.. that's the function of the

president's unrelenting commitment and the first lady and dr. biden and so many actors who have stepped to the plate. we have made so much progress because so many more veterans have gotten the opportunity to bring their skills and talent to the work place and countless more employers are benefiting from it. i like to think of us as match.com at the department of labor. we match job seekers who want to punch their ticket to the middle class with businesses who want to grow their business. in the dataset recession, director, center for a job seekers are at least 1.4 for every job opening. that's good news for veterans. that's good news for every job

seeker. every year our american job centers, where match.com is an action, 2500 american job centers with about 14 million people, including roughly 1 million veterans in the services. we help transition service members and spouses prepare for civilian life through the transition assistance program. last fourth of july travel to hawaii because one of the remarkable opportunities you have been hawaii is you can visit every branch of the service, including the coast guard. what we thought they are, we did a number of focus groups not only service members, i was spouses to talk about the transition assistance program. didn't see your help in the help of so many others, the program keeps getting better. continuous quality improvement is what we are all about. we don't know what we don't know and that is why we rely on you for so much feedback. for three of the five days of

the transition assistance program them at the labor department puts i'm opposed recall the department of labor workshop. we know it's a fact that because we are constantly doing surveys. they aren't adding value and more than 16,000 participants who most recently respond to a survey on the curricula, 95% reported they would use what they learned of their own transition planning. 93% reported the program enhance their competence and the reason those numbers are high as you continue to give us feedback. this works. let's tweet it. that is why this conference is so important. that is why my colleague brent d. a while, the va and others will be here because we want to work to make sure it is 100%, not simply 95%. i want to talk to the 5% who didn't think we did then surveys

and understand why it do a better job. another key to the success of the program is a close coronation with our partners. we share best practices with dod, with the va. and member service members want to start their own small business and we had the sba has an important partner. the department of education, department of agriculture, which they serve so many pockets of rural america and veterans all over our country including but not limited to rural america. we want to make sure we have our partners here. sharing our expertise and byron from colleagues learning moment is how we deliver the best programs who are transitioning service members and their spouses so that we can fortify that link. you know because you have made your life's work on homelessness. if we want to eliminate veterans homelessness, it starts with having first read the data is

overwhelming that we have to address housing first. we made tremendous progress in this area. in late 2009, the president set forth an ambitious goal to end homelessness among veterans. some are skeptical. they said we could not do this until they saw what was happening in places like virginia, places like new orleans and phoenix, salt lake city and others. they have shown us how to eliminate functional veterans homelessness and it is again all about partnership. a year ago i traveled to three of these cities with secretary mcdonald and secretary castro and we teamed up with local partners, faith leaders, local officials and healthy competition going to other cities and saying how can salt lake did it and you can't do it? they look at you and say we are working on it. and that is good. behind all of these figures and success stories are people.

the thing that inspires me in this job are the people that i meet. the service providers like you who are doing such remarkable work. the batter into our overcoming the odds. people like genevieve. we met her when we went to tucson. a few months before she was a single mom who found himself homeless with no job next issue is referred to the sullivan jackson employment center where she accessed short-term housing assistance, completed the sales training program and enrolled in community college free genevieve told us the services she received or not handouts. they were a hand up to help her turn her life around, to translate the skills and talent she developed in her military service into a civilian career thanks in large measure to all of you here in this room. homelessness among veterans has followed by 36%. that happened because of the hard work people in this room

and i'm here to say again on behalf of the president, thank you. according to the 2010 survey, 74,000 veterans are homeless. in january 2015 the number has fallen to 48,000. that is a substantial decline. we have more work to do. i was actually out in tucson for the point in time surveyed and any person who to this day inspires me. a guy named cliff wade. when cliff got out of the army, he found himself with no job, no home and he got into the criminal justice system. what cliff did after he was able to turn his life around, he got into a labor department funded event for veterans. he met a direct or transitional living program to help connect into the resources that he needed to get on its feet.

what cliff does today as he is now a veterans outreach specialist for old pueblo community services. as he told me, these are class words. we can go around the horn here and everybody can tell the stories that success because that is that gets you out of bed in the morning and that's it helps me tell my parents that maybe i've got another letter of reference, mom. my story is evidence that veterans homelessness and can work. today i'm a taxpayer who makes too much money to qualify for the service is the of the street, who has a bachelor's degree with honors in engineering and everyday i'm lucky to have a job changing the lives of veterans like me. everyday girl like you to have that job. everyday my wife is privileged to have that job of expanding opportunity. one thing that enables us to expand opportunity are those grants. thank you for mentioning that at the outset. because we know that hvrp works.

it is only getting better and that is because we have drawn on our experiences to improve the program. we've made house calls so we can learn from you about how to do a better job. he posted a streamlined funding opportunity announcement a month earlier than previous years because we heard from you. get the money out sooner because they can use it. guess what, we see it now. i'm going to talk to you about that. here is what we are doing. we are looking to participate in outcomes because we don't want to give money appeared to want to make sure we measure outcomes paper to spend outcomes have improved over the course of this administration. the most recent annual replacement rate of hvrp participants is 69%, highest in program history. many of the veterans we try to place of multiple barriers to employment.

it is not as simple as giving them a resume and a few job leads. there's got to address all of those barriers. we take the veteran take the veteran where we find him are heard and get them on a pathway to independence. that is what we are doing. we have a 69% participation rate and that is an increase of 10-point from where we were in 2010. but numbers are striking, but the people behind the data are what get us out of bed in the morning. debra raises a veteran who found himself homeless and unemployed after years of substance abuse. record nader met him in 2002, the first year of hvrp living in an emergency shelter. he enrolled in our program, transferred to beacon house, outpatient treatment for his substance abuse issues and training to become a house manager for her poems. he worked diligently with our job coordinator to make himself a great candidate and earn a support staff position at a family shelter like the one

where he's charted. today, doug is the director of housing for beacon house. since it's been on the job, it's completed associates degree in nablus in his own home with his family. that's what this is all about. we need more ducks, more genevieve's, marquis. were no veterans homelessness is not simply a moral outrage. it's an economic estimate because everybody i talk to who gets out of homelessness, i ask them what are you most excited about. they say what to work. i went to be a taxpayer. i want to be a role model to make children. that is what we here day in and day out and that is why it was so important for us. i really appreciate the feedback i got two years ago when i asked the question what can we do better at the department of labor. your first answer to me was make sure you ask for more money for hvrp because it works. we asked for more money and they

got it. we need your help to make sure it's funded in the upcoming budget cycle. i am here to tell you that the $35 million we already had that we are announcing in hvrp grants and that's about 63 new grants totaling 15 million to state and local workforce investment boards, ngos, tribal governments, faith taste and community-based organizations. together these grants provide an estimated 17,000 estimates by training assistance to exile the civilian labor market just as they excel in their service to our country. starting in july we build on a best practice model of our most successful hvrp grantees. thank you for letting us go to school. we are requiring that every participant b.: rolled and a local american job center to provide additional employment

services for as long as they need them. the new policy at: phone that will offer additional services not normally offered to hvrp recipients because of disability services. veterans have access to individual trading account opportunities. disabled veteran specialist. disability navigator services. community college services employment and training workshops. so many services. match.com offices because american job centers. when you have additional tools in your toolbox, you could move the ball down the field more effectively and that is why we are doing this. we initially the dialogue as well as federal partners and grantees on other ways we can increase the impact of hvrp within the broader context of programs that serve homeless veterans. but we can't stop fighting for those who have fought so hard

for us. that is very thank you for your recommendations. to look at the administration budget and we are proposing a $50 million appropriation for fiscal year 2017. i haven't even been up unadulterated appropriation cycle. i know we can do it alone. i'm alive because i'm alive because arsenic from firm to ask for your help in making sure the $50 million becomes a reality. i am here to say that i need your help. get up to the hill and make sure that $50 million becomes a reality because you'd know that hvrp is a great example of how government working together with their private partners and local government partners can change lives. that is what this is all about. it is about changing lives. it's about making sure we do everything we can do for a group of people who've already done everything they can do for our nation. that is why we spend so much time building and expanding partnerships business leaders.

our vets have seen a remarkable partnership with.or biden and the first lady and we are doing so much in your doing so much to encourage partners because we are preparing people for jobs but no one is hiring them. that isn't going to work at the good news is the biggest challenge is that we have so many interested who have figured out our great workers because they understand teamwork and how to understand under pressure. they have the core competencies to succeed. we've had so many would markedly affected partners of the u.s. chamber, jpmorgan chase, labor unions like the how mr. hardhats program. we have worked with roughly 500 companies to produce results and you had a similarly remarkable track record. i want to stay thank you to funders in the dim but not limited to the home depot foundation investing over $109

over the past five years and affordable housing development and rehab for homeless vets and families. several of your grantees from the foundation are here today as well and i hope you keep up the great work. city community development has made targeted meaningful investment in affordable housing because what i've seen in terms of the remaining unfinished business is to go to los angeles in the cna acute housing crisis. mayor carr said he is doing his level best at making progress, but the scope of the problem is so significant that we need to continue these investments in housing so that we can implement these housing first initiatives. uber and left had the funds provided for transportation of homeless veterans going back to work. we know there are transportation barriers and the good news about what we do is we understand that ameritrade for two vouchers you can get a seat and get back on

your feet. i hope is to move forward on the balcony looking down, i hope you take a moment to say we've come a long way. i hope you don't take too long because we do have a long way to go that we are going to be there with you. you know what, the peer-to-peer knowledge exchange is a fancy way of saying we all learn from each other. that is what you are doing here. you know what, be kleptomaniacs. i haven't had an original idea in my life. i pride myself i'm going to conferences, listening to people and taking their ideas in the first time i will say it was your idea. the second time i will say someone taught me and the third time it is my idea. okay, folks? i hope you'll allow me to do that. you have so many good ideas out there. the innovation occurring in local communities across this country is what it's all about.

for me what it's all about is the visit i took to walter reid a few months back because i make it a point to talk to veterans who are recovering from injuries incurred in the line of duty. i met a wounded warrior last year and he had a t-shirt on that embodies i think our mission statement here. it's sad i can't fail. it's not in my dna. this is a double amputee who had a remarkable spirit and he wanted to get back on to work. he wanted to get back on with his life and he had a determination about him. you know what, i would offer a friendly amendment to what he said, which is we can't fail. i remember traveling with the president last year to selma, alabama to mark the 50th anniversary of what a sunday. in his inspiring remarks, the president said some mean that i think is remarkably applicable

to our work here. she said the most important word in a democracy is that simple two letter word, we. we the people in order to form a more perfect union. it is amazing what we can accomplish when we marshal the collective power of way. the voting rights act that followed, the tragic incidents of bloody sunday, the voting rights act was about ordinary people who did extraordinary things for our nation and the work that is being done to and chronic veterans homelessness is about extraordinary people in this room and elsewhere doing extraordinary things with partners and government, federal, state and local. partners in faith communities, partners in education. partners in the business community, labor movement and you've all but the tip of the

spear, the ngos making sure as hubert humphrey challenged us, making sure that nobody in this country is living in the shadows. thank you for your work. thank you for educating us. thank you for pushing us. i encourage you to do so and give us those ideas so i can feel them and take them to scale and share them with my colleagues and sometimes give you credit. i'll try to make sure i do that. but i am so grateful for the work you do because again, i have a feeling your parents to do the same things my parents taught me. you're getting letters of reference with great regularity and as a result of that, we are a better nation because we all succeed only when we all succeed. we all succeed when we feel the whole team. we are a better nation for it. thank you for building a more perfect union every single day by making sure nobody lives in

the shadows. thank you for educating us and making us smarter and better. have a great conference. [applause] >> i think today we in effect catch up with the 20th century. we've been invisible half of the congress the past seven years. we watched our house collects avengers and the tv coverage that members of our colleagues

in the house. >> today as the u.s. senate comes out of the dark ages, we create another historic moment and the relationship between congress and technological advancements in communications through radio and television. >> 50 years ago or executive branch began appearing on television. today marks the first time under legislative ranch on the medium of communication through which most americans get their information about what our government and country does. >> televising our senate chamber proceedings also represents a wise and warranted policy. broadcast media coverage recognizes the basic needs of the citizens of our nation to note that government.

>> i would show to you the body of evidence on this question. do you trust william jefferson clinton. >> we have just witnessed something that has never before happened in all of senate history. the change of power during a session of congress. >> what the american people still don't understand this bill is these three areas in this build the next five years will put the government in charge of everybody's health care. >> i'm sure it made a number of mistakes in my political career. having c-span televise the senate is one of them.

>> madam president, we proudly gave 72 of our delicate to the next person that the united states -- president of the united states. [cheers and applause] [cheers and applause] the government of puerto rico has defaulted on payments for a $72 billion. congress is considering legislation to assist the island territory.

policy analyst out what had us all puerto rico's problems and event hosted at the inter-american dialogue. this is an hour and a half. [inaudible conversations] >> good morning. thank you all very much for joining us today. we are going to talk about a very serious and urgent situation confronting puerto

rico, the home of 3.5 million americans. the territory's economy as we read every day has been declining for a decade that's accumulated huge debts that it can't possibly pay. puerto rico posted a $72 billion to investors at 26 billion pension funds. started missing bond payments in january and is expected to default on nearly 2 billion payments to july 1st. that is roughly 100% of its gross national product. thousands of residents are leaving the island for the mainland every month to look for jobs and better public services. the exodus is accelerating. in this context, congress and the obama administration have come up with compromise.

the bill would establish a financial control board to oversee the island government and help restructure his dad in federal court. required the government and the board to adequately finance pension funds that are close to empty today. it would would would temporarily stay stare caused losses by prejudice against the island's government which starts its work. remains to be seen of course who will be appointed to this board. the president would pick for firm lists provided by republican leaders in the house and senate and won the president would pick to the democratic leaders. the bill has already generated some criticism including creditors of coors and for different reasons from labor unions. others recognize the problems and the flaws but believe this is the best possible formula to address the crisis and recognize

that time is running out. in any event, there's a lot of ground to cover about this complex and grave situation. we have three superb experts who closely tracked puerto rico for many years and have kindly agreed to share their insights and is with us this morning. barry bosworth is a senior fellow at the economic studies program at brookings institution. he served as presidential adviser and specialist on fiscal and monetary policy, economic growth, capital formation and social security. he also has taught at her plea and harvard and his many publications include an analysis of the puerto rico economy. we are pleased once again to have very witnessed at the dialogue. rafael cox is professor of law at the university district of columbia and is a prominent

puerto rican lawyer and in 2012 as candidate for position of resident commissioner alongside governor padilla. he studies at cornell, oxford and graduated from harvard law school as part as long puerto rico with reichardt and echevarria. we are happy to have rafael with us this morning. josé peralta is formally served as assistant secretary for private sector within the office of department of homeland security. he currently is deputy chair of the global alliance for trade facilitation. josé has also served as direct. the americas at the u.s. chamber of commerce and executive director of the association of american chambers of commerce in latin america. he graduated from the university of puerto rico and completed his doctoral studies at the university of michigan and we

are thrilled to have josé with us as well who is really followed this question very close to you. we are going to follow a question format -- question-and-answer format this morning. i'm going to post questions to our speakers and after a few rounds, we are going to open it up and invite your comments and questions and look forward to a very forgot is an interesting exchange. before getting started, i want to acknowledge and thank very much the work of my colleagues here who runs the rule of law program at the dialogue for coordinating the session and all the effort to make this possible and also been red star who is assisted program -- program assistant in the rule of law program at the dialogue and also co-authored a very good paper blog post for the dialect called porta rico path to solution. thank you boat for all of your support and help.

let's begin if we could review, berry. there's a lot of ground to cover and a lot of questions. you have been following puerto rico for a long time and effort about it a lot. if you could just give us your sense of the real -- what we need to understand to know why this is happening. what are the real origins, main causes of this, however he gotten to the situation we are currently in and how d.c. interns at the different roles in different players where the responsibility is and could this have been avoided. you've been watching this story for many, many years. how we gotten to this point? >> i think there are a multitude of causes of what happened.

one thing that emphasizes people think it's too recent. it's been going on a long time, basically since the mid-1970s. porter rico had a remarkably good governor after the end of world war ii they made enormous progress. they used to be called the asian tigers. they were compared with bad and they did extremely well from the end of world war ii in 1975, that they started from abject poverty. people don't have enough credit for how porter rico was when it started up. it did it primarily for by encouraging puerto ricans on an overpopulated island had half the population went to the mainland and half of them got jobs basically an expert oriented industry. they were a low-cost supply of labor inside if you remember back before 1975 is very high.

the u.s. then made up of trade liberalization. this teraflop collapsed and porter rico was no longer a low-cost source of manufacturing. it is a high-cost source of manufacturing labor and it was inevitable the sector was going to be declining just like it has mainly because it's taken over by lower-cost countries particularly in the nation. that part of it was inevitable. the big engine for growth went away. they were never able to diversify the economy in a way that it further opportunities. it turned into a political game here in the u.s. two big events were organized labor that upset in the 1970s about the jobs moving to porter rico and then convinced of the

federal government to the extent the u.s. minimum wage to porter rico. so the federal minimum wage applies and porter rico. you may think it even states, but remember porter rico's income was one third that of the united states. like having the minimum wage three times higher than here. much higher than the rest of the caribbean area. so tourism is very hard to be profitable in porter rico. you'd rather go to one of the other islands were a smart track of and cheaper. it doesn't have a lot of options. the companies that pay because they didn't have the competitive advantage anymore so the government gave them a tax loophole and basically porter rico turned into a tax gain of income shifting, corporations played games, and come to the

island so it didn't have to pay tax. but it was just a subterfuge and give this later phase out to about 2006. a lot of people think that's where the problems started. puerto rico has been declining steadily since 1975. it got much worse than the great recession and it has had no recovery unlike the rest of the economy. the rest of the economy hasn't been adequate. puerto rico has this long relative decline in the question i think is the big problem. we do not have an economic program of what we think would work in puerto rico that would make it economically competitive. >> that's enough over there.

>> thank you. rafael, which you want to add anything to that and also in your view to politicians, political figures, shift some of the blame or responsibility, you know, the fact is that gary has laid out. >> thank you very much for the question. the first thing i want to do is think inter-american dialogue for a placing puerto rico. it is not just a domestic issue as congress might believe. the puerto rico conundrum is an international issue both in its very nature and cope. after all, puerto rico is not merely u.s. territory. puerto rico is a convenient latin american association and i want you to take that away from this panel. not to answer michael's

question, the first thing i want to emphasize is the geopolitical chronology. mentioned the second world war. puerto rico has a permanent role in the united states cold war strategy during the post-second world war. and that has changed. the united states has actually been rather neglectful and in different parts of puerto rico, seems actually in the 70s and most of what they sent the 90s on. that is also something that is crucial to understand. now, the question mike composes his if the political status and darker disco economic crisis and let me phrase that question. i'm going to say the relation

between puerto rico says colonial condition and the current crisis. why am i using the hatchet to colonial? i'm using the adjective colonial because the cat is out of the bag. for the first time since 60 years ago when the united nations remove puerto rico from the least independent territories at the behest of the howard administration, for the first time in the 16 years am in the united states and political branches have finally met it to the world that puerto rico remains a colony and nothing of note happens in the 19th of these. basically, puerto rico remains a territory subject under the u.s. constitution. this goes back to michael's question. what the consequence of the

legal reality, what is the consequence of the colonial condition of puerto rico says fiscal economic inclusion. the consequence has been great. first of all, the most obvious consequence of puerto rico says the colonial condition is puerto rico, unlike any sovereign country about the world and unlike the 50 states, puerto rico cannot declare any municipalities for cooperation to solve and. we cannot do that. puerto rico has no legal authority under the colonial arrangement to be bankrupt. it has the legal authority to negotiate binding the agreement with any of its creditors. puerto rico has to seek congresses permission or seek the u.s. supreme court's blessing as it is trying to do

by the franklin trust case before the supreme court. so that's the first obvious consequence of puerto rico's condition. now, one of the other consequences, how they relate to the implosion. the answer is in order for puerto rico to jumpstart its economy comment buried in mind that puerto rico's most difficult challenge. the most pressing challenges the absence of economic development and economic rule so that the debt burden and economic rule is so asymmetrical that it makes it impossible for puerto rico to bring up that. so that is fundamental. in order to jumpstart our economy like you saw yesterday,

to be more competitive in the global scene, puerto rico really has a set of tools. the set of tools are unavailable in the colonial condition. they have no control for its fiscal policy. puerto rico has no control of its trade policy. puerto rico has no control of its monetary policy. puerto rico has no control of the environmental renovations regulations, air and space regulations, puerto rico has no control even of its own health care policy. $2 billion a year worth of cost for the puerto rican government and really a very hard time when it really controls is none of those economic triggers are controlled by congress and puerto rico has no representation in congress.

we only have a nonvoting delegate. so in a nutshell and to summarize, yes, the colonial condition make that harder for puerto rico to charge a path forward and i believe this is the most pernicious moment in recent history for puerto rico to articulate the total package that is negotiate with the political branches in washington way out of the fiscal crisis by negotiating and the colonizing bank table to address the pink elephant in the room, the most to actually put aside puerto rico and dignified colonial condition. >> thank you, but failed. now let's turn to you. you've also been extremely engaged and focused on puerto rico for a number of years.

i mean, back to the question, how do we get to this point? you've been in washington. are there stats that might have been taken from a policy measures in washington to try to stem where we are at today. >> thank you for the question, michael in thank you for being here. before i begin i want to acknowledge the role and my colleagues in the diaspora network here in washington working to support civil society environment and puerto rico went to find solutions to the process. i'd like to type about the diaspora because there's several missing links in this conversation. a great example of the networks that can support solutions. i'm going to take your question, but i agree with my co-panelists i'm going to talk a little bit about what happens in puerto rico. there are things that can be done in washington and my

co-panelists have eloquently explained the macro situation and the political situation regarding the colony and whether we believe that's the case or not. but i want to talk about the institutional problem in puerto rico. most people when they look of puerto rico's crisis, we want to summarize economic terms talking about an economy that has lost part of dignity, competitiveness and therefore the government overspends to compensate for shortcomings regardless of the behavior of the business cycle and other economic factors. that is a recipe for disaster. when you combine some economic mismanagement in the way that these financing mechanisms were issued in structured, not to mention shortsighted fiscal policy because of the political cycle, the budget process which is a bit chaotic as you can imagine that some of the questions that have emerged about the lack of transparent in how the government does its accounting. all of these things have been mentioned several times.

i want to highlight the factor that unites all of these various things. the question of the quality of institutions and puerto rico. who makes decisions, even in the context and let's assume we control the colonial issue and are able to fix it. we have to have a set of leaders and decision-makers they can decisions for the long-term. puerto rico has an institutional problem, the sense that puerto rico has for many years and many years and i guess to barry's point about the started happening in the 1970s as puerto rico has been ruled for many years by coalitions that compete with each other for this day for electoral competition as opposed to productive coalitions, the ones of the puerto rico out of poverty and into the task. the productive coalitions and 1970s, which is remarkable considering nobody has had to rethink how the economy works

and yet there is no -- there has no such coalition governing puerto rico in that point. in that sense, the other component of the problem is puerto rico political parties active mechanisms for recruitment and movement abilities. puerto rico doesn't have a fully functioning civil service that creates incentives for public officials to behave in a way that leads to better for improving our excellence in the way they manage. it is determined by the way parties recruit elite and the way parties move people off the channel and tube leadership positions which means loyalty is fundamentally attached to the party and not to the fundamental political economic system. that is a recipe for this coalition. this insurgency on the political status alluded to create a vested interest in maintaining

the system and arguing over politics of data need to revisit economic incentives on the status quo, which should be the basis for a productive coalitions. we have a fundamental vicious cycle in the way the institutions were in the way in which the structure of incentives that decision-makers have to make long-term and short-term decisions about of course short-term decisions and that of course leads to credibility problems we can talk about a little later. >> ray, thank you dear barry, let's go back to you and talk a little bit about this pending bill. to what extent, in your view, does this really address some of the problems? is it a band-aid? some critics have said it is a bailout. you know, where do you come down on this and is this given where we are today and the urgency of the situation i think all of us

see, is this the best sort of formula at this time are what is your sense of this bill? >> first of all, the bill is not a bailout. one of the things that has created some tension in all of the negotiation is the refusal of the federal government to put up any new light in resolving the situation in puerto rico. there's no bailout in that sense. the bondholders who are going to get paid. if they don't pass this bill on july 1st, the puerto rican that will go into default. default can be an extremely unruly process because at that point if you look at what happened from the u.s., i think everybody in this room must be aware of what happened with

respect to argentina when it tried to negotiate an agreement and a couple people dissented and a judge stepped in and said you've got to pay them first. that is the sort of threat that would have been an even more complicated situation in argentina. you have to accept some sort of a notion, it a board of some kind and i also need the idea that puerto rico could be left to do it itself is just not realistic. these are going to be very painful measures to take in trying to resolve the fiscal problems and i think it's realistic. when you look at the details, just pull it apart between the conflicts, between concern for people in puerto rico and

bondholders. many of the provisions are just impossibly contradictory. so i think the real problem is it's not workable. a lot of it will depend on this board with two and one. what is the congress put on the list? if they put the risk together they compose the people are bondholders are representatives in bondholders, everybody's going to hold out and have a representative on the board and delay decisions and nothing can get done. if you don't have a cohesive board, i don't think it's going to work. so i think the complaints in puerto rico that it doesn't represent them, that's what

happens when you default on its debt. it's kind of painful. we went through it in the district of columbia, new york city, philadelphia and detroit. this is not a new thing. the outsider comes in, sets up a board and tries to resolve the issue. i am worried that this is just not going to work. it is going to delay too long. i think inevitably puerto rico is in a state of economic, really pretty rapid decline. if you are an investor, would you put any money into the business and puerto rico under the circumstances was so much uncertainty? i don't see them resolving the uncertainty. on one hand i think it is the best you're going to get. but it's not going to work. >> is the situation going to continue? could it go on?

as if it's not going to work or what happens? >> i'm reluctant to answer the question in public. i think puerto ricans have been making the right decision. under current circumstances, there is no resolution of the economic crisis in puerto rico. the trouble is not everybody can emigrate because what is happening right now is the housing market is collapsing. so it's going to be very hard for middle income people. it's like a debt crisis here the united states. you couldn't move because you couldn't get rid of your house. i think it's very attract his for retired people.

people at the top and bottom, a very uniform parliament. they have no job opportunities. and in our society, if you don't have a job, i think you people have no choice but to continue to leave the island. it's a very sad circumstance, but i don't see that we have a solution that sort bull. i don't think people on the dead sides realize puerto rico just can't pay. come on, this debt is 100% of their national income plus another $40 billion in unfunded pension liabilities to public workers. the public workers also have to be realistic. most of them are covered by social security like everybody else on the island here that the best they're going to be able to do. they had to pensions and they are now going to affect you but get one. i see a huge magnitude of that

right now probably in the neighborhood of at least 50%. i don't think puerto rico -- i think they can cover their current budget with the old debt payments. and so how do you turn things around economically if you can't commit to any new investment opportunities? i think that is a very dismal outlook. i would like to be more optimistic, but i don't see how you make this bill work. >> do you want to give us the pessimistic view? we don't want to be too each year. i know you want to get in, but if you could also address how this is being viewed in puerto rico and is it unrealistic as barry says? how is it playing out?

>> first of all, i appreciate the observations. i feel that differently however. when you look at the human dimension to this, the first question most people have is a control board for what? a control board acting solely as a collection agency, what will be the economic policies the board will engineer to start wrote in puerto rico. during my remarks, i saw that puerto rico says fundamental challenge is not the debt ridden itself with global competitiveness and spurred economic development. having a controlled board composed of folks who have no relation with the weather to puerto rico. out of seven members, only one

will have residence in puerto rico. that doesn't mean he or she will be puerto rican. it means that he or she might have a business relationship to puerto rico. we're going to have a bunch of folks with no connection whatsoever to puerto rico but identify themselves with making choices about very important choices and those choices should be made by elected officials, not by a board that has no accountability to the people. there's going to be a lack of legitimacy. those people in puerto rico will not acknowledge the board as representing him or her. i believe the united states of america, where the foundation of prince paul of the republic is concerned by the governed, that the magna carta 13th century is the principal to actually

articulate the duration of independence and subsequently the u.s. constitution. the board in fact will unify the puerto rican constitution without the consent of the people of puerto rico. the fundamental problem with the board and one wrong doesn't fix another wrong. yes, i agree with most folks that the restructuring chapter is stepping in the right direction, very mad at colonial condition as i said earlier. or in fact the mine that we are at territory and we have no real already to declare ourselves think. yes, we need to restructuring mechanism and the bill does provide for a restructuring mechanism. there is a distinction to be drawn that the board presented for puerto rico was in the

90s. don't -- don't overlook nuances. nuances as seminal. they put in place not just a sturdy mashers, but also put in place liquidity facilities. the u.s. treasury set up for that district short term obligations. the government guaranteed the unlimited liabilities of the district, guess. order rico says unfunded pension liability is $30 billion in the districts unfolded was between three and $5 billion, guess. nonetheless, there were only the quiddity facilities put in place for the district and those are not puerto rico.

you need to put this into a geopolitical gift. it seems the u.s. political branches are sending a message to puerto rico, and message to puerto rico, meaning you guys aren't allowed. we will not be trying to give her deficient territory for colonial arrangement. you guys should start thinking that the message to censor political message that somehow we need to assess this after. to conclude and to some outcome of the way in which the fiscal board is being presented i think really sad a very, very bad precedent and it's been presented in a rather faulty way things to me. >> thank you. if you could talk about -- a

little bit about the board and how you see this and also if you could add this is crisis we are facing now is really an opportunity to start rethinking some fundamental questions or is it realistically the best you could do to kind of deal and just manage the current crisis. >> i concur with my co-panelist on the send -- >> i will mention the very basic point. by the way, the question of the euphemism of the fiscal oversight control board, all of these things there something more to it than semantics. i think that there are fundamental flaws in the way that looks like an away the oversight works. for example, there is no procedure for debt

restructuring. there are questions about what happens after february 201710 bondholders waited out the bill doesn't provide for any of that stuff that you can have a protect it legal process as my panelists were singing. there is no path to explain what happened after the board and and this is just as you were saying a mechanism for ensuring repayment. ..

aside from the internal inconsistencies, puerto rico has a credibility problem. puerto rico's politicians and institutions could not make credible commitments to making whether it's a budget balanced, transparency in fiscal accounts. and could make the cuts it needs to make. the question i alluded to earlier, most places in the world that have gone through the kind of macroeconomic restructuring puerto rico needs to go through, remember latin america in the '80s and '90s, when they got the money from the imf, there were advisors that reigned in with no attachment to the countries where they served, and administered a bitter pill. the bitter pill of reform and a strong what each step and

restructure an economy. this board at least in name should start as a mechanism, a some sort of outside, external oversight that administers the bitter pill that is going -- in puerto rico there is a credibility problem. the ability to maintain, to stick to a certain policy path. my problem is windows imf missions and windows conditionals were attached to countries or places for restructuring, not only did they provide liquidity, they also provided technical assistance and a path forward and how is it you're going to move things forward. puerto rico, most economic decision-making is not done by economist. so, for example, out is a touch of a a path forward with a group of folks that can devise an economic growth program for puerto rico? where is the technical assistance of folks restructure their budgets and restructure or fiscal accounts?

and produce measures that are economically sound but to go towards productivity measures et cetera. we are not seeing that. puerto rico atli needs that type of assistance. >> thank you. i see a lot of people in this room have a lot of expertise and good thoughts about puerto rico. so why do we open it up now, and please just identify yourselves, be brief, either post a question or make a comment. no need to disguise your comment as a question. in the back there, please. >> good morning. my question is if you had to describe a profile, not a name, i don't want specific names but if you could describe which are ideal board makeup would be, can you give me the profile of the seven members of the board? what would be the background,

their expertise, and how that would shape up to be that we don't want a board of just politician or a board of just economist i can imagine what that ideal make of the? >> thank you. why d don't we go to ramon and then here. >> puerto rico is very successful in 1950s. 1950s. it was build a super hybrid that lead nowhere with. in the 1960s i was studying economics at the university of puerto rico and we are arguing it wasn't sustainable back then. we knew it was a speedway to know where. a friend once commented, it's almost been like a kept woman, kept in the basement. her own children are at the political party. as long as it will attractive, the u.s. was happy to keep her there. she's no longer as attractive. there's no attraction there.

so what do we do with this now and what do we do with the children? institutions are not trustworthy because again, order returns have made them untrustworthy. why puerto rican voters tolerated this? the deficit is there's of citizenship and lack of citizenship and supervise when the puerto ricans are doing in their name. i finally and economics, we have depended for 70 years on wealthy -- not the creation of wealth in puerto rico. there is not a class of entrepreneurs in puerto rico. what are we doing to great wealth in puerto rico? your point is the economic decisions are made by lawyers and politicians, not bite economies. not that economies know better but then all the better than lawyers.

>> to questions. first, i guess, how would the current crisis affect independent movement or independent said that in puerto rico? the fact that a crisis going on, is there more they want to be, make their own decisions quick second question, we come to jumpstart a con once again he talked about the exodus of thousands of puerto ricans. it is a brain drain, and exit is that labor force, badly needed labor force. how is the puerto rican government going to try to bring back the people that have left? thank you. >> thanks for putting this together. great panel. i have two quick questions.

the first for mr. bosworth and the rest from of wants to take it on the panel. as a puerto rican we've talked about as was mentioned, the super majority of the five of the seven members, you know, a stay litigation, et cetera. austerity. but a lot of puerto ricans come down on the fund an issue -- fundamental issue of democracy. you see that as an esoteric philosophical argument, or are there outside folks that i just see the value in that? a related comment, question, how is it that republicans that are preached for small government and limited federal roles in local issues can just come in and take over as they did in puerto rico? is that a contradiction or is it just rhetoric? of the economic temptations of not having to buy in from the people if they are opposed to

the board as many see an undemocratic. >> thank you. >> you can nominate yourself for the board by the way. [laughter] >> i think there are some guidance for the board. one of the big sources of uncertainty in the financial situation of the government is it's very difficult to determine what is the tax raising capacity of the government? like here in the district of columbia they discovered that huge amounts of tax revenues were not being collected because deals have been made with private entrepreneurs in the city. what they did was they discovered all those, they reversed them and they they got a big surge of revenue, admittedly in a booming economy. so there's a big need for this board that some financial

expertise, some people who are knowledgeable about o and p type matters computerlike, budgetary decisions. i don't think it's hopeless in puerto rico. i think the government has some confidence in that level. i do think though they need a reassessment of the tax situation entity to bring in some outside experts, and from my perspective there's far too many loopholes. i would say the same thing about any government tax system i guess because i think the same thing here in the mainland. but i think they need some tax experts. and the rest of it i think, you try to be as diversified with people's background as possible. i don't like the idea of a board that is made up a list from congress that much. brain drain, i don't fully agree. the surprising thing about the puerto rican immigration is how

balanced it is. people at the bottom are leaving because there are no job opportunities for low-wage people, low skilled people in puerto rico. they go to the mainland. a be the minimum wage is low but they can get a job. and at the top, yes, people have been leaving, particularly most recently because of medical technicians. and the financial situation with health care system has become quite untenable. i understand the suspension of democracy, but that's what happens when you can't pay, if you can't, you just realistically can't expect that you can sit down and make all those decisions in a timely fashion. what are they going to cut? who's going to pay more tax?

you just can't do it. puerto rico has demonstrated they can't do it. it's half of this problem. it's not new. it's at least 15 years of intense problems, when the budget, the debt began to spiral out of control in the early 2000. so you know you can't handle it alone. it's asking too much in a community that split almost 50/50. you think american elections remain close? a are nothing compared to puerto rican elections. the last one, what did it take him like six weeks or more try to resolve the one? the people are deeply split over which party should make these decisions. they don't agree. they hate each other in that respect, much like democrats and republicans on the mainland. so i think it's inevitable, as we try to have a board process this as fair as possible. it's not permanent.

it's a temporary thing trying to restore order, get a reasonable degree of structure to the decision-making and then get out of. i think that deadlines are a little unrealistic. they are too tight. they need to be extended a little bit. but puerto rico government will return to running everything, let in the meantime, i'm surprised, i was talking to alice i didn't eve understand en though i live to come the extent to which the control board took over even very small decision-making is. they ran the schools. they did everything. and i think it's inevitable in trying to restructure and limit expenditures and thousands of the two. it's a tough task. there's going to be a lot of screaming if they do their job well.

but we all come out of this. new york city winter and extremely painful process from the state government stripped him of a big punch of the revenue back in the 1970s. and i think it was a terrible economic situation for a decade, but they did recover. it's a painful thing to do. i hope they do it as fast as possible. >> yes, i'm going to start by answering the question, the absence of democracy. obviously, i agree with that 100% as i mentioned earlier. then you have alejandro's question regarding to ask for, only because the issue is in context of the crisis. obviously, we want to see our best and brightest. you have won the 20 puerto ricans hopping on a plane daily.

last year we lost 84,000 puerto ricans who came to the mainland, and that's one of the consequences of the current economic implosion of the puerto rico. and that diaspora we note, until we have an economic development strategy, not austerity measures on their own. the american medicine doesn't work in puerto rico. it's one of the more surprising things ever to see the u.s. call on chancellor merkel within the context of the crease crisis, trying to persuade the german government to ease on austerity for greece and allowing measures and sort of nonsecular measures integrate context and then have the political ring trust in washington a completely different within the context of order rico where you have 3.6 million new u.s. citizens. with regard to alejandro's

second question, the economic crisis, yes. there will be and it is right now with regards to solving the conundrum. at the moment this is not an issue of status formula but obviously there's a very strong consensus in puerto rico for the first time since the 1950s with the current arrangement is broken. and that something must be done to actually fix that. now, as regards to ramon made a series of comments, and he raised two questions. he said why people keep voting the way they do in puerto rico and the reason is because the election law in puerto rico is fundamentally rigged. it perpetuates -- to principal political point. unlike what happened in the

dominican republic or what happens in chile, what happens in brazil, what happens in other countries around the world, what happened in germany or spain come in puerto rico there is no possibility for political alliances among the very the political parties. winner takes it all, and basically uses for the most part political power as a way of actually perpetuate itself in power by financing public points its political -- >> will that work? >> well, yeah. that's fundamentally one of the downsides of our system, plus the financing of politics leads to corruption, patronizing to consider. it's to fix it in puerto rico in the current condition is obviously the decision of the supreme court, right, opening of the laws of us to the mainland

the also plug in puerto rico and that's the law of the land, that's the supreme law of the land and includes a puerto rico as well. france has raised the question having to do with a profile of the board members. well, as far as i'm concerned that's a conversation that we need not have no comment because as far as i'm concerned a conversation that we should still be having is how to structure the board. the way it has been premised, it's not satisfactory to me or to most puerto ricans. the board must be the result of a joint effort by the local elected officials in puerto rico and congress, the same way we came up with a mechanism, congress came up with a mechanism after the second world war were but both the puerto rican people have some sort of participation and congress have participation in drafting an arrangement, but in the context of -- you need to have buy-in by

the people of puerto rico through their elected officials to have legitimacy, and that's not happening as it stands right now and that's something most order begins should actually come and most political parties will oppose. that's the conversation we should have right now. the passing of the board as it stands today is not. those of us who are against the proposition that you can have a dictatorial board basically put into democracy in puerto rico, we are going to fight to fight. we will keep fighting the fight. in the hous house for, in the se come in the white house, and when the whole dust settles, then we have the conversation. who should be sitting on the board, right? >> if i could follow up. are the members of congress that

are pushing for that idea of restructuring the board? i mean, do you have the champions in congress? >> senator bernie sanders has vehemently opposed the board as it stands today. senator bob menendez -- >> on -- >> right, on the board. obviously there' there is a cons that we need restructuring, okay, and restructuring includes the negotiations, which means chapter nine will be enough. but the board as it stands really is going to hinder rather than help puerto rico in the long run. and that's a fight we need to make your that's a fight we need to give right now. >> thank you. let me group of them because i think the questions are related to each other. first of all let me first say that actually do think the

democratic legitimacy is very much a question and very much an issue, perhaps for different reasons than my panelists would think the we are talking about, the recent democratic legitimate matters is because the fundamental relationship between puerto rico and the united states is not a selfish under tremendous power in a. we have that fundamental, i mean in washington, d.c. there is still the question of representation before congress which has spurred a tremendous power movement for statehood. new york, philadelphia, detroit or places where poor southern set up an account these things do not go towards a fundamental relationship between state and society in those places. in puerto rico that relationship is very much to a question about what i think a democratic question, that democratic legitimacy issue cannot be parked aside as one would think. in that regard let me answer the questions. of the democratic legitimacy of the board itself, you're asking

whether it's a necessary question, i think there's something really interesting about the question of democratic legitimacy. are we asking can we talk about democratic legitimacy, are we talking about the quality of citizenship argument that our citizens are not adequately represented in support of the with making fiscal decisions? are or what about the status argument that this is a colonial imposition? i think it's important for us to figure exactly what do we mean by tha them? i think that's an important matter of debate. i concur there is equality of citizenship argument to be made strongly and this could be an opportunity to raise those questions. i don't see anybody raising the. i see them more in terms of, sort a lot of legitimate questions i see the more in terms of the statistician because there is that fundamental power relationship that has not been solved. on the question, i think there's a lot about, the question of the brain drain.

i think it's extremely tied to the question of entrepreneurship at also the question of the diaspora. puerto rico has to understand, this is a process that is emerging from but our institutions are a little hard to catch up on the fact that puerto rico is a trans-nationalize nation. that's not the only one. there are several other nations in the world, el salvador comes to mind where there's more money coming in from the people outside than what the country makes in its exports. that is a fundamental rethink of the relationship between its domestic and foreign. because the identity issue still unsolved of those boundaries are difficult to address a difficult to enter lives as a mechanism. but -- internalize as a mechanism. the fundamental, there's a great opportunity for puerto rico to rethink its relationship with its diaspora. as a matter of policy to institutionalize a mechanism to which it's an sort the importance of the diaspora and to derive from the resources,

the capabilities come input into the economy. there's a tremendous movement, for example, a font of ownership in puerto rico startups. a lot of over think about economic solutions are based on the manufacturing model of the 50s, '60s, 70s which as we all know is broken because the are a set of structural factors that don't make it competitive for manufacturing purposes. we could talk about this more but my point to answer the question about the composition of the board, i think it depends on what you want from this board and this goes back to that question. for example, what is the fundamental purpose of the board? is the fundamental purpose of the board to make sure that finances are straight or to make sure that there's a path forward

in economic growth? i think to the extent the board should of people representing all those pretty used to be frank with you because those are complementary. otherwise 1 10 years from now we'll be revisiting the same problem because how do you get out of a negative zero of an economy that needs be, intended to sustain its ability to function as a productivity problem at a shrinking tax base that doesn't put the resources necessary to sustain? >> why do we go him one more round. -- why don't we go one more round? >> one very tedious thing about the board in puerto rico is for the most part the politicians are against it, but when they pull the individuals, 70-80% of the people in puerto rico for it. because they are desperate. they don't see the politicians and solving the problems. they just talk about status of this and that instead of giving as you said administrative things, for example, if the

problem basically is there has been an admission of too many bones. why do we change the system? in virginia where i lived for many years to issue a bond, it had to be sent to the public and the public and to vote on it and approve it. some sort of mechanism should exist so the people of puerto rico in the future approved bonds or not come after all, if they're going to be fiscally responsible they should have a say so, and not four or five individuals. i think measures like that is what this board should be proposing, not merely deciding how much money goes to each one, but for the future how are they going to avoid it is happening again? at also how do you come even now with this crisis, the government is proposing a budget that has

this huge deficit, and people see how the government wastes money. they keep talking about this crisis or whatever, but hey, they just spent $3 million have a caucus in spanish-language and they couldn't even spell it correctly. it was anna beresford. they keep giving money to these former governors so they can have these associations were they can get together and talk about the wonderful things they did, that they have channel six, channel six is a tv station that nobody sees and when you go past it on saturday night, guess who is there? there? is the governor's brother-in-law who is singing away and is getting this. so i think someone who comes in that does not have a vested interest on what the political results are going to be is what is needed. so they will sit and reform the way puerto ricans look at things that they think about good administration and this and that instead of just status or

whatever. anyhow, also in terms of the political, thinking concretely being abusive, i want to say something. in 1952 was not that international agreement done. it was a political agreement that the united states allowed puerto ricans to have self-government if the respected this constitution that was approved by congress, right? well, this constitution, who violated that relationship first? it was the puerto rican present government. they approve legislation which was atrocious this year. that legislation, they said that people that were supplies of the government and provided services, the government could force them to continue to keep providing those without compensation, those people could go to court to get compensation. so a number of provisions have

been violated by the present government. how can they then turn around and say we are a democracy, this and that. they are not protecting us. the u.s. government, make sure there is a constitution that protected us, it is government has violated that. >> thank you. this is a question for barry in particular but also for the other panelists. i'm just wondering if any lessons that one can draw from the recent experience of greece? i find, looking from the outside, that the parallels are a strike, including the question from the very profound questios that were asked about the limits of democracy when dealing with extreme economic circumstances. >> good morning.

my name is maximillian. i want to commend all the panelists for presentations given. there's a couple things that i disagree with in terms of some of the assumptions and want to have a dialogue about them. regarding, first, on the idea that a similar circumstances in washington, d.c., new york and detroit are applicable to puerto rico. and i would like to ask the panel to comment on this. with in detroit, it was part of a judicial system which the people in detroit understood it as such, as part of their legal system. new york was not in a position on the federal government on the state of new york. it was a deal they did with the state of new york and the new york state put up and place a control board.

in washington, d.c. it talk to sets of legislations two years apart to get through the control board that were both described by mr. bosworth and others. the first board looked like the one that applies to puerto rico right up without any of the restructuring. but again, d.c., good or bad come has been used with congress intervening directly. no import requesting that since the 1940s. how do you think going back to the democracy issue, but a fundamental point of representation, they have never seen this? how do you expect the control board to really work in puerto rico when there's no parallel in their political system? pretty much still alive there.

at the second part of would ask second part of it as content other of the plan to also engage on this, i know people who are against the control board for the different points that have been raised today, not the fundamental question is, even people who agree with you and congress, what is the alternative? what is, what people di need ise attitude what is the alternative. not whether it's in the congressional package. i think people a great at least until for now, this is the best deal republican caucus is going to get. if you accept that as the premise, what is the alternative that is not federal and can come from puerto rico? thank you. >> in the back. >> good morning. this i just want reflect on a few things some folks said about beyond abandoned that is going to be whatever the legislation is going to be, i think going to

puerto rico for the last 20 some odd years and i've consistently watched and i've been working there, consistently watch the economic downturn and juicy and infrastructure. you see it in the education system to use it all across the island. so my question is not a band-aid that we're in a situation now, some people referenced detroit, for example, we have an automotive industry that drove the entire region and so what's the forward-looking plan for puerto rico? cuba is going to come online. dominican republic is driving tourism right now. is a consistent decline in tourism receipts from puerto rico. someone mentioned other opportunities in other industries whether they start opportunity, innovation, or is it, some people mentioned about that doctors are leaving the is there an opportunity, for example, automatic so you have,

he reconstructed your tourism sector. and so are the institutions that are in place? out of the brookings or other organizations are looking at the forward-looking beyond their current debt crisis, and what does the item to look like -- automatic. >> thank you very, very much. let's start with trying to maybe this time and then rafael and let barry have the final word. >> thank you. let me very quickly address some of these points. on the first question i just wanted to highlight, legislation, legislators make bad decisions and that bills all the time. to say that because you made, you passed a bad deal you don't have the right to call or decision of democratic legitimacy or call for democratic legitimacy. it's a bit of a misnomer. but i would say, however, that there is in puerto rico state

before. state reform can take a variety of forms. so, for example, i mentioned the fact of improper civil servant in puerto rico that creates inducement for officials to act towards a public good. a structure where people can move up the civil latter as a result of their achievement for a result of excellence in their performance, and that creates a positive cycle on management. puerto ricans voted to reduce the size of the legislature, and the government has ignored the mandate. there's also been proposition to reduce the number of municipalities because that creates governance over last -- overlap. that's it powerful message politicians could be sent to the popular sure that they want to do things different. we can talk about transparency and accountability.

guestco 20 other states penetrate do not have a public audited financial statement, but none of them is facing a credibility crisis like puerto rico so the are things that can be done to shore up the credibility and the awesome things that can be done administratively to address this issue, as we said. on comparison with new york and d.c. boards, and again i said earlier, i think that the our fundamental differences obviously the comparisons are not automatic. i have encourage colleagues in puerto rico to produce this deep analysis of what those boards look like in comparison with puerto rico because there is a fundamental question and it is as i said there is a fundamental question about power of symmetry allies at the heart of a lot of the ways in which these mechanisms are set up an in a way that the exercise their authority and their power. and we just cannot ignore that simply because we are doing in

the interest of fiscal probity of economic management. it's an interesting questionable what is the alternative to a fiscal control board, because just puerto rico does need a mechanism that can make policies stick, something that's also a credible commitment problem in decision-making. however, i don't know necessarily that has to be solely federal or solar local. i think the two things have to coming together because ultimately united states functions through subsidiaries, decisions are locally made for the largest part on many things. federal been bored bored -- federal control board that x. is problems pashtun what is a long-term strategy. in that regard i would say there is no silver bullet. none of the countries in central

america, there's a point made about to become online republic et cetera, none of these countries have a silver bullet. it's going rapidly but there's a huge disconnect. i think what is more important for puerto rico is that there is policy cohesion in terms of the various strategies of the first things. we talk started, we talk about medical tourism. we can also talk about supply chain policies and things in that regard, that all of them act cohesively through a single policy framework which i think is part of the lessons from the 91 of the things that is important for member of greece is there was a lender of last resort willing to work with finite and greek authorities. and i did not have a technical problem. greece had huge problem of competitiveness. there is no clear answer for it. so there is no silver bullet on can edit in this effort is a single bold on productivity.

there's a big difference between greece and argentina. argentina had huge economic bubble the fundamentals of productivity and economy were there. so there were resources to work with a record know what has been working on the sentimental spin port of rico and see how they are made compatible with the path we find out of the current crisis. >> thanks. >> a very substantive and document of the tort puerto rico administration, yet she's making the right case. puerto rico's challenges are a consequences of our colonial condition. there's corruption of local politicians. and there's no choices we can make locally that we haven't been able to make. such as once powerful tax reform, corporate tax reform has not arrived in puerto rico the way it should be.

we have not a diversified our fuel base consumption. energy costs are way july in puerto rico. we haven't really found a local government. government is just too big at the moment. but something we should put on table that no government has had the political will to actually accomplish meaningful redesigning. there's no proper tax administration system locally. i mean, the department of the treasury, in puerto rico is a very inefficient. making sure those who pay taxes pay the taxes. so yes, there is a panoply of elements that render the legitimacy and strength in regards to the inefficiency or local governments.

but the issue of the absence of democratic legitimacy of the board, the whole idea of actually writing a wrong with another wrong, the constitution of puerto rico, the rule of law, the oscilloscope rule of law that we have in order to go in this way really, we can achieve similar views but actually structuring the board in differently, as i've mentioned before. as regards to kevin's comment, about the greek, as my fellow panelists have suggested come in the context of greece, first of all you for completely different political scenario. greece had a bargaining chip it could actually exit the eurozone come and the european central

bank was involved. the imf was involved. the french were involved. the germans were involved. the exposure of the members were way too high for them not to be involved in the creates a new. indian-american scenario, perhaps some folks in congress are going to end up realizing, before next month, the puerto rican crisis, we have a multiplier effect in the u.s. as bond market. and that may mean that sooner or later the puerto rico crisis will have an effect on the mainland. because most unusual form, usual forms and capital investment forms are heavily investing in

puerto rico commercial paper. so if puerto rico doesn't pay its debt you'll end up having consequences in the mainland. folks in pensioners in california, a new jersey come across the country will feel it. somehow that means first political actors in congress will actually act press any more responsible way than they have done so far. as regards to max questions, legitimacy, yes, i guess the answer to question is that perhaps we could have engineered a process whereby puerto rican actors and actress in congress would have actually engineered a consent mechanism or by folks in puerto rico could -- [inaudible] the whole board mechanism perhaps by having a local vote on it.