There's something about Puerto Rico that has caused many commentators to describe it as "America's Greece," and it definitely isn't yogurt. Instead, it's the terrible state of the US commonwealth's economy, which has caused Gov. Alejandro Garcia Padilla to admit that its $72 billion debt is "not payable," the New York Times reports. "This is not politics, this is math," he says. The island's rate of debt to GDP is higher than that of any US state, and its government could run out of cash as soon as July, triggering a government shutdown and other measures, reports the Wall Street Journal, which notes that Puerto Rico's deep recession began after corporate tax breaks expired in 2006 and manufacturers started to leave the island.
The governor says Puerto Ricans are already struggling with issues such as government austerity, rising crime, and high unemployment and that it's time for creditors to share the pain by deferring repayments. "If they don't come to the table, it will be bad for them," he tells the Times. "What will happen is that our economy will get into a worse situation and we'll have less money to pay them. They will be shooting themselves in the foot." Some 24% of Puerto Rico's bonds are held by so-called "vulture funds" that specialize in high-risk efforts and have opposed efforts to restructure the debt, the Guardian reports. The Times notes, though, that many Americans may have Puerto Rican investments tied up in mutual funds and not be aware of it.