Competing Brokeness

Puerto Rico and Greece. Which one will work out better, do you think?

4 comments:

  1. Greece and the EU can be shed of each other to their mutual benefit. That's a lot less likely for Puerto Rico and the US.

    Eric Hines

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  2. So do you think PR will work out worse than Greece, or will Greece's part of the 'mutual benefit' still leave them in rough shape compared to a bailed-out PR?

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  3. In the long run, Greece will be the better off of the two if it learns the fiscal lessons the separation will force upon it. Of course, Greece could wind up a Russian satrapy.

    A bailed-out PR will be the worse off, morally, since they'll have learned that freeloading works for a while longer. A bailed-out PR also will be at best just as badly off as a separate Greece since such a PR still will have no fiscal discipline, no incentive to get any, and so will be just as deeply in debt in short order as they are now--with just as much to show for their debt as they have now.

    Eric Hines

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  4. A bailed-out PR will also set a precedent for US states that do similarly stupid things with debt. That just does not sound like a good move.

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