Surprise, Surprise, Puerto Rico is deep in debt!
How did Puerto Rico get so deep into debt?
A three-tiered solution for Puerto Rico https://www.washingtonpost.com/news/posteverything/wp/2017/12/14/a-three-tiered-solution-for-puerto-rico/?utm_term=.e598e93e4893
The government of the United States of America
its laws placed only on this island territory
Puerto Rico !
President Abraham Lincoln
freed the slaves of this country,
all of this counter;
this must also include our territories,
all of our territories!
An exodus of large businesses and a lack of tax revenue forced the Puerto Rican government to borrow money and sell bonds to Wall Street.
The federal government has made things worse through laws that make it harder for Puerto Rico to take control of its finances and economy.
Puerto Rico has little say in how it is governed from Washington,
its citizens have almost no voice in federal policies that affect them.
The U.S. Congress changed the law
So what happened 10 years ago?
Congress is partly to blame for the mess.
The island used to be a tax haven for some big businesses
such as the pharmaceutical industry.
It was cheaper to make drugs on the island than anywhere else in America
companies didn’t have to pay federal tax on the Puerto Rican operations.
But in the mid-1990s,
Congress began rolling back the special tax exemptions for businesses operating in Puerto Rico.
The tax breaks phased out and fully ended in 2006.
Puerto Rico’s economy tanked after this happened, and it has yet to recover. Many good private sector jobs were lost and tax revenues dropped. The economy has shrunk almost every year since.
On top of that,
the Merchant Marine Act of 1920
mandates that only U.S. vessels
can take goods
between Puerto Rico
the U.S. mainland.
This increases prices on the island and makes goods produced in Puerto Rico less competitive than those coming from cheaper Caribbean nations that send goods on their own ships. http://money.cnn.com/2016/05/12/investing/puerto-rico-debt-crisis/index.html