After months of facing indifference from Congress, the people of Puerto Rico might finally be making progress on getting some help with the island’s massive debt crisisfrom both the Obama administration and Congress.
Last Wednesday, the Obama administration outlined a proposal that would allow the island’s entities to restructure debts, provide “independent financial oversight” to ensure Puerto Rico sticks to a financial recovery plan, reform the unequal treatment of Puerto Rico under Medicaid, and allow Puerto Rico access to the Earned Income Tax Credit.
The next day, Puerto Rico Gov. Alejandro García Padilla, Rep. Pedro Pierluisi, and representatives from the Treasury Department testified before the Senate Committee on Energy and Natural Resources. García Padilla said steep cuts to public services had already been made, but that if nothing were done, the island would run out of money next month. Committee chair Sen. Lisa Murkowski (R-Alaska) agreed that something needed to be done but wasn’t convinced that Congress had been given accurate data with which to make decisions.
Sen. Elizabeth Warren, (D-Mass.)*, a member of the committee, spoke out strongly in favor of Pierluisi’s Chapter 9 proposal. Warren threw her support behind the proposal earlier this summer and was a cosponsor on the Senate’s version of a Pierluisi’s House bill. Criticizing the debt holders—which she repeatedly called “vulture funds”—she pressed on the Treasury Department to “be just as creative in coming up with solutions for Puerto Rico as it was when the big banks called for help.”…….