New York - Independent groups and voices from the diaspora advocated yesterday to step up the pressure for a substantial reduction of the principal in Puerto Rico’s debt, and an audit that leads to the prosecution of those who illegally indebted the Island.
“If there is to be a new beginning in Puerto Rico, the principal of the debt, which stands at around $69 billion, must be cut by 80%,” said bankruptcy attorney Carlos Cuevas, who has litigated before the judge named to preside over the territorial bankruptcy case, Laura Taylor Swain.
“That way, a realistic payment plan can be crafted and (at the same time) Puerto Rico can grow its economy,” Cuevas said.
It’s two different things. But the 80% cut in the size of the debt coincides with the reduction of the debt’s service –that is, the annual payment,– sought by the Oversight Board, THAT operates above the Island’s elected government.
Just before, during a prior discussion panel, Eric LeCompte, executive director of Jubilee USA –which has advised religious leaders in Puerto Rico and is experienced in international debt crisis cases–, warned that the cut to the principal must be of at least 60%.
Both Cuevas and LeCompte were members of a panel yesterday during the Diaspora Summit II of the Center for Puerto Rican Studies, held at the School of Social Work of Hunter College, right in the heart of New York’s old Puerto Rican neighborhood. Over 250 people and representatives from a hundred Puerto Rican organizations took part in the first day of conferences and panels.
There is a general recognition that new action plans are required while the pressure is kept on the court and the Oversight Board, who will be representing the government in the process meant to adjust a large portion of the Puerto Rican government’s financial obligations.
But, given that the debt will never be paid under the current terms, attorney Cuevas said the debt restructuring process must be seen as “an opportunity to transform Puerto Rico,” and audit the debt to prosecute, either in criminal or civil court, those who irregularly indebted the country. “There’ll be no justice until those responsible are made to answer,” he added.
The decisions already made by the Oversight Board –which operates above the Island’s elected government and the very proposals by governor Ricardo Rosselló– now make imminent an era of harsh cutbacks in government spending, which in years to come will further contract the economy.
“There’s going to be austerity. The question is how will it be distributed,” said the director of the Center for Puerto Rican Studies, Edwin Meléndez, who organized the meeting.
To journalist Juan González, co-host of radio show “Democracy Now”, Washington cannot ignore the serious fiscal crisis. “Puerto Rico has never had the power to control its economy,” he noted, when stressing the need to end with the current colonial relation.
The most recent debate in Congress over efforts to replace the close to $1.2 billion in Medicaid funds provided by Obamacare and which run dry at year’s end, left the Island with a $295.9 million allocation that keeps spending for health services in Puerto Rico at the same level but only until March 2018.
“We stand at the most complicated moment for the issue of health,” said Dennis Rivera, formerly a spokesperson for the Committee to Address the Health Crisis and current advisor of the Service Employees International Union (SEIU), when mentioning the refusal by Republicans in Congress to grant parity to Puerto Rico in the Medicaid program and president Donald Trump’s twits to stop the allocation of $295.9 million in Medicaid funds.
Rivera has had close relations with senior leaders in Congress since his time as president of mighty Local 1199 of New York. There is consensus on the need for new levels of action. “The Board will keep us afloat, but it’s not going to carry us forward,” said Gretchen Sierra Zorita, from the Puerto Rican National Agenda, a coalition of over 30 organizations that would use the summit to hold a separate meeting.
“We have to take action, but also understand that this crisis will last an entire decade. Urgent work is needed to respond, but also to setup a structure to sustain consistent efforts in a single direction,” said, for his part, the president of Local 32BJ, Héctor Figueroa, who is the most influential Puerto Rican union leader in the US, representing 160,000 workers.
Figueroa, who is Vice President of the Service Employees International Union (SEIU), held that this group is looking into how to become a party to the legal debt restructuring process, as did the American Federation of Country, State, and Municipal Employees (AFCSME).
“We have to defend workers’ pensions,” he said, by pointing “that (they) have to convince the judge that the focus of bankruptcy mustn’t be how much of the debt can be paid by Puerto Rico, but rather that Puerto Rico cannot pay for the debt (because) how then will we make sure that services to the people are not affected.”
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