Why not sell of the island, or part of it for seasteading?
Puerto Rico files for biggest ever U.S. local government bankruptcy
271–280 of 481 posts
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#272Earlier quoted context omitted.
> But if we make it our social norm that bankruptcy is nothing to be ashamed of and to be taken lightly I don't know about "taken lightly" but bankruptcy and defaulting on a debt should not be something to be "ashamed" of, for an individual, a company, or a government. Default is an option specifically written into every debt contract out there. There should be no more shame in choosing to default as there would be f…
> There should be no more shame in choosing to default as there would be for choosing to exercise a stock option that causes your counterparty lose all his money. Defaulting on a debt is not about shame. Governments don't feel shame. The ramifications are that future credit becomes much more expensive, as the next contract's debt provisions will be harsher. > No surprise that it's mainly bankers pushing the "it's imm…
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Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#273Earlier quoted context omitted.
Lowering taxes only works if you can combine it with something else that will keep the companies in place afterwards, such as a critical mass of specialized workers, infrastructure, etc. Otherwise it's just playing the downward-spiral game in a saturated market. The federal government should create a 10-year plan to subsidize PR and fix its economy/democracy from the ground up. If you look at Eastern Europe, it takes…
> that's magical thinking, and usually from corrupted politicians turfing their funders. Subsidization is the game that corrupt politicians love. Not so much lowering taxes (and therefore their power to choose the beneficiaries among their friends/special interests). Unless of course the tax reduction is via a myriad of specialized loopholes and deductions, then it could be directed at a chosen few.
Spending money and cutting taxes are essentially equivalent, though.
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#274Earlier quoted context omitted.
Probably recreating the tax climate that attracted pharmaceutical manufacturers and was allowed to lapse would be more effective than trying to gin up tourism (although in my opinion probably that wouldn't be all that helpful either).
Lowering taxes only works if you can combine it with something else that will keep the companies in place afterwards, such as a critical mass of specialized workers, infrastructure, etc. Otherwise it's just playing the downward-spiral game in a saturated market. The federal government should create a 10-year plan to subsidize PR and fix its economy/democracy from the ground up. If you look at Eastern Europe, it takes…
Well, nevertheless, the exodus of the pharmaceutical industry was a disaster. I agree that something more serious is needed but obviously the federal government is more concerned with making sure a handful of well-placed people can profit handsomely off their high-risk investments in Puerto Rican bonds.
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#275Earlier quoted context omitted.
Same as always. If you do visit make sure to email me. Ill take you out to a nice dinner.
Do you have any recommendations for first-time visitors? Apart from Culebra we have no idea what we want to see.
Absolutely. Go to the west side to Cabo Rojo. Eat some great fresh seafood. Then head to Lajas (15 min drive) at night to see the bioluminiscent bay (wear jeans and bring mosquito repelent). Then go to the east side and end up in Fajardo. Visit El Yunque and then eat some local delicacies in los kioskos. After all that, call me, and Ill take you to my dads hacienda where Ill serve some rice and beans while you relax in a hammock and look at El Yunque from a distance.
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#276Earlier quoted context omitted.
Very true. Puerto Rico is a look into the future. Illinois and other states are <20 years away from the same fate.
Which states are at risk of default?
Right now everyone is solvent.
But as more Medicaid costs shift to states and they have to face their underfunded or unfunded pension obligations, things will get nasty.
Iirc, New Jersey (recent governors have balanced the cash budget by suspending pension fund payments), Massachusetts and Illinois are in the worse shape.
Other states are a mess, but are more sound. New York pension obligations are guaranteed by the state constitution, and pension contributions have taken place but the high taxes and presence of Wall St have mostly funded the obligations. (They do have an issue with the low interest rate environment and expectation o 7% returns)
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#277Earlier quoted context omitted.
Crazy. So if you move to PR but making money from other US based interests you get exempted from US federal income tax, but if you move and work permentantly in say Germany, you still get charged US Federal Income tax?
Here's the relevant IRS rule: https://www.irs.gov/taxtopics/tc902.html
The relevant laws in PR are Laws 20 and 22. https://www.the2022actsociety.org
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#278All that text about Puerto Rico's financial difficulties and not one mention of the rampant fraud that spun up the debt from a reasonable amount to the $XB that is likely to default is the result of graft, corruption, and fraud enabled by many US and international actors. Want to take a guess how many of those responsible for the transactions, debt issues, and back-office fund transfers are in jail and all their asse…
its moral hazard by many parties, but after what happened in 2008 and the lack of punishment that should have come to wall street, the financial system learned that they could get away with anything.
2008, Savings & Loans...
Finance really can do anything
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#279Earlier quoted context omitted.
Crazy. So if you move to PR but making money from other US based interests you get exempted from US federal income tax, but if you move and work permentantly in say Germany, you still get charged US Federal Income tax?
That was my question. The US is one of two countries where US citizens are required to file taxes even if they're not living in the country (the other is Eritrea).
If I remember correctly, PR and Guam are the two places in the world where your income is exempt from federal income tax, if you pay local taxes. There are some exceptions to that.
It's supposed to give some local autonomy to the taxation process and fiscal management.
Re: Puerto Rico files for biggest ever U.S. local government bankruptcy
#280Earlier quoted context omitted.
> If everyone has the expectation that the lenders and borrowers will try their best to live up to the contract they made in good faith, wouldn't it be a better equlibrium? What makes you think Puerto Rico did not try? How much longer will the poor have to suffer until you accept they've learned their lesson? Some facts about Puerto Rico: Puerto Rico is poor, almost half of the people live below the poverty line. The…
I wasn't making commentary about Puerto Rico, except in taking exception to the poster above me who was pushing the line that not only should Puerto Rico default on their debt, they shouldn't even regard it as a bad thing that they have to, since after all the people lending them the money knew it might never get paid back and built it into the interest they charge.
What is the exception you're taking? It sounds like it's the "regard it as a bad thing" part, which you present without support.
As long as we're talking about pushing lines.