Are Federal Judges Overpaid?

Chief Justice Roberts has just issued his year-end report on the federal judiciary. As in past years, he urges Congress to raise the salaries of federal judges. The accompanying data can be found here. The latter web page might seem to make up in beautiful graphics for what it lacks in statistical rigor, but let’s hope that lower-court judges do not use it as a guide for evaluating expert testimony. Roberts’ argument boils down to two points: that the real wages of federal judges have declined since 1969 because of inflation; and that today first-year associates in some law firms, law school deans, and many senior law professors make more than judges do.

(Last year Roberts also noted that federal judges make less than counterparts in the UK; however, it turns out that in most developed countries with sophisticated legal systems, judges make less than American judges do.  The judiciaries in those countries are also less prestigious, yet they seem to perform just as well as ours does.)

The fact is that in 1969 federal judges were extremely well paid, near the top of the income distribution. Today, they are in the top 5 percent or so. There is no particular reason to think that Congress got judicial pay right in 1969; it could have been too high. In the meantime, the real wages of lawyers have increased, so that now many lawyers make more than federal judges. It is also true that many CEOs make more than the president of the United States. There is no particular reason to think that government salaries should be as high as, or higher than, private sector salaries, even salaries of jobs that seem to draw on comparable skills. It all depends on the relative value of government employees, and no one knows how to measure the social value of the federal judge.

Roberts worries that as the relative salaries of judges decline, the quality of the federal judiciary will decline, because fewer people will give up high private-sector salaries in order to become judges, and that judges will retire in order to seize opportunities for higher pay.

However, the data do not support this argument. Albert Yoon has performed a statistical study of judicial retention, and finds no evidence that judges have retired at higher rates as their relative salary has declined. See also this CRS study, which comes to the same conclusion (and debunks many other claims Roberts has made about judicial pay). It is worth pointing out that the non-pecuniary benefits of being a judge are enormous—one has power, status, an interesting job, job security, and an extremely generous pension—and few people want to give this up. Indeed, many judges continue to work even after their pension fully vests, and since their pension is the same as their salary, these judges, in effect, work for free.

Scott Baker has also conducted a study; his study exploits the different cost of living levels across states, to see whether there is any correlation between judicial quality—measured in multiple ways—and the effective standard of living of particular judges. He finds none of any importance.

Finally, with Steve Choi and Mitu Gulati, I have looked at whether the salaries of state high court judges—which vary greatly—are correlated with judicial quality, and found little evidence of such a correlation.  Our study is here.

Why wouldn’t more highly paid judges be better? There are several possible explanations.

First, the non-pecuniary benefits of being a judge might well swamp the cash benefits. We already know that partners will give up a million dollars a year to become a judge; would it make a difference if they give up only, say, $950,000 per year?

Second, federal judges are appointed, and so the quality of the federal judiciary depends in the first instance on the quality of the appointments process. If presidents and senators use appointments as patronage opportunities (think of Harriet Miers), then a salary increase just improves the value of patronage, not the quality of judging.

Third, even high quality people do not necessarily want to work hard once they become judges. So a high salary might attract higher quality people, but if these people do not work hard because there is no sanction for not working hard, and there is none, then judicial output will not necessarily improve.

A final point, one that is rarely made in the debates, is that federal judges should not be paid more than the value of their activity. If you overpay federal judges, you attract from the private sector people who are more productive as practicing lawyers.

There is no easy way to figure out the social value of a federal judge, but until some progress is made in coming up with a figure, Justice Roberts’ arguments will remain in the realm of speculation.

For other comments on the Chief Justice's arguments (past and present) in favor of a pay raise, see:

The WSJ law blog;

Ilya Somin;

Dahlia Lithwick

Comments

[minderbender]

"If you overpay federal judges, you attract from the private sector people who are more productive as practicing lawyers."

In most professional fields this would be true - it would be true, for instance, of engineers. However, many lawyers are "productive" only in the sense that it is individually profitable to hire them, not that they increase social wellbeing. Imagine a litigator who is very effective at redistributing wealth from other people to his client. He might not increase social welfare at all - he may decrease it - but he might nevertheless be well compensated for his efforts. It may be true that the overall system depends on zealous advocates to uncover the truth (or whatever), but the marginal effect of a lawyer on social welfare might still be negative.

On a different note, I think that on average, judges are probably overcompensated. After all, Judge Judy makes $25 million a year, putting her salary well above first-year associates at most law firms.

[minderbender]

Also, Judge Posner has blogged on this topic:

http://www.becker-posner-blog.com/archives/2007/03/judicial_salari.html

[Kimball Corson]

Federal and state judges' pay should be scaled significantly according to a Sunstein-like measure of the neutrality of their decisions. The more neutral their decisions, the higher their individual pay. Most Supreme Court Justices, by this test, need a major pay cut.

[Barry]

IIRC, the modern idea of the amateur in sporting competitions was developed in the UK, where it served to handicap those with limited resources. If you have to earn a living, serious training is much harder then for those who don't - unless you can earn a living through competition.

It looks like Posner understands that very well. If federal judges are underpaid, that would skew their demographics towards those who have substantial wealth, and those who expect, um.... future recompense for their decisions.

[Joan A. Conway]

I don't think the judges are overpaid if they are working at their job.

Many however lean heavily upon their staff for lots of their work.

Seeing someone like me in the courtroom would make any federal judge defer their work to their staff in self-defense.

[Barbara Ann Jackson]

re: Pay Raise For Some Judges' Is A Revolting Concept! Plus, New Orleans Federal Judiciary Call To Impeach Judge G. Thomas Porteous. . .

For people whose lives have been devastated because of federal judges' (or any judge's) lack of regard for established laws, talk of pay raises for judges is a revolting concept. Also, it seems that knowledge of the law IS NOT required in order to become appointed as a judge, nor to remain one. Like a certain New Orleans federal who
repeatedly granted motions, orders and rulings to lawyers despite that the named defendant in the lawsuit never was served the lawsuit. Even worse, the federal judge had absolutely no federal subject matter
jurisdiction over that state tort lawsuit for Conversion.

Posted on the www.lawgrace.org website is the court transcript portion from a hearing where that judge dictated his own rules,in utter disregard for removal statutes, although jurisprudence clearly states
that the grounds for removing a lawsuit to federal court must exist at the time of removal; and improper removal cannot be cured if FEDERAL SUBJECT MATTER JURISDICTION DID NOT EXIST. Moreover, no judge can
exercise jurisdiction over a defendant which has not been made a party to a lawsuit.

Because of railroading such as this, overall perceptions about judicial collusion and unlikelihood of receiving justice steers some people to televised courtrooms. But, then there are also hallmark examples such as former U.S. Attorney General Alberto Gonzales' characterizations of Wrongs things as Right things. Further, it is common knowledge that many judges receive junkets and all sorts of perks -unfortunately from conflict of interests entities appearing in
some of their courtrooms.

But even more relevant, since this country's nationwide Mortgage Mess / Foreclosure Crisis situation affects every American in some way or another, New Orleans federal court systems comes to the forefront in
light of MANIFEST judicial collusion which abets mortgage giants FREDDIE MAC and WELLS FARGO in real estate and mortgage fraud
racketeering here.

FORECLOSURE FRAUD committed via DEBT COLLECTION abuse and deception, is the worst factor of the Mortgage Mess. Collectors file foreclosures naming DEFUNCT mortgage companies, or mortgage companies which NO
LONGER hold the note; and affix "ransom" amounts (collectors' fees) exceeding "Acceleration Clauses." When homeowners sue for "Unfair Debt Collection Practices," collectors get even more $$ from protracted
litigation while leading some lenders to believe the homeowner caused added legal expenses.

ACTUAL SITUATION: For a purported foreclosure debt of $86,000.00, filing under a non-existent mortgage company, collection attorneys racked up approximately a quarter of a million dollars in fees litigating lawsuits for various damages against their sham client. The foreclosed property was ultimately sold to a 3rd party for $37,000.00. (Dollar amounts approximate.) Securities Investors got nothing, nothing practical was accomplished by evicting the homeowners, property value declined in that neighborhood, and collectors made bundles! As an added measure to inflame courts and heighten chances of judicial favor, collectors propagate that defaulted property owners are costing their clients mega bucks. Using such false leverage with judges against people facing homelessness has to be the cruelest type of exploitation and maligning!

Moreover, the foregoing description regarding real estate racketeering and the New Orleans federal judiciary IS NOT the only blatant collusion, injustice, cronyism, and disparity. However, this scenario
of corruption reveals why crime, violence, poverty, oppression, disintegration of households is so pervasive.

Lastly, because of reported rampant abuse of power, in my opinion, without some type of merit raise system, some judges should not
receive raises! And the one in particular, New Orleans federal Judge Porteous whose impeachment Chief Justice Roberts is required to consider, should actually be in jail like his fellow judges who were
jailed in the "Bail Bonds Unlimited" / "Operation Wrinkled Robe" scandals.
How Justice Roberts deals with Judge Porteous will say a lot about his promise to enhance judicial integrity.
_____________________________________________________________________
Here's some other links:

-FEDERAL JUDGES' Pay Raise; New Orleans Federal Judiciary Call To Impeach
http://newsblaze.com/story/20080101084831tsop.nb/newsblaze/TOPSTORY/Top-Stories.html

-Viewpoint: Calls for Impeachment of N. O. Federal Judge G. Thomas Porteous"
http://www.opednews.com/articles/opedne_barbara__071223_viewpoint_3a___calls_f.htm.

-Mortgage Mess, Foreclosure Fraud and Impediments to Justice
http://newsblaze.com/story/20071203130614tsop.nb/newsblaze/TOPSTORY/Top-Stories.

-Casualties From New Orleans Ineptness and Corruption Coming To A City Near You
http://www.lawgrace.org/2006/06/30/casualties-from-corruption/
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Barbara Ann Jackson (Katrina displaced from New Orleans)
www.lawgrace.org

[Barry]

Eric Posner: "First, the non-pecuniary benefits of being a judge might well swamp the cash benefits. We already know that partners will give up a million dollars a year to become a judge; would it make a difference if they give up only, say, $950,000 per year?"

Eric, please contact your nearest U Chicago econ undergraduate. Tell them that you don't understand something called 'marginal analysis'; ask them to explain it to you.