Puerto Rico’s $74 billion burden left it helpless when Maria hit

Bloomberg

Year after year, as Puerto Rico’s government drew ever closer to ruin, it cut hundreds of millions of dollars from roads, schools and other public works.
It neglected the electricity system, leaving it dilapidated and prone to prolonged outages. The water utility, which was leaking untreated sewage, put a $1.4 billion construction plan on hold. At least 5,800 police and firefighting jobs were cut. Unable to cover its share, Puerto Rico lost federal funds for work on its 7,700 kilometres of roads.
Long before Hurricane Maria struck September 20, a man-made disaster left the bankrupt US commonwealth vulnerable, according to a review of the territory’s finances and $74 billion debt. While Puerto Rico’s political leaders almost doubled the debt since 2006, proceeds were often used to keep the bureaucracy afloat, paper over deficits or finance projects that did little to pull the economy from recession. After investors stopped buying the US territory’s bonds, agencies warned that the electricity and water systems were falling into decay. Investments in roads, schools, utilities and other public projects slid to $906 million last year from $2.4 billion in 2012, according to the Government Development Bank.
“This devastation is the byproduct of a long-standing set of decisions,” Governor Ricardo Rossello, who took office in January, said in an interview, referring to the crippled power grid.