June 10, 2015
Hon. John Boehner,
Speaker of the House
United States House of Representatives
Washington, DC
Dear Speaker Boehner,
On behalf of the Institute for Liberty, I write to urge you to
affirm conservative principles about
governance and fiscal accountability and make sure legislation
to extend a bailout to Puerto Rico
is not supported by the U.S. Congress.
The legislation, H.R. 870, does not represent a prudent or
long-term solution to Puerto Ricos astounding $73 billion debt.
First, it would only apply to a fraction of the public debt the
roughly $24 billion in outstanding obligations of the Puerto Rico
Electric Power Authority and
other public corporations. Once officials in Puerto Rico walk
away from these debts to
bondholders, they will walk from their other debts. That would
put U.S taxpayers on the hook
for $164 billion bailout.
Second, a bailout is not the way to reform Puerto Ricos
financial management and governing system, which clearly needs to
urgent reform. Vacating contracts with investors and then not
committing to reduce government spending, pare bloated pension
obligations and implement tax
reform is a recipe for more waste and more debt accumulation by
Puerto Ricos government. The American people have made it clear
they are tired of mismanagement and expansion of
government in recent elections. This applies to the federal,
state and local level. It also applies to
U.S. territories if taxpayers are being asked to should their
bailout.
In light of these considerations, it is disappointing that House
Judiciary Committee is
entertaining a bailout for Puerto Rico. If there is another
Congressional hearing on Puerto Ricos debt, it should examine
successful ways to address the crisis on the Island, such as
Congressional
imposition of a control board. A number of groups also dedicated
to liberty, free markets and the
rule of law have also recommended looking into this as an
alternative to a taxpayer-funded
bailout.
H.R. 870 is the product of Democrats like Resident Commissioner
Pedro Pierluisi and has the
backing of Puerto Ricos governor Alejandro Garcia Padilla with
supported by the extreme left like Representative Luis Gutierrez.
Last week, one of the Islands most principled conservatives, New
Progressive Party vice chairperson Jennifer Gonzalez, said the bill
betrays the beliefs and
values of Puerto Rico that have passed from generation to
generation. She called on Puerto Ricans to face our current
economic challenges."
This was a courageous affirmation of the conservative beliefs
that represent the best hope for
Puerto Ricos long-term stability and prosperity. She understands
that Puerto Ricos best hopes rest in making comprehensive,
structural reforms in how the island is governed and how its
finances are managed. This is the mindset the IFL and other
conservative groups want to see
more from by the Congress.
Thank you in advance for your leadership in helping to extend
and strengthen the tenets of
limited and competent government by blocking additional action
on H.R. 870.
Sincerely,
Andrew Langer, President
Institute for Liberty
