[Jack Black]

Think about it. Default on the bonds with no way to resolve the rest of the problems and all they have done is shut off access to any new borrowing, not addressing root causes.

Yes, I see what you mean.

So, lets assume that they are not allowed to declare bankruptcy. First they default on the Bonds, then they have to start defaulting on everything else, which is even harder to pay without access to borrowing, it's strictly a cash-in, cash-out basis.

So, then the pensions go unpaid. That is clearly a lot of hardship for people relying on them ..

It's hard for me to see this ending anyway except a bail-out. "Evil Republicans want to let poor old Pureto-Rican pensioners starve", that always works with the squishy cusckservatives.

So, maybe the bankruptcy is the way to go?

[Vigilanteman]

Yep. Bottom line is that there are consequences to declaring bankruptcy; there are none for bailouts.

For starters, needs test the pensions. Reduce the pensions accordingly where there is no demonstrable need.

Liberals are already talking about doing this for social security, even though the "rich" have paid into the plan and many government employees have paid little or nothing for their gold-plated pensions.