- - Wednesday, November 20, 2019

The Trump administration has been advancing an “America First” platform, with a focus on immigration, trade and economic development. Now three years in, the results have been positive for the country.

The administration has justifiably put America’s trading relationships and fair treatment in the international economy under great scrutiny, whether that be negotiating with China or the new U.S.-Mexico-Canada trade agreement.

As we assess trading partners, the same standard should apply to foreign investment and countries that snub their nose at obligations to American investors.


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They would accept nothing less of the United States. Why should we?

Truly putting “America First” also should mean collecting foreign debt, especially when American citizens are affected.



One example worth highlighting is $1.6 billion owed by Peru, which comes from land bonds.

Why does this matter?

According to PeruBonds.org, more than 5.4 million American pensioners hold an interest in these Peruvian land bonds. The debt is held across 33 states — including Ohio, Pennsylvania, Michigan, Illinois, Florida, New York, California and Texas — and 216 plans.

Pensioners include teamsters, police and fire pensions, university endowments, trade unions, public employee groups, and teachers, among others.

Peru has refused to pay the debt.

But the pressure is increasing.

A bipartisan group of more than 100 members of the House, four senators, three governors and countless mayors and state lawmakers from across the country have contacted Secretary of State Mike Pompeo or voiced their concern.

The issue caught my attention at a recent House subcommittee hearing. Rep. Albio Sires, the Democratic chairman of the House Foreign Affairs Committee’s subcommittee on Western Hemisphere, civilian security and trade, called Peru’s unwillingness to repay the debt a “slap in the face” to his New Jersey constituents.

The reality is that American investors are being stiffed by a foreign government refusing to settle sovereign debt. Because it is a sovereign debt, the debt repayment negotiation requires U.S. government involvement. In fact, the same free trade agreement that was negotiated and approved by Congress in 2009 is now being used against the bondholders in arbitration.

If Washington is willing to weigh the merits of President Trump’s proposed U.S.-Mexico-Canada trade agreement and trade deals with China, shouldn’t we hold our free-trade partners such as Peru to similar standards?

Interestingly, Mr. Trump’s speech at the Economic Club of New York included a promise to raise tariffs on China unless meaningful progress for a trade deal was reached. The president continued, “And that’s going to be true for other countries as well.”

Sovereign debt from countries such as Peru should be on the White House’s radar for negotiation and action.

One lesson here is that the American investment community should be wary of foreign investment without understanding of the obligation of sovereign countries to honor debt.

The “Big Three” credit rating agencies have refused to rate the Peruvian bonds, despite repeated calls from investors to address the defaulted debt, leaving investors uninformed and misled.

Peru is not the only example of sovereign debt owed to the U.S. It is just one example, but it is an important one.

Peru is a trading partner and a Western Hemisphere ally. We should expect more from its leaders.

The Trump administration has the opportunity to force Peru to “own up to their debt” and restore the trust and financial security of American workers and retirees’ funds.

Putting “America First” means putting Americans first, and that should mean collecting sovereign debt that Americans are owed.

• Matt Mackowiak is president of Austin, Texas, and Washington-based Potomac Strategy Group. He’s a Republican consultant, a Bush administration and Bush-Cheney reelection campaign veteran and former press secretary to two U.S. senators.

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