Posner, Parsimony, and Prudence on Judicial Salaries

For reasons that will appear below, I should have thought that the case for a federal judicial salary increase was so one-sided that it hardly justified a blog posting. But when a sitting federal judge — and a judge who enjoys some renown as an economist — takes issue with the argument for a judicial pay raise, it’s worth paying attention. And a few weeks ago, Judge Richard Posner did exactly that on a blog he shares with Nobel laureate Gary Becker.

To understand Posner’s critique, let’s first look at the case for a judicial pay raise. This is a little bit sensitive because federal judges already make what by most standards would be considered a lot of money — $165,200 for trial-court judges, $175,100 for the intermediate courts of appeals, and $203,000 for Supreme Court justices ($212,100 for the Chief Justice). That’s more than the vast majority of taxpayers earn, and that has to be acknowledged up front. Still, when it comes to compensation, you do tend to get what you pay for, and when the average guy wants a lawyer or a doctor he does not typically restrict the field to only those doctors or lawyers who earn less than he does. Nor, when he buys a stock, does he typically refuse to invest in a well-managed company unless the CEO makes less than he does. We may well wish to avoid the stock of companies that grossly overpay their CEOs (just as we may wish to avoid lawyers or doctors who are grossly overpaid compared to their peers), but in every case the relevant consideration is not what we ourselves make, but what other lawyers, doctors, and CEOs make.

If one accepts the premise that federal judges should be selected from the top tier of the legal profession, then compensation for federal judges is falling way behind the salaries this top tier can earn in other jobs. Choose your metric: Is the greatest travesty that district judges now earn only a smidge more than first-year associates in New York City? Or is it that federal judges on average earn only half what senior law professors earn? Or is it that federal judicial compensation (in inflation-adjusted terms) has actually fallen by 23.9 percent since 1969 while the pay of other U.S. workers has increased by 17.8 percent? Or is it that judicial pay is now so far below the pay of the top tier of lawyers in private practice that no one bothers to make the comparison?

A number of knowledgeable observers have argued for a judicial pay increase in the last few months. Paul Volcker had a well-argued essay in The Wall Street Journal, in which he framed his argument in terms of fairness to those who accept lifetime appointments to the judiciary and may give up very promising careers in anticipation of serving the public for the rest of their professional lives. Chief Justice Roberts, in his annual report on the state of the judiciary, framed the issue in terms of the way that lagging compensation influences the selection process. I think this is closer to the heart of the matter. Far fewer judges today — less than half — come from private practice; at first blush at least, it appears the government is simply being outbid for the services of these lawyers. Certainly there are many fine lawyers who are not in private practice, and many fine judges who came to the bench after spending most of their early careers in some other form of government service. But federal judges wield enormous power, and some of the mistakes they make are difficult if not impossible to correct. Before handing that kind of power to anyone for life, shouldn’t we try to make sure we’re offering a reasonably competitive salary?

Enter Judge Posner, who doesn’t come right out and call the Roberts report sloppy, but he does say it is “not analytical,” which in Judge Posner’s world is generally not a nice thing to say. Judge Posner supplies some of the missing analysis, pointing out for example that the retirement benefits for the federal judiciary are quite good (retirement with full pay at 65 after 15 years of service or at 70 with 10 years of service). He also offers alternative explanations for why more judges are drawn from government service and fewer are drawn from the private sector. But I take the crux of Judge Posner’s critique to be this:

Above all, a judgeship confers very substantial nonpecuniary benefits. The job is less taxing than practicing law, more interesting (though this is partly a matter of taste), and highly prestigious. Judges exercise considerable power, not only over the litigants in the cases before them but also in shaping the law for the future, and power is a highly valued form of compensation for many people. Judges are public figures, even if only locally, to a degree that few even very successful lawyers are. And judges are not at the beck and call of impatient and demanding clients, as even the most successful lawyers are.

I think Judge Posner is right to consider nonpecuniary forms of compensation. But that ultimately makes me think a salary increase for judges is even more necessary. Because if judges are deriving less of their “compensation” in dollars and more of it in the form of power and prestige, I think we will find over time that we are attracting judges who tend to be hungrier for power than a judge ought to be. Judge Posner recognizes part of this potential problem:

The best argument for raising judicial salaries, though not an argument that reflects well on the character of judges (but after all they’re only people), is that people who have a great deal of discretion in their job, yet feel underpaid, may take their revenge by underperforming. If a judge works 2000 hours a year, so that his hourly fee is less than $90, and he feels indignant at being paid so little, he may decide to work fewer hours, delegating more work to staff, or to work the same number of hours but with less concentration, or to increase his nonpecuniary compensation by bullying the lawyers who appear before him.

Well, yes. Such judges do exist and they can work great mischief in individual cases, though I rather doubt the money has anything to do with it. But could it be that low salaries tend to bias the candidate pool toward those who as judges will succumb to the temptations of judicial activism? Isn’t that even more plausible than the rudeness or laziness hypothesized by Judge Posner? A few sad cases may get “non-pecuniary compensation” by bullying lawyers, but I suspect that most federal judges get much more non-pecuniary compensation from the sense that they have been able to make a real difference in the life of the community and the lives of its citizens. As salaries fall in purely pecuniary terms, isn’t that a likely place where a judge might try to “increase his non-pecuniary compensation”?

The decisive factor, it seems to me, is that we can afford to be more careful about something as important as the federal judiciary. One of the greatest perversities surrounding the federal budget is not just that we waste money, but that we try to make up for the waste by taking money away from items in the budget that genuinely matter. We lavish money on altogether superfluous things like the notorious “bridge to nowhere,” but try to skimp on things that we all agree are core functions of our government, like the federal judiciary. My back-of-the-envelope estimate is that we could double all judicial salaries for about $140 million, which is only slightly more than was reportedly earmarked for shrimp and Atlantic menhaden fishermen in the recent “emergency” funding bill for “Iraq.” How much of an improvement in the selection and behavior of judges would that have to buy us in order to be a better investment than the shrimp-fishermen subsidy?

One Response to “Posner, Parsimony, and Prudence on Judicial Salaries”

  1. David Fitzgerald Says:

    As William H. Mulligan, former dean of Fordham Law School and Second Circuit Judge said when retiring from the bench to become a partner at Skadden, “Although you can live on a federal judge’s salary, you can’t die on it.”

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