What I Learned Today

A chance discussion at work raised the question of how much our leaders at Caltech and JPL earn. Some investigation turned up interesting results.

According to The Chronicle of Philanthropy, the president of Caltech (Jean-Lou Chameau) was paid a staggering $765,260 in 2009 (most recent numbers). He also serves as a director of MTS Systems Corporation, earning ~$150,000 per year in fees and stock awards. Impressive.

In contrast, the most recent salary reported for Charles Elachi, director of JPL (which is a division of Caltech), was $455,820 in 2006. At that time, the president of Caltech (David Baltimore) was paid $590,000. It is not clear whether Elachi’s salary has grown with the president’s; turnover in Caltech presidents seems higher than that of JPL directors, which could lead to faster salary growth.

Now a point of comparison. The president of the United States is a job with a fixed salary dictated by Congress. My understanding has been that one goal is to never position this job as something one might do for the money — that being perhaps a poor motivation for applying. The reality is a little more complex. Most of us learned in school that the president earns $200,000 per year. This had been in effect since 1969 (a long time for any salary to remain fixed!), but changed in 2001, when the salary was bumped up to $400,000 per year (at the instigation of Bill Clinton, whom it didn’t benefit; George W. Bush was the first to enjoy the increase).

Initially it seems a little strange that the head of Caltech (or JPL) is compensated at a higher level than the president of the country. But again, the president isn’t meant to be the highest earner in the country. And when you dig a little deeper, total presidential compensation tells a different story. In addition to salary, the president of the U.S. receives “a $50,000 expense account, a $100,000 non-taxable travel account, and $19,000 for entertainment.” Further, the president is provided with a home (while in office), meals, transportation, security, etc. After leaving office, the president continues to earn a $191,300 per year pension and also receives a government-provided office with staff and travel funds. Wow!

I present these figures not in any way to snipe at our institutional (and national) leaders, but more as an awed observation of the fact that any individual could be paid so hugely. I know there are other individuals that undoubtedly are paid more (we’ve all heard about crazy CEO salaries and compensation), but it just boggles my mind that anyone could even make use of such a huge sum in any practical fashion. No doubt they have good financial advisors, and I wouldn’t be surprised if they contribute large sums to charitable institutions, which can certainly make use of the money. But otherwise — how much can a single individual (or family) realistically spend in getting through life? And once those needs are met, what else is there?

For people with this kind of disposable income, it seems a perfect opportunity to think big. Fund research for diabetes! Make that mission to Mars happen! Invest in technology that can fundamentally change how we interact with, or how we understand, the world (and each other). No one person can solve every problem or investigate every idea. But money can be the lever to swing the massed efforts of others in a productive, world-changing direction. In that way, these seeming excesses of compensation instead can compensate us all.