Urgent Call for Debt Relief After Hurricane Shatters Puerto Rico and U.S. Virgin Islands

Posted Oct. 4, 2017

MP3 Interview with Eric LeCompte, executive director of the Jubilee USA Network, conducted by Scott Harris

puertorico

The destructive power of Hurricane Maria, which smashed tens of thousands of homes and knocked out electric power and phone service for most of Puerto Rico's 3.5 million residents, was the worst storm to hit the island in nearly a century. When the federal government's response was late to initiate rescue operations and provide emergency food, water and fuel, criticism bubbled to the surface. But very few observers, however, would have predicted that in the midst of such a serious humanitarian crisis that President Trump would have launched a twitter war against the people of Puerto Rico, essentially labeling residents as lazy. Among the public officials Trump attacked were San Juan Mayor Carmen Yulín Cruz, accusing her of playing politics and being a poor leader.

When the president arrived for a visit to Puerto Rico two weeks after the storm on Oct. 3, he congratulated himself and his administration for its response to the disaster. In a bizarre moment, Trump then said the island should be "very proud" of its low official death count of 16, comparing the situation to Hurricane Katrina in 2005, based on the number of people who had died, implying that Puerto Rico's current crisis wasn't a "real catastrophe."

But the disastrous situation in Puerto Rico pre-dates the ravages of Hurricane Maria. Sixty percent of the Island's children live in poverty and its people have been dealing with a decades-long economic crisis that amassed $72 billion in debt, triggering the largest bankruptcy process in U.S. history. Between The Lines’ Scott Harris spoke with Eric LeCompte, executive director of the Jubilee USA Network, who discusses island religious leaders' and his group's advocacy of debt relief for both Puerto Rico and the U.S. Virgin Islands, after the devastation wrought by Hurricanes Irma and Maria.[Rush transcript]

ERIC LECOMPTE: In particular, we definitely want the bankruptcy process in Puerto Rico to continue to move forward. That process is going to take into account the devastation of the hurricane and ensure a higher cut in terms of the debt. In terms of the aid that comes from the United States that comes from the federal government, we want it to be robust in the form of grants that goes in terms of relief aid to Puerto Rico, the U.S. Virgin Islands. We don't want Puerto Rico or the U.S. Virgin Islands to have to get more debt in order to finance its reconstruction and recovery.

It's also absolutely imperative that the aid that comes in is sufficient to rebuild Puerto Rico and the U.S. Virgin Islands in ways that are going to be able to withstand what seem to be more powerful and more frequent storms in this moment of our history.

And the final piece that we and our partners in Puerto Rico are advocating and it actually impacts many of the Caribbean Islands that have been devastated by the storms – from Puerto Rico to the U.S. Virgin Islands to the countries of Antigua and Barbuda and Dominica – is that we really believe it's incumbent on Congress to pass greater laws around budget transparency, responsible lending and borrowing because these types of laws prevent financial crisis. These types of laws actually secure protections in the markets not only for the U.S. citizens living in Puerto Rico and U.S. Virgin Islands, but also in U.S. states and foreign countries because much of the world's debt is actually contracted through New York law.

BETWEEN THE LINES: Eric, what is the prospect that we'll have a Republican-controlled Congress and Donald Trump as president be predisposed to sign into law some of these debt relief measures, given the hostility we've seen particularly from the White House.

ERIC LECOMPTE: Well, in terms of Puerto Rico, the bankruptcy process that in effect passed last year with strong support from Republican leadership and Democratic leadership and then signed into law by President Obama. And not only did that legislation delay debt payments for Puerto Rico in particular, that legislation is also what created this super-bankruptcy process, the only bankruptcy process in U.S. history that has the ability to restructure all of Puerto Rico's debt.

So, in terms of Puerto Rico, they have access to this debt relief process right now, which is very positive. Unfortunately, we are dealing with a different situation with the U.S. Virgin Islands, where it is much more difficult for them to access this legislation. And whatever relief package comes together for the U.S. Virgin Islands, in some way, Congress needs to deal with the debt. At this point, we don't know what that could possibly look like, but we're trying to engage Congress to include that in the package for the U.S. Virgin Islands because they absolutely don't have the resources to pay debt at this point.

BETWEEN THE LINES: Eric, what would you recommend for people who are very much alarmed and their hearts going out to the people of Puerto Rico struggling with this disaster? What's an effective way they can help in the short term and the long term?

ERIC LECOMPTE: Well, in the short term, it's absolutely critical that we do let Congress know that being able to resolve the situation in Puerto Rico also means that we have to resolve the financial crisis. Listeners can go to our website, www.JubileeUSA.org, and we have a petition that's up which actually is going to the International Monetary Fund, in order to secure debt relief and protections for Caribbean countries devastated by Irma and Maria, like Antigua and Barbuda and the island of Dominica – developing countries totally devastated by Hurricane Maria. And that petition also goes to the White House, the Congress and to those involved in the bankruptcy process and governance on the island of Puerto Rico, calling for debt relief as well as to ensure that the island gets the proper aid and grants.

Find more information and commentary on Puerto Rico's debt crisis and calls for debt relief, by visiting the Jubilee USA Network at JubileeUSA.org.

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