Gordon Gee and Folks Not Connected to Reality

In today's Parade Magazine, there was a small interview with E. Gordon Gee, president of Ohio State University. Mr Gee has argued that public colleges should get more funding from the federal government.

Among the things Mr Gee is reported to have said are:

• Why public colleges deserve funds from the economic stimulus package: We are the economic stimulus. The future of the nation is going to be idea-driven, so colleges are the smokestack industries of tomorrow.
• Concerning what he would say to Mr Obama: I would argue for a significant infusion of money for the intellectual infrastructure of the country—the National Science Foundation and the National Institutes of Health. The Obama Administration needs to focus on supporting things that will be important to the knowledge economy, like science, mathematics, and engineering—things that allow us to remain competitive in the world.
• Concerning his $1.3MM salary: I run the largest and most complex institution in the country. If I perform well, I hope people look at me and say I'm worth what they are paying. I assure you, if I don't perform, people will complain.

There are a couple of things about this that strike me as entirely nonsensical.

First, in the matter of his $1.3MM salary. Mr Gee argues that he runs a large school. He does. But does that, in and of itself, make his work worth $1.3MM? Does his work create $1.3MM in value for the University and his employers, the people of Ohio which has a 7.8% unemployment rate? I suspect that the answer to both those questions is no. Mr Gee further argues that he hopes people, here I assume he means the people of Ohio, will complain if he doesn't perform. I find that a curious argument. Consider, for example, someone working for Mc Donalds in a minimum wage job. If that person doesn't perform people not only complain, the employee gets fired. It's called work and if you don't do your job E. Gordon you get fired entirely independent of how much you are paid!

So neither of Mr Gee's arguments about his salary really make much sense. They amount to little more than an extremely well paid man saying he thinks he should be extremely well paid.

Now, I don't know Mr Gee. Perhaps he does, indeed, deserve to be well paid. But consider what else he had to say!

Second, Mr Gee says that the nation's future is an idea driven economy and therefore his university is deserving of money from the economic stimulus package. Mr Gee is presumed to be a smart man as he is, after all, president of the largest US university. Does he rellay believe this, or does he simply have his hand out like so many others?

I've heard this argument about the new economy based on knowledge, ideas, service, etc. That it is entirely silly seems to me entirely obvious.

Don't think so. Consider the following thought experiment. You're in your home. You just woke up in your bed. Now imagine going through your day under two different conditions. In the first, there is no new economy but there is an industrial economy. In the second, there is a new economy but there is no industrial economy. Now in the first, you'd still have breakfast, still have cloths, still have a car, still have all the things that an industrial manufacturing economy provides. Life wouldn't really be much different. However, in the second, you'd not have any of the numerious every day things an industrial economy provides. Never mind that the new economy can't exist without the old economy. It is after all true that the new economy depends on an extensive industrial infrastructure that provides electronics, communications, etc.

My point here is that talk about a new economy that forgoes well paying manufacturing jobs is simply silly. As a society, I believe, we need both. Unfortunately, in the last few decades US business and government has bought into the notion that we should ship industrial jobs to other lower cost countries. The net, entirely predictable, result is that the US middle class has been severly damaged.

Returning to Mr Gee, he seems to have drunk much to much of his own cool aid. What Ohio needs, you remember Ohio, the folks that pay Mr Gee $1.3MM, and what the US needs, you remember Mr Gee's desire for some of that, are jobs, some 1MM or so jobs to replace those lost in the last year. The US doesn't need 1MM new software engineers. There are already many of those out of work. What the US needs is 1MM new manufacturing jobs! Given Mr Gee's rather silly views, I have a hard time imagining he's much different from many other overpaid executives who justify their compensation for no better reason that they think they should be well paid and argue silliness such as the new economy.