The Democrats’ plan to nationalize a private insurance company and seize $500 million of its insurance reserves was probably the most blatantly illegal action I have ever seen the Democrats pursue. After Governor Ritter floated the idea of stealing $500 million to make up for a $300 million shortfall, the Senate Democrats quickly jumped in behind him.
Pinnacol insures a majority of the businesses in Colorado, providing worker’s compensation to approximately 58,000 small businesses.
The plan was blatantly unfair to the thousands of small businesses who have paid into the insurance reserves, expecting a safety net if their employees get hurt. The Democrats ignored all arguments from small business owners and employees who were put at risk by the seizure. They even ignored a clear warning from Attorney General John Suthers, who stated that the seizure was illegal and that he would not defend the lawsuit. Even the Denver Post said that the plan to risk the state budget on the outcome of a lawsuit was reckless.
After Governor Ritter flipped on the issue, the Democrats were forced to table the proposal. However, Democrat Senator Brandon Shaffer kept a piece of the proposal alive to save face and (I expect) exact revenge on the company that won the “rule of law” argument. He is forcing through a bill to spend $30,000 on a legislative audit of Pinnacol in addition to the annual Financial Audit, triennial Department of Insurance audit and annual Department of Worker’s Compensation audit.
The “audit” is really just political cover for a witch hunt. I have no doubt that the interim committee will find some trumped-up charge from their taxpayer-funded raid, which will form the basis of next year’s justification to nationalize a well-performing private business.
