The commonwealth's court filing on Wednesday revealed the blunt reality of the matter: "Puerto Rico is unable to provide its citizens effective services", because of the weight of the island's debt, reads the filing by the federal control board.
Puerto Rico's overall debt burden is almost seven times larger than Detroit's was when it entered bankruptcy.
Simon Johnson, a professor of entrepreneurship at the MIT Sloan School of Management, warned Tuesday that failure to activate Title III would result in "chaos", as creditors filed lawsuits in multiple courts.
Board Chairman Jose Carrion did not immediately address those comments, but said in an earlier statement that while the bankruptcy-like process is needed to offset lawsuits, consensual negotiations are still preferable and that the board will pursue those with willing creditors. "A long and drawn-out battle with creditors will be catastrophic for Puerto Rico and its people", he said.
The financial collapse promises to impose deep losses on bondholders who for years snapped up Puerto Rico's securities, even as the government contended with a shrinking economy and chronic budget shortfalls.
The slide into bankruptcy would mark a new low in Wall Street's relations with Gov. Rosselló, a political newcomer who pledged as a candidate to repay the territory's debts, shrink the government and strengthen ties with the U.S.
SAN JUAN Puerto Rico sought relief on Wednesday under a law enacted to help the United States commonwealth restructure its massive debt load, paving the way for what could be the largest-ever bankruptcy case involving a U.S. local government entity. This could pave the way for what could be the largest-ever bankruptcy case involving a United States local government entity, Efe news reported.
This is probably not an option for Puerto Rico. And the scale of Puerto Rico's debts is far larger than any other major American government, exceeded only by those of the more populated and wealthier New York, California and MA.
CNN wants to hear from you: Do you live in Puerto Rico? Given the willingness for creditors to let the legal stay expire, it seems that Puerto Rico may only be able to restructure its debt using the courts.
And those economic woes have taken their toll. The territory'sIts agriculture department suspended subsidies to farmers. The treasury withheld tax refunds.
Supplementing the Petition is a "Statement of Oversight Board In Connection with PROMESA Title III Petition" (the "Statement").
One group, the Center for Individual Freedom, spent millions on ads calling the Puerto Rico bill a "bailout", targeting congressional districts.
"Furthermore", he said, "it cements the political precedent set by Congress for high-spending states with unsustainable debts to ultimately follow suit". "Make no mistake: The board has chosen to turn Puerto Rico into the next Argentina".
Carrier group heads for Korean waters as Trump calls leaders
Navy officer overseeing military operations in the Pacific says the crisis with North Korea is at the worst point he's ever seen. Secretary of State Rex Tillerson said on Thursday that China had asked North Korea not to conduct any more nuclear tests.
Iraq, US in talks to keep American troop presence after IS
Government forces launched a major offensive to recapture Mosul, the last major urban stronghold of Isis in Iraq , in October. The logic reflects concerns that a premature withdrawal from Iraq at the end of 2011, initiated by President George W.
Daredevils snap losing streak, stun SRH by six wickets
David Warner and Shikhar Dhawan played all over the park, and aided by some sloppy Delhi fielding, crossed fifty in five overs. Delhi's sloppy fielding did not help matters as dropped catches and misfields added a substantial amount to Sunrisers' score.