Before island's primary, Sanders criticizes Puerto Rico plan

AP News
|
Posted: May 23, 2016 5:18 PM
Before island's primary, Sanders criticizes Puerto Rico plan

LOS ANGELES (AP) — Two weeks before Puerto Rico's primary, Democratic presidential candidate Bernie Sanders says a deal between House leaders and the Obama administration to help the island out of debt has colonialist overtones.

In a letter to fellow Senate Democrats on Monday, the Vermont senator says the House bill to create a control board and allow some restructuring of the U.S. territory's $70 billion debt would make "a terrible situation even worse." House Democratic Leader Nancy Pelosi and the Obama administration are supporting the Republican legislation, which is scheduled for a committee vote this week.

Sanders said the bill would empower an "unelected and undemocratic oversight board" and criticized the legislation for allowing the governor of Puerto Rico to cut the minimum wage temporarily for some younger workers.

"We must stop treating Puerto Rico like a colony and start treating the American citizens of Puerto Rico with the respect and dignity that they deserve," Sanders wrote.

Sanders is trailing Democratic rival Hillary Clinton in the presidential primaries and Clinton has outperformed Sanders among Latino voters. Both are competing in the June 5 Puerto Rican primary.

In a statement last week, Clinton said she has serious concerns about the power of the control board but believes the legislation should move forward, or "too many Puerto Ricans will continue to suffer."

So far, Sanders' opposition hasn't swayed Democrats who are supporting the bill. Arizona Rep. Raul Grijalva, one of a small number of House lawmakers backing Sanders' presidential bid, is the top Democrat on the House committee that will consider the legislation. His office reiterated his support for the deal after Sanders sent the letter Monday.

Grijalva "understands that there are Democratic concerns with the bill, but he's been very involved with the negotiations over these past few months and understands that this bill is a compromise," said spokeswoman Diane Padilla.

Padilla said it's not the bill Grijalva would write, but the Treasury Department "has reassured him that it'll help get the people of Puerto Rico back on their feet, which is what he ultimately wants." Treasury Secretary Jacob Lew, who was also involved in negotiations, has called the legislation a "fair, but tough bipartisan compromise."

Puerto Rico, which has struggled to overcome a lengthy recession, has missed several payments to creditors and faces a $2 billion installment, the largest yet, on July 1. Two government agencies have been under a state of emergency, and the economic crisis has forced businesses to close, driven up the employment rate and sparked an exodus of hundreds of thousands of people to the U.S. mainland.

Sanders' opposition could cause more problems in the Senate, where one lawmaker can slow a bill's progress. Senate Democratic Leader Harry Reid had no immediate comment on Sanders' letter.

Senators have said they are waiting to see what happens in the House before they consider a bill, so it could be weeks or months before the chamber takes up the issue. Sanders has been largely absent from Senate proceedings during his lengthy primary campaign.

In his letter, Sanders warned that the control board would have the power to cut the budget, slash pensions and take other measures. He notes that most of the control board would be chosen by House Speaker Paul Ryan, R-Wis., and Senate Majority Leader Mitch McConnell, R-Ky.

He noted that unions have opposed the bill, due to the minimum wage provision and a proposed suspension of the Obama administration's overtime rules for the island. Sanders said the legislation "looks out for the needs of Wall Street vulture funds first and foremost."

Bondholders, including hedge funds, have lobbied to make sure the legislation ensures their rights as creditors are held up by the control board. Republicans say the legislation would force the control board both to honor creditors and find a way to pay for government pensions, which have been underfunded by more than $40 billion.

Ryan has strongly supported the bill, saying it is the only way to avoid an eventual bailout of the territory.

Puerto Rican officials are more in line with Sanders. Gov. Alejandro Garcia Padilla said last week the bill isn't "consistent with our country's basic democratic principles." He wants a less powerful board that can't fully control the island's finances.

___

Jalonick reported from Washington.

___

Follow Ken Thomas on Twitter: https://www.twitter.com/kthomasDC