QuickTake Q&A: Why Puerto Rico’s Debt Became a National Issue

QuickTake Q&A: Why Puerto Rico’s Debt Became a National Issue - Bloomberg:
"Puerto Rico, like other U.S. territories, doesn’t normally get front-burner attention in Washington. But its huge debt has become a pressing issue for Congress, the Supreme Court and the municipal-bond market.
As a territory, Puerto Rico enjoyed certain advantages as it accumulated its debt.
As a territory, it’s now fighting limits on what to do about it.
1. What’s happening?
Puerto Rico, already delinquent on its debt payments, can’t afford a $2 billion bill due on July 1. With an eye on that deadline, the House of Representatives is considering legislation that would enable restructuring of Puerto Rico’s debt, delay lawsuits against the territory and create a federal control board to oversee its finances.
2. How did we get here?
Puerto Rico’s $70 billion in debt, amassed from years of borrowing to cover deficits as the economy contracted, exceeds that of every U.S. state government except California and New York. After stating in 2015 that it was unable to pay its borrowings, Puerto Rico’s government began talks with creditors, turned to Washington for help and enacted a law allowing it to suspend payments through January 2017 on a wide swath of bonds..."
Read on and prepare to pay...more!