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O’Malley in Puerto Rico: Extend Bankruptcy Protection

Aug. 3, 2015 (EIRNS)—Martin O’Malley visited the U.S. Territory of Puerto Rico, on Aug. 1, calling for debt protection for the island, and casting out Wall Street in the process. In an interview with AP, the only media to report on his visit, O’Malley insisted, "The main thing we need to do is extend the same bankruptcy protections that we have on the federal level to Puerto Rico." Bills that would extend Chapter 9 bankruptcy protection to public Puerto Rican entities, exist in both houses of the U.S. Congress, but haven’t moved forward due to lobbying by predatory vulture funds.

"Right now, the people of Puerto Rico ... are being treated very unjustly by forces on the mainland," he said, "forces on Wall Street and the intransigence of this Republican Congress in taking action to restore simple bankruptcy protections." Speaking of the Gov. Alejandro García Padilla, O’Malley said,

"He doesn’t have a magic wand. This should be something that our Congress, even our Republican Congress, cares about because it would do some damage and it would impact the United States if Puerto Rico were to go under, or its economy to tank, because we can’t renegotiate this debt."

Speaking of the campaign at large, O’Malley said,

"Our country wants new leadership, they want leadership independent of the old politics of the past and the relationships of the past that are holding us back from a better future ... we want an economy that works for all of us again instead of just for a few of us."

By the time you read this, Puerto Rico will have missed a $58 million debt payment owed by the Public Finance Commission (PFC). This is the smallest of the four bond issues that were due, with the $252 million due from the Sales Tax Finance Corp. (Cofina), the $169 million due by the Government Development Bank (GDB), and the $92 million due for the Municipal Financing Authority all having been paid. Despite what the monetarist press keeps shreiking, missing the PFC payment is not even technically a default, as these bonds were "moral obligation bonds," with no legal obligation that they be paid.

On Aug. 1, the International Business Times accused Puerto Rico of "operating with a $703 million budget deficit for the fiscal year that began last month," adding that,

"the Commonwealth faces $635 million in debt-service payments this month, according to the Standard & Poors ratings agency. Overall, it has to make $5.4 billion in bond payments through next summer, according to data compiled by Bloomberg. Meanwhile, its fiscal 2015 budget, running through next June, is $9.8 billion, leaving little for services such as trash pickup, road maintenance, education and other government functions."

O’Malley’s visit, at this time of crisis, will be remembered. It comes three months after Republican candidate Jeb Bush went there to impress people with his Spanish, before the crisis got critical. Bush’s main interest, at the time, was stemming the tide of immigration, primarily to his adopted state of Florida. O’Malley refused to get drawn into press queries about "statehood," and otherwise refused to comment about Hillary Clinton’s collapsing campaign.