Trump rejects push to help solve Puerto Rico debt crisis
SAN JUAN, Puerto Rico (AP) — U.S. President Donald Trump said on Thursday that he is opposed to a push to help Puerto Rico resolve its $70 billion debt load as the U.S. territory faces looming austerity measures amid a deep economic crisis.
Trump issued a Twitter blast aimed at efforts to help the island cover its Medicaid costs — an issue that’s entangled in Puerto Rico’s last-minute debt negotiations.
“The Democrats want to shut government if we don’t bail out Puerto Rico and give billions to their insurance companies for OCare failure. NO!” he tweeted.
Trump was referring to negotiations over a huge, government-wide spending bill that includes myriad elements, including abortion-related issues and Obama-era regulations on the environment on regulating Wall Street.
House Minority Leader Rep. Nancy Pelosi, a California Democrat, said at a news conference on Thursday that Puerto Rico remains one of several “outstanding areas of concern.”
Puerto Rico Gov. Ricardo Rossello traveled to Washington D.C. to lobby legislators for relief from a decade-long economic crisis that is blamed partly on previous administrations in the territory that borrowed billions of dollars to cover budget deficits.
Rossello repeated requests that Puerto Rico receive the same amount of Medicaid funding that U.S. states do. It currently receives lower Medicaid and Medicare reimbursements compared with U.S. states, forcing it to spend more than $1 billion a year in Medicaid alone above what it would face if it were a state. Nearly half of the island’s 3.4 million inhabitants rely on Medicaid.
“Democrats are trying to bail out insurance companies from disastrous #ObamaCare, and Puerto Rico with your tax dollars. Sad!” Trump wrote.
Rossello replied in a tweet: “The American citizens of Puerto Rico deserve to be treated fairly. Health and civil rights are not partisan issues.”
Rossello’s spokeswoman issued a press release on Thursday stating that Trump’s statements “do not reflect the overall sentiment regarding the discussion and analysis going on in Congress on this issue.”
Puerto Rico faces a May 1 deadline to either reach a deal with bondholders to restructure a portion of its debt or embrace a bankruptcy-like process. The local government has been negotiating with bondholders since last week.
Puerto Rico legislators on Wednesday alleged that some Republicans were leading efforts to force Puerto Rico to delay implementation of a bankruptcy-like process in exchange for an increase in Medicaid funds.
Puerto Rico expects to have completely spent its $6.4 billion worth of supplemental Medicaid funding by December 2017. That means the island would face an additional $850 million in health care spending by next fiscal year if Congress takes no action. A federal control board overseeing Puerto Rico’s finances warned this week that without additional Medicaid funds, the island could either drop hundreds of thousands of Medicaid recipients or redirect money originally set aside to pay creditors and fund public services.
The crisis has prompted thousands of unionized government workers to go on strike this week to protest upcoming austerity measures, and tens of thousands of students at Puerto Rico’s largest public university have been on strike since early this month to protest millions of dollars of looming cuts.
Associated Press writer Andrew Taylor in Washington, D.C. contributed to this report.