Clinton: Let Puerto Rico restructure its debt

Hillary ClintonHillary Diane Rodham ClintonPelosi on power in DC: 'You have to seize it' Cuba readies for life without Castro Chelsea Clinton: Pics of Trump getting vaccinated would help him 'claim credit' MORE on Tuesday called on Congress to allow Puerto Rico to access United States bankruptcy laws amid a looming debt crisis in the island territory. 

"Congress and the Obama administration need to partner with Puerto Rico by providing real support and tools so that Puerto Rico can do the hard work it will take to get on a path toward stability and prosperity," the 2016 Democratic presidential candidate said in a statement first reported by Reuters.

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"As a first step, Congress should provide Puerto Rico the same authority that states already have to enable severely distressed government entities, including municipalities and public corporations, to restructure their debts under Chapter 9 of the Bankruptcy Code," Clinton continued, according to Reuters.

Clinton joins a Democratic challenger on the issue, former Maryland Gov. Martin O'Malley, who last week called on Congress to "act now to avoid Puerto Rico's economic collapse."

"As a nation we must help our fellow US citizens not only because it's the right thing to do, but because our region's economic stability depends on it," O'Malley said in a statement.

Puerto Rico has a crushing $72 billion in debt that it is unable to pay, Gov. Alejandro Garcia Padilla announced last week. The commonwealth, like U.S. states, cannot declare bankruptcy and restructure its debt under the law.

However, officials in that country have called on Congress to allow its public entities, including municipalities, to have access to bankruptcy laws allowed to other agencies or municipalities in the U.S., like Detroit.

Resident Commissioner Pedro Pierluisi (D), Puerto Rico's nonvoting representative, has worked to build support for legislation in Congress, where the fight has now landed.

White House press secretary Josh Earnest said last week that Congress should consider allowing Puerto Rico access to the laws, but said "there is no one in the administration" considering "a federal bailout of Puerto Rico."

"We're not talking about a bailout, we're talking about a fair shot at success," Clinton said Tuesday, per Reuters.

A U.S. appeals court Monday affirmed a lower court ruling striking down Puerto Rico legislation intended to give the territory's municipalities bankruptcy protection. 

"Besides being irrational and arbitrary, the exclusion of Puerto Rico's power to authorize its municipalities to request federal bankruptcy relief should be re-examined in light of more recent rational-basis review case law," the U.S. Court of Appeals for the First Circuit said in the ruling, according to Reuters.

— This story was edited at 11:50 a.m.