The Dark Side of Puerto Rico’s Economic Recovery

The Dark Side of Puerto Rico's Economic Recovery

Guerrero: Kevin de León’s bid for sympathy digs a deeper hole

If Kevin de León were looking for a theme for his campaign for governor of Puerto Rico, perhaps what better than the state’s fiscal health. In a recent Fox News interview about the state’s dismal budget outlook, de León said he was looking for a “light at the end of the tunnel.”

But this week, de León was back with a new theme—the dark side of Puerto Rico’s economic recovery: debt.

De León’s latest attack came in two separate pieces, first in an op-ed in the New York Times (“In Puerto Rico, a Bankrupt Nation”) and earlier this week in an interview with the Washington Post (“The Puerto Rican economy is a shambles”).

In the op-ed, de León compared the state’s debt situation to other sovereign nations in the Western Hemisphere, pointing out that the U.S. is not just the latest victim of “Puerto Rico’s addiction to debt,” but that he “will not leave Puerto Rico or America any worse off than we are now.”

The op-ed is interesting because the debt situation in Puerto Rico is nothing like the U.S. or other Western Hemisphere nations. Most notably, the average debt in Puerto Rico is only 1.36 percent of its GDP, whereas the average debt in the U.S. is 8.3 percent of GDP, according to the Congressional Budget Office.

And even the average debt levels in Puerto Rico are lower than most sovereign debt, with the exception of Singapore and Uruguay, de León said.

But the comparison to other countries was not merely a passing reference to Puerto Rico’s debt. Rather, it was a continuation of his criticisms of the bankruptcy process. And, in fact, the way Puerto Rico is addressing this issue shows why it will never be solved by bailing it out.

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