Why is Puerto Rico in bankruptcy?
globalpoliticsandlaw.com
globalpoliticsandlaw.com
Even with the problems listed in the article their economic situation from the the 90s to now was not unmanageable, it was corruption and corporate collusion to extract the maximum amount of money from the island that expanded the problems to their current levels. Becoming a state would put enough regulation and oversight in place to make those problems go away, or at least put their corruption on the same level as a normal US state.
The short run... There will be problems.
Becoming a state wouldn't fix the combined impact of NAFTA + the Jones Act, which alone is enough to wipe out the economy[0]. Corruption may be a cherry on top, but eliminating that doesn't solve the problem that there is simply no way they can export anything at a competitive rate, and that they also can't import things they need at reasonable prices either.
And becoming a state is in Puerto Rico's best interests, but it doesn't fix this problem either. Hawaii is suffering as well from the Jones Act - the difference is that Hawaii's economy was slightly less dependent on NAFTA-affected trade, and over 20% of Hawaii's economy comes from the military and national defense. So Puerto Rico is hit harder, but not for reasons that would be solved by statehood.
[0] NAFTA itself would not have been as much of a problem for Puerto Rico if it weren't for the Jones Act, so it's specifically the combination of both that's relevant.
As stated, statehood would not solve this part of the problem for Puerto Rico (i.e., they would need a Jones Act exemption as well).
Similarly for Puerto Rico, wouldn't Florida -> The Bahamas -> Puerto Rico solve some of the issues?
The only issue with adding foreign stops is the additional import/export regulations. NAFTA solves some of that for an intermediary stop in Canada/Mexico, but doesn't do much to help Puerto Rico's situation.
Statehood itself might not directly solve this, but it would get them representation. Two senators and a handful of congressmen can solve a great deal of problems.
I agree the export situation is not ideal. I disagree that this is the a game-ending proposition for the Puerto Rican economy. Without corruption, or at least some corruption mitigation the state of Puerto Rico could at least move in one direction... One direction, speaking of famous people Did you Ricky Martin, Benicio Del Toro and Joaquin Phoenix are all Puerto Rican. Did you know that there are software companies there, mostly boring B2B and financial stuff because of the friendly tax situation there. It seems a real place with real people can produce Stars and Software even when there is corruption.
Imagine if they could use some federal funds to clean up the broken glass and old plastic from their beaches while they clean out their oligopoly. An actual tourism industry with actual competition.
Exports can be important or can be minor. Clearly it is not the only thing in $103 billion per year economy of Puerto Rico. Consider that Nebraska (I keep using NE because the other half of my family is there) is only generating $80 billion per year and is landlocked so the Nebraskan export situation is even worse and few are attesting to the dire state here.
The only reason against it I can see is a short term one: if PR were seen to add a Party X congressional delegation, Party Y might try to block statehood.
Because the new obligations we'd be taking on wouldn't be offset by the benefits.
As it is now they cost us more, getting them to be more self sufficient like every state is, would cost us less even if they never contributed after they fixed their problems.
Then there is the human side of this. Sentences like "Because the new obligations we'd be taking on wouldn't be offset by the benefits" entirely ignore the human cost. These are our fellow Americans and we are willing to just let them suffer. It says something that we don't help them, and it says something different if we do.
What is generally believed:
Government bonds (with a few exceptions) have always, and will always be paid back no matter how much money the government loses, or how bad the economy is. Simply because governments can't go bankrupt.
Reality:
Government bonds, for all governments including the US government, have never been paid back, with ONE exception (in 4500 years of capitalist history). As soon as the governments get into trouble, losses are imposed on creditors immediately, and often repeatedly. Since states survive, on average, less than 2 centuries, the default rate on government bonds (including government bonds of global hegemons), over all of history, is about 2.8%.
Therefore any government-issued bond that pays less than 2.8% interest is a net-negative investment.
Even the corollary, that government debt is safer than large company issued debt is wrong. Large companies only have default rates of 2.5%. The difference is even larger in the US because the US of course defaulted in practice when Nixon killed the Gold standard, and so did most if not all governments worldwide. Companies that had issued bonds at the time, most paid them back just fine. Same with WWII. After world war 2, a lot of large company debt was actually transferred back to the owners, whereas even the German state did not even repay it's postwar debts.
Even in cases where it's incredibly ridiculous and morally wrong, governments don't pay back debts. Take for example the German debt to Greece from WWII. The Germans decided not to pay it back, and Greece had no way to enforce this. They still don't, and now that Germany can impose monetary limits on Greece, they still don't see any need whatsoever to pay back their owed debts [1]. And yes, the German debt to Greece FAR exceeds what Greece would need to get out of their crisis. Even now, the German state is not willing to even forgive Greek debt to the amount they still owe the Greeks.
https://en.wikipedia.org/wiki/German_reparations_for_World_W...
And those are supposed to be features?
- Culebra has amazing beaches - Visit the bioluminescent bay - Visit El Yunque. You can do the regular tour or visit other trails. - You can go rapeling - You can go SCUBA diving - You can go visit reefs - You can go zip-lining
They're not limited to PR, but you can do them someplace new/different.
You can escape the cold. (45° here and raining. I _kind_ of wish I was back in PR)
Remember you are responding to comments discussing how it's easier, not "better".
Your comment, as it is, is totally out of place for this thread.
For foreigners, I understand it's probably easier to enter any of the other sovereign islands than a US territory, or (if you're from the EU), any of the colonial islands would also be easy.
If you need a passport, you need a passport. If you need a Visa, you need a Visa.
It might be cheaper or a shorter trip. But besides that it's the same.
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Unless you take a cruise I guess.