Wednesday, April 01, 2020
Hawai'i Free Press

Current Articles | Archives

Thursday, October 01, 2015
Senate Puerto Rico Package to Include Jones Act Exemption?
By Michael Hansen @ 2:22 PM :: 2577 Views :: Jones Act

by Michael Hansen, Hawaii Shippers Council, September 30, 2015

Reuters in a news article “U.S. Sen. Hatch says no help for Puerto Rico unless better disclosure” posted on September 29, 2015, reported on a hearing held by the U.S. Senate Finance Committee chaired by Senator Orin Hatch (R-UT) on what measures the federal government can take to relieve the Puerto Rico financial crisis.

The hearing centered on Governor Alejandro Garcia Padilla’s financial turnaround plan known as “Puerto Rico Fiscal and Economic Growth Plan” issued on September 9, 2015, and the earlier “Puerto Rico – A Way Forward” commonly known as the Krueger Report issued June 29, 2015.

The Republican members including Sen. Hatch and Senator Chuck Grassley (R-IA) a member of the Finance Committee and Chairman of the Senate Judiciary Committee, were skeptical of a federal financial control board for Puerto Rico on constitutional grounds, opposed to granting Chapter 9 bankruptcy to the Commonwealth because of the effects on the municipal bond market, and were reluctant to increase funding for Medicare and Medicaid due to budgetary considerations. However, the Republicans said they are willing to consider exempting Puerto Rico from the Jones Act and the federal minimum wage.

A witness before the committee, Douglas Holtz-Eakin, president of the American Action Forum (AAF) and former Director of the Congressional Budget Office (2003 – 2005), testified against a Chapter 9 bankruptcy extension and a federal financial control board.

The ranking minority member Senator Ron Wyden (D-OR) expressed support for additional funding for Medicare and Medicaid and noted that the Republicans need to consider the views of the minority to pass a bill.

This puts a new wrinkle on the issue of federal assistance for Puerto Rico. The Democrats have been focused on extending Chapter 9 Bankruptcy protection to the Commonwealth and greater federal funding of the territorial Medicare and Medicaid plans. In response, the Jones Act industry has publically threatened to block these measures if a Puerto Rico relief bill contains a Jones Act exemption.

Meanwhile the Senate Republicans seem to support Jones Act and federal minimum wage exemptions for Puerto Rico, and do not support Chapter 9 Bankruptcy extension and greater federal funding of Medicare and Medicaid.

It will be interesting to see how this turns out.

Key excerpts:

Powerful Senate Finance Committee Chairman Orrin Hatch on Tuesday warned there could be no help for Puerto Rico without better financial disclosure, while expressing doubts about extending bankruptcy protection for the indebted island and questioning the idea of imposing a financial control board.

A turnaround plan unveiled in September by a working group appointed by Governor Alejandro Garcia Padilla asked for help from the U.S. government, including access to court-sanctioned restructuring laws, an exemption from the Jones Act which protects U.S. shipping, and what it would call equitable treatment under Medicaid and Medicare funding schemes.

"If we don't get really well-audited figures, it's going to be pretty hard to help you," Hatch, a Republican, told the head of its Government Development Bank (GDB) Melba Acosta, at a hearing on the island's problems. "I don't think Puerto Rico is treated fairly, for the most part. But we need really good information from you in order to help you."

Hatch questioned one witness, a budget expert from the American Action Forum (AAF) think tank, about his views on extending Chapter 9 bankruptcy protection, which allows a state's municipalities and public agencies to seek bankruptcy protection, but does not apply to Puerto Rico, which is a territory.

Douglas Holtz-Eakin, president of the AAF, said he had "deep reservations" about the focus on allowing Chapter 9 and Hatch said he shared some of Holtz-Eakin's skepticism.

Holtz-Eakin also expressed doubts about using a control board to manage Puerto Rico through its financial crisis, one idea which has been raised by members of U.S. Congress as well as officials on the island.

"A control board independent enough would have to be basically imposed on Puerto Rico and infringe on its sovereignty and I think that's a problematic thing for the federal government to do," said Holtz-Eakin. Hatch said that if there is a board, "it probably should have to be independent".

Iowa Senator Chuck Grassley, a Republican member of the Senate Finance Committee and chairman of the Senate Judiciary Committee, said a local control board "if ever created will be ineffective due to local politics and pressure."

"Perhaps then a federal financial control board should be part of a comprehensive approach to remove obstacles to certain fiscal reform," Grassley said.

Grassley also was skeptical about allowing Chapter 9 bankruptcy for Puerto Rico, saying such a move alone would not solve the U.S. territory's financial problems.

However, he said Congress should consider exempting Puerto Rico from the Jones Act and the federal minimum wage.

Senator Ron Wyden, the top Democrat on the Senate Finance Committee, urged witnesses to propose bipartisan solutions which could succeed. He said a better funding system for Medicaid and improvements to Medicare ought to be on the table.

Hatch, however, said that solving healthcare was not "as simple as deciding to give more health funds to Puerto Rico, because doing so would necessarily mean reduced funding for other priorities, increased taxes, or even more federal debt."

FULL TEXT: Sen Grassley Speech

Links

TEXT "follow HawaiiFreePress" to 40404

Register to Vote

2aHawaii

808 Silent Majority

808 State Update AM940

ABCDEFG Blog

ACA Signups Hawaii

ACCE

ALEC

Alliance Defending Freedom

Aloha Life Advocates

Aloha Pregnancy Care Center

American Council of Trustees and Alumni

American Mothers of Hawaii

AMVETS-Hawaii

AntiPlanner

Antonio Gramsci Reading List

A Place for Women in Waipio

Astronomy Hawaii

Audit The Rail

Ballotpedia Hawaii

Better Hawaii 

Blaisdell Memorial Project

Broken Trust 

Build More Hawaiian Homes Working Group

CAFR Hawaii

Castaway Conservative

Children's Alliance Hawaii

Children's Rights Institute

ChinaTownWatch.com

Christian Homeschoolers of Hawaii

Citizens for Recall

Cliff Slater's Second Opinion

Coffee Break

CSIS Pacific Forum

DAR Hawaii

DeedySupport.com

DVids Hawaii

E Hana Kakou Kelii Akina

E Māua Ola i Moku o Keawe

Farmers For Choice Hawaii

FIRE

Fix Oahu!

Follow the Money Hawaii

Frank in Hawaii

Front Page Magazine

Frontline: The Fixers

Genetic Literacy Project

Get Off Your Butts!

God, Freedom, America

Grassroot Institute

Habele.org

Hawaii Aganst Assisted Suicide

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii Coalition Against Legalized Gambling

Hawaii ConCon Info

Hawaii Credit Union Watch

Hawaii Crime Victims' Rights

Hawaii Crop Improvement Association

Hawaii Debt Clock

Hawaii Defending Marriage

Hawaii Defense Foundation

Hawaii Families for Educational Choice

Hawaii Family Advocates

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federalist Society

Hawaii Federation of Republican Women

Hawaii Firearm Community

Hawaii Fishermen's Alliance

Hawaii Future Project

Hawaii Gathering of Eagles

Hawaii History Blog

Hawaii Homeschool Association

Hawaii Jihadi Trial

Hawaii March for Life

Hawaii Meth Project

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Right to Life -- Big Island

Hawaii Right to Life -- Oahu

Hawaii Shield Law Coalition

Hawaii Shippers Council

Hawaii Smokers Alliance

Hawaii State Data Lab

Hawaii Together

Heritage Foundation

HI Coalition Against Legalized Gambling

HIEC.Coop 

HiFiCo

Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Homeless Crisis

Honolulu Navy League

Honolulu Traffic

Horns of Jericho Blog

House Minority Blog

House Republican Caucus YouTube

HPACC

Hump Day Report

I Vote Hawaii

If Hawaii News

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

Investigative Project on Terrorism

Iowa Meets Maui

Jackson v Abercrombie

Jihad Watch

Judgepedia Hawaii

July 4 in Hawaii

Kahle v New Hope

Kakaako Cares

Kau TEA Party

Kauai Co GOP

Keep Hawaii's Heroes

KeyWiki

Land and Power in Hawaii

Legislative Committee Analysis Tool

Lessons in Firearm Education

Lingle Years

Malulani Foundation

Managed Care Matters -- Hawaii

Malama Pregnancy Center of Maui

Mauna Kea Recreational Users Group

MentalIllnessPolicy.org

Middle East Forum--The Legal Project

Mililani Conservatives for Change

Military Home Educators' Network Oahu

Missile Defense Advocacy

MIS Veterans Hawaii

Muslim Brotherhood in America

NAMI Hawaii

NARTH

Natatorium.org

National Christian Foundation Hawaii

National Parents Org Hawaii

National Wind Watch

New Zeal

NFIB Hawaii News

No GMO Means No Aloha

Northwest Economic Policy Seminar

Not Dead Yet, Hawaii

Now What I Really Think

NRA-ILA Hawaii

Oahu Alternative Transport

ObamaCare Abortion Hawaii

Obookiah

OHA Lies

Opt Out Today

OurFutureHawaii.com

Pacific Aviation Museum

Patients Rights Council Hawaii

PEACE Hawaii

People vs Machine

Pritchett Cartoons 

Pro-GMO Hawaii

P.U.E.O.

RailRipoff.com

Rental by Owner Awareness Assn

Republican Party -- Hawaii State

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

Robotics Organizing Committee

School Choice in Hawaii

SenatorFong.com

SIFE Remington

SIFE W. Oahu 

Sink the Jones Act

Smart About Marijuana--Hawaii

St Marianne Cope

State Budget Solutions Hawaii

State Policy Network

Statehood for Guam

Tax Foundation of Hawaii

The Harriet Tubman Agenda

The Long War Journal

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

Truth About Trade & Technology - Hawaii

UCC Truths

Union Members Know Your Rights

US Tax Foundation Hawaii Info

Valor in the Pacific

VAREP Honolulu

Waagey.org

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii

Yes2TMT