Today, the Senate voted to advance the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA), the bipartisan agreement to address Puerto Rico’s growing debt crisis. The House passed it two weeks ago.
As I noted then, like many bipartisan deals in DC, PROMESA it is filled with toxic anti-worker and anti-democratic provisions. PROMESA shows clearly that Washington cares more about bondholders than the working people of Puerto Rico.
Also, to quote my piece from two weeks ago:
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Senator Robert Menendez (D-NJ) gave a great floor speech a few weeks ago highlighting the flaws of PROMESA:
“I rise to speak about the ongoing crisis affecting the 3.5 million American citizens in Puerto Rico and to comment on the legislation pending in the House.
“We are facing a critical moment in the history of Puerto Rico. The island is sinking under a mountain of debt. I’ve said it before but it bears repeating: Just servicing the government’s $72 billion debt swallows 36 percent of the island’s revenue. That means that for every dollar Puerto Rico takes in, they immediate send over a third off to bondholders. This is not sustainable for any government, especially one that has been mired in a decade long recession.
“Congress is faced with an immediate and serious choice. Indeed, the decisions we make in the next month will have profound consequences on the people of Puerto Rico for a generation. The stakes are so high, we simply have to get this right.
“I’ve said from the beginning that any fix needs to provide a clear path to restructuring, with an oversight board that represents the people of Puerto Rico and respects their democratic rights. And, if we truly want to help the economic situation on the island, we also need to provide parity for healthcare funds and worker tax credits that all 3.5 million American citizens living in Puerto Rico have access to once they move to the mainland.
“Now, I must say I’ve been encouraged by Speaker Ryan and Chairman Bishop’s acknowledgment that Congress needs to act to prevent this fiscal crisis from becoming a full blown humanitarian catastrophe. But unfortunately, the legislation that is being marked up tomorrow falls short on several fronts.
“Instead of offering a clear path to restructuring, the legislation creates a number of obstacles that could derail the island’s attempts to achieve sustainable debt payments. Most striking, it requires a 5 to 2, supermajority vote by the control board to access this necessary restructuring authority.
“While most reasonable people agree it’s absolutely vital for Puerto Rico to be able to restructure its debt, this authority can be blocked by a simple minority of the board. And without the authority to restructure its debt, this legislation does virtually nothing to help Puerto Rico to dig out of the hole they’re in.
“Exacerbating this concern is the composition and scope of power endowed to the control board. The fact that the Puerto Rican people will have absolutely no say over who is appointed or what action they decide to take is blatant neocolonialism.
“And while there is some fancy language to pretend that the President will get to pick the board members, this is all a fig leaf to hide the real levers of power. The board will be composed of 4 Republican appointees and 3 Democrat appointees, and in addition to being the gatekeeper to restructuring, it will have the power to veto laws and regulations, override budgets, and determine the level of debt payments.
“To me, it’s simply wrong and un-American to take away the basic and fundamental democratic rights of the people of Puerto Rico.
“This bill also puts speculating hedge funds above pensioners, including language to ensure that in any restructuring deal puts the people who worked their entire lives to help the island at the back of the line behind Wall Street. I’ll remind my colleagues that each and every Puerto Rican is an American citizen, many of whom have fought and died for our country in every war over the past century. They deserve the same rights and respect as citizens in New Jersey, Wisconsin, Utah or any other state in the nation.
“Finally, the proposed legislation senselessly cuts minimum wage rules and new overtime protections that would apply to workers in Puerto Rico. At a time when cities and States across this nation are moving towards increasing the minimum wage, I cannot fathom why anyone would support decreasing it for Puerto Rico.
“With a poverty rate of approximately 45%, lowering people’s wages is not a pro-growth strategy, as some have called it; it’s a pro-migration strategy. These unrelated riders are counterproductive and will only drive more Puerto Rican residents to migrate to the mainland, where they won’t have to work for sub-minimum wages.
“Mr. President, as it currently stands, I’m afraid this bill provides little more than a Band-Aid on a bullet hole with regard to Puerto Rico’s unsustainable debt. Mark my words—if we don’t seize this opportunity to address this crisis in a meaningful way, we’ll be right back here in a year from now picking up the pieces. So while it’s absolutely clear that we need to act and act decisively and expediently to help our fellow citizens in Puerto Rico, just as importantly, we need to get this right.
“Working together and helping each other in a time of need is what this country is all about. When a hurricane hits the Gulf Coast or a tornado ravages the Midwest, I don’t ask how many of my constituents in New Jersey were affected. Rather, I stand with my fellow Americans and fight to provide relief, regardless of what state or territory they’re from.
“Let’s continue to honor that timeless American tradition, let’s honor our country’s motto of E Pluribus Unum – “out of many… one” – and provide our fellow Americans in Puerto Rico with the tools they need to dig themselves out of this mess, without taking away their rights of self-governance.”
Kenneth Romero, the executive director of the National Hispanic Caucus of State Legislators, excoriated the bill in a recent op-ed:
So the truth is that PROMESA falls short on its deliverables. It needs to promise more if the goal is to help the people of Puerto Rico — not its creditors nor its government — get out of this mess.
More importantly, PROMESA cannot be another exercise of colonial ruling, leaving the island and its democratically elected government without the power to determine what is best for Puerto Rico. Not a single hearing was held on the island to listen to what the people most affected by PROMESA have to say — 3.5 million American citizens muted. That all of this is happening in the 21st century and under the American flag is not only deplorable, it’s inhumane.
Bernie Sanders similarly condemned the bill in a letter to his colleagues, noting, “We must make it clear that hedge fund managers on Wall Street cannot get a 100 percent return on Puerto Rican bonds they purchased for as little as 29 cents on the dollar yielding interest rates of up to 34 percent while the budget for hungry children in Puerto Rico would be cut.”
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The cloture vote today was 68-32. 32 Democrats and 36 Republicans voted for it. 14 Democrats and 18 Republicans voted against it.
Here are the 14 Democrats:
Tammy Baldwin (D-WI)
Cory Booker (D-NJ)
Barbara Boxer (D-CA)
Sherrod Brown (D-OH)
Maria Cantwell (D-WA)
Joe Donnelly (D-IN)
Joe Manchin (D-WV)
Ed Markey (D-MA)
Bob Menendez (D-NJ)
Jeff Merkley (D-OR)
Patty Murray (D-WA)
Jon Tester (D-MT)
Bernie Sanders (I-VT)
Elizabeth Warren (D-MA)
Thursday, Jun 30, 2016 · 1:26:35 AM +00:00 · Liberty Equality Fraternity and Trees
Several additional votes were taken today.
Bob Menendez offered an amendment to open up the possibility for amendments to the bill. It failed 44 to 54.
The vote was largely party line. However, Ted Cruz (R-TX), Mike Lee (R-UT), and Rand Paul (R-KY) voted for it with the Democrats. Joe Donnelly (D-IN), Dianne Feinstein (D-CA), and Angus King (I-ME) voted against it with the Republicans.
Next up was an amendment to waive all budgetary discipline for the bill. It passed 85 to 13. The 13 consisted of the Democrats who voted against cloture, minus Joe Donnelly (who voted for the amendment) and Joe Manchin (who was not there), plus David Perdue (R-GA).
The Senate then passed the bill 68-30. Again, the number of Democratic NOs closely resembled the cloture vote. Joe Donnelly (D-IN), who voted against cloture, voted against passage. Joe Manchin (D-WV) was not there for the vote.