QuickTake Q&A: Why Puerto Rico’s Debt Became a National Issue
People walk on a street in Old San Juan, Puerto Rico.
Photographer: Christopher Gregory/BloombergThis article is for subscribers only.
Puerto Rico, like other U.S. territories, doesn’t normally get front-burner attention in Washington. But its huge debt has become a pressing issue for Congress, the Supreme Court and the municipal-bond market. As a territory, Puerto Rico enjoyed certain advantages as it accumulated its debt. As a territory, it’s now fighting limits on what to do about it.
Puerto Rico, already delinquent on its debt payments, can’t afford a $2 billion bill due on July 1. With an eye on that deadline, the House of Representatives is considering legislation that would enable restructuring of Puerto Rico’s debt, delay lawsuits against the territory and create a federal control board to oversee its finances.