The 1% of academia

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By Nick DAngelo

In June 2013, professor of history at the New School of Public Policy Claire Potter published an Opinions editorial for CNN titled: “Big debt for students, big perks for university elites.” The premise of the article, and Potter’s greater work, is that while graduating classes owe $600 million in student loans — and that’s 2010 numbers — college administrators are walking away with sizeable and lavish compensation packages.

Mother Jones expanded the conversation in September when the website published a graph called “Presidents vs. Professors.”

“As higher-ed becomes more corporate,” writes Maggie Severns, “Administrators’ salaries are rising while their employees’ are staying flat.” Dr. Potter notes that the phenomenon of “CEO-style” university presidents’ salaries have been traditionally reserved to private institutions, but that is no longer the case.

Since 2003, the presidents of private institutions have walked away with an average of well-over $200,000 as an annual salary. And while that number flat-lined for most of the recession, it never dipped. In 2012, the average annual salary for a private baccalaureate institution president hovered around $275,000.

So where does Union fall? Because our college is federally tax-exempt, it must file an annual reporting return with the IRS that details its mission, programs and finances. Form 990 is public information, despite it being buried deep within the tangled bureaucracy. Perhaps the most telling aspect of Form 990 is Schedule J, which includes a simple, one-page chart depicting the Top 10 highest paid employees of Union College.

In 2010, our president collected a base salary of $399,066, well above the national average that year, easily placing him at #1 on the Union College Top 10. After including other reportable compensation, retirement and deferred compensation and non-taxable benefits, that number reached over $580,000. Vice presidents occupied four of the Top 10 spots, with base compensation ranging from #5 at $171,341, to #2 at $201,350. The other five highest earners at Union are professors, and while they may not be the longest serving, they are some of the most visible and most popular. The top earning professor in 2010 took in a base compensation of $146,347, peaking at #6.

For most of these top earners, the numbers seem fair. These individuals, especially the professors, represent the top of their fields, spanning from the humanities to the hard sciences. In 2008, a professor focused on education policy, Marc Bousequet, wrote a journal article defending the rising salaries in academia. “Asking Whether Presidents Are Overpaid Is the Wrong Question,” appearing in the Chronicle of Higher Education, argued that while some campus presidents are overpaid, the administrators working below them are not.

“Instead,” writes Bousequet, “They work hard at complex and demanding positions and are often paid less than managers with comparable responsibilities in other lines of work.” The real problem may be that the majority of faculty members are underpaid, a concept Bousequet refers to as “perennial exploitation.”

While to some of us our president’s salary may seem beyond excessive, it is nowhere near the top of the list in terms of the highest paid university presidents in the country. In fact, it doesn’t even make the top 150. In 2012, the Chronicle of Higher Education released data on the salaries of 493 chief executives at 480 private, non-profit institutions based on 2010 compensation. Union College stood at #184. In fact, one must go past #34 to reach an annual salary below $1 million. The top paid president in 2010 was former-U.S. Senator Bob Kerrey, who raked in $3.05 million as head of the New School — no wonder Claire Potter is on such a mission.

Even within the Capital Region, Union College just barely breaks the top three highest paid executives. Coming in a very distant third, Union’s president’s salary pales in comparison to those of the State University at Albany and the Rensellaer Polytenic Institute.

RPI’s president took in a ridiculous $2.34 million in 2010, representing 0.48 percent of the total school budget. That salary could pay the school’s cost of attendance 44 times. In comparison, the president’s salary at Union presents 0.33 percent of the budget and could pay the annual cost of attendance nine times.

So are we the lucky ones? Are we rational and reasonable? Or is Union just the least bad on the list? The answers depend on how we define fairness. If we’re defining it in relative terms, Union is certainly doing better than its colleagues. Our administrative-faculty pay gap is far narrower than others. In absolute terms though, there is still a contentious debate over defining the role of a college president: Are they CEOs or educators?

In my 2012 essay for the Union Book, “College Incorporated,” I argued that the growing financial focus of institutions like Union is clouding the larger mission to provide exemplary education. In that sense, this argument seems to be a corrollary. Colleges are not corporations, and, therefore, our administrators should not be treated as CEOs.

 

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