapse, loss of functioning political and legal order, purposeful domestic resistance or insurgency, pervasive public health emergencies, and catastrophic natural and human disasters.”


Having spent more than half a century exporting war to foreign lands, profiting from war, and creating a national economy seemingly dependent on the spoils of war, the war hawks long ago turned their profit-driven appetites on us, bringing home the spoils of war—the military tanks, grenade launchers, Kevlar helmets, assault rifles, gas masks, ammunition, battering rams, night vision binoculars, etc.—and handing them over to local police, thereby turning America into a battlefield.


As I make clear in my book Battlefield America: The War on the American People, this is how the police state wins and “we the people” lose.


More than 50 years ago, President Dwight Eisenhower warned us not to let the profit-driven war machine endanger our liberties or democratic processes.


We failed to heed his warning.


As Eisenhower recognized in a speech given to the American Society of Newspaper Editors, on Apr. 16, 1953, the consequences of allowing the military-industrial complex to wage war, exhaust our resources and dictate our national priorities are beyond grave:


“Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete pavement. We pay for a single fighter plane with a half million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people… This is not a way of life at all, in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron.”


WC: 2617





ABOUT JOHN W. WHITEHEAD

Constitutional attorney and author John W. Whitehead is founder and president of The Rutherford Institute. His new book Battlefield America: The War on the American People (SelectBooks, 2015) is available online at www.amazon.com. Whitehead can be contacted at johnw@rutherford.org.


PUBLICATION GUIDELINES / REPRINT PERMISSION

John W. Whitehead’s weekly commentaries are available for publication to newspapers and web publications at no charge. Please contact staff@rutherford.org to obtain reprint permission.



The post The Military Industrial Complex Strikes Again: War Spending Will Bankrupt America appeared first on The Sleuth Journal.

Thursday, July 6, 2017

7 fast facts about the economic collapse of Illinois

The state of Illinois is in big trouble. In fact, they’re facing an economic collapse. Some pundits are calling them “The Venezuela of the United States.”


They owe $14,711,351,943.90 in overdue bills. This does not count their day-to-day operating expenses – this is money that should have already been paid out, but wasn’t. Nearly 15 BILLION DOLLARS.


Like every person who has ever spent more than they’re making with no regard for budget, things are starting to go downhill in an ever-growing avalanche of disasters. Here are 7 thing you need to know about what’s going on in Illinois and how they got to this crisis point.


1) Illinois is about to be the first state ever to have their credit downgraded to “junk.”


They’re about to become the first state ever to see their credit downgraded by Standard & Poor to “junk status,” which means they are a terrible credit risk. If they’re even able to borrow money, it will be at much higher interest rates than ever before. This means that anything they spend on infrastructure (or refinancing their existing debt) will cost much more. And guess who will foot the bill for that? The taxpayers.


To put this in perspective, even  Michigan, with all of the issues in Detroit, has not been downgraded to junk status. That’s how much worse things are in Illinois.



Illinois has a tab of unpaid bills worth $15 billion, equivalent to 40% of its operating budget. The state’s backlog of financial obligations will skyrocket to $28 billion by June 2019 without a deal, Moody’s predicted, which would rack up even more interest and penalties than what is already owed. Even if a deal is reached, state debt and taxpayer dues will both likely increase. (source)



2) They haven’t had a state budget in 3 years.


Let me compare this to a household again, yet, of course on a far grander scale. To figure out how to pay off crippling debt, you have to have a strict budget in place.  You’ll need to slash expenditures where you can, increase income where you can, and do without some of the finer things. Pennies turn into dollars.


The trouble is, Illinois legislators haven’t passed a state budget in 3 years now.


Part of the issue is that the Democrat-led state Congress can’t come to an agreement with the Republican governor. (Something I think we can all relate to on a national level. Can we please look at this and figure out a way to get along in DC?) The July 1 fiscal year-end deadline has come and gone with no deal in place.


They’ve just been muddling along, not thinking about the big picture.


Read more via Organic Prepper

Monday, May 22, 2017

Is Puerto Rico’s Economic Collapse A Ploy By Liberals To Permanently Shift The Balance Of Power In Congress?

Is Puerto Rico’s Economic Collapse A Ploy By Liberals To Permanently Shift The Balance Of Power In Congress? | U.S.-Capitol-During-The-Day-Public-Domain | Collapse Economy & Business Politics Sleuth Journal US Congress


Next month, citizens of Puerto Rico are going to vote on statehood, and the absolutely devastating economic collapse that is gripping the island could be enough to push pro-statehood forces over the edge to victory.  Of course Congress has the final say on whether Puerto Rico becomes a state or not, but it is going to be very difficult to deny Puerto Rico’s 3.4 million residents statehood if they strongly insist that they want it.  Needless to say, if Puerto Rico becomes the 51st U.S. state that would greatly benefit the Democrats, because the population of Puerto Rico is very liberal.


Puerto Rico does not get to vote in presidential elections, but they do help select the nominees for both parties.  In 2016, 58,764 votes were cast in the Democratic caucuses held in Puerto Rico, and only 36,660 votes were cast in the Republican primary.  As a state, it is doubtful whether Puerto Rico would send any Republican lawmakers to Washington for decades to come.



So if Puerto Rico becomes a state, the Democrats would add two new senators and probably four or five representatives.


Puerto Rico would be the 30th largest state in the entire country, and so it would instantly have more political power than 21 other U.S. states.


This upcoming vote on June 11th is going to be extremely important, and pro-statehood forces are working very hard to get a positive result.  The following info about the referendum in June comes from Wikipedia…



The fifth referendum will be held on June 11, 2017 and will offer two options: “Statehood” and “Independence/Free Association.” It will be the first referendum not to offer the choice of “Commonwealth.” Newly-elected Governor Ricardo Rosselló is strongly in favor of statehood for Puerto Rico to help develop the economy and help to “solve our 500-year-old colonial dilemma … Colonialism is not an option …. It’s a civil rights issue … 3.5 million citizens seeking an absolute democracy,” he told the news media.[30] Benefits of statehood include an additional $10 billion per year in federal funds, the right to vote in presidential elections, higher Social Security and Medicare benefits, and a right for its government agencies and municipalities to file for bankruptcy. The latter is currently prohibited.[31]


At approximately the same time as the referendum, Puerto Rico’s legislators are also expected to vote on a bill that would allow the Governor to draft a state constitution and hold elections to choose senators and representatives to the federal Congress.[31]



Over the past decade, Puerto Rico has been suffering through a nightmarish economic recession that never seems to end.  The island was recently forced to declare the equivalent of bankruptcy because it is facing $123 billion in debt and pension obligations.  At this moment 46 percent of the residents of Puerto Rico are living below the poverty line, the unemployment rate is 11 percent, and authorities just announced that another 179 public schools will be closing down.


It has been argued that the Obama administration could have done much more to alleviate the economic problems in Puerto Rico but that it purposely chose not to do so.


Why?


Well, the worse economic conditions get in Puerto Rico, the better it is for pro-statehood forces.  Puerto Ricans are being told that becoming a state is the key to Puerto Rico’s long-term economic future, and at this point many are willing to do just about anything to get the economic suffering to end.  The following is a short excerpt from a New York Times article entitled “Amid Puerto Rico’s Fiscal Ruins, a New Push for Statehood“…



A vigorous push for statehood was a central campaign promise of Gov. Ricardo Rosselló, 38, who was inaugurated in January. Next month, he will ask residents to vote, in a nonbinding referendum, for statehood as part of a long-term fix for a commonwealth facing a period of severe austerity that is likely to include shuttered public schools, frozen salaries, slashed pensions and crimped investments in public health. The island remains in the grip of a recession that has lingered for much of the past decade.



Could it be possible that this is what liberals have wanted all along?


Could it be possible that Obama and his minions saw Puerto Rico as a chess piece that could be used to permanently shift the balance of power in Congress?


Of course if Puerto Rico becomes a state that would have implications for presidential elections as well.


In the end, it will be Congress that decides what the fate of Puerto Rico will be, but if the people of Puerto Rico truly want to become the 51st U.S. state it is going to be really hard to deny them that opportunity indefinitely.



Last year at their national conventions, the Democrats and the Republicans both took the position that the citizens of Puerto Rico should be able to make this decision for themselves.  But once faced with a final decision, it is inevitable that many Republican members of Congress would be opposed to statehood.


Personally, I believe that either independence or “free association” would be much better for Puerto Rico, and let us hope that the people of Puerto Rico choose that direction.


But when people are really hurting, they will often grasp any sort of olive branch that is being offered to them, and right now the progressives are really pushing statehood.


Of course for strategists on the left, the goal is not to help the suffering people of Puerto Rico.


Rather, the endgame is complete domination of the U.S. political system by any means necessary.

Thursday, May 11, 2017

Puerto Rico Declares Bankruptcy

Puerto Rico Declares Bankruptcy | puerto-rico-debt | Special Interests World News (image: @lgbtpr/Twitter)

Colonized and exploited by America since 1898, its people, governor and other officials are powerless – ruled by US administrations and Congress.


Islanders have no control over their lives, welfare and destiny, no say over foreign relations, commerce, trade, air space, land and offshore waters, immigration and emigration, nationality and citizenship, currency, maritime laws, military service, US bases on its territory, constitutionality of its laws, jurisdictions and legal procedures, treaties, radio and television, communications, agriculture, natural resources and more.


For nearly 120 years, it’s been victimized by US imperial rapaciousness. Things finally came to head financially. Puerto Rico is bankrupt, though can’t declare it under US law.



It’s a wasteland of high unemployment, poverty and deprivation. Force-fed austerity exacerbates dire economic conditions.


Islanders are US citizens without enfranchisement on the mainland. They pay federal taxes, getting back pathetically little in return.


They suffer from mismanagement, political greed, widespread corruption, deplorable social services, and monied interests exploiting them, enforced by police state harshness.


Debt-entrapped, it’s been forced to pay bankers and other large creditors at the expense of responsibly serving its residents.


Its debt is crushing, unrepayable at around $123 billion – $74 billion owed creditors, another $49 billion in unfunded pension obligations.


Historically Puerto Rico was barred from declaring bankruptcy. Legislation enacted last year allows bankruptcy-like proceedings.


Creditors were unwilling to grant concessions. Now they’ll be forced to take big haircuts. Government pensioners and workers nearing retirement may lose out altogether.


Mass exodus to the mainland, including the island’s best and brightest, complicated things further. Puerto Rico is a zombie economy, unable to function without help – not forthcoming after Congress refused bailout help.


So did Trump, saying no “bailout” for Puerto Rico, just generous handouts he wants for Wall Street, war-profiteers, other corporate predators, and America’s super-rich.


An 11th hour effort to avoid bankruptcy failed. Creditors refused a restructuring deal to take a 23% haircut on their general obligation bonds, and a 42% loss on their Cofina sales tax-backed debt, according to the Municipal Securities Rulemaking Board web site. Now they’ll incur bigger hits.


Last summer, Congress passed the Puerto Rico Oversight, Management and Economic Stability Act (PROMESA), giving a federally appointed committee control over the island’s finances, along with creating a Title III bankruptcy process.



PROMESA gives the federal committee authority to consolidate island agencies, privatize government assets, fire public workers, restructure Puerto Rico’s balance sheet, and retroactively stay bondholder lawsuits.


A Supreme Court-appointed judge will handle proceedings, bankruptcy without formally declaring it.


Unlike US counties, cities and other municipalities, states and US territories can’t declare Chapter 9 bankruptcy, allowing them to restructure debt.


Puerto Rico faces a long, painful struggle ahead, debt-entrapped by creditors, ill-served by uncaring Washington, mismanaged by corrupt officials, a deplorable situation, affecting its poor and most vulnerable hardest.