‘Here Come da Judge’
“If your lawyer’s sleepin’, better give him a nudge! Everybody look alive, ‘cause here come da judge! Here come da judge!”—that famous chant by comedian Sammy Davis Jr. who stole the judge sketch in the popular 1960s TV parody “Laugh-In,” would have played nicely in the intro of one Richard “Dick” Ravitch as he made his way to a roundtable discussion held at La Fortaleza earlier this week. The former lieutenant governor of New York is being sold by Gov. Alejandro García Padilla as the voice of reason amid so much turbulence. Ravitch has accepted the unenviable task of representing the incumbent governor as an ex-officio member of the federal control board enabled by the Puerto Rico Oversight, Management & Economic Stability Act (Promesa). It is time to wake up; although Ravitch will represent the governor for a few short months, he will be in a position to wield influence on board members with whom he interacts.
The first time Ravitch held court with the Puerto Rico press several months ago, he was presented as a top-notch adviser for Puerto Rico, who wanted to share his experience helping to pull New York City from financial despair in the 1970s on a path to prosperity. During that first meeting, he shared that he wanted to help Puerto Rico. He failed to mention that he sat on the board of Build America Mutual (BAM), a bond insurance company that could benefit greatly if his influence were wielded in a way that would force other bond insurance companies on the hook for some $16 billion to cover payments in Puerto Rico’s debt crisis. Assured Guaranty, MBIA’s National Public Finance Guarantee, Ambac Assurance and Syncora Guarantee are some of the monolines that eye Ravitch’s involvement with great concern. Ravitch resigned from his seat on the BAM board last week to dispel concerns over the potential conflict of interest. No vendas guayaba.
After hosting yet another roundtable with the Puerto Rico press this past week, many questions remain unanswered. Although his powwow with our reporters this past Monday shed light on some important items coming down the pike—for instance, he warned that the García Padilla administration’s fiscal plan will be a roadmap from the pits of Hell—Ravitch continues to sell himself as the wise man who can fix Puerto Rico’s ailing economy. Still, he will likely not remain in place after the new governor is sworn in on Jan. 3, 2017.
More than anything, his “pro bono” appointment suggests Puerto Rico lost so much credibility that we need proxies to speak for us. In his most recent elocution, Ravitch claimed that the members of the board should all have a clean slate. He does not want to make any judgmental comments regarding control board member Carlos García, whose designation is broadly questioned because he was one of the protagonists in jacking up Puerto Rico’s debt in the promotion of a scoop-and-toss culture.
Would Ravitch change his mind about Carlos García if he knew that there were pleas made by members of the GOP for García to be removed from the list? There was mounting concern among staffers in House Speaker Paul Ryan’s office tracing to García’s role in the racking up of Puerto Rico’s debt as the president of the Government Development Bank in 2011. He reportedly had a hand in orchestrating short-term bond deals worth at least $2.5 billion that are now coming due.
Thankfully, as an ex-officio member, Ravitch does not have a vote in the outcomes of decisions made by the board. He will, however, wield considerable influence—the question is: for whom? There are very few serious observers of this process who believe he is in this out of the goodness of his heart.
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