6. PROMESA
Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA) "is a US federal law that established an oversight board, a process for restructuring debt, and expedited procedures for approving critical infrastructure projects in order to combat the Puerto Rican government-debt crisis."
Essential reading to understand PROMESA:
Everything You Need to Know About the Proposed Federal Control Board for Puerto Rico
By Luis Gallardo, Latino Rebels, April 4, 2016
“Though the District of Columbia had its own federal control board during the 1990s, talk of a board in Puerto Rico first surfaced in 2014 during a heated legal battle between the Puerto Rican government and the local Doral Bank. Congresspeople affiliated with Doral proposed the federal control board as a response to the Puerto Rican government’s refusal to pay up $230 million in alleged tax returns. Said tax returns were the product of negotiations and an agreement signed between the previous administration of Governor Luis Fortuño and Doral Bank. The García Padilla administration screamed foul, citing the number to be inflated and finding that the Fortuño officials who signed the agreement were later offered positions and hired by Doral. Though the case dragged on, Doral eventually collapsed and disappeared amid scandals of fraud and federal arrests.”
(Remember, around the time of the Doral dispute, Koch Brothers-funded ads appeared against former governor Alejandro García Padilla American Future Fund Goes to the Islands by Viveca Novak on September 12, 2014)
The Road to PROMESA By Zachary Williams, Pasquines, Jul 28, 2016
(this article has a good timeline on events leading up to PROMESA)
Thank the 14 Senate Democrats Who Stood Up Against the Neocolonial PROMESA Bill.
“As I noted then, like many bipartisan deals in DC, PROMESA it is filled with toxic anti-worker and anti-democratic provisions. PROMESA shows clearly that Washington cares more about bondholders than the working people of Puerto Rico.”
(Republicans who voted against mostly far right who didn’t want to be seen as giving PR a “bailout” which this bill clearly was/is not. Democrats who were against were blocked from making improvements to the bill. Menéndez was one of the few outspoken Democratic critics of PROMESA bill...)
"Bob Menéndez offered an amendment to open up the possibility for amendments to the bill. It failed 44 to 54. The vote was largely party line. However, Ted Cruz (R-TX), Mike Lee (R-UT), and Rand Paul (R-KY) voted for it with the Democrats. Joe Donnelly (D-IN), Dianne Feinstein (D-CA), and Angus King (I-ME) voted against (making amendments) with the Republicans.”
PROMESA’s promises fall short By Kenneth Romero, The Hill, June 8, 2016
“Resident Commissioner Pedro Pierluisi’s bill, the Puerto Rico Chapter 9 Uniformity Act (H.R. 870), was definitely a step in the right direction, empowering Puerto Rico with the ability to restructure under the U.S. bankruptcy code, as was the case until 1984 when, inexplicably, Strom Thurmond deprived the island from this section of the Code.”
“H.R. 870 achieved unprecedented bipartisan support on the island, partly because it would yield fair and equitable agreements between bond issuing entities and their creditors. Instead, PROMESA has fractured the island’s two main political parties, and the same seems to be happening on Capitol Hill: Congressman Luis Gutiérrez (D-Ill.) is vehemently challenging the position of Minority Leader Nancy Pelosi (D-Calif.), while Sen. Bernie Sanders (I-Vt.) has vowed to fight the bill that has the support of an unlikely pairing: Speaker Paul Ryan (R-Wis.) and Democratic presidential hopeful Hillary Clinton.”
Inside the Billion-Dollar Battle for Puerto Rico’s Future
By Jonathan Mahler and Nicholas Confessore, NYT, Dec 19, 2015
“Early this year, with Puerto Rico’s economic outlook darkening, the island’s nonvoting member of the House of Representatives, Pedro R. Pierluisi, made what he thought was a modest proposal.
He introduced a bill that would change federal law to allow Puerto Rico’s struggling municipalities and public corporations, such as the island’s power authority, to declare bankruptcy. It would affect only about a third of the island’s debt, Mr. Pierluisi told Republican colleagues in Congress. It would also give Puerto Rico the same right as most states and leverage against creditors — so-called Chapter 9 bankruptcy protection. And it would cost taxpayers nothing.”
More articles on PROMESA at the bottom section of this post.
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PROMESA emerged out of Congress from the House Natural Resources Committee. This alone should tell you exactly how the US views its colonies, only as Natural Resources to be exploited. The supposed "relief" for the complicated Puerto Rico financial mess did NOT emerge out of a finance committee. Because it was excluded from federal Chapter 9 bankruptcy in 1984, Puerto Rico enacted its own bankruptcy law in 2014. The PR government was immediately sued by Franklin Advisers and OppenheimerFunds. Puerto Rico lost the lawsuits: Puerto Rico v. Franklin California Tax-Free Trust, No. 15-233, and Acosta-Febo v. Franklin California Tax-Free Trust, No. 15-255 on June 13, 2016 at the US Supreme Court. PROMESA was signed by President Obama on June 30, 2016.
Sadly, many of the critiques of this rushed bill, sponsored and written by dubious sources, have been thoroughly vindicated 2 years later. This Koch brothers’ bill would not have passed if Democrats had voted against it. At the very least, Democrats could have demanded a lot more concessions to this bill but refused to do so. Because let's be honest, both parties serve rich donors, Wall Street and hedge fund billionaires wanted the fiscal control board. This bill was moving through Congress right in the midst of the 2016 US presidential primaries. This points to politicians’ using Puerto Ricans as pawns, just like they do with other marginalized groups. In the middle of all this, there were local primaries for governor in Puerto Rico on June 5, 2016. (For more info on the November 2016 gubernatorial race in Puerto Rico see here.) Guess who won that governor's race? An extremely compliant governor that if one is charitable, has done very little to resist the avalanche of austerity and privatization. If one is less charitable, the current governor, Ricardo Rosselló, seems fully on board with a radical US right wing agenda because he believes it will bring Puerto Rico closer to statehood.
A BIPARTISAN FRAUD
House Committee on Natural Resources Report June 3, 2016
HOUSE VOTE June 9, 2016
Yes: 139 Republicans, 158 Democrats
No: 103 Republicans, 24 Democrats
SENATE VOTE June 29, 2016
Yes: 68
No: 30
Yes: 36 Republicans, 31 Democrats
No: 18 Republicans, 11 Democrats
Abstain: 2
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H.R. 4900 - the first version of PROMESA was introduced by House Committee Chairman Rob Bishop (R-UT) and bill sponsor Rep. Sean Duffy (R-WI) April 12, 2016. The Senate version is H.R. 5278.
ROB BISHOP - Republican, Chairman of the House Natural Resources Committee. He is not well-liked by various Native American tribes in his state, who see him as a land-grabber.
Rob Bishop: Trump rights a wrong in Utah By Rob Bishop, Deseret News, December 7, 2017
Land-grabbing Republican lawmakers are trying to gut the Antiquities Act. Don't let them By The LA Times Editorial Board, Oct 21, 2017
Rep. Rob Bishop Angers House Colleagues Over His Handling of Indian Affairs Rob Capriccioso, Indian Country Today, June 7, 2017 Natural Resources chairman appears intent on quashing pro-tribal House legislation and relations
“After a May 24 hearing that called into question fundamental tenets of tribal sovereignty and federal recognition of tribes, some U.S. House members and staffers are expressing concern that U.S. Rep. Rob Bishop (R-UT), chairman of the House Natural Resources Committee, is ignoring Indian voices as he attempts to shrink tribal sovereignty and federal trust and treaty responsibilities.”
Utah politicians shamelessly continue federal land grab effort, By Rich Landers, Spokesman Review, March 8, 2017
Utah Representative Wants Bears Ears Gone And He Wants Trump To Do It By Kirk Siegler, NPR, February 5, 2017
Ute Tribe PAC
“If the 2016 Utah Public Lands Initiative (PLI) would have become law, it would have taken more than 100,000 acres of the Ute Indian Tribe's Reservation Lands for the State of Utah. These 100,000 acres are within the oil and gas rich Uintah Basin, the very resources that the Tribe uses to fund its government, provide for its members, and support the local and regional economy.” “This so-called “Utah Public Lands Initiative” by Congressman Rob Bishop is nothing but a 21st Century Indian Land grab, the first of its kind in over 100 years. ” — Ute Indian Tribe
Rob Bishop: Republicans seek 'paradigm shift' in federal land management Bartholomew D Sullivan, USA TODAY, March 9, 2017
Rob Bishop’s Utah Public Lands Initiative Defeated Grand Canyon Trust, December 09 2016
Ute Tribe declares political war with Rep. Rob Bishop By Lee Davidson, The Salt Lake Tribune, October 19, 2016
SEAN DUFFY
Rep. Sean Duffy (R-WI), PROMESA’s sponsor (H.R. 4900), is a Koch Brothers protegé and vapid reality star turned politician who emerged from the MTV’s Real World. His wife is a “Latina” conservative on Fox News, Rachel Campos-Duffy, who also shills GOP-Koch-libertarianism for the Libre Initiative.
The Koch Brothers’ Latino Front: Libre Initiative By Ed Morales, September 29, 2014
The 16 elected officials who scored invites to the Koch brothers’ donor retreat By James Hohmann, Washington Post, August 1, 2015
Duffy even had the gall to fundraise in Puerto Rico in 2017 with right-wing criolla elite.
Getting $ from same pendejos that dutifully caught Trump's paper towels...
...who think being white supremacist Christian conservatives will bring Puerto Rico closer to statehood.
For further reading:
Committee on Natural Resources Releases Puerto Rico Legislation
H.R.4900: PROMESA, ProPublica
Hearings begin on Puerto Rico debt bill
By Patricia Guadalupe - 04/13/16
“But several key provisions remain that were heavily criticized in the original draft, including an oversight board whose members would be appointed by Congress and which would not be accountable to the island government."
“The control board would still have veto power over Puerto Rico’s budget, laws, financial plans, regulations, contracts, and other vital decisions that should be made by the duly elected officials of the island, not seven unelected bureaucrats,” says Federico de Jesús, a former Obama administration official and Puerto Rico government aide.”
Hillary Clinton and Bernie Sanders clash over Puerto Rico rescue bill
By Heather Long, CNN, May 20, 2016
"Hillary Clinton is on board with the bipartisan plan to rescue Puerto Rico from near economic collapse, but Senator Bernie Sanders issued a strong statement Friday evening against it."
Menéndez Speaks in Opposition to House Puerto Rico Bill H.R. 5278, Tuesday, May 24, 2016,
“And while there is some fancy language to pretend that the President will get to pick the board members, this is all a fig leaf to hide the real levers of power. The board will be composed of 4 Republican appointees and 3 Democrat appointees, and in addition to being the gatekeeper to restructuring, it will have the power to veto laws and regulations, override budgets, and determine the level of debt payments.
“To me, it’s simply wrong and un-American to take away the basic and fundamental democratic rights of the people of Puerto Rico."
Who Is Responsible for Puerto Rico’s Debt? There’s evidence some of it is illegal—and activists agree that Washington’s colonial control over the island’s economy helped create the crisis.
By Ed Morales, The Nation, June 7, 2016
“Vulture-fund groups, many of whom bought bonds as cheaply as 30 cents on the dollar and which have more to gain by the potential of acquiring government-owned assets as part of a settlement, seem to be happy with the bill. Democrats like Nancy Pelosi strongly backed PROMESA because the bill “achieved a restructuring process that can work,” even with its poison pill of austerity measures that include lowering the minimum wage to $4.25 for workers under 25 (if the governor chooses to enact this provision). Republicans like the sharply conservative Puerto Rico–born Raúl Labrador and Rob Bishop, who shepherded the bill through the House as committee chair, are satisfied, since the bill left out any provision for healthcare parity and satisfied the Republican mantra of shrinking government spending and mandating a business-friendly economic growth plan.”
“The fiscal oversight board audit isn’t coming from a perspective of protecting the interests of PR,” said Carlos Ramos Gonzalez, law professor at the Inter-American School of Law in San Juan and author of a report on the constitutionality of the fiscal-oversight board.
““It’s a perspective of protecting the interests of the creditors. For me, that’s very clear.”” It is apparent that the authors of PROMESA are well aware that an audit might find parts of the debt illegal, even though that’s not exactly headline news in the US media. Pagán mentioned that his collaborators have noticed a specific clause in the House bill that would seem to override any findings made by his audit commission. It appears under the “Liability Claim” section: “The term ‘Liability Claim’ means, as it relates to a Liability—(A) right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured.” [Emphasis added.]” (!!!)
Menéndez, Senators Want SEC Investigation into Potential Illegal Activity Leading to Puerto Rico Debt Crisis
June 14, 2016
U.S. Senator Bob Menéndez (D-N.J.) led a letter to her calling on the agency to investigate potential fraud and illegal conduct, which may have contributed to Puerto Rico’s debt crisis. Sens. Elizabeth Warren (D-Mass.), Chuck Schumer (D-N.Y.), Kirsten Gillibrand (D-N.Y.), Bernie Sanders (D-Vt.), Jeff Merkley (D-Ore.) and Richard Blumenthal (D-Conn.) co-signed the letter.
“The people of Puerto Rico deserve to know whether illegal activity by advisors to Puerto Rico and its municipal entities contributed to the current debt crisis,” said Menéndez in addressing Ms. White during this morning’s hearing. “Several colleagues have joined me in a letter to you and the Commission urging you to be a cop on the beat of Wall Street but also on the streets of San Juan.”
Sanders opposes Puerto Rico bill in test of his post-campaign clout
By David Weigel, Washington Post, June 28, 2016
"Even after losing Puerto Rico's presidential primary, Sanders has opposed the Puerto Rico Oversight, Management, and Economic Stability Act, usually referred to as PROMESA, calling it a shockingly undemocratic attempt to impose austerity measures on the debt-laden island. The bill would create an emergency board, dominated by Republicans, able to govern without accountability -- and to immediately lower the island's minimum wage."
Puerto Rico: Last Week Tonight with John Oliver (HBO)
Puerto Rico is suffering a massive debt crisis. Lin-Manuel Miranda joins John Oliver to call for relief. (Lin-Manuel’s song & dance for “Puerto Rico relief”)
In Lin-Manuel Miranda's Beloved Puerto Rico, Family Speaks of Unfolding Crisis
Congress Passes PROMESA Act for Puerto Rico Debt Crisis
By Stephen A. Nuño, NBC News, Jun.29.2016
Puerto Rico's Problems Go Way Beyond Its Debt The new law, PROMESA, staves off a financial emergency, but does little to fix the underlying troubles of the island and its people. By Gillian B. White, Jul 1, 2016
Leaders appoint allies, adversaries to Puerto Rico growth task force
Sens. Marco Rubio (R-Fla.), Orrin Hatch (R-Utah), Bob Menendez (D-N.J.) and Bill Nelson (D-Fla.) along with Reps. Sean Duffy (R-Wis.), Tom MacArthur (R-N.J.) Nydia Velázquez (D-N.Y.) and Resident Commissioner Pedro Pierluisi (D-Puerto Rico) have been appointed by congressional leaders to the Congressional Task Force on Economic Growth in Puerto Rico. By Sylvan Lane, The Hill, July 15, 2016
Minimum wage in Puerto Rico will be lowered to $4.25 per hour
By Nelson Denis, War Against All Puerto Ricans
Wall Street Vultures Descend On Debt-Ridden Puerto Rico
‘Any “bailout” that might occur … seems directed only at the Wall Street vultures who now control most of the debt,’ Déborah Berman-Santana tells MintPress News in a sprawling interview about the debt crisis in Puerto Rico.
By Michael Nevradakis, August 18th, 2016, Mint Press News
Unwanted Help in Puerto Rico The Unpromising PROMESA
By Isaac Rauch August 25, 2016, Foreign Affairs
PROMESA’s Dangerous Premises Sep 18, 2017 Martin Guzman, Joseph E. Stiglitz
While many comparisons have been made about Puerto Rico debt crisis to Greece, another apt comparison is Detroit. (Looting Detroit series)
