He earned less money for trying to enforce a no cheating policy.No, his pay was increased by less than in previous years. He didn't actually earn less.
Would you work twice the amount of time for less pay?
He didn't work twice the time. 32 lecture hours is an indicator of the workload - he spends far more on the course than just contact hours.
The problem seems systemic, he throws his hands in the air and gives up because he cannot do anything alone and is punished.
He still got a pay increase. Not as much as he would have liked, but it's not exactly horrible punishment. In one aspect he's just as guilty as his cheaters - he is more concerned for the big bux at the end than in doing his job properly: "If doing things properly means I get paid less, screw that".
EDIT: it's important to note that he also reports on the changed dynamic of the class, not just the dollars. That being said, it's interesting that the dollars come first.