municipal bankruptcy

Puerto Rico: More Views, Including on the Role of the Obama Administration

03/08/16

Watch here at 1pm ET to see former Treasury official Brad Setser, now senior fellow at the Council on Foreign Relations, talk about Puerto Rico (along with Cate Long, Dick Ravitch, and Aaron Kuriloff).

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Puerto Rico: Facilitate an Exchange Offer, Now

03/04/16

Jacoby asks what can the Executive Branch do to help out Puerto Rico.  The most practical thing it could do, right now, is to facilitate an exchange offer.  Whether the Treasury itself can act as a mediator, or at least facilitate mediation by some outsider, this seems like the quickest way to a real solution to the near-term problems the Commonwealth faces.  Treasury might also act as an overseer of reforms and a (comparatively

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Puerto Rico: Eminent Domain, Greenbacks, and the Exchange Stabilization Fund--Some Outside-the-Box Musings

03/03/16
The Puerto Rico situation feels a little like a McGuyver episode.  How do we get out of a locked room with only a rubber band and a toothpick?  Here are some half-baked thoughts, first on the nature of the problems and then some ideas for solutions.  
 
To set the stage, there seem to me to be three core problems facing Puerto Rico.  First and most immediate is a leverage problem.  There’s simply too much leverage for what the Puerto Rican economy can support.  Second, there is a priorities problem.
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Puerto Rico And (Very) Soft Executive Power

03/02/16

Melissa's post asked what the executive branch could do to facilitate restructuring of Puerto Rico's debt. I'll get to that, but I first want to talk about Puerto Rico itself. At first glance, the Commonwealth seems to be in a uniquely terrible position. It has the disadvantages of a sovereign (e.g., no bankruptcy) but lacks the advantages (e.g., legal and/or practical immunity from legal enforcement).

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Puerto Rico's Recovery Act to be Considered by Supremes

12/04/15

In a somewhat surprising move, the Supreme Court has granted cert. to consider if Puerto Rico's Recovery Act is preempted by section 903 of the Code. I have previously argued it is not, but the First Circuit disagreed. We will now see who wins.

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What? (Puerto Rico Edition)

11/03/15

So former Senator Judd Gregg has an op-ed in The Hill opposing the administration's plan for a territorial version of chapter 9. In the piece, he tells us "[a]ny bankruptcy bill for Puerto Rico would punish retirees whose pension funds invested in these bonds because they were tax-free."

Tax free retirement funds investing in tax free bonds?  Now we are just making stuff up.

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