WH Budget Director: Trump Didn’t Really Mean To Say We Would Erase PR’s Debt

Budget Director Mick Mulvaney speaks about the Trump Administration's budget proposal during daily press briefing at the White House, Thursday, March 16, 2017, in Washington. (AP Photo/Andrew Harnik)
Andrew Harnik/AP

White House budget director Mick Mulvaney energetically corrected President Donald Trump on Wednesday, insisting that the President did not really mean creditors or the government would have to wipe out Puerto Rico’s debt.

“I wouldn’t take it word for word with that,” Mulvaney said on CNN, before a lengthy explanation of the need for Puerto Rico to tackle its own debt.

Trump made the comment to Fox News’ Geraldo Rivera after touring the devastation left on the island Tuesday, nearly two weeks after Hurricane Maria wreaked havoc on the U.S. territory. Before the interview, Trump had insisted that Puerto Rico’s government “work with us” to fund both the hurricane recovery and its debt.

“We’re going to work something out,” he said Tuesday of the island’s $72 billion debt, which in 2016 was put under the control of a federally appointed financial oversight board in accordance with the so-called PROMESA legislation.

“I don’t know if it’s Goldman Sachs but whoever it is, you can wave good-bye to that,” Trump told Rivera of the debt.

It was a surprising change 0f tone.

Asked by CNN’s Chris Cuomo if Trump’s Tuesday statement should be taken “seriously on its face,” Mulvaney said “I wouldn’t take it word for word with that.”

The budget director said he had spoken to Trump “at length” on the flight back from Puerto Rico and that “the primary focus of the federal effort is to make sure the island is safe and that we’re rebuilding the island.”

“We are not going to deal, right now, with those fundamental difficulties that Puerto Rico had before the storm,” he added later. Mulvaney noted that Puerto Rico’s troubled assets were within the realm of the PROMESA legislation.

Puerto Rico’s non-voting congressional representative at the time, Pedro Pierluisi, supported the legislation but also used it as an argument for Puerto Ricans to seek statehood. Many Puerto Ricans and others with parents born on the island, including Rep. Luis Gutiérrez (D-IL), refer to the financial oversight board a “Junta,” in reference to the term used for an occupying governing force.

“Why did he say we’re going to get rid of the debt, then?” Cuomo asked Mulvaney.

“I think the President knows that in order for Puerto Rico long-term to fix itself it’s going to have to deal with that debt situation,” Mulvaney said.

He mistakenly called Puerto Rico a country. It’s a U.S. territory and its residents are U.S. citizens.

“The country was poorly — excuse me, the territory was very poorly run for a very long time,” Mulvaney said, adding: “This was a very badly mismanaged island for a very long time. I don’t think I’m making any news by saying that. And I think what you saw the President talking about was his acknowledgement that Puerto Rico’s going to have to figure out a way to solve that debt problem in order to fix itself going forward.”

“We can help it. And we will help it. We will help Puerto Rico rebuild from the storm. Puerto Rico’s going to have to figure out how to fix the errors that its made for the last generation on its own finances.”

ABOUT THE AUTHOR

Matt Shuham is a news writer for TPM. He was previously assistant editor of The National Memo and managing editor of the Harvard Political Review. He is available by email at mshuham@talkingpointsmemo.com and on Twitter @mattshuham.
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