>> coming up on newsmakers, the governor of puerto rico will talk about his country's debt, and the prospects of a response from congress. then, we will talk about the political landscape leaving -- leading into the next phase of the presidential race. then, congressman john lewis will receive the holocaust museum award. newsmakers, on joining us from the american commonwealth of puerto rico is the governor there to talk about their fiscal situation. thank you for being with us. , nick timorous, who is the national wall street correspondent, and jonathan miller from cq local. they are also here to help us this morning. if i may begin, can you tell the american people how order rico

is $70 billion in debt. in a very short story, we got into a recession, congress -- with thepproved help of that section, it was to help puerto rico walk out of the recession. however, congress said it was too much and repealed that section. , we walked the end into a recession again. from 2006 2 2012, there was an anti-space in work creation.

space -- empty space in work creation. from 2006 and 2012, it was double. one governor to 60 billion. in just four years each. debt --272 billion in debt, to $72 billion in not just because of adjustment, but also with loans. that is the history, and now we have to deal with that. you declaredear, the debt unpayable, and this past week the government missed

most of its payment. there is a larger it hundred million dollar payment due in -- $8008 million million payment due in july. will you be able to make that payment? guest: no, i do not think we will be able to have that money. issue of not wanting to pay, it is that i do not have the money. the money does not exist. happened on monday, and the same will happen on the first of july. we do not have the money. >> last year, the commonwealth so increase the sales tax, revenue has been running slightly above last year's levels. why would puerto rico not have

the money if you're after you revenues are up? debt servicee the has increased this year. we increase our obligation. this year, the debt service increased, too. our debt budget was 36%, a higher ratio was one third of puerto rico. the average in the united states is five. the average in the world is seven. we are up 36%. it is just a burden that is too heavy for the commonwealth. governor, as well as you know, there is a bill before congress to help rescue the

territory from its debt. conservatives and republicans are very leery of bailing out puerto rico. one of the things they are concerned about is that they say puerto rico has gotten itself into this mess, but it is not producing enough. it's economy is in the dumps. can you get a guarantee that puerto rico will not be back six months from now, a year from now, saying that they need or their assistance? you need what is in essence a bailout? that best me answer first, this is not a bailout. we are not asking for a bailout. puertothat says that rico is asking for a bailout is just lying. ,econdly, if we do not act now

if congress does not grant puerto rico a debt restructuring law, then ae of bailout will be inevitable. it will be very expensive for u.s. taxpayers. if they act now, it will cost zero dollars to u.s. taxpayers. if they do not act, then there will be a heavy cost to u.s. taxpayers. host: how heavy a cost? guest: sorry? host: how heavy a cost? guest: billions of dollars. the more conservative estimate billion in ais $20 couple of years if we do not restructure our debt now. if we are able to restructure it now, then that will not be

needed. what we need from that deal from washington, d.c., is a that isuring process workable. something that is doable. that is why we need to fix it. i trust paul ryan's commitment. pelosi and others on their commitment. they are working to help us fix it. board. to fix also the will besight board applicable to a city like washington, d or detroit, but would not be applicable to new

york state or michigan state. puerto rico is not a city, they -- they areuristic a large jurisdiction. form of the bill is due out next week. by this time, people are thinking we may not be able to get a bill until september. is that too late for puerto rico? guest: it is already late. into a crisis. public schools are overflowing. now with the fears of the zika virus, it is even worse. we have not been able to pay the to get kids special education.

we have been able to pay the full amount to bus drivers to take kids to school. we are struggling to pay schools and firefighters to give them fuel for transportation. it is an everyday job to borrow from peter to pay paul. we are getting into and on sustainable -- and unsustainable atmosphere. we are getting to the end of the road. had been there for the united states every time that they have conflict.o fight in a originally, -- we do not ask if

the conflict is fair or unfair. if it is good or bad, we just go for the united states. it is time now for congress to thatup, and let us know they value our relationship. i think it is important to make one point that viewers may not be following. the reason congress has been asked to be involved is that puerto rico is not have access to title ix. because the 1984 of them is to the bankruptcy code excluded for -- for rico from the title , there is not an orderly process to restructure the debt. that is part of the reason why congress is having to get involved here. his youthe issue of military crisis that you are talking about, this week there

were reports that baseball players and major league baseball, who were supposed to , they are nowan seeking to move the games to miami, because concerns over the zika virus. i wanted to ask you, what message with that send? what would you say to americans in the mainland that are worried about visiting puerto rico right now? guest: that is just ignorant. the same chances you have of getting the zika virus in order rico, you will have the same chances in miami. it is like the flu, but it is bad for pregnant women and women that are expecting or looking to get pregnant. , if you suggestion is are a woman and you are looking

to have a baby or already pregnant, do not go to florida. you should not go to miami or puerto rico or brazil. u.s. olympic team did -- i want ton rio ask the question, when the u.s. olympic team not show up in rio? that is the mecca of the zika virus right now. it would be offensive to puerto ricans. honored,an was not puerto ricans would be offended. relief. to get if today's baseball players are , ifng no to puerto rico

they cannot show up for just a ,ew games in honor of clemente they say no to a mosquito, it is offensive. it is just ignorant. host: what do you say to your own citizens?\ puerto ricans have been leaving for the mainland for better economic activities. -- economic opportunities. what you say to those citizens? understand that the yard is always greener with your neighbor. right now, we are helping people to move back. they went to united states thinking they can get a job immediately, and was not so much effort. some of them are now flying back.

-- it is young people, productive people that are leaving. the people that are flying back are the more mature people. we have been reducing crime ratesand unemployment from 16% to 11%. we need to do it better to convince people to stay here. , again, more expensive to u.s. taxpayers if puerto rico moves to the states, and then claims a government eight in the states, rather than puerto rico. government aid in the states, rather than in puerto rico. so we need to convince them to

stay, or to fight back if they already left. we need to continue to reduce our crime rate and unemployment rate, so they are able to move their families forward here in puerto rico. >> one of the portions of the that -- of the bill democrats are coming out against is the lowering of the minimum wage in puerto rico. republicans point to a commission that was -- excuse me, a report that was put out why a commission last year by your government. it said that lowering the minimum wage would actually help the economy and puerto rico. the twist in the bill is that you alone would have that right to wage -- with the minimum wage. why not just let the minimum wage stay how it is? one republicans have a symbolic victory and not have to pull --

lower the minimum wage? guest: the report that you mentioned is a report that i commission from a former economist from the monetary fund. i agree with many of the study findings. amendment, i did not ask her to correct anything that i was not against. when the report went public, i said publicly that i was against that specific measure, because it goes against the economy. there is plenty of evidence in couldto show that people that people that can buy more things, houses, cars, it can help the economy to move on.

what we need is a competitive advantage. telling asking -- i am congress about the action and reaction of what they did. just about what some of you said before, the conservatives are saying that if we get into this problem -- two things about that. first, the answer is no. they took us out of the bankruptcy code without asking. 936, and we section told them what the result would be. we were right. crisis wasng of this in congress on their actions. -- thank god got that our workers do not have the same attitude.

say, if you get into that trouble alone, you have to get out on your loan. >> you alone would have the power to wage -- wave that minimum wage provision. when i just keep it in the bill -- why not just keep it in the bill? ,uest: i am the governor now and i will always try to protect my people. with that attitude ,ould,, the borrowing attitude and not involve people, if the -- if id order rico felt the power was safe. puerto rico, iin am just trying to protect them from governments in the future.

as you presume, if the power is in puerto rico, and we can decide not to act, then our minimum salary will remain the same, then that is something we can live with. host: we have about five minutes left. >> i wanted to ask you, do you think the treasury should be prepared if congress cannot pass this bill to make some kind of commitment to exchange for the region bonds with treasury bonds? asked the treasury if they would consider year -- consider this? guest: >> they can do that, but i do not think it would solve the problem. convinceying to

congress to solve this problem. that is a possibility. the treasury things -- i think that they do. when theyy are right said it would not solve the problem. to solve the problem, congress needs to act. >> your government has been involved in negotiations involving a debt exchange proposal, what options do ricansrs have it puerto default? guest: two things. first, what i am asking of creditors, they are in one group. --y are

that is plenty of groups fight among each other. them to come up with a deal that solves the crisis. a proposal could ring back the crisis in a couple of years, no. on general a second of next year, i will not be the governor. that i am not saying i can do this to solve the crisis and then kick the can to the next seven or. i am asking them to solve the crisis. -- to the next governor.

i am asking them to solve the crisis. puerto rico would be liable through other measures, if we do not comply to the plan that i proposed last september. it is already in place. it is already part of a five-year fiscal plan. in september, i extended it to a tenure fiscal plan. i am telling editors to stick to that fiscal plan. -- i am telling creditors to stick to that fiscal plan. if i do not comply, then there is some kind of penalty that puerto rico would have if we do not stick to our own plan. plan, i madeee the it public last september.

>> puerto rico has base cleaned and refused to banking congress to help save it. reduced to begging congress to help save it. puerto rico can do once congress acts. i am wondering, has this whole debt crisis changed your opinion on statehood or not? you would have had access to the income tax credit, medicare and medicaid reimbursements, has this changed your mind at all on that issue? if you are against statehood and nationhood? guest: people here are against it, too. but let's address this question. first, is independent -- is

everyone?helping did statehood help detroit city? new york city? the answer is no. helped in theve case of chapter nine bankruptcy. guest: it would not be enough. chapter nine would only apply to public operation. it would not be enough. it is like what is happening in illinois. --t is happening in greece i'm sorry, argentina. took $16.2 billion in loans, plus 7 billion from our fun. that is a lot of money.

he took it in 2011. it is not something that happened 30 years ago. it is not something that happened five years ago. he was very responsible. we need a responsible government. governor, there has been an intense lobbying campaign in washington by groups that are elite to be backed by a hedge fund. ,hey are calling this a bailout even though as you noted there is no taxpayer assistance in this bill. some people believe they are financed in part by investors that took part in the last debt offering that your country was a part of. it was after the credit rating down on. rico had been

was it a mistake to issue the response -- those bonds? guest: no, we tried. theou remember, when i said debt was not sustainable, everybody said it was not right. now, everybody agrees the debt is unsustainable. this is mathematic. before you declare the debt unsustainable, you said that that would be payable. what changed over those 12 months? guest: i was trying to negotiated with them. negotiated -- negotiate it with them. i tried many measures. something that you need to comply. it is not something that you do one thing today, it is something

you need to continue. , i was those other steps not able to comply with do -- due to inability to go to the inability to negotiate. room.ned some wiggle that is why we are asking them not to do this that is good for them and good for us. i have no doubt that this lying.n is host: governor, we are all out of time. thank you so much for being this week's newsmaker. guest: thank you for having me.

i will always be here on the other end of the line. host: all right, governor, thank you. let me turn to the two of you. nick, if i could begin with you, what did you make of him saying that they would deftly not make the july 1 payment? a scary definitely tone. the government has missed a few payments already. as the governor explained, there are different classes of debt. they fall into different parts of the debt class. the government has made a proposal, where they would restructure their debt, and they would be able to pay half of the debt service that they have right now. that he is coming out and saying, right off the bat, we are going to miss this payment, i think it will be seen as a more watershed moment then

some of these default. host: how do you think the markets will respond? there is no surprise -- >> there is no surprise that puerto rico is in trouble. it is not entirely clear how big of a surprise it is. i think people that there is a question about the ability to pay and willingness to pay. do not have the willingness, because we do not have the ability. we will see how the market response to that. host: what you think happens if they default? >> to have increased risk of litigation, litigation against the government and between creditors. as the governor explained, you do not have just one issuance of debt. you have competing structures with competing security pledges.

there is some of the risk that the creditors will sue each other. the upside is that puerto rico's economy is not growing. as we heard, people arepeople ad fairly easily, they call it the $99 solution, that's it to get on jetblue to orlando. these are u.s. citizens, they have american passports, they are able to come here very easy. theproblem is how you get economy to grow, and how do you get the economy to grow if people are suing each other and the government is not able to go out into the capital markets and raise money? isn't able to refinance its existing debt? what business is going to want to open up or hire more environment?that it doesn't help the problem at all. host: they say there could be a a bailout news from washington. that means millions of dollars. guest: probably. you're going to have more

requests for help your assistance, even though this has been characterized by some people as a bailout, there is no taxpayer money on the table. writing down about creditors. if that doesn't happen, i think you see increased odds of pressure will build on republicans and democrats actually put real taxpayer money on the table. host: will there be a bill that's passed on the house for -- house floor? guest: paul ryan has a lot at stake, he has put his stamp of on this bill. he said he wanted to get something done by march 31, they blew the deadline. they missed the deadline. deadliness to work on when they don't get stuff done. so there's going to be the bailout next week it's going to

be talked about, there are a lot of people still on the fence. we are waiting to see what the revisions of this bill look like. people i'm talking to say they are close on getting some agreement. but the proof is in the pudding. closed: one of the architects of that bill is the chairman of the natural resources committee, who is our guest next week on newsmakers. i want to think whether you talking -- both of you for talking to us. [captions copyright national cable satellite corp. 2015] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] >> coming up, republican rights michelle obama gives the commencement address at jackson state university, mississippi. >> in iraq and afghanistan, i helped both countries with their