Maybe someone will propose that at some point, and if that happens, you'll have a lot of company in your outrage. But that is not what is happening right now.
The fear is that PR will keep trying to pay these bonds and pensions haphazardly, will have no money to pay to keep hospitals and schools running, etc., and so will then come hat in hand to Congress to stop people from dying. And then, whether your or I want it, some taxpayer money may indeed get paid.
What needs to be done is a budget -- pay a certain amount to bondholders, and a certain amount to pensioners, and keep the government running. The pensioners and bondholders are going to have to suck up those losses themselves. That's what some in Congress are trying to do now, before we get the weepy images of dying kids on TV, and bleeding hearts pouring taxpayer dollars into PR.
You getting all fired up about attempts to restructure that debt so that it can be handled without a taxpayer bailout is exactly the kind of thing that will make a bailout more likely.
Ok, I understand your confusion. Here is how it will work so you can see what will actually happen.
The “bankruptcy”, enforced by US bankruptcy court, will stop all creditor collection cold. Then a “plan of reorganization” will be quickly adopted where in exchange for USA infusion of $10- 20 billion NOW, the debts will be GUARANTEED by the USA assuring Wall Street. Wall street will extend the terms and now sell the debt on the secondary market like hotcakes like they did when the stupid government guaranteed low income fat mortgages!! The joke is that we will be placated by the installation of a “CONTROL BOARD” to “watch over things” since we now have billions in the game and soon will have $70 billion in the game ( plus 44 billion for union retirements!!) because of our guarantees. The statute they want to pass says that the Control Board SHALL HAVE THE POWER to pay debt and to guarantee debt!! A BAIL OUT!! We don’t even do that in Illinois. But if you read this bill it may apply ti other states!!! There is no permission in the Constitution to pay a foreign countries debt with our money. There is no constitutional authority to pay the debts of Illinois.
Ok, I understand your confusion. Here is how it will work so you can see what will actually happen.
The “bankruptcy”, enforced by US bankruptcy court, will stop all creditor collection cold. Then a “plan of reorganization” will be quickly adopted where in exchange for USA infusion of $10- 20 billion NOW, the debts will be GUARANTEED by the USA assuring Wall Street. Wall street will extend the terms and now sell the debt on the secondary market like hotcakes like they did when the stupid government guaranteed low income fat mortgages!! The joke is that we will be placated by the installation of a “CONTROL BOARD” to “watch over things” since we now have billions in the game and soon will have $70 billion in the game ( plus 44 billion for union retirements!!) because of our guarantees. The statute they want to pass says that the Control Board SHALL HAVE THE POWER to pay debt and to guarantee debt!! A BAIL OUT!! We don’t even do that in Illinois. But if you read this bill it may apply ti other states!!! There is no permission in the Constitution to pay a foreign countries debt with our money. There is no constitutional authority to pay the debts of Illinois.