"Colonial Control Board" Poised to Have Hands on Puerto Rico's Finances

"Colonial Control Board" Poised to Have Hands on Puerto Rico's Finances

Puerto Rico’s finances are poised to be controlled by what critics dub “a colonial control board” after the U.S. Senate on Wednesday advanced the so-called PROMESA legislation.

The motion for cloture passed 68-32, which “makes final passage of the legislation a virtual certainty,” The Hill reports.

It’s “identical to the plan passed by the House of Representatives this month,” as Reuters reports, and comes just two days ahead of the deadline for the territory to make $2 billion of bond payments.

The White House has also indicated President Barack Obama would sign the measure.

Puerto Rico owes $72 billion in debt, but as a U.S. territory is ineligible for federal bankruptcy protection. According to geopolitical analyst Eric Draitser,

Religious development coalition Jubilee USA has urged the Senate to vote for final passage on the measure, with Eric LeCompte, its executive director, saying Monday, “If legislation doesn’t pass before July 1st, we are opening the door for vulture funds to exploit Puerto Rico.”

Democracy Now! host Juan Gonzalez, meanwhile, said that while the bill “would establish a means for Puerto Rico to restructure its $72 billion in debt,” it would also impose “a colonial control board.”

The “rescue package” would also allow for the minimum wage to be slashed for some workers.

Gonzalez said Wednesday, “it’s astonishing to me how so many liberals in this country, who rail about American aggression abroad, are being so silent over this absolute imposition of colonial control by the United States government over the affairs of Puerto Rico. And Jack Lew, the secretary of treasury, spent almost all day yesterday basically meeting with Democratic senators to convince them, to pressure them to support this bill.”

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He added that Senate approval of the bill would mean “a really dark day for the people of Puerto Rico, who are completely opposed to this bill.”

PROMESA has critics within the Senate as well, such as Sen. Bob Menendez (D-N.J.), who took to the chamber’s floor for hours Tuesday arguing that the bill needed improvements. Politico reports:

Bernie Sanders is also opposed to the legislation, and spoke against the measure on the Senate floor on Tuesday, saying that it would favor “vulture capitalists.”

He also argued last month that it “would make a terrible situation even worse.” The majority of the outside control board members would be handpicked by Majority Leader McConnell and House Speaker Paul Ryan “while the people of Puerto Rico would be in charge of choosing none,” he stated.  “That may make sense to the Tea Party and one of the largest trade groups representing Wall Street—groups that endorsed this legislation—but it makes absolutely no sense to me.”

Alejandro García-Padilla, the governor of Puerto Rico, writes at CNBC Wednesday that Puerto Rico has no choice other than to default on more than $1 billion, and that it “cannot endure any more austerity.” As for PROMESA, he says it’s “a mixed bag.”

A final vote will come on Wednesday, the Associated Press reports.

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