Is Puerto Rico Really A Failed State?

Puerto Rico is holding $72 billion in debt after decades of borrowing and overspending. Can the country survive another disastrous default?

Puerto Rico is in trouble. Just last month, the U.S. territory defaulted on its debt for a third time, prompting some international observers to declare it a "failed state." But what does that term even mean? We take a closer look in today's Seeker Daily report.

While there are no hard-and-fast rules for declaring a failed state, there are some emerging designations. According to the non-profit Fund for Peace, four characteristics suggest that a functional state has transitioned to a "fragile" or failed state.

The first is that a failed state has lost the authority to make collective decisions. In the case of Puerto Rico, this is a tricky question. As an unincorporated territory of the U.S., Puerto Rico relies heavily on its mother nation to determine certain economic and governance policies. In fact, the territory's current debt crisis has been largely managed by the U.S.

Another characteristic of a failed state is an inability to provide public services. Whether Puerto Rico is meeting this criterion depends on how you define your terms. The monopolized energy service, Puerto Rico Electric Power Authority, is delivering electricity -- but only to those who can pay the rapidly escalating prices. More than a third of residents in Puerto Rico public housing reported an income of "zero" in 2015.

RELATED: Should The U.S. Let Puerto Rico Go Bankrupt?

Failed states also tend to lose control of their police forces. Puerto Rico has issues here, as well. According to a recent Justice Department report, roughly 10 percent of the police force were arrested between 2005 and 2015 for offenses including murder, assault and drug trafficking.

Finally, failed states ultimately prove unable to interact with other nations in the international community. That qualifier doesn't exactly apply to Puerto Rico, since it's a dependent territory of the U.S.

The conclusion: Despite widespread poverty, mass emigration and a worrisome decline in the social order, Puerto Rico is not a failed state. At least, not yet.

-- Glenn McDonald

Learn More:

CNN: Puerto Rico makes historic default

Vox: The Puerto Rico crisis, explained

New York Times: A Surreal Life on the Precipice in Puerto Rico

NBC News: Congress Passes PROMESA Act for Puerto Rico Debt Crisis