
Can Puerto Rico Pay its Debts or Is Default in the Future?
Q. A U.S. federal judge last month struck down Puerto Rico's Recovery Act, a law passed last year to allow the island to overhaul the debts and labor contracts of struggling public corporations, and the U.S. House of Representatives recently held a hearing on a bill that would allow Puerto Rico's public agencies to reorganize under Chapter 9 of the U.S. Bankruptcy Code as the commonwealth struggles with a high debt load and weak economy. How will Puerto Rico's debt woes play