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Connecticut's capital faces fiscal meltdown tied to union promises, default deemed likely
Connecticut's capital of Hartford is in the midst of a financial meltdown as the city considers defaulting on its debt as early as next month, a crisis fueled in large part by union promises and other decisions dating back years.
While the capital is hoping a state bailout can help, Moody’s Investors Services last week predicted Hartford will likely move to default by November -- and soon could run up deficits reaching $80 million per year without a change in strategy, due to the cost of pensions, benefits and debt service. The city has more than $500 million in outstanding debt. The city recently lost a major corporation that had called the state’s capital home since 1853—Aetna Inc.
The insurance giant crucial to Hartford’s economy announced this summer it would move its headquarters to New York City. The state also lost another critical corporation – General Electric. Both companies cited the state's high taxes.
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