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A member of an exclusive lobbying group made up of leaders from the Bay State’s biggest companies says Massachusetts is the priciest place to do business.

“It’s much more expensive to add an employee in Massachusetts than elsewhere in the world, and we have offices in more than 20 countries,” said Ted Kelly, Liberty Mutual’s CEO and one of 14 executives who formed the Massachusetts Competitive Partnership to influence the way the commonwealth operates.

In a rare interview at the insurance company’s Berkeley Street headquarters, Kelly told the Herald that the government must lower the tax burden across the board to spur job growth. He also blamed high government salaries as one reason why it’s so expensive to do business here.

“Seventy-five percent of the residents in the average suburban, middle-class town are paying excess taxes to support government workers who get high salaries and very rich benefits,” he said.

Kelly – the boss of 4,100 workers statewide, out of 45,000 worldwide – spoke for the first time about his membership in the Massachusetts Competitive Partnership, which has been criticized by other, well-established Bay State business groups.

The 64-year-old Weston resident – who came to the state from Ireland in the 1960s to attend graduate school at the Massachusetts Institute of Technology – said the business group started to come together nearly four years ago over breakfast where the Hub CEOs discussed how they could influence Beacon Hill power brokers.

“We were at a stage where we were beginning to feel quite negative about Massachusetts,” Kelly recalled. “To be charitable, we found Massachusetts a non-welcoming place and not a very fertile ground for business.”

He complained that, until recently, Massachusetts set rate increases for auto insurance, which he said made competition and lower prices for consumers impossible.

“We insure one in three cars in Venezuela and have more freedom in a socialist country than in this part of the world,” Kelly said.

Liberty Mutual recently embarked on a $300 million expansion of its corporate headquarters in the Back Bay that could create 600 jobs. Kelly said the company had seriously considered building the headquarters in New Hampshire, but was persuaded to grow in Boston after the Menino and Patrick administrations offered tax incentives that could total as much as $50 million over 20 years.

“We are really pleased that the state and the city worked together to come up with a proposed package that would make it attractive for us to expand here,” he said. “Absent the hard work they did, we would be putting a shovel in the ground somewhere else.”

CAPTION: GIVE US LIBERTY: Edmund `Ted’ Kelly, CEO of Liberty Mutual, says his company pays more to hire new workers in Massachusetts than it pays in any other place in the world. STAFF PHOTO BY TED FITZGERALD

Originally published by By THOMAS GRILLO.

(c) 2010 Boston Herald. Provided by ProQuest LLC. All rights Reserved.