Below you'll find a list of all posts that have been tagged as “debt”
Puerto Rico’s governor may have said the commonwealth’s debt is unpayable, but that doesn’t mean Puerto Ricans aren’t going to pay for it. Vulture capitalists are circling the island, ready to extract still more wealth from the impoverished island. You already know the drill: Capital is sucked out by corporate interests that pay little in taxes, budget deficits grow and …
Hedge fund managers and bondholders are pressing the government of Puerto Rico to drive through a series of punishing austerity measures, including dramatic cuts to public education and workers’ rights protections, to “solve” the crisis of debt and poverty gripping the Caribbean island. A group representing $5.2 billion of debt held by 38 investment managers paid three former economists for …
Over the past few months we have been forced to bear witness to a humiliating farce unfolding in Europe. Greece, which was first accepted into the European Monetary Union under false pretenses, then saddled with excessive levels of debt, then crippled through the imposition of austerity, finally did something: the Greeks elected a government that promised to shake things up. …
Bleeding to Debt: As With Detroit, So With Puerto Rico?
Puerto Rico is in a “death spiral,” Gov. Alejandro García Padilla has declared, unable to pay off an estimated $72 billion in debts. Padilla’s plea to creditors for concessions and more time on overdue notes isn’t playing well with bondholders, and Puerto Ricans have had it with government cutbacks and runaway increases in the cost of living to service the debt.
Padilla sees a way out—declaring bankruptcy. The problem is, by law only U.S. municipalities and states can seek bankruptcy protection from the courts, and Puerto Rico is a U.S. territory; it must first seek special dispensation from Congress.
Padilla has hired former federal judge Stephen Rhodes as a consultant on restructuring Puerto Rico’s debt. For many, it’s a troubling sign. Rhodes, now in private practice, was the judge who presided over Detroit’s contentious $18-billion bankruptcy, sanctioning wholesale plunder of the once-prosperous city.
Abayomi Azikiwe, editor in chief of Pan African News Wire and our correspondent on Detroit’s bankruptcy, says Padilla’s hiring of Rhodes is an indication that the Detroit bankruptcy model is about to be applied to Puerto Rico.
Hours before anti-austerity demonstrators flooded the streets of central Athens on Friday, a number of retired Greek military officers publicly called for a “yes” vote in Sunday’s referendum on the European Union’s demands, defying Prime Minister Alexis Tsipras’s call for a “no” vote. The contrast between masses of workers denouncing EU austerity and the pronouncements of prominent military figures could …
During my desultory post-graduation years in San Francisco, I lived in a big duplex with three roommates. We had bands, fledging writing gigs and other financially unpromising passions, until one of us threw over la vie bohème to work at a consulting firm. We teased him mercilessly for using nonsensical catchphrases like “think outside the box” and for getting a …
On Sunday evening the governor of Puerto Rico, Alejandro García Padilla of the Popular Democratic Party, announced that the US commonwealth would need to restructure its $72 billion in debt. The island of 3.5 million people has been in a deep economic crisis since 2006, experiencing high unemployment, large-scale emigration and severe austerity measures. Between 2004 and 2014 Puerto Rico …
The weekend of June 27-28 marks the likely last comprehensive negotiating session between the Troika and the Greek government before the current extension of the debt agreement between Greece and the Troika formally expires on June 30, 2015. As final negotiations come down to the wire, the class nature of the bargaining positions of the two parties is becoming …
Dr. Jack Rasmus provides an update on Greek debt negotiations since last week’s Alternative Visions show and discussion on the origins of the Greek debt. Updates include Troika scenarios outlined at its June 12 meeting in Bratislava, the IMF walkout after, the failed meetings that occurred in Brussels over the weekend of June 13-14, and Greece’s proposals of June 15 rejected again by the Troika. Also discussed are the sabotage of the Greek government negotiators by their own Greek Central Bank, which on June 17 publicly declared Greece should sign the Troika’s latest package; Greek prime minister, Tsipras’, warmly welcomed visit to Russia on the same day; and the failed meeting of June 18 of Euro finance ministers in Luxemburg at which it was expected Greece would concede to the Troika’s position but didn’t. Jack notes the growing statements by German and IMF representatives that a managed default and Greek exit is preferable to continuing Greece’s unresolvable debt crisis. Were Greece to agree to the Troika’s position, and generate a $2-$3 billion a year surplus (by cutting spending and raising sales taxes) that it would take Greece 150 years to pay off the Troika debt. Greece cannot pay and cannot ‘grow out of’ the crisis, Rasmus argues. Rumors continue to grow that Greece may rearrange its cabinet, replacing hardliners with more amenable cabinet members should it agree to more Troika cuts in exchange for some debt restructuring. The political and economic risks for both sides of continuing negotiations and of default are noted. Default is quite possible, Rasmus notes, but the most likely 60-40 scenario is some kind of more concessions by Greece for some kind of debt restructuring over the next 90 days, as the current extension is extended yet again.
Despite the grievous state of the Ukrainian economy, the IMF said it will continue to lend money to Ukraine, so Kiev can complete economic restructuring. “In the event that a negotiated settlement with private creditors is not reached and the country determines that it cannot service its debt, the Fund can lend to Ukraine consistent with its Lending-into-Arrears Policy,” IMF …
