Of all the places I might have found myself on a Saturday morning, a breezy sidewalk at Hanscom Field was probably the most enlightening. There, I found myself gawking at a golden-hued building so richly landscaped with azaleas and evergreens, so impeccably maintained with a princely portico and a flag flapping from above, that it looked like the regal headquarters of a Fortune 500 company.
It wasn’t, though. It was just the jet hangar for a Fortune 500 company, that company being Liberty Mutual.
You know Liberty Mutual. Nice TV ads and, as we learned last week, a former chief executive, Ted Kelly, who was paid an average of $50 million annually for the past four years. That’s just shy of a million a week, $192,000 per working day, $24,000 an hour. It’s also a sign that America is heading straight off a cliff.
A couple of callers and e-mailers urged me to see the company’s private airline terminal at Hanscom with my own eyes. I would have poked my head inside but for the 8-foot fence, painted black and topped with razor wire, and the remotely operated gate that glides open only for invited guests.
Fortunately, I learned from Massport that Liberty Mutual doesn’t have one corporate jet parked at Hanscom, or even two. No, it has a fleet of five, including three Gulfstream 450s and two high-end Bombardiers, about $150 million worth of big, powerful, long-range aircraft, all of them housed in a state-of-the art 30,000-square-foot hangar with heated ramps. Basically, your friendly Boston-based insurer, the one that just got $46.5 million in city and state tax breaks, has its own air force. Hopefully they’re not planning an attack on MetLife or Arbella.
But why should anyone be surprised? A company that paid its chief executive $50 million a year probably doesn’t expect its management team to fly Delta and US Airways. Suppose some fellow passenger tried asking Kelly about, say, insurance. How traumatic would that have been?
I have no doubt that if Liberty Mutual talked to me about its fleet, it would have said that corporate flights are more efficient, allowing its very important executives to hit more stops in a single day and not to squander time tangled in security lines or on connections.
But they didn’t say any of that. After I ticked off my questions to John Cusolito, Liberty Mutual’s vice president for public relations, he paused and said, “Can I ask why you’re writing this?’’
The next time I heard from him was in an e-mail, which read as follows: “Consistent with other Fortune 100 global companies, Liberty Mutual operates leased aircraft to support our operations across the United States and in 26 countries around the world. We cannot comment on your other questions for both business and security reasons.’’
So let’s instead go to an extraordinary online database, WSJ Jet Tracker, compiled by a team of reporters and editors from the Wall Street Journal and detailing most corporate flights over the four-year period that ended Dec. 31, 2010. The newspaper spent months matching so-called tail numbers to owners and obtained flight records through Freedom of Information Act requests to the Federal Aviation Administration. Many companies attempt to block travels of their aircraft from being viewed by the public.
The database shows that after the standard-issue business centers of New York, Chicago, Washington, D.C., and Seattle, that Vero Beach, Fla., was the 10th most popular destination for Liberty Mutual jets, with 22 trips there in those four years, always in cool weather months up north.
I know just enough about Florida to know that Vero Beach isn’t exactly a hotbed of commerce. But wait a minute, local property records show that Kelly and his wife bought an oceanfront house in 2005 in neighboring Indian River Shores for $7.75 million. Bizarre coincidence?
If it is, it’s equally coincidental that Hyannis was another popular destination for Liberty Mutual jets, with a dozen flights over the four years, including six directly from Hanscom, which is just 88 highway miles away. Another check of land records shows that Kelly happens to own a couple of properties in nearby Osterville that are valued by the town at just under $7 million.
One other factoid, courtesy of a US Golf Association handicap website: Kelly belongs to the same Osterville golf course, the Oyster Harbors Club, as Tom May, the $9.2 million a year NStar (now Northeast Utilities) chief executive who sits on the Liberty Mutual board of directors that determined Kelly’s pay. The coincidences keep rolling.
In a later e-mail, Cusolito declined to say whether Kelly was on board those flights to Vero Beach and Hyannis, and if he was, whether he paid out of pocket or if they were another perk of the job.
Likewise, Cusolito never responded to questions of whether Kelly still gets use of the planes after his retirement last year (he now serves as chairman of the Liberty Mutual board), and whether the other part-time Liberty Mutual directors get access to the fleet along with their $200,000 yearly pay.
Again, “security reasons.’’
I never even got around to asking him about all those cold weather flights to Palm Beach and Naples, Fla., and summer jaunts to Nantucket. But you get the point.
I’ll say again what I’ve said before: This is not a screed against the rich. You invent something, you found a business, you excel in sports or the arts, you deserve whatever the world pays you. But when you’re the CEO of a public company, or in this case, a mutual owned by the policy holders, you are a steward, not a lord, and this kind of pay and these kinds of perks are a thumb in the eye of common decency and sense.
This is not even a screed against Kelly, by every measure a brilliant businessman and, according to the downtown crowd, a philanthropic and likable guy.
But $50 million in annual pay to run an insurance company, along with a veritable air force at your beck and call, says everything about absurd values, about profound disproportions, about a level of greed inexplicably and dangerously accepted as normal.
In 2010, Kelly told the Boston Herald residents of middle-class Massachusetts towns “are paying excess taxes to support government workers who get high salaries and very rich benefits.’’
So I leave you with one last thought: The $50 million a year insurance man, lounging in a Liberty Mutual jet for the 20-minute flight from Hanscom to Hyannis, gazing down at so many overpaid firefighters, teachers, and police officers sitting in the traffic jam below.