House GOP opposes bankruptcy protections for Puerto Rico
WASHINGTON (AP) — Leading House Republicans declared their opposition Wednesday to allowing debt-ridden Puerto Rico access to Chapter 9 bankruptcy protections, raising new uncertainty about how the island can emerge from its financial crisis.
A statement from House Judiciary Chairman Bob Goodlatte of Virginia said members of his committee share a concern that “to provide Puerto Rico’s municipalities access to chapter 9 of the Bankruptcy Code would not, by itself, solve Puerto Rico’s difficulties, which are associated with underlying, structural economic problems.”
Earlier, House Speaker John Boehner, R-Ohio, referred reporters asking about the issue to Goodlatte’s committee.
The White House and leading Democrats, including presidential candidate Hillary Rodham Clinton and Sen. Chuck Schumer of New York, have raised bankruptcy as a possible way out of Puerto Rico’s economic crisis.
As a U.S. territory, Puerto Rico is prohibited from allowing its municipalities, such as a debt-burdened state-run power company, to enter bankruptcy protection as a way to restructure their debts. Schumer is pursuing legislation to change that, though he has not yet succeeded in attracting Republican co-sponsors. The reaction Wednesday from House Republicans suggests such a bill could hit a dead end in the House anyway.