It's Time to Help Puerto Rico

From World Atlas

Puerto Rico is broke. It's got a $72 billion debt, and it can't re-pay it. Left alone, the island will simply default, without the benefit of bankruptcy protections that mainland states, counties, and municipalities have. The island needs help, now. The Obama Administration has offered a plan:

The Obama administration last week offered the outline of a rescue plan to help the island and the 3.5 million American citizens who live there. The plan would impose new oversight on the island’s finances and expand access to government programs like Medicaid and the earned-income tax credit. Crucially, it asks Congress to change the law so that Puerto Rico’s territorial government and its municipalities can seek bankruptcy protection.

Of course, there is another side to this- investors who don't want to "take a haircut" on what they are owed. They say belt-tightening can work. I believe the New York Times answers that charge more effectively than I can here:

Many investors who have lent money to Puerto Rico and stand to lose under any debt restructuring are bitterly opposed to the Obama plan. They say Puerto Rico can repay all of its debt if it tightens its belt and privatizes utilities and other government-owned businesses. Changing the law now, they argue, is deeply unfair. But the record of what has happened in troubled countries like Greece is clear: Austerity policies have only worsened the crisis. As for the fairness argument, legislators change laws all the time to meet new circumstances.

By doing what needs to be done now, we can avoid future defaults, and put Puerto Rico on a pathway to prosperity. It is not in our interests to have them default. It is not in our interests to have them fail. Yes, their elected officials have, in the past, run the country broke. It's important that we remember though, it's not about the past-

There is no doubt that Puerto Rican leaders have mismanaged the island’s finances and economy. What’s at issue now, though, is not Puerto Rico’s past but its future and that of its inhabitants. If Congress doesn’t like the administration’s ideas, it needs to come up with its own.

Congress must act. It's in everyone's best interests.