More on Puerto Rico

Since Puerto Rico isn't a sovereign nation, it can't get funding from the IMF. Since Puerto Rico isn't one of these 'united' states, it can't go bankrupt through whatever process the federal government has chosen for its little minions.

There is a small possibility that given no other alternatives, they do something nearer to Iceland rather than Greece.
There is an infinitesimal chance that they do the sort of things that would result in them being similar to Singapore.

Nobody in their right mind should be giving loans to monopolies owned by governments, but people do because of perceived safety. The government can come and extract money from you at the point of a gun, so lenders feel like it is a safe bet. But folks have been leaving Puerto Rico for years. There isn't much business, and their government's only answer to that has been to enlarge the bureaucracies, which in turn tend to weaken and destroy any remaining businesses on the island.

Neither the debt nor the bureaucracies are a good thing. In a time of crisis like this, if they both can be repudiated while simultaneously developing a framework for small businesses to thrive, then after a short bumpy ride, they'll probably be alright. In fact, in a generation or two, Puerto Rico might look like the place all the remaining competent Americans went to live.

The key is making a fast transition from a huge government heavily dependent on debt that it never really expects to pay back, to a very small government that understands small businesses are the more productive and employ more people than either governments or multinationals. Few states understand this- often we see governors doing photo-ops with some big corporations and crowing about how many jobs they've brought to the state- in reality those jobs seldom show up, and we often end up with empty facilities that the state has at least partially paid for. We've got a former GM plant in town here- it is most definitely not providing any jobs. All we get are occasional rumors of potential new businesses.

One of the particularly daft things I heard yesterday was that the Puerto Rican power monopoly should go with wind and solar power. They actually showed solar and wind farms on screen while they were discussing it. They do realize Puerto Rico is an island, right? Solar and wind farms take up a crap load of space, and should, in fact, be considered a form of pollution in their own right.

A solar program may be a good idea, but it would be a good idea in a non-monopolistic context. A decentralized solar system in which local people have solar panels and batteries. It would certainly be a good idea if people could sell any excess to each other, but what should not happen is this crazy system where people get wired directly into the grid, but don't have any batteries for when the grid goes down.

But what is probably the best is least likely to happen- small nuclear reactors with modern fail safe designs. This is a good example of why the presumption that Puerto Rico would be better off it there were laws on the books to let it go bankrupt was dubious- there are laws on the books about nuclear power, and they tend to keep everyone stuck with less safe (and more polluting) energy alternatives and/or older, less safe nuclear reactor designs.