With JP Morgan running into trouble in recent weeks, many financial experts have called for CEO Jamie Dimon to step down from the board of the New York Federal Reserve.

As the Wall Street Journal puts it,

The critics say a person who is leading a bank that is under regulatory scrutiny shouldn’t be a director at a regional Fed bank. More broadly, they say, bankers shouldn’t be Fed directors.

Now one other member of the NY Fed has come out in support of Dimon: Columbia University President Lee Bollinger.

“I do not think he should step down,” Mr. Bollinger said in an interview with The Wall Street Journal. He said Mr. Dimon appears to have done nothing wrong, that critics attacking the Fed have a “false understanding” of how it works….

An unexpected opinion from someone who in the past has styled himself as a voice of independence and reform. (Why a lawyer/university president is the chair of the NY Fed’s board of directors is, of course, another question.) Simon Johnson, the very smart MIT economist, called Bollinger’s remarks “out of touch with informed expert opinion.”

But the relevant question isn’t really whether Bollinger’s remarks are part of a consensus or not; the question is how much Bollinger and/or Columbia stand to gain from being owed a favor by Jamie Dimon. Columbia is currently in the midst of a huge expansion north of 125th Street. Will we one day see a Dimon Center for Business Studies? Or perhaps in a few years, Bollinger may join the board of JP Morgan?

The point is, as with Ruth Simmons at Brown, Drew Faust at Harvard, and scores of other university presidents, these outside jobs are compromising the integrity of the university president’s role….