There’s Nothing Wrong With Paul Krugman Making $225,000 a Year

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April 16 2014 7:30 PM

Paul Krugman Isn’t a Hypocrite

A $225,000 salary for the critic of inequality is more than fair.

Paul Krugman in Sao Paulo, Brasil in Jan. 2012.
Paul Krugman in Brasil in 2012

Courtesy of Ze Carlos Barretta/Folhapress MERCADO/Flickr

Paul Krugman may be America’s foremost public intellectual. He’s certainly a contender for the title. He has done more than any other thinker to sound the alarm about rising income inequality in the United States, and in doing so he has shaped the worldview of a generation of liberals. Krugman’s influence reflects more than just the stylishness of his writing or his reach as a widely read columnist for the New York Times. It also rests on his sterling academic credentials. Among other laurels, Krugman has been awarded the Nobel Prize and the John Bates Clark Medal, the highest distinctions available to a living economist. The esteem in which Krugman is held among his fellow scholars lends his arguments an authority that delights those inclined to agree with him—and drives those disinclined to do so, myself very much included, up the wall.

So when Gawker reported that Krugman was offered $225,000 to join the faculty of the City University of New York’s Graduate Center, at least some of Krugman’s critics saw an opportunity to knock “Krugtron the Invincible” down a peg or two. Was he not aware that CUNY is a publicly funded institution that pays bona fide full-time professors far less than Krugman was being offered to essentially serve as a mascot for the school’s new inequality initiative—a mascot with a truly minimal teaching load? If Krugman cares so much about income inequality, his detractors wondered, why would he accept such a sum for doing so little work? And as someone who has done so much to draw attention to the evils of “the undeserving rich,” how could the offer not leave him feeling like at least a little bit of a jerk?

But this is one case where I think Krugman is in the right and his critics are in the wrong. Not only should he have had no compunction about accepting CUNY’s offer—he would have been entirely justified in asking for more. And doing so should have no bearing on his credibility as a scourge of rising inequality.

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When Krugman announced he was leaving Princeton to join the CUNY faculty back in February, it was a big deal. Princeton, one of the country’s most storied, selective, and elite private research universities, was losing its most celebrated social scientist to a public institution that prided itself on its inclusiveness and its democratic spirit. Krugman emphasized that though he’d very much appreciated his time at Princeton, he was attracted by the opportunity to devote more time and effort to the study of income inequality.

To that end, he sought an affiliation with the Luxembourg Income Study, a think tank that gathers and analyzes data on income, wealth, and employment from a number of countries to draw meaningful cross-national comparisons. It just so happens that the LIS is led by Janet Gornick, a professor of political science and sociology at the Graduate Center. One thing led to another, and Krugman wound up with not just a LIS affiliation, but also with a faculty position at the Graduate Center.

Understandably, Krugman chose not to disclose any financial details in his announcement. But one can read between the lines. The LIS does difficult, expensive, thankless work, and attracting a scholar of Krugman’s stature would do much to raise its profile. The Graduate Center is home to a number of well-regarded scholars, yet it is not generally seen as competitive with other major research universities with deeper pockets. Krugman’s value to CUNY wouldn’t be that he is willing to devote a great deal of time and energy to educating graduate students, so it’s not surprising that the Graduate Center didn’t ask him to devote a significant portion of his time to that end. Rather, his value lies in his ability to raise the school’s profile—to attract other faculty members, to attract high-caliber graduate students, and, perhaps most importantly, to attract donors who share Krugman’s convictions concerning income inequality, or who at least find it useful to appear to share his convictions. Viewed through this lens, CUNY’s offer to Krugman looks like a bargain.

One thing to keep in mind is that Krugman is most likely taking a salary cut by leaving Princeton for CUNY. We don’t know what Princeton paid Krugman, but we can ballpark it. The University of California is one of many public universities that provides information on how much it pays its employees, and a quick look reveals a number of faculty members who haven’t received Krugman’s accolades but who are being paid quite a bit more than CUNY offered to pay Krugman. Having followed the academic job market closely for some years now, I can tell you that even Berkeley, the crown jewel of California’s public university system, finds it difficult to match the salaries offered by schools like Princeton, with its $17 billion endowment. And then there are the bloated salaries public universities routinely offer athletic coaches. Far be it from me to suggest that Paul Krugman will do as much for CUNY as basketball coach John Calipari does for the University of Kentucky. But Calipari earned $5.4 million in 2012. Isn’t it possible that Krugman might be worth one-twenty-fourth as much as Calipari? Or maybe even a little bit more?

As Krugman has made clear on more than one occasion, his quarrel is not with members of the top 5 percent or even with members of the top 1 percent. The real problem, in his view, lies with the top 0.01 percent, a category dominated by executives, especially those who work in finance. These are the people with the resources to manipulate political outcomes and entrench their power and that of their descendants. I happen to think that Krugman is wrong about the threat posed by this kind of dynastic wealth, but he has made it absolutely clear that he sees this threat as separate and distinct from the wage gains experienced by upper-middle-income professionals. According to Krugman, the main thing that we as a society should do about upper-middle-income professionals, or rather upper-upper-middle-income professionals, is raise their taxes. And who doubts that Krugman would happily pay a higher marginal tax rate?

There is a moral framework that would make Krugman’s (apparent) willingness to accept CUNY’s offer look damning. In If You’re an Egalitarian, How Come You’re So Rich?, the political philosopher G.A. Cohen argued that we as individuals shouldn’t just favor institutions that are designed to maximize the well-being of the poorest among us, like, say, a progressive tax code. Rather, all of the choices we make should serve this end, whether or not the right institutions are in place. So short of donating every cent he earns above what he needs to survive, Krugman would indeed be failing as an inequality fighter by Cohen’s rigorous standard. But then, who wouldn’t?

Reihan Salam is a columnist for Slate.

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