Somewhat overshadowed by the historic vote over civil unions has been more bad news for Hartford, this time in the form of job losses resulting from MetLife's proposed takeover of Travelers. At least 600 jobs will be lost, according to MetLife.
Both Governor Rell and Attorney General Blumenthal are trying to resolve the problem, although they're taking slightly different tacks. Rell has been negotiating with MetLife to get them to try and reduce the number of job cuts. This strategy hasn't been particularly successful, as the company seems unwilling to cut fewer positions. Blumenthal, however, is taking a more direct approach:
Blumenthal said he would intervene when the state insurance department begins its approval process. He said he wants to protect up to 800 jobs that he maintained may be lost and would also insist that MetLife continue investments in local charitable and cultural programs that Travelers has had.
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"This acquisition is against the public interest because it will destroy jobs, damage our economy and disadvantage families," he said in a statement. (Insurance Journal)
The phrase "against the public interest" is important. The state insurance commissioner, Susan Cogswell, can block the merger if it is deemed to be against the public interest. In this case, it obviously is.
It should be noted that mergers like this one are rarely, if ever, stopped. The insurance commission appears to be a rubber stamp body in this regard. I don't think that any have been stopped in Connecticut. If Blumenthal succeeds, the effects could potentially be widespread and powerful.
Blumenthal has been very much in the spotlight lately. In the past few weeks he has announced a lawsuit against the U.S. Department of Education for failing to fund No Child Left Behind, he has given George Jepsen the nod to run for his position next year, and now this. It is, to say the least, a bit unusual... and has picked up the hopes of Democrats who either want him to challenge Jodi Rell for governor or (less likely, but far more intriguing) Joe Lieberman for senator. These firm, decisive (and popular!) actions are boosting the Attorney General's image around the state and the country. Could Blumenthal, after years of hibernation, be emerging on the national scene once more?
In the meantime, the matter of MetLife is still unresolved. Blumenthal warded off criticism of being anti-business by saying:
"We're not trying to bar MetLife at the door... We welcome them if they are good corporate citizens." (Haigh)
So far they show all indications of being quite the opposite. This merger might be great for MetLife, but it's bad for Hartford and bad for Connecticut. Here's hoping he scares them into some better concessions.
Sources
Haigh, Susan. "Blumenthal seeks denial of Travelers acquisition." Associated Press 13 April, 2005.
Rinde, Meir. "Cutting Our Losses." Hartford Advocate 14 April 2005.
"Conn. AG to Oppose MetLife-Travelers Life Merger." Insurance Journal 14 April 2005.
1 comment:
It sounds like Blumenthal is playing the "bad cop" role again to Rell's "good cop". If Rell was serious, she would get on the telephone to her insurance commissioner, so well all have to watch it play out. Blumenthal's a least consistant, he opposed the Fleet merger siting jobs as a main reason, but the banking commissioner didn't go along.
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