Greece skips debt payment. Puerto Rico wants to do the same.
I wrote about Greece facing bankruptcy here. Today, Greece skipped their scheduled payments to the IMF. Greek finance minister Yanis Varoufakis said that Greece wouldn’t pay the IMF. Maybe my wish came true that Greece would repudiate its debts. Read more about the Greek default here: http://www.businessinsider.com/greece-misses-its-imf-payment-2015-6#ixzz3ebad7Wfp
The US territory of Puerto Rico wants to declare bankruptcy too. Economic output in Puerto Rico has been falling for the last decade. Puerto Rico is bleeding both money and its educated young men and young women. U.S. lawmakers sponsored a bill this week allowing Puerto Rico to file for bankruptcy. The governor of Puerto Rico has until the end of August to submit an economic and financial reform plan.
There are many successful states Puerto Rico could emulate as it reforms. The government of Puerto Rico can’t do so. I predict the government of Puerto Rico will keep the regulations and government kickbacks that drove business out of Puerto Rico. Those are the same kickbacks and crony regulations that put the existing government in power. Like any bankruptcy restructuring, they can’t change their government until they get rid of their politicians. Read more here: http://www.miamiherald.com/news/nation-world/national/article25818208.html#storylink=cpy
This is fascinating.