The further to the left or the right you move, the more your lens on life distorts.

Thursday, May 04, 2017

Puerto Rico

As a quasi-media representative of the Democratic party, The New York Times shills for bigger and bigger spending policies, attacks the GOP when it tries, often in vain, to make budget cuts, calls Republicans "heartless" when they try to reduce the massive taxpayer costs associated with Obamacare subsidies, and on and on. Today, the NYT reports:
With its creditors at its heels and its coffers depleted, Puerto Rico sought what is essentially bankruptcy relief in federal court on Wednesday, the first time in history that an American state or territory had taken the extraordinary measure.

The action sent Puerto Rico, whose approximately $123 billion in debt and pension obligations far exceeds the $18 billion bankruptcy filed by Detroit in 2013, to uncharted ground.

While the court proceedings could eventually make the island solvent for the first time in decades, the more immediate repercussions will likely be grim: Government workers will forgo pension money, public health and infrastructure projects will go wanting, and the “brain drain” the island has been suffering as professionals move to the mainland could intensify.

Puerto Rico is “unable to provide its citizens effective services” because of the crushing weight of its debt, according to a filing on Wednesday by the federal board that has supervised the island’s financial affairs since last year.
Puerto Rico has been reliably Blue for decades. The U.S. territory spent freely and without concern for the consequences; it's Democratic leaders acquiesced as public sector unions demanded higher pensions, kicking the can down the road (does any of this sound familiar?)

Now, small, family owned businesses who contracted to the Puerto Rican government will be stiffed; bond-holders will be screwed, and pension holders will get the shaft. I'd say that's pretty "heartless" and its all a consequence of irresponsible Democratic governance, blindly supported by citizens who believed empty promises made by elected officials.

It is amusing to have the NYT write that Puerto Rico is “unable to provide its citizens effective services because of the crushing weight of its debt" while contemporaneously condemning any attempt to save states and federal government from the same fate down the road. I'm also certain that the Times will lobby to have taxpayers bail out Puerto Rico. I hope that the Congress refuses to do. There must be moral hazard in this case. It will serve as a warning to states like IL, CT, and CA, among others.

But then again, consistency, critical thinking, and fiscally responsible governance are not a big part of the progressive playbook.