Editing Government of Puerto Rico (section)

===Public debt===
{{Main article|Public debt of Puerto Rico}}

In May 2007, local economists expressed serious concerns when it was revealed that the [[Puerto Rico public debt]] equaled to 76% of its [[gross national product]] (GNP), making it one of the most indebted countries by percentage in the world, even more than the United States.<ref name="ENDI_76_centavos">[http://www.endi.com/noticia/portada/noticias/debe_puerto_rico_76_centavos_de_cada_dolar/208760 ''Debe Puerto Rico 76 centavos de cada dólar''] by Joanisabel González, [[El Nuevo Día]], May 5, 2007, accessed May 5, 2007 (Spanish)</ref>{{update inline|date=November 2012}}  Economists have criticized the government's fiscal policy, whose level of expenditures and indebtedness has increased significantly within the past decade while the economy was grown at a much slower pace. Between 2000 and 2006 alone, Puerto Rico's GNP rose 5.37%, while its public debt's relation to GNP rose 18%.<ref name="ENDI_76_centavos"/> By comparison, many other Latin American countries have seen reductions in their GNP-public debt percentages during that same time period.<ref name="ENDI_76_centavos"/>

By early 2017, the [[Puerto Rican government-debt crisis]] posed serious problems for the government which was saddled with outstanding bond debt that had climbed to $70 billion or $12,000 per capita<ref name="Baribeau">{{cite web |url=https://www.forbes.com/sites/debtwire/2017/01/23/united-states-virgin-islands-risks-capsizing-under-weight-of-debt/#570913e73673 |title=United States Virgin Islands Risks Capsizing Under Weight Of Debt |last=Baribeau |first=Simone |date=January 23, 2017 |website=[[Forbes]] |access-date=February 15, 2017}}</ref> at a time with a 45 percent poverty rate and 12.4% unemployment that is more than twice the mainland U.S. average.<ref>{{cite web |url=http://www.thefiscaltimes.com/latestnews/2017/01/18/Puerto-Rico-oversight-board-favors-more-time-restructuring-talks |title=Puerto Rico oversight board favors more time for restructuring talks |author=Nick Brown |date=January 18, 2017 |website=Fiscal Times |publisher=The Fiscal Times |access-date=February 16, 2017}}</ref><ref name="Baribeau"/> The debt had been increasing during a decade long recession.<ref>{{cite news |author=Associated Press<!--Staff writer(s); no by-line.--> |title=Puerto Rico Gets More Time |url=http://www.starherald.com/news/nation_world/puerto-rico-gets-more-time-to-propose-fiscal-plan/article_b805f0e6-f333-5d33-8d94-d29a610d820a.html |newspaper=Star Herald |location=Scottsbluff, ME |date=January 29, 2017 |access-date=February 16, 2017 }}{{dead link|date=July 2017 |bot=InternetArchiveBot |fix-attempted=yes }}</ref>

The Commonwealth had been defaulting on many debts, including bonds, since 2015.  With debt payments due, the Governor was facing the risk of a government shutdown and failure to fund the managed care health system.<ref>{{cite news |last=Platt |first=Eric |date=January 19, 2017 |title=New Puerto Rico governor seeks amicable debt crisis resolution |url=https://www.ft.com/content/d9551584-de66-11e6-86ac-f253db7791c6 |archive-url=https://ghostarchive.org/archive/20221210/https://www.ft.com/content/d9551584-de66-11e6-86ac-f253db7791c6 |archive-date=2022-12-10 |url-access=subscription  |newspaper=Financial Times |location=New York |access-date=February 17, 2017}}</ref><ref name="Watson">{{cite web |url=https://www.treasury.gov/connect/blog/Pages/Secretary-Lew-Sends-Letter-to-115th-Congress-on-Puerto-Rico.aspx |title=Secretary Lew Sends Letter to 115th Congress on Puerto Rico |last=Watson |first=Dan |date=January 17, 2017 |website=Department of the Treasury |access-date=February 16, 2017}}</ref> "Without action before April, Puerto Rico’s ability to execute contracts for Fiscal Year 2018 with its managed care organizations will be threatened, thereby putting at risk beginning July 1, 2017 the health care of up to 900,000 poor U.S. citizens living in Puerto Rico", according to a letter sent to Congress by the Secretary of the Treasury and the Secretary of Health and Human Services. They also said that "Congress must enact measures recommended by both Republicans and Democrats that fix Puerto Rico’s inequitable health care financing structure and promote sustained economic growth."<ref name="Watson"/>

Initially, the oversight board created under [[PROMESA]] called for Puerto Rico's governor [[Ricardo Rosselló]] to deliver a fiscal turnaround plan by January 28. Just before that deadline, the control board gave the Commonwealth government until February 28 to present a fiscal plan (including negotiations with creditors for restructuring debt) to solve the problems. A moratorium on lawsuits by debtors was extended to May 31.<ref>{{cite news |author=Associated Press<!--Staff writer(s); no by-line.--> |url=http://www.starherald.com/news/nation_world/puerto-rico-gets-more-time-to-propose-fiscal-plan/article_b805f0e6-f333-5d33-8d94-d29a610d820a.html |newspaper=Star Herald |location=Scottsbluff, ME |date=January 29, 2017 |access-date=February 16, 2017 }}{{dead link|date=July 2017 |bot=InternetArchiveBot |fix-attempted=yes }}</ref> It is essential for Puerto Rico to reach restructuring deals to avoid a bankruptcy-like process under [[PROMESA]].<ref>{{cite web |url=http://www.thefiscaltimes.com/latestnews/2017/01/18/Puerto-Rico-oversight-board-favors-more-time-restructuring-talks |title=Puerto Rico oversight board favors more time for restructuring talks |author=Nick Brown |date=January 18, 2017 |website=Fiscal Times |publisher=The Fiscal Times |access-date=February 16, 2017 |quote=The bipartisan, seven-member oversight board was created under the federal Puerto Rico rescue law known as PROMESA, passed by the U.S. Congress last year. It is charged with helping the island manage its finances and navigate its way out of the economic jam, including by negotiating restructuring deals with creditors.}}</ref>

Statehood might be useful as a means of dealing with the financial crisis, since it would allow for bankruptcy and the relevant protection. In the [[Puerto Rican status referendum, 2020]], the majority of voters approved of Puerto Rico becoming a state.<ref>{{cite web|title=Plebiscito Resulatados Isal|trans-title=Island Plesbiscite Results|work=Comisión Estatal de Elecciones|trans-work=[[Puerto Rico State Commission on Elections]]|url=https://elecciones2020.ceepur.org/Escrutinio_General_93/index.html#en/default/PLEBISCITO_Resumen.xml|access-date=December 31, 2020|language=es|archive-url=https://web.archive.org/web/20210202072404/https://elecciones2020.ceepur.org/Escrutinio_General_93/index.html|archive-date=2021-02-02|url-status=live}}</ref> However, the referendum was non-binding, and there has been little federal action since the referendum.

According to the Government Development Bank, statehood might be the only solution to the debt crisis. Congress has the power to vote to allow Chapter 9 protection without the need for statehood, but in late 2015 there was very little support in the House for this concept. Other benefits to statehood include increased disability benefits and Medicaid funding, the right to vote in Presidential elections and the higher (federal) minimum wage.<ref>{{cite web |url=https://www.theatlantic.com/business/archive/2015/11/ben-carson-puerto-rico/415014/ |title=Why Puerto Rican Statehood Matters So Much Right Now |last=White |first=Gillian B. |date=November 9, 2017 |website=[[The Atlantic]] |publisher=The Atlantic Monthly Group |access-date=February 21, 2017 |quote=Six words: the ability to file for bankruptcy}}</ref>