Campaign against debt adjustment plan kicks off with march Tuesday
By John McPhaul
The Citizen Front for the Debt Audit, along with island social, environmental, student, union and professional organizations, is kicking off a campaign in opposition to the debt adjustment plan proposed by the Financial Oversight and Management Board (FOMB) that will deliver more than $7 billion in cash to vulture funds, pay $12 billion in illegal debt and, they say, render the government inoperative in seven years.
The organization called on the people to “March for a Dignified Future: No to the Debt Adjustment Plan” on Tuesday, when the judge handling the government bankruptcy case, Laura Taylor Swain, will decide whether to start the voting process for creditor approval of the debt adjustment plan.
Thousands of people will vote in the process, including bondholders, pensioners, public workers and other unsecured creditors of the government.
“It is important that the people know and understand the terrible repercussions that this debt adjustment plan has for the future of the island,” said Eva Prados Rodríguez, an attorney and spokesperson for the Front, in a written statement. “The FOMB, without a real and comprehensive audit of the debt, is proposing a new payment plan to central government bondholders that puts not only pensions at risk, but also the future of our people. We will not be able to comply with the payment agreement to the bondholders and the real impact will be more cuts to essential services, the closure of schools, municipalities, government offices, university campuses and the rise in the costs of water, electricity and tolls.”
What the oversight board proposes as a new payment plan for bondholders is not a real exit from bankruptcy, Prados Rodríguez said. The Front’s spokesperson made a public appeal to the people who have the right to vote to not support the plan.
“The Legislative Assembly and the governor took the right step with the approval of the Law for a Dignified Retirement to demand another exit from bankruptcy, and it is important that now the people also speak out against it,” said another organizer of the campaign, Justo Méndez.
Prados Rodríguez said the oversight board’s argument that its plan achieves a 61% debt cut is false because, by granting an advance of $7 billion in cash to the vulture funds, that reduction would actually be between 19 percent and 23 percent. In addition, the board did not ask Swain to declare about $12 billion issued in bonds illegal.
According to the most optimistic projections made by the oversight board itself, the economy will collapse as soon as 2030.
“What the Board is guaranteeing with these agreements is the real possibility of a second bankruptcy,” said planner José “Tato” Rivera Santana. “This is an unsustainable agreement to pay, with conditions that are too favorable and unrealistic for bondholders and with serious consequences for the availability of economic resources for health, security, education, culture, and road services, in addition to continuing to weaken our main educational center, the University of Puerto Rico.”
As part of the campaign initiated by the organizations, orientations will be held throughout the island with public workers and other unsecured creditors of the government with the right to vote, along educational efforts through social networks about the real impact of the debt adjustment plan, lobbying in the Legislature and mobilizations.
Among the organizations that have joined the campaign are the Puerto Rico Bar Association, Social Work Professionals Association, Puerto Rican Workers Central, Puerto Rico Teachers Federation, Vamos de Puerto Rico, Legal Aid Puerto Rico, Sembrando Sentido, and El Puente-Enlace Latino de Acción Climático, among others.