Academia is supposed to be a place of scholarship, an environment free of conflicting interests and only dedicated to the search for knowledge. But according to a report by The New York Times Wall Street has weaseled their way into the ivory tower to slant the scholarship in their favor. Those academics who play ball and support the views Wall Street likes are handsomely rewarded. Those that don’t have to live on their relatively modest salaries.

Financial ties among professors promoting speculation and the banks and trading firms that profit from it date back to the beginning of the recent commodities boom, which got an intellectual kick-start from academia. After Congress and the Clinton administration deregulated the commodities markets in 2000, and the Securities and Exchange Commission lowered capital requirements on investment banks in 2004, the financial giants began developing new funds to capitalize on the opportunity.

Enter the well paid promoters of the new status quo, some of whom have a PhD after their name such as Professor Craig Pirrong from the University of Houston. Pirrong is a leading advocate for keeping speculation in the commodities market as loosely regulated as possible. He also is extremely well compensated by the masters of finance capital for promoting that position.

So what? Finance professors are paid by outside consultants and say what their clients want to hear – isn’t that just business, just PR work?

No, because unlike a PR representative academics are cited in court cases as grounds for a judge to interfere with policy and reinterpret the law.

Mr. Pirrong’s research was cited extensively by the plaintiffs in a lawsuit filed by Wall Street interests in 2011 that for two years has blocked the limits on speculation that had been approved by Congress as part of the Dodd-Frank financial reform law.

During that same time period, Mr. Pirrong has worked as a paid research consultant for one of the lead plaintiffs in the case, the International Swaps and Derivatives Association, according to his disclosure form.

A rather clear conflict of interest if ever there was one – as an academic Pirrong is considered an objective scholar and expert, while as a consultant he is being paid by clients with rather obvious expectations. Will Pirrong be rehired by the International Swaps and Derivatives Association if he concludes that regulating derivatives is a good idea? No way.

The corruption of academia by Wall Street was also a major subject of the Academy-award winning documentary Inside Job which exposed the extensive relationship between finance professors and Wall Street firms through paid consulting work. Professor Pirrong is just the latest example.

Has academia become a bought priesthood when it comes to Wall Street?  If so, should judges really be citing their work to interpret or change the law?