Puerto Rico Declares Bankruptcy

[pbrower2a]

(05-05-2017, 10:37 AM)X_4AD_84 Wrote:

(05-05-2017, 08:43 AM)pbrower2a Wrote: I predict political consequences far beyond Puerto Rico. What do you think?

I agree PR won't be the last. So many states are now upside down due to future pension commitments and other future costs. Here in California, in spite of a nearly miraculous recovery from where we were early this decade (we were essentially a West Coast version of a Rust Belt state), due to our crumbling infrastructure on top of the pension issue, new taxes are being levied in the form of an increased fuel tax and vehicle registration fees. More of these to come. While this method will probably prevent BK it will harm our quality of life in other ways even as the potholes get filled and the future pension fund gets bolstered.

I was thinking along the lines of a rush to statehood.

Some states have problems. Infrastructure built all at the same time can fall apart at the same time, and infrastructure that was once inexpensive to maintain becomes in turn fiendishly  expensive to maintain and in turn in need of renovation and replacement. Highways may be the most visible. In general the older a segment of freeway the heavier is its traffic. Sections of Interstate 94 in Michigan are now over sixty years old, and the entire route from the Indiana state line to Ann Arbor is now all at least 55 years old.  It has been repaved, but two lanes in each direction are now inadequate between Kalamazoo and Interstate 69 at Marshall; the interchange between Interstates 69 is an obsolete cloverleaf with tight turns. Having driven that stretch of freeway I can tell you that it is dangerous because of the disparity of truck and car speeds. I-94 should have been rebuilt as a six-lane expressway when the opportunity existed.

But traffic jams are obvious enough for someone to see and experience. Sewage systems are arguably more critical.

Michigan was the "California of the Midwest" in building its freeway system early, especially in Detroit. Except in mountainous areas that get heavy snows. California could get away with limited maintenance on most freeways because of mild weather. But even that has its limits. California's freeway system used to be one of the technological wonders of the world, but it now looks primitive and worn out.

Back to Puerto Rico. Political entities can go bankrupt for many reasons. One is projects that do harm. Detroit was a pioneer in freeways, but the freeways took middle-class people quickly out of Detroit and with them the funds from the tax base. Detroit may be a wreck for other reasons, but its vanishing middle class is much of the cause of the biggest municipal bankruptcy in American history. I'm not sure where Puerto Rico went wrong... misplaced priorities? Corruption? Neglect of maintenance? Trying to do too much too fast?

Maybe someone from Puerto Rico can tell us.