In a surprising twist, President Trump claimed he wants to eliminate Puerto Rico’s $72 billion debt during an interview with Fox News’ Geraldo Rivera that aired Tuesday night.

Without providing details, Trump told Rivera that “we’re going to work something out” so that the debt burden on the hurricane-ravaged island can be relaxed.

“We have to look at their hold debt structure,” Trump continued. “You know, they owe a lot of money to your friends on Wall Street, and we’re going to have to wipe that out. That’s going to have to be — you can say goodbye to that.”

“I don’t know if it’s Goldman Sachs, but whoever it is — you can say goodbye to that,” he added. “We have to do something about this.”

Trump said Puerto Rico's debt will have to be wiped out. "We're going to have to wipe that out. You're going to say goodbye to that" pic.twitter.com/vn4V8gVaDQ — Brandon Wall (@Walldo) October 4, 2017

Trump’s comment took many observers by surprise, coming as they do on the heels of the president repeatedly going out of his way to mention Puerto Rico’s debt in the context of the humanitarian crisis created by Hurricane Maria.

Texas & Florida are doing great but Puerto Rico, which was already suffering from broken infrastructure & massive debt, is in deep trouble.. — Donald J. Trump (@realDonaldTrump) September 26, 2017

…It's old electrical grid, which was in terrible shape, was devastated. Much of the Island was destroyed, with billions of dollars…. — Donald J. Trump (@realDonaldTrump) September 26, 2017

…owed to Wall Street and the banks which, sadly, must be dealt with. Food, water and medical are top priorities – and doing well. #FEMA — Donald J. Trump (@realDonaldTrump) September 26, 2017

Four days after posting those tweets, Trump delivered a speech to the National Association of Manufacturers in which he described the Puerto Rico as “an island surrounded by water, big water, ocean water” and said, “Ultimately the government of Puerto Rico will have to work with us to determine how this massive rebuilding effort — it will end up being one of the biggest ever — will be funded and organized, and what we will do with the tremendous amount of existing debt already on the island.”


Those comments certainly didn’t engender confidence that Trump was considering some sort of bailout. Nor did a tweet he posted earlier that morning.

…The fact is that Puerto Rico has been destroyed by two hurricanes. Big decisions will have to be made as to the cost of its rebuilding! — Donald J. Trump (@realDonaldTrump) September 29, 2017

It’s unclear if Trump understood what he was promising during his comments to Rivera. But in any event, his comments about wanting to do something for Puerto Rico’s government caused the unincorporated U.S. territory’s general obligation bonds to fall to a record low on Wednesday morning.

Puerto Rican bonds getting clobbered after those Trump comments about wiping out the debt https://t.co/g58phdIeAW pic.twitter.com/XICGmgUJXH — Joe Weisenthal (@TheStalwart) October 4, 2017

While Puerto Rican bonds tanked, White House budget director Mick Mulvaney tried to walk Trump’s comments back during a CNN interview on Wednesday morning.


Asked if Trump’s comments should be taken seriously, Mulvaney said “I wouldn’t take it word for word with that,” adding that he talked to the president about the situation after he conducted his interview with Rivera.

“I talked to the president about this at some length yesterday as we flew home aboard Air Force One, and what we’re focusing on right now is what you and I just talked about, which is the primary focus of the federal effort is to make sure that the island is safe and that we’re rebuilding the island,” Mulvaney said. “Dealing with the challenges that Puerto Rico had — the island is at least $72 billion in debt, $120 [billion] if you go by other accounts before the storm… We are not going to deal right now with those fundamental difficulties that Puerto Rico had before the storm.”

OMB director on Trump saying he will wipe out Puerto Rico's debt: "I wouldn't take it word for word with that" https://t.co/MXOMDhmyBw — CNN Politics (@CNNPolitics) October 4, 2017

Mulvaney went on to say, “We’re absolutely not going to bail them out.”

Trump’s interview with Rivera was conducted during the president’s Tuesday trip to Puerto Rico — a trip in which he delivered off-pitch comments thanking the island’s governor for not criticizing him, downplayed the devastation wrought by Maria in comparison with a “real catastrophe” like Hurricane Katrina, admonished hurricane victims to “have a good time,” and shot rolls of paper towel into a crowd at a chapel like a team mascot does at sporting events.


Trump’s comments come while more than 90 percent of Puerto Rico’s electrical grid remains down. Though Trump touted the fact that there have so far been only 16 confirmed deaths as a result of Hurricane Maria, the actual number is much higher.

The New York Times reports that it’s “it is far from clear whether the president or the federal government has the power” to unilaterally relieve Puerto Rico’s debts, which are “held by a diverse universe of investors, including big hedge funds and middle-class Puerto Ricans who thought it would make a safe retirement nest egg.”