Issued March 11, 2020
"Yesterday’s press reporting of an Electronic Municipal Monitoring Access system (“EMMA”) filing notifying the market that a part of the Government of Puerto Rico is now unable to pay bondholders, even AFTER restructuring under PROMESA, provides concrete evidence of what SEIU and its members in Puerto Rico have been saying all along, “PROMESA es Pobreza”, or PROMESA is Poverty. Noted economists have said that the debt of Puerto Rico needs to be cut between 80% and 90% for Puerto Rico for its people to have a sustainable future.
Instead of following that advice, the Government of Puerto Rico agreed to a reduction of only 33% in the Government Development Bank’s debt. The Government’s gift to Wall St. led to a failure only one year and three months later while Puerto Rico is still in bankruptcy. The Oversight Board has done no better in seeking deeper cuts. It too has chosen to reward Wall St. hedge funds at the expense of the people of Puerto Rico.
SEIU warned Congress that such a result would happen because PROMESA did not provide the tools Puerto Rico needed to cut its debt to a sustainable level and succeed in transforming itself. SEIU also warned Congress that a second restructuring proceeding would need to occur if Puerto Rico continues on its current course. Today’s announcement of this default event is proof that SEIU’s members are right, PROMESA es Pobreza for the people of Puerto Rico."
*SEIU makes this statement on its own behalf, and not on behalf of any creditor committee or group participating in the Title III proceedings