Treasury secretary presses Senate Dems to back Puerto Rico bill

Treasury Secretary Jack Lew met with Senate Democrats on Tuesday, urging them to support a bill to help Puerto Rico restructure its debt.

The bill passed the House early this month with broad bipartisan support and the backing of the White House, House Speaker Paul Ryan (R-Wis.) and Minority Leader Nancy Pelosi (D-Calif.)

{mosads}But Democratic senators are giving the bill a chilly reception ahead of a likely vote next week.

Lew met with Senate Democrats during their weekly policy lunch. He said he stressed that Puerto Rico can’t afford to wait for help dealing with more than $70 billion in debt it can’t pay and a collapsing economy. 

“It’s not a crisis of the future. It’s a crisis of the moment,” Lew told reporters after the lunch. “I was down in Puerto Rico a month ago and saw first hand what it means for hospitals that can’t buy the drugs they needed in real-time, and what it means on the main streets that are 70 percent boarded up.”

The bill would establish a seven-person oversight board charged with restructuring Puerto Rico’s debt and a congressional task force to investigate what led the commonwealth’s economy to ruin. Puerto Rico owes a $2 billion debt payment due on July 1, which has accelerated efforts to pass the bill.

No Senate Democrat has publicly backed the bill, and several caucus heavyweights oppose it. Sens. Bernie Sanders (I-Vt.) and Bob Menendez (D-N.J.) don’t support the House legislation and have offered alternatives. 

Sen. Sherrod Brown (D-Ohio), a progressive leader and possible vice presidential pick, has also spoken out against certain provisions affecting Puerto Rico’s minimum wage and exempting the territory from a recent Labor Department rule expanding overtime payments to thousands of employees.

The House bill was constructed through months of arduous negotiations and supporters on both sides of the aisle say there is no viable alternative. 

Senate Majority Leader Mitch McConnell (R-Ky.) is likely to schedule a vote on the bill right before the chamber leaves for the July 4th recess. That gives squeamish Democrats little time to change the bill and forces them to choose between the original legislation or none at all.

Though the bill is likely to pass, Lew’s presence reflects the intense pressure placed on lawmakers by the administration. President Obama met with key lawmakers of Puerto Rican heritage and Lew personally called House Democrats in the days before the House vote, even when the bill appeared safe to pass. 

“The question at the end of the day will be ‘Does Congress act to give Puerto Rico the tools, a lifeline, so that the 3.5 million Americans who live in Puerto Rico aren’t plunged into chaos?” said Lew.