By Richard Vedder
We all have been aware that universities have been giving large salary increases to senior administrators at the same time they have been crying that they are poor to legislators, taxpayers, parents of students, and alumni. The Columbus Dispatch has done a detailed investigation of top administrator salaries at one of America's largest public universities, Ohio State, and the results are shocking.
Gordon Gee became prez at Ohio State for the second time last year, and in ONE year he has DOUBLED salaries for the top administrators that make up his cabinet --from
$2.9 million to $5.8 million. The number of these senior administrators grew from nine to fourteen, implying that average administrative pay rose from a bit over $300,000 a year to over $400,000 --about a 30 percent increase in a single year.
Moreover, that is not the whole story. A system of bonuses exists for most of the senior employees, often 30 percent of base salary. The bonuses depend on certain performance objectives being met. Additionally, deferred compensation worth six digits is added on for most of the administrators. As a consequence, at least three administrators potentially will make over $1 million this year --and that does not count Gee himself, the football coach (who makes at least double that), and the basketball coach. Five years ago, no one made a million dollars a year in public higher education --now it appears that six persons make more than that at ONE institution!!
As the school grabs more federal grants, larger state appropriations, and raises tuition substantially, it has used some of the incremental funds to finance huge salary increases for the elite who run the institution, while swelling the bureaucracy. For example, there was one very well paid governmental relations person in the cabinet --now there are two, both with base pay of over $300,000. One, who is filling a new position, is a current legislator who now makes well under $100,000 a year. I bet she would have loved to take the job at a salary of $150,000 a year. One of the lobbyists is on the bonus plan, which seems to suggest that he gets a kickback the more money the legislature gives to the university, opening up a moral cesspool of untold dimensions.
All of this is going on in the midst of a poor economy (particularly in Ohio), with the governor forcing some budget cuts. Some schools are laying off staff, but the rent-seeking greed financed by third parties continues, and, indeed accelerates. Let the public be damned.
Higher education is facing a day of reckoning, and actions like those taken at OSU will hasten the day.