Aetna confirmed Wednesday it will move its corporate headquarters out of Hartford, Connecticut, due to “the fiscal problems and leadership of our state.”
The insurance giant is Hartford’s fourth largest taxpayer and has been an icon of Connecticut’s capital city for 164 years. It is expected to move its corporate headquarters and top executives to either Boston or New York City, reports the Hartford Courant.
Aetna CEO Mark Bertolini ignored pleas and incentives from Connecticut Gov. Dannel Malloy (D-WFP), whose state is mired in financial difficulties largely due to decades of union contract deals and regulatory and tax policies that are antagonistic to business.
“We are in negotiations with several states regarding a headquarters relocation, with the goal of broadening our access to innovation and the talent that will fill knowledge economy-type positions,” the company said in a statement, reports the Courant. “We remain committed to our Connecticut-based employees and the Hartford campus, and hope to have a final resolution by early summer.”
Malloy reportedly hopes Aetna will keep the “vast majority” of its 5,800 employees in the state.
Aetna’s exit follows that of GE, which Larry Kudlow described at National Review in early 2016, as “another sad marker in the downhill slide brought about by Connecticut’s high-tax, high-regulation, anti-business policies of the last 25 years.”
“Does anyone doubt that massive tax hikes on successful earners and corporations drive those same folks out of state?” Kudlow asks. “That’s the new Connecticut story.”
A report at the CT Mirror at the end of April notes the state’s sharply declining income tax collections are at the worst since the last recession.
The news report adds:
More importantly, the escalating erosion means income tax projections for the next two fiscal years must be downgraded by $500 million and $600 million, respectively, Gov. Dannel P. Malloy’s administration said Thursday.
That adds $1.1 billion to an already daunting $3.6 billion deficit forecast, all but shattering hopes of avoiding tax increases or big municipal aid reductions in the next budget.
A study released in June of 2016 by George Mason University’s Mercatus Center found that Connecticut ranks as the state in the worst fiscal condition – second only to Puerto Rico, which has amassed $70 billion in debt due to out-of-control government spending coupled with interference from Washington, D.C.
According to Mercatus, Connecticut’s fiscal state is “poor across all categories,” which cover cash, budget, long-term, citizen service-level, and trust fund solvency.
In early 2016, financial information site WalletHub performed an analysis that compared the 50 state capitals to identify which combines the best in “affordability, a strong economy, high education standards, and overall excellent quality of life.” Hartford was rated as the worst state capital in the United States.
In the fall of 2015, a Quinnipiac University survey found that Malloy’s approval rating had plummeted to 32%, the “lowest score for any governor in the nine states surveyed” in 2015.
“Gov. Dannel Malloy’s job approval rating has plummeted to 32 percent, close to the historic 24 percent low hit by disgraced former Gov. John Rowland in January 2004, and Gov. Malloy is not in the middle of a corruption scandal,” said Quinnipiac poll director Douglas Schwartz, Ph.D. “Malloy is getting hammered on the critical pocketbook issues, taxes, the budget and the economy and jobs.”
“Only 36 percent of voters are satisfied with the way things are going in the state, one of the lowest scores since Quinnipiac University started asking this question in 1997,” he added.
In 2015, after an analysis of U.S. Census Bureau data, Bloomberg News found that Connecticut is one of the states people are fleeing the most.
A Gallup poll in 2014 found Connecticut had dropped to dead last place in the nation in job creation, as workers reported the worst climate for hiring. CNBC also ranked the state among the five worst states for business in 2014.