WASHINGTON -- Hillary Rodham Clinton said Tuesday that Congress and President Barack Obama's administration should help Puerto Rico restructure its debts under Chapter 9 bankruptcy.
The Democratic presidential candidate called on lawmakers and the White House to "partner with Puerto Rico by providing real support and tools so that Puerto Rico can do the hard work it will take to get on a path toward stability and prosperity."
Puerto Rican Gov. Alejandro Garcia Padilla said last month that the island's $72 billion public debt is unpayable after a nearly decade-long economic slump.
Puerto Rico, which is excluded from a part of the U.S. bankruptcy code used by municipal entities and cities such as Detroit, failed this week in a bid to revive a local restructuring law to help it deal with its debt.
The dispute centers on whether the island can make its own rules for allowing public agencies to seek protection from creditors.
The U.S. Court of Appeals in Boston resisted the effort Monday, agreeing with a San Juan judge who threw out the statute in February. The commonwealth may ask the U.S. Supreme Court to consider the case, said Cesar Miranda Rodriguez, Puerto Rico's attorney general.
Meanwhile, legislation allowing Puerto Rico to use Chapter 9 bankruptcy laws is pending in the House. In the Senate, Sens. Charles Schumer of New York and Richard Blumenthal of Connecticut are planning to propose companion legislation.
In a statement Tuesday, Clinton said Congress should give the U.S. territory the same ability to restructure its debts as U.S. municipalities and public corporations under the bankruptcy code.
"We're not talking about a bailout; we're talking about a fair shot at success," Clinton said.
The White House has said it is not considering a federal bailout of Puerto Rico.
Clinton's statement Tuesday came after Maryland Gov. Martin O'Malley, another Democratic presidential candidate, said last month that Puerto Rico should be able to negotiate with its creditors under U.S. bankruptcy laws.
Former Florida Gov. Jeb Bush, who is seeking the Republican nomination, also has said Puerto Rico should be able to seek Chapter 9 bankruptcy.
Vermont Sen. Bernie Sanders, another Clinton rival, also backed the bankruptcy protections in a statement Tuesday. He pinned the blame for Puerto Rico's woes on Wall Street, saying the debt "has everything to do with the policies of austerity and the greed of large financial institutions."
Information for this article was contributed by Ken Thomas of The Associated Press and by Christie Smythe, Michelle Kaske and staff members of Bloomberg News.
A Section on 07/08/2015