WASHINGTON (AP) – Congress will not act to help debt-ridden Puerto Rico ahead of a May 1 deadline when nearly half-a-billion dollars in bond payments come due, House Majority Leader Kevin McCarthy said Tuesday.
The California Republican's admission to reporters amounted to a statement of the obvious, given that the deadline is days away and the House has failed so far even to get a bill out of committee. A more important deadline looms July 1 when around $2 billion in principle and interest payments come due.
McCarthy said he's "hopeful" a bipartisan bill could emerge from the House by then, though the Senate still would have to act.
Even as the island territory, home to 3.5 million American citizens, faces financial catastrophe, Congress has been unable to come together around a solution. Some House conservatives have been scared off by an aggressive ad campaign, funded by shadowy interests, claiming congressional intervention would amount to a bailout.
In fact, McCarthy and House Speaker Paul Ryan have been adamant there will be no bailout. Instead the bill they back would set up a control board that could help the commonwealth restructure its ballooning debt, much of it resulting from decades of Washington tax policies that encouraged investment in Puerto Rico, then drove it away.
"We're going to protect taxpayers, it will not be a bailout," McCarthy said. "And if we don't proactively do that we could be in a situation that puts taxpayers at risk."
McCarthy sought to shift some of the blame to the Obama administration, claiming lawmakers have been waiting for some answers from the Treasury Department.
"We'll get it done as soon as possible. The most important thing to do here is to get it done right," he said.
At the White House, Press Secretary Josh Earnest disagreed with McCarthy's criticism of the administration. He said the White House was "encouraged by the fact that the leader of the House has finally acknowledged that there is something that needs to be addressed here. We haven't seen much of a sense of urgency to act" from Congress.