A footnote to financial incentives

Ken Priest receives Role Model Award

Ken Priest receives Role Model Award

From an employment standpoint, David Proctor is removed from the capitalist system. Hard work does not earn him more money. Doing a lousy job will not get him fired. He has a job for life, whether he does it well or poorly.

From a strictly economic viewpoint, this has a predictable outcome. Proctor has no economic incentive to work, so he will not do so. Excellence provides no financial benefit, so he should not pursue it.

Proctor’s situation interests me because he should be an example of the bad things that will happen if two recently controversial issues are resolved without due deference to the market economy. Socialize medicine and we’ll lose most of our doctors, and those that remain won’t be any good. Place salary caps on corporate executives and our main economic drivers will struggle under poor management.

Proctor, though, turns capitalism on its head. He is a federal judge for the Northern District of Alabama. He has a lifetime appointment and a fixed salary. I have covered a few of his trials, most recently the trial of (former) State Rep. Sue Schmitz. Lawyers in his court typically have a huge economic incentive, but invariably he outworks them. He starts early and runs late. He keeps odd hours to avoid wasting the jury’s time. He generally has already researched the legal issue before a lawyer files the motion, and he understands the issue better than the advocate who is paid to succeed.

I do not know what motivates Proctor. Maybe he wants an appellate court appointment. Maybe he enjoys the respect of lawyers and jurors. Maybe he derives satisfaction from seeing justice accomplished. What I do know, however, is that his motivator is not financial.

At first Proctor jumped out as an anomaly, but further thought suggests he is something more than that. EMTs get poverty-level wages, but save lives. Calculate the hourly wage of many teachers (my wife included) and it would be well below minimum wage. Firemen, policemen, pastors. Don’t be too nasty in your comments, but I would even include journalists in the category.

My 13-year-old daughter just walked in the room, and I asked her for more examples. She said, “janitors.” I thought she had missed my point, but then she said: “Ken Priest.” He’s a janitor at Cedar Ridge Middle School, and an amazing guy. He is totally committed to the students and to the upkeep of the building. For him, it most certainly is not about money.

As I think about people I know, most are in the Janitor Priest-Judge Proctor category. Sure they care about money, but place them in a job and they will do it to the best of their ability. Their prime motivator is not money, but noneconomic forms of satisfaction. Those motivators may be selfish or they may be altruistic, but the point is they are not financial.

I’m not sure where the point leads me, but I know it makes me more suspicious of my oft-stated criticisms of salary caps and socialized medicine. Economic forces are powerful, but they share space with many motivators that go unmentioned in economics textbooks. Those unmentioned motivators may be the most powerful.

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