Back in June we blogged the resignation of Zach Weiss from one of the more difficult jobs in America: head of New York's workers comp board. Weiss had been appointed by former governor Elliot Spitzer (whose libidinous indiscretions, we note in passing, were relatively modest, at least when judged by the new standard set by Tiger Woods). After two years mired in New York's deeply adversarial system, Weiss quit to become an administrative law judge.
Governor David Patterson, who stepped in when Spitzer stepped down, has announced the appointment of Jeffrey Fenster as the new director of the board. Today is Fenster's first day on the job. Fenster is a lawyer who once worked for WR Group Holdings, a hedge fund group based in Connecticut. The company website features a picture of the Connecticut shore with a lighthouse in the distance. The sea is absolutely calm - not exactly indicative of the world of hedge funds, or the world of workers comp, for that matter.
If nothing else, Fenster's experience in hedge funds prepares him for the complex risks involved in his new position. He now manages one of the most expensive, frictional, cumbersome, and ineffective comp systems in America. Despite recent reforms, rates are still too high, benefits are too low, fraud is rampant and virtually all stakeholders are miserable. The Empire state is a mess. I have no idea what Governor Patterson promised Fenster for taking the job, but it probably wasn't enough. Fenster is likely to look back on his presumably hectic hedge fund days as the calm before the storm, which is not exactly high praise for his new job. Good luck to him and to all who labor in New York's challenged and challenging comp system.