Declare Bankruptcy in Puerto Rico

In a rare show of bipartisan support, Congress passed a bill last June to save Puerto Rico from a debt spiral and certain economic collapse. Known as “Promesa,” the bill was a tough compromise based on hard facts about the state of the island’s finances. Unfortunately, an outbreak of wishful thinking on the part of the local government threatens to sabotage the hard-won gains the bill promises for the 3.5 million Americans who call Puerto Rico home.

Neither Democrats nor Republicans got all they asked for with Promesa. Critically, the law failed to provide Puerto Rico’s most vulnerable with Medicaid funding and an earned income tax credit – matters that Congress still needs urgently to address. But it did create two mechanisms essential to ending the island's fiscal crisis and building a foundation for growth.