Unlikely Leader Quells Puerto Rico Chaos as ‘Coup’ Theories Ebb

(Bloomberg) -- The battle over the leadership of Puerto Rico appears to be over.

Seven days after taking the oath of office as the island’s third governor in a week, Wanda Vazquez is winning pledges of cooperation from the island’s political leaders.

“The governor will have our cooperation and we have personally expressed this to her,” Senate President Thomas Rivera Schatz, a Vazquez political nemesis in her previous capacity as justice secretary, said in a message posted on Facebook.

Puerto Rico’s nonvoting representative in the U.S. House of Representatives, Jenniffer Gonzalez, tweeted an invitation for Vazquez to go to the White House to “work as a team and show that Puerto Rico is back to normal.” (It wasn’t immediately clear if that invitation had been cleared with President Donald Trump.)

Some of the police barricades erected outside the executive mansion during the recent protests that ousted former Governor Ricardo Rossello have come down.

Even Puerto Rico’s debt restructuring appears to be plodding along. On Sunday, the federal control board overseeing Puerto Rico’s finances said the government water utility reached an agreement on nearly $1 billion of outstanding loans that will save the agency about $380 million in interest costs over the next decade. It’s not clear Vazquez had anything to do with it, but the deal suggests the effort to cut Puerto Rico’s debt is continuing apace. Investors even seem optimistic on the island’s prospects: some of the restructured sales-tax-backed bonds -- issued in exchange for the old ones -- are trading for about 100 cents on the dollar.

The easing of the chaos comes as the island tries to navigate a record bankruptcy; rebuild from the 2017 storm; and dig itself out of a decade-long recession. The leadership void has cast a shadow over those processes, and provided ammunition to critics -- including President Trump -- who have argued that Puerto Rico can’t be trusted with billions in federal aid.

The mayhem had been nearly constant since early July.

Last month, leaked text messages showed Rossello and his inner circle disparaging regular Puerto Ricans, prompting a wave of cabinet resignations and massive street protests that led to his ouster.

The next in line to the governorship had left under a cloud of scandal, and Rossello appointed Pedro Pierluisi, a private sector lawyer, to fill the void when he left office on Aug. 2. But Pierluisi, who wasn’t confirmed by both chambers of the legislature, was forced out of office by a legal challenge heard by the Puerto Rico Supreme Court. That left Vazquez as the next up in the line of succession, but there were rumblings she’d quickly engineer a way to extricate herself from a job that seemed thrust on her unwillingly.

A day after her swearing in, members of her own dominant New Progressive Party held a meeting in the capital in which several lawmakers openly called for Gonzalez, the federal congresswoman, to step in as governor. Members of the opposition accused Rivera Schatz, the powerful Senate president, of coordinating the move.

Rivera Schatz took umbrage again Wednesday at what he called the “coup” theories. He acknowledged that he had asked Gonzalez if she would be willing to step in as governor, but only because of the limited interest Vazquez had initially shown for the position.

Meanwhile, Vazquez appeared to be trying to dispel any lingering doubts about her commitment, posing for photo ops and issuing press releases that seem intended to support a business-as-usual narrative.

In the past three days, she visited a school to talk about teacher recruitment and halted a controversial power contract related to Hurricane Maria repairs.

In an emailed response from her office, Gonzalez, the congresswoman, said Vazquez had agreed to meet with her in Washington next month, though a specific date isn’t set.

To contact the reporter on this story: Jonathan Levin in Miami at jlevin20@bloomberg.net

To contact the editors responsible for this story: James Crombie at jcrombie8@bloomberg.net, William Selway, Christopher Maloney

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