The U.S. $73 Billion Puerto Rico Problem

In a White House briefing, Josh Earnest, the spokesperson revealed that the United States will not bail our Puerto Rico. Oh really? In March of 2009, the White House created one of ‘those’ task forces, this one dedicated to Puerto Rico. 4 years later….financial crisis is worse.

On October 30, 2009, President Obama signed Executive Order 13517, which directed the Task Force to maintain its focus on the status question, but added to the Task Force’s responsibilities by seeking advice and recommendations on policies that promote job creation, education, health care, clean energy, and economic development on the Island.

The current Task Force was convened in December 2009 with members from every Cabinet agency. It organized two public hearings in San Juan, Puerto Rico and Washington, D.C. to hear directly from a broad cross section of voices on the issues of status and economic development. Furthermore, hundreds of citizens from Puerto Rico and the mainland offered input by sending materials through the mail and electronically through a White House public comment e-mail address. Members of the Task Force and White House staff also met with congressional leaders, Puerto Rican elected officials, and other interested parties to hear their views.

 

   

From the WSJ:

As Puerto Rico sinks under the weight of $73 billion in government and agency debt—not to mention billions more in unfunded pension and health-care liabilities—its political class is looking for an escape hatch.

This isn’t about wiping the slate clean. But if a bankruptcy judge approved the write-down of, say, half the municipal debt, it would reduce the fiscal pressure.

There’s an app for that. The trouble for Puerto Rico is that getting it requires a retroactive change in U.S. law. If Congress cares about the future of Puerto Rico or the hundreds of thousands of Americans who hold Puerto Rican debt, it will just say no.

More than half of the outstanding Puerto Rico debt is triple tax-exempt revenue bonds issued by government-owned corporations. Unlike public corporations and municipalities in the 50 states, these enterprises do not have access to Chapter 9 bankruptcy protection under the U.S. code. If they fail to meet their loan obligations, they face receivership.

Last June Puerto Rico enacted a law to allow its government corporations to declare bankruptcy. But in February, a U.S. federal judge in San Juan struck down that law on grounds that the federal bankruptcy code supersedes it.

Greece vs. Puerto Rico

The governor warned that Puerto Rico can’t pay its $72 billion public debt on the eve of a private Monday meeting with legislators, delivering another jolt to the recession-gripped U.S. island as well as a world financial system already worrying over Greece’s collapsing finances.

Gov. Alejandro Garcia Padilla is hoping to defer debt payments while negotiating with creditors, spokesman Jesus Manuel Ortiz said Sunday night.

Garcia is expected to air a pre-recorded televised address after meeting with legislators, who are still debating a $9.8 billion budget that calls for $674 million in cuts and sets aside $1.5 billion to help pay off the debt. The budget has to be approved by Tuesday.

Ortiz confirmed comments by Padilla that appeared in a report in The New York Times published late Sunday, less than a day before Garcia planned to meet with legislators.

“There is no other option. I would love to have an easier option. This is not politics, this is math,” Garcia is quoted as saying in the Times.

Puerto Rico’s bonds were popular with U.S. mutual funds because they were tax-free, but hedge funds and distressed-debt buyers began stepping in to buy up debt as the island’s economy worsened and its credit rating dropped.

Garcia’s comments will likely not have much impact on Wall Street, said economist Jose Villamil, a former U.N. consultant and CEO of an economic and planning consulting firm.

“The markets are clear that Puerto Rico is heading to a direction of a restructuring or default,” said the economist, adding that a voluntary restructuring by bondholders might be the best option.

“The last four administrations have kicked the can down the road,” said Villamil. “At this point, there is no more can to kick. So we’re going to take some very strict measures and some very profound measures. It’s going to hurt, but there’s no way out.”

Some legislators were taken aback by Garcia’s comments, including Rep. Jenniffer Gonzalez, spokeswoman for the main opposition party.

“I think it’s irresponsible,” Gonzalez said. “He met privately with The New York Times last week, but he hasn’t met with the leaders of this island.”

Puerto Rico’s constitution dictates that the debt has to be paid before any other financial obligation is met. If Garcia seeks to not pay the debt at all, it will require a referendum and a vote on a constitutional amendment, she said in a phone interview.

Puerto Rico’s situation has drawn comparisons to Greece, where the government decreed this weekend that banks would be shuttered for six business days and restrictions imposed on cash withdrawals. The country’s five-year financial crisis has sparked questions about its continued membership in the 19-nation shared euro currency and the European Union.

Puerto Rico’s governor recently confirmed that he had considered having his government seek permission from the U.S. Congress to declare bankruptcy amid a nearly decade-long economic slump. His administration is currently pushing for the right for Puerto Rico’s public agencies to file for bankruptcy under Chapter 9. Neither the agencies nor the island’s government can file for bankruptcy under current U.S. rules.

Puerto Rico’s public agencies owe a large portion of the debt, with the power company alone owing some $9 billion. The company is facing a restructuring as the government continues to negotiate with creditors as the deadline for a roughly $400 million payment nears.

Garcia has taken several measures to help generate more government revenue, including signing legislation raising the sales tax to 11.5 percent and creating a 4 percent tax on professional services. The sales tax increase goes into effect Wednesday and the new services tax on Oct. 1, to be followed by a transition to a value-added tax by April 1.

When Do Murders by Illegals Become a Crisis?

A murder a day? The numbers are tracking to be almost accurate as Barack Obama’s prisoner release policy of illegals is killing Americans.

Senator Grassley needs our help as his office is demanding answers. It is also most important to track this bill making its way through the congressional legislative path. The sponsors of this bill are also questionable including Congressman Duncan Hunter, (R-CA).

There are on average 44 murders a day in the United States, according to the Centers for Disease Control and Prevention. Assuming murders by illegal immigrants were prorated as a percentage of the U.S. population, it is not unreasonable to assume one to two murders a day are committed by illegal immigrants.

121 murders attributed to illegals released by Obama administration

Washington Times:

More than 100 immigrants whom the Obama administration released back into the community went on to be charged with subsequent killings, according to government data released Monday that raises more questions about whether immigration authorities are doing enough to detail illegal immigrants awaiting deportation.

In one case, U.S. Immigration and Customs Enforcement acknowledged that its agents didn’t find out about an illegal immigrant’s death threats and court injunctions against him — which should have put him back in detention — until after the man was accused of murder.

That case, involving Apolinar Altamirano, is the latest instance of someone who went through the Obama administration’s deportation system and was released, only to go on to be charged with major crimes.

 

ICE officials say they don’t regularly notify local authorities when they release an immigrant and don’t have a way of finding out from those authorities whether a former detainee gets into trouble with the law, so they didn’t know whether Mr. Altamirano’s $10,000 bond should have been revoked.

“ICE was not aware of the injunctions against Mr. Altamirano until after his January 22, 2015 arrest for first-degree murder, armed robbery and related offenses,” the agency said in a letter to Senate Judiciary Committee Chairman Chuck Grassley, Iowa Republican, and Sen. Jeff Flake, an Arizona Republican in whose state the killing occurred.

All told, 121 immigrants who were held but eventually released by ICE went on to commit “homicide-related offenses” from 2010 through 2014, the agency said.

It said 33 of those were ordered released by immigration courts and another 24 were released because of a 2001 Supreme Court decision capping the time an immigrant can be detained to six months. But a majority of the releases were at ICE’s discretion.

In a statement Monday, ICE said that a criminal record isn’t enough to qualify for mandatory detention under agency policies.

“When making custody determinations, ICE performs an individualized review of the individual’s immigration history and criminal history, pursuant to the Immigration and Naturalization Act (INA),” the agency said. “In accordance with the requirements of the INA, not all criminals are subject to mandatory detention and thus may be eligible for bond.”

Detention cannot be used as a further punishment for their crimes or for being in the country illegally, but rather must be used as a tool for further deportation.

Still, ICE stiffened its policies this year, insisting that a supervisor approve cases when the agency plans to release immigrants with serious criminal records.

Even those released are usually monitored in some fashion, though The Washington Times reported last week that most of those under electronic monitoring violated some conditions of their release. Few violations were deemed serious enough to have their release revoked.

Critics who have been pushing for stiffer immigration enforcement said the violence rate for released immigrants is probably much higher and the 121 charged are only those who have been caught.

“Illegal immigration is not a victimless crime,” said Maria Espinoza, co-founder of the Remembrance Project, which advocates for victims of crimes committed by immigrants. “This further supports what we have been fighting for. The safety and welfare of Americans must be the priority of the administration and the Republican-led Congress.”

Don Rosenberg, whose son was killed in a traffic accident by an illegal immigrant driving without a license, said the government lacks the willpower to deport people and to do it quickly.

“These people can and should be deported. We have that option, and we don’t want to take it, and this is what happens,” he said. “I guess until somebody who has the responsibility to make these decisions has one of their loved ones killed, it’s going to continue to happen.”

In the case of Mr. Altamirano, he was put in deportation proceedings on Jan. 3, 2013, and released after posting bond four days later. His first hearing before the immigration court wasn’t until April 9, 2014, and he was still awaiting a final deportation order in January this year when he was arrested on charges of shooting a convenience store clerk in Mesa, Arizona.

Mr. Grassley and Sen. Jeff Sessions, Alabama Republican and chairman of the immigration subcommittee, are seeking answers from Homeland Security Secretary Jeh Johnson, Attorney General Loretta Lynch and Secretary of State John F. Kerry.

The senators want to know why Mr. Kerry hasn’t put more pressure on other countries to take back their citizens whom the U.S. wants to deport. Under the 2001 Supreme Court ruling known as the Zadvydas case, the U.S. generally cannot detain foreigners longer than six months if their countries won’t accept them. Every year, thousands of immigrants are put back on the streets because of Zadvydas.

Republicans have long pressured the State Department — under President George W. Bush and now under President Obama — to use diplomatic tools such as denying visas to top officials try to force other countries to take back their citizens.

The Times reported that ICE releases hundreds of Cuban criminals into U.S. communities every year because the island nation refuses to take them back.

 

 

Bio-weapons, History: Russia, Syria and Beyond

As it has been proven by countless authorities, chemical weapons used in Syria still continues today with future conditions ripe for more death events by chemical weapons.

Bashir al Assad is a desperate man today and nothing is beyond desperate decisions including more chemical weapons or attempting to kill his Vice President.

In part from the WSJ:

Assad Chemical Threat Rises
U.S. intelligence agencies believe there is a strong possibility the Assad regime will use chemical weapons on a large scale as part of a last-ditch effort to protect key Syrian government strongholds if Islamist fighters and other rebels try to overrun them, U.S. officials said.

Analysts and policy makers have been poring over all available intelligence hoping to determine what types of chemical weapons the regime might be able to deploy and what event or events might trigger their use, according to officials briefed on the matter.

Last year, Syrian President Bashar al-Assad let international inspectors oversee the removal of what President Barack Obama called the regime’s most deadly chemical weapons. The deal averted U.S. airstrikes that would have come in retaliation for an Aug. 21, 2013, sarin-gas attack that killed more than 1,400 people.

 

Since then, the U.S. officials said, the Assad regime has developed and deployed a new type of chemical bomb filled with chlorine, which Mr. Assad could now decide to use on a larger scale in key areas. U.S. officials also suspect the regime may have squirreled away at least a small reserve of the chemical precursors needed to make nerve agents sarin or VX. Use of those chemicals would raise greater international concerns because they are more deadly than chlorine and were supposed to have been eliminated. Read more here.

*** Obama defers the chemical weapons operation in Syria to Russia. Obama announced his red-line of use of chemical weapons in Syria as a shallow and empty threat. This decision is best described as giving a known terrorist ICBM’s. How so?

In part from Congressional documents: When Yeltsin took office in January 1992, the US forced his public admission that there had been an offensive Soviet BW program and that it had continued until March 1992. Yeltsin promised the US president and the British prime minister to abolish the program, which he apparently presumed to think would be possible by decree, and to dismiss the military officials who had run the program for the preceding decades. However, he did not do any of these things. These same military officials who advised Yeltsin in January 1992 to continue the BW program remained in their positions. Following additional defections from the program, the US and UK stated that the BW program continued as of September 1992, and they forced Russian agreement to the Trilateral Statement, signed in Moscow in September 1992. Russia committed itself in the document to allow access to the biological weapon facilities of the Russian Ministry of Defense. However Russian negotiating teams ran these negotiations into the ground between 1993 and 1996, at which point they were discontinued. An unconcerned and essentially oblivious Yeltsin had long before this point simply washed his hands of the issue despite repeated appeals by President Clinton and his senior officials.

US and EU assistance programs for the conversion of the Biopreparat and Ministry of Agriculture facilities led to access to these and assurance that they were subsequently performing legitimate civilian research and commercial activities. Virtually no proliferation apparently took place from the Soviet BW program. Official annual US government declarations continue to question Russian compliance with the BWC, and the three major Ministry of Defense facilities remain closed to this day.

In a somewhat bizarre development in February and March 2012 Putin and then-Russian Minister of Defense Anatoly Serdyukov publicly referred to 28 tasks that Putin established for the RF-MOD in order “to prepare for threats of the future.” Putin wrote that Russia needed to be prepared for “quick and effective responses to new challenges,” and one of the 28 tasks that Putin specified as “The development of weapons based on new physical principles: radiation, geophysical, wave, genetic, psychophysical, etc.”2 “Genetic” weapons would obviously be forbidden by the Biological Weapons Convention, and the remainder are an arms control nightmare that would explicitly contravene another multilateral arms control treaty that was championed by the Brezhnev administration, the Convention on the Prohibition of Military or any other Hostile Use of Environmental Modification Technologies, signed on May 18, 1977 and entered into force on October 5, 1978.

The three primary issues of current concern regarding Russia and biological weapons are therefore the following:

1) Russia destroyed the Trilateral negotiations that followed from the September 1992 US-UKRussian Trilateral Agreement.

2) As a corollary, the three Russian Ministry of Defense BW laboratories remain closed to international examination. There is no way of knowing whether these institutions continue an offensive BW program, and if so, to what degree.

3) The statement by President Vladimir Putin in February-March 2012 to develop genetic weapons is extremely problematic and troubling. Putin’s remarks were never revoked or clarified to this date.

 Where is Obama and Samantha Power at the UN on this matter?

What real explanation can Barack Obama offer that he turned to Putin to deal with the matter in Syria? How much more genocide will there be and will it be confined just to Syria?

In part: “Ken Alibek was Dr. Kanatjan Alibekov, the first deputy chief of research and production for the Soviet biological-weapons program. He was the top scientist in the program, a sprawling, clandestine enterprise known as Biopreparat, or The System, by the scientists who worked in it. Biopreparat research-and-production facilities were flung all across the Soviet Union. As Dr. Alibekov, Ken Alibek had thirtytwo thousand scientists and staff people working under him. Alibek has a Doctor of Sciences degree in anthrax. It is a kind of superdegree, which he received in 1988, at the age of thirty-seven, for directing the research team that developed the Soviet Union’s most powerful weapons-grade anthrax. He did this research as head of the Stepnagorsk bioweapons facility, in what is now Kazakhstan, which was once the largest biowarfare production facility in the world. The Afibekov anthrax became fitfly operational in 1989. It is an amber-gray powder, finer than bath talc, with smooth, creamy particles that tend to fly apart and vanish in the air, becoming invisible and driffing for miles. The Alibekov anthrax is four times more efficient than the standard product. Ken Alibek is part of a diaspora of biologists who came out of Russia foflowing the breakup of the Soviet Union. Government funding for research decreased dramatically, and scientists who were working in the biowarfare program found themselves without jobs. Some of them went looking abroad. A few have come to the United States or Great Britain, but most went elsewhere. “No one knows where they are,” Alibek says. One can guess-that they’ve ended up in Iraq, Syria, Libya, China, Iran, perhaps Israel, perhaps India–but no one really knows, probably not even the Russian’ government. No doubt some of these biologists have carried the Alibekov formi4a in their heads, if not master seed strains of the anthrax and samples of the finished product in containers. The Alibekov anthrax may be one of the more common bioweapons in the world today. It seems plausible that Iraqi biologists, for instance, know the Alibekov formula by now. One day, Ken Alibek and I were sitting in a conference room near his office taMng about the anthrax he and his research team had developed. “It’s very difficult to say if I felt a sense of excitement over this. It’s very difficult to say what I felt like,” he said. “It woulddt be true to say that I thought I was doing something wrong..l thought I had done something very important. The anthrax was one of my [outstanding] scientific personal result.” I asked him if he’d tell me the formula for his anthrax. “I cadt say this,” he answered. “I won’t publish it. I’m just curious,” I said. “Look, you must understand, this is unbelievably serious. You can’t publish this formula,” he said. When I assured him I wouldn’t, he told me the formula for the Alibekov anthrax. He uttered just one sentence. The Alibekov anthrax is simple, and the formula is somewhat surprisingi not quite what you’d expect. Two unrelated materials are mixed with pure powdered anthrax spores. It took a lot of research and testing to get the trick right, and Afibek must have driven his research group hard and skdmy to arrive at it. “There are many countries that would to know how to do this,” he said.”

 

 

 

So Goes Greece?

Could Russia be looming in the dark?

At 3 am this morning in Greece:

Greece’s parliament has voted in favor of Prime Minister Alexis Tsipras‘ motion to hold a referendum on the country’s creditor proposals for reforms in exchange for loans. Tsipras and his coalition government have urged people to vote against the deal, throwing into question the country’s financial future.

The vote is to be held next Sunday, July 5. It has raised the question of whether Greece can remain in Europe’s joint currency, the euro. Many Greeks alarmed by the announcement for the referendum early Saturday morning formed queues at ATM machines, putting a further strain on banking deposits.

FRANKFURT: Greek banks have been heavily dependant on ” Emergency Liquidity Assistance” (ELA) since being cut off from standard European Central Bank funding options in early February.  These are effectively loans given at the discretion of the national central bank of the country in question, although they have to be approved by the ECB.

The ECB adds that the national central banks may provide ELA “against adequate collateral” and only to “illiquid but solvent” credit institutions.

Any changes to the limits of ELA require a two-thirds majority in the ECB’s 25-member Governing Council. The Governing Council approves maximum ELA amounts for each individual bank.

The exact details of ELA are not published but the average interest rate charged on it is estimated to be around 100 to 150 basis points above the ECB’s benchmark interest rate. That rate is currently 0.05 percent.

The collateral banks post when using ELA is typically of a lower average quality than is normally accepted by the ECB. But a larger ‘haircut’ – or discount – is also usually applied to counterbalance some of the risks.

A key justification for ELA provision is to “prevent or mitigate potential systemic effects as a result of contagion through other financial institutions or market infrastructures.”

ELA loans sit on the balance sheet of the national central bank and therefore that of the Eurosystem of central banks (the euro zone’s 19 national central banks plus the ECB), but not directly on the ECB’s own balance sheet.

Is a Plan B in the works? Sunday’s emergency meeting could spell out that answer.

‘Plan B’ looms after Greece and Europe fall out

Brussels (AFP) – With Greece’s creditors refusing to extend its bailout, attention has turned swiftly to preventing massive capital flight as worried Greek citizens pull cash from ATMs.

Fears that the banks may not open Monday have prompted the European Central Bank to meet but officials say it will be up to Greece to stem an outflow that has already reached dangerous levels.

“If there isn’t capital controls by Tuesday at the latest, it’s over,” said a European source close to the negotiations.

“Greek banks are near liquidation and can no longer remain solvent. Once the banks fail, ‘Grexit’ will become irreversible,” the source said.

Talks on Saturday collapsed with the Greek contingent leaving the remaining 18 eurozone ministers to consider the consequences of a default.

In a statement, the ministers appeared to urge Greece towards capital controls, saying that the expiry of the bailout “will require measures by the Greek authorities, with the technical assistance of the institutions, to safeguard the stability of the Greek financial system.”

The withdrawals today were “exceptionally high,” warned the influential German Finance Minister Wolfgang Schaeuble at the talks on Saturday.

Faced with this calamity, Natixis analysts Jesus Castillo and Alan Lemagnen said the Greek government could decide a bank holiday, an order that the nation’s banks remain closed to avoid a run by customers.

Similar moves were made in 2013, when Cyprus imposed drastic limitations on cash withdrawals and money transfers abroad when its banks faced crisis — in large part due to contagion from the crisis in Greece.

– ‘Fight contagion’ –

“We will do everything to fight against any possible danger of contagion,” Schaeuble added.

If the scenario were repeated in Greece now, European leaders would act to prevent the same contagion that flowed from Greece in 2012 to other troubled eurozone members like Spain, Portugal and Ireland.

That disruption was caused by spooked investors shunning the bonds of vulnerable countries, sending their borrowing rates unsustainably high. At the same time, banks in healthier eurozone countries holding debt of weak eurozone nations were suddenly seen as a risk.

But risk of renewed contagion has been greatly reduced by firewalls built since 2010 by eurozone authorities, and the creation of a European banking union to police lenders and oversee a collective response to the crisis.

And in the meantime, most European banks have significantly wound down their exposure to Greece and other troubled eurozone members.

The ECB also now has tools unavailable to it in 2010. It is in the midst of successful quantitive easing programme injecting liquidity into the eurozone economy, and could easily step up its purchases of sovereign bonds if investors dump debt.

It could also deploy the thus far unused “outright monetary transactions” to purchase sovereign debt — a plan it unveiled in 2012 to calm panicked markets, and which has recently cleared legal challenges from opponents.

Until Saturday’s debacle in Brussels, the ECB bought time to allow discussions to continue, pumping cash into the teetering Greek financial system.

To achieve that, the Frankfurt-based central bank maintained its emergency liquidity funding to Greek banks to prevent their collapse — and in doing so withstood heated opposition from Germany.

So far ECB chief Mario Draghi has refused to cut emergency funding for Greek banks, but that decision is expected to be soon reversed.

The central bank’s governing council is set to hold an emergency meeting on Sunday, and a decision to end the lifeline is increasingly expected.

Obama, the Conductor of Chaos

Barack Obama holds the baton to an anti-American orchestra of tuned, tested, rehearsed instruments. The production is mismanaged, sour to the ears and causes people to leave the arena when the verses are not American and in cadence with allies. The entire governmental score is tyrannical and abusive.

His performance however, is well driven by inside marxist, communists and socialist operators who themselves have tuned, tested and rehearsed instruments where it is in harmony with enemies of America. How about Hugo Chavez, Mohammed Morsi or the Taliban? Then there is Iran.

Three branches of government have been reduced to one, where Conductor Obama has ruled with a pen and a phone and otherwise political extortion. Up to the point where Senate majority leader, Harry Reid lost his leadership post, he functionally stopped and paralyzed the people’s work on Congress to protect Barack Obama.

All the while, Maestro Obama had his was working his intonations on the Supreme Court with his choice picks of Elena Kagan and Sonia Sotomayor, swinging the black robe influence to a more left octave. The court is broken when one sees the real dissention between the justices when not on the bench.

Obama has led an opus where the very social and civil structure in America has been thrown into turmoil. Border Patrol has no clue how to enforce immigration laws, they abide to DHS memos written by Secretary Jeh Johnson. Historical flags and icons are to be removed and gender designated bathrooms are now without any designation.

The fundamental security of government personnel and documents of several agencies has been compromised by an epic cyber intrusion and that finale is from over as the damage will be ongoing for years.

The very personal concern of having access to healthcare has reached a crisis pitch such that insurance deductibles are financially bending and having a doctor’s appointment is a future dream. Nothing is more demonstrative of this condition than that of the Veteran’s Administration where there is a slow death waltz.

Barack Obama performed a medley of government fraud and extortion using the IRS, the EPA, the DoJ, ATF, Education, HUD and HHS to name a few.

Off our shores, conditions are much worse. Barack Obama has modulated a score of retreat while his measure of sympathy to Islam in pure nocturne. His administration led of early in 2009 with the Cairo speech where the ligature plays out today throughout the Muslim world. The retreat from Iraq and his shallow threat of a ‘red-line’ have prove deadly in the whole region, a modern day holocaust. And mostly sadly of all was allowing 4 Americans to perish in Libya with no hope of security, support or rescue.

The most grave of the Obama coda is the terror and dying of Christians.

The building crescendo of Obama will be the nuclear agreement with Iran where Israel, Saudi Arabia, Europe and America as the great Satan will be his encore.

The stretto of the Obama symphony is defined here in an excellent summary by Stephen Hayes of The Weekly Standard.

There are several months left for the conductor of chaos to work his baton and that tremolo is clearly upon us and the world.