Tuesday, April 22, 2014

Serious Financial Problems in Puerto Rico and What Should Be Done About It

Adam Muntner emails:
I was looking at the Texas Ratio for a number of banks and observed that among the worst banks with a billion or more in assets, Puerto Rico is statistically over represented. The commonality is that they all have terrible ratings for non-performing loans...

Then there is this: http://fusion.net/leadership/story/puerto-rico-legalizing-prostitution-marijuana-fix-debt-crisis-586448

While I support legalizing drugs and prostitution, PR thinks they can be legalized and taxed to raise more money to fix their debt problems, as if "not enough taxes" are the problem as opposed to spending.

There is one good suggestion mentioned in the comments: exclude PR from the Jones Act that requires all goods to be shipped in from the US merchant fleet, which turns PR into a mercantilist colony and prevents trade with neighbors.

The best thing for PR to do would be to leave the US and become a free port but the locals are too brainwashed by US govt propaganda. They for  a time even criminalized the PR independence movement, banned its flag and *speaking of* independence (no joke, Ley de Mordaza in 1948 - http://en.wikipedia.org/wiki/Gag_Law_%28Puerto_Rico%29 )



  1. The people of PR are also too dependent on USG handouts to vote independence. The Jones act should be scrapped totally, not just for PR.

  2. "The best thing for PR to do would be to leave the US and become a free port but the locals are too brainwashed by US govt propaganda."

    Getting all the benefits of statehood w/ little of the costs, including admission to the welfare state, is "brainwashing"? Sorry, there's little benefit to the citizens of this country to keeping Puerto Rico on the rolls except as a tax haven for large corporations. If anything, Puerto Rico's status is "open borders" in reverse. What a debacle. Free PR alright - for the US taxpayer!

  3. Isn't it amazing how these idiot statists always think the problem is that not enough money has been stolen from people instead of realizing that their spending far too much of other people's hard earned income? Thieves are not known for their morality though.

  4. What is ridiculous is that the terms "regulate" and "to tax" often follow the word "legalize".

    With enough regulation you can prevent suppliers from offering goods to the public.

    With enough taxes you can raise the price of the good so that only a small group of the most urgent consumers will pay it thus crippling its trade.

    And yet even though suppliers are burdened and consumers must pay more for a good than its market price, its been legalized!!! We are all free now! Sheesh.

  5. "Getting all the benefits of statehood w/ little of the costs"

    Which benefits? The island has been under social security since SSA's inception. All federal regulations/laws apply to the island. The island is a colony/territory and falls within the jurisdiction of the Secretary of the Interior. The island has had appointed military governors and it wasn't until the 1940's that puertorricans got elect a governor. The idiots in Puerto Rico, in exchange for citizenship in these uSA agreed to put their progeny under conscription for WW1. That agreement is in the Jones Act. Citizenship in these uSA, not because that the island is a State in union but because of a law. Laws can be repealed.

    Trust me, I left Puerto Rico because there was no future for me there. I left for the same reason I would not live in New Jersey or New York. They are typical in their social welfare views as most other Hispanics but many of the welfare laws are imposed from above by the FedGov.

    BTW, my wife is from Mississippi and our honeymoon year (1984-5) we lived in Puerto Rico. Because her residency was in Puerto Rico she no longer could vote in the the Federal elections.
    Puertorricans deserve much of of the grief they bring themselves but these uSA are culpable for a lot of it.

  6. Funny how no matter where it is, government is always 99.999% the reason why there is massive debt and suffering.

  7. Did you know obama bailed out investor's in Puerto Rico behind the public's back?

    The Obama Administration's Backdoor Bailout Of Puerto Rico


    'Backdoor bailout' boosts Puerto Rico's revenues | Reuters