Time is Running Out for Puerto Rico

It’s difficult to overstate the problems facing the 3.5 million American citizens living on the island of Puerto Rico. The island has an overwhelming $70 billion in outstanding debt, but due to restrictions passed by Congress, no ability to reasonably restructure that debt. They’ve been mired in an economic recession for a decade, with an unemployment rate of around 12% and a poverty rate of about 45%. Tens of thousands of Puerto Ricans are leaving the island for the mainland each year, further harming the economy and tearing families apart.

Puerto Rico has already partially defaulted on several debt payments and lacks the funds to make a $2 billion payment due on July 1. The island’s government has invoked emergency powers and attempted to stave off economic collapse, but as the debt crisis worsens, the island is finding it more difficult to provide essential services. Already, 150 schools have been closed in recent years, and hundreds more are facing possible closure. Teachers are leaving in droves.

Hospitals are laying off staff, closing entire floors, and trying desperately not to run out of essential materials such as gloves and gauze pads. Emergency rooms are only open for limited hours. One hospital reportedly has less than 12 days of cash on hand. On average, one doctor a day leaves the island, and of those that remain, some are prioritizing patients and requiring cash up front for medical services.

To make matters worse, Puerto Rico is being hit hard by the Zika virus. There have already been at least 1,800 locally transmitted cases of Zika on the island. Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, said, “unless something dramatic changes, 25% of Puerto Rico is going to get Zika.”

And while this litany of awful events has unfolded before our eyes, the Republicans who control Congress have dawdled on measures to address the crisis. Only recently have we seen any action in Washington, and while the potential solutions discussed have been far from perfect, Puerto Rico is running out of time — the island faces a crippling default on Friday, July 1st.

The House of Representatives recently passed a bill that would create an oversight board to develop a fiscal plan for the island and attempt to voluntarily renegotiate all of Puerto Rico’s debts.

If the debts can’t be renegotiated voluntarily, the oversight board could seek a court-supervised debt restructuring process similar to bankruptcy. This bankruptcy process would only be available to U.S. territories that agree to an oversight board, so the bill could not apply to any of the 50 states.

The bill irresponsibly includes a provision inserted by House Republicans that would authorize a lowered minimum wage for workers under 25 years old, but includes no provisions for any of the oversight board’s dealings to be transparent or even readily available in Spanish.

On Friday, I wrote to Treasury Secretary Jack Lew to share my specific concerns about transparency and translation services.

He replied, and I‘m encouraged that the Treasury Department has committed to do all it can to promote transparency and provide prompt Spanish translations as Treasury helps establish the oversight board and draft its bylaws.

Make no mistake — Republican leaders failed to bring this bill up with enough time for an honest debate, and have moved to block efforts to amend and improve it. Last week I had a heartfelt conversation with Archbishop Blase Cupich of the Archdiocese of Chicago. He relayed to me what he was hearing from his counterpart Archibishop Roberto González Nieves of the Archdiocese of San Juan.

Archbishop González Nieves was clear that if Congress doesn’t act now, the island will face drastic austerity that will cause untold suffering for millions of men, women, and children citizens of our country. We simply cannot let that happen. This bill is far from perfect, but provides the debt restructuring authority that the island needs in the midst of a growing economic and humanitarian crisis. For those reasons, I will support this legislation, but I will be vigilant in ensuring that it is administered fairly and transparently, with the needs of the Puerto Rican people firmly in mind.