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This Puerto Rico default is different

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Barring an economic miracle, Puerto Rico is going to default on a more than $400 million debt payment on Monday. The implications could be pretty far-reaching because it would be defaulting on some bonds that are guaranteed by the territory’s constitution. 

The government’s still running, officially, but everyday Puerto Ricans are already suffering, said Edwin Melendez, director of the Center for Puerto Rican Studies at Hunter College in New York.

“The math is very simple — you have declining revenues,” he said. “You have a fixed-debt obligation, so the only thing to do is to cut services.”

Puerto Rico owes payments of $2 billion more on July 1.

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