This past January 1, in his year-end report to Congress on the federal judiciary, which he heads, Chief Justice Roberts urged Congress to raise federal judicial salaries. They have not been increased (except for cost of living increases in some years), since a very large raise in 1991--from $89,500 to $125,100 for district judges (trial judges), and from $95,000 to $132,700 for circuit (appellate) judges. The current salaries are $165,200 and $175,100, respectively.
The chief justice's report is not analytical. It points out that federal judicial salaries have fallen in real (i.e., inflation-adjusted terms since 1969), but this is misleading because judicial salaries (cost of living increases to one side) are raised infrequently--and when they are raised, they are raised by a goodly amount. 1969, the base year picked by Chief Justice Roberts, was the year of a big raise (from $33,000 to $42,500 for circuit judges), and afterwards inflation ate away at the salary in real terms; and likewise after the next big raise, in 1991. As a result, in most years since 1969, federal judges' salaries have been lower in real terms than their current salaries.
What is true, however, as also pointed out in the report, is that federal judicial salaries are now well behind those of deans and professors at leading law schools, whereas they used to be comparable. And of course they are far behind the salaries of successful practicing lawyers. That has always been true, but a novel twist is that judicial salaries are now lower than first-year associates' salaries at New York law firms, when the associates' bonuses are included.
The chief justice's report states that the federal judiciary is facing a crisis because of the salary lag. It notes that 38 federal judges have left the bench in the last six years, and that 60 percent of newly appointed judges come from the public sector rather than from private practice, whereas the figure used to be only 35 percent.
To say that the wages in some job category are "too low" doesn't make much economic sense when one is talking about a job in the private sector. An employer who has trouble finding workers of the requisite skill and experience at the wage that he's offering will raise the wage. Even if there is an unanticipated demand for workers of a particular type, there will not be a "shortage"; the limited supply of workers will be allocated to the most urgent demanders, and other employers will substitute other inputs (including workers with less skill or experience) or curtail their output.
In the public sector, however, there is no automatic mechanism for equilibrating the supply of and demand for workers, so there may be shortages in particular jobs, and the existence of a shortage would be a signal that the legislature should raise the wages for those jobs. No such signal is being emitted in the judicial sector. There is not a shortage of applicants for federal judgeships, but instead an excess of applicants, as is true in many other government jobs (look how many people are running for President). But because there are no very definite criteria for appointment to a federal judgeship, there is a possibility that the queue for the jobs is dominated by low-quality applicants. Let us consider whether there is evidence of that.
Increased turnover could be a sign of job dissatisfaction due to a low wage. But has turnover increased? The Roberts report gets to the figure 38 by lumping in retirements with resignations. Federal judges (as I'm about to note) can when they reach retirement age (between 65 and 70 depending on their years of judicial service) either remain as senior judges, working part time, or retire, in which event they can take another job. The decision to retire is less likely to be motivated by dissatisfaction with salary than the decision to resign, and it also has less impact, since the alternative is continued service as a senior judge, normally part time. Resignations remain rare. Since the beginning of 2000, only 12 judges have resigned, out of a total of some 800. In the comparable six-year period 1969 to 1974, when there were only about 60 percent as many federal judges as there are now, 10 of them resigned, a higher percentage than in the last six years. Resignations of circuit judges are especially rare; there have been only 8 since 1981.
The most serious omission in Chief Justice Roberts's report is the other compensation that judges receive besides their salaries. Most judges who want to can teach a course or a seminar at a law school and receive another $25,000 in pay (the ceiling on outside income, apart from investment income and royalties, and a very low ceiling given current law school salaries‚Äîwhich benefits judges, since they can teach less to reach their ceiling, as it is an ever-diminishing percentage of a professor's salary). The federal judicial pension is extremely generous--a judge can retire at age 65 with only 15 years of judicial service (or at 70 with 10 years), and receive his full salary for life; nor does he make any contribution to funding the pension. The health benefits are also good. 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 do not mean to suggest that every successful practitioner would exchange his $1 million or $2 million (or greater) annual income for a judge's salary. But enough, out of a national population of a million lawyers, are willing to do so to enable the filling of vacancies in the federal courts, especially practitioners in their fifties who have built up a nice nest egg. So I do not think that the increased draw of new judges from the public sector is a function of salary lag. Partly it is due to the fact that the federal docket, especially at the district court level, is increasingly dominated by criminal, prisoner, and employment-discrimination cases, none of which are case categories particularly congenial to lawyers who have a commercial practice. Partly it is due to the fact that many highly competent lawyers prefer to work for government, for example as career prosecutors, rather than engage in private practice, so that competition from public-sector lawyers for judgeships is greater than it once was. And partly it is that ideology figures increasingly as a factor in federal judicial appointments, and both academics and career government lawyers are likely to have emitted clearer signs of ideological orientation than commercial practitioners.
Raising salaries would not do a great deal to attract commercial lawyers to judgeships. The lawyer who doesn't want to exchange a $1 million income for a $175,000 income is unlikely to exchange it for a $225,000 income--Roberts doesn't name a figure to which he thinks judicial salaries should be raised, but he can hardly expect Congress to raise salaries by more than 30 percent, and that only intermittently, so that inflation will eat away at the salary until the next jump. And one effect of raising judicial salaries would be to make the job a bigger patronage plum for ex-Congressmen, friends of Senators, and others with political connections, so that the average quality of the applicant pool might actually fall.
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. But this argument for raising judicial salaries is unlikely to receive a warm welcome from Congress.
But there is one compensation measure that is long overdue and could be effectuated at minimum cost to the federal fisc. That would be to introduce a cost of living differential. The cost of living differs very widely among different communities in the United States. Boston‚Äôs cost of living is 40 percent above the average for the nation; the cost of living in Kanakee, Illinois, is 12 percent below the average; and these are not the extremes. Modest cost of living differentials, constituting raises limited to high cost-of-living areas, for federal judges would go some distance toward remedying any perceived problem of judicial undercompensation.