Even nicer if, as in an example of which I have first-hand knowledge, the school says “you have no undergraduate teaching duties, we want you to focus on research, and BTW, here is a nice new research facility we set up just for you and your grad students to do it in”. It’s amazing what you can get when you have a suitable reputation.
I don’t know what this guy is complaining about, but I very much doubt that teaching undergraduate courses would do anything to inspire better research. Inspiration generally comes from colleagues and the peer community.
If this guy’s ruminations were right, Princeton’s Institute for Advanced Study would not have produced 36 Nobel Laureates, 46 of the 64 Fields Medalists, and 24 of the 28 Abel Prize Laureates, as well as many MacArthur Fellows and Wolf Prize winners. Likewise, IBM Research has found it productive and profitable to designate their top scientists as “IBM Fellows”, which basically means “from now on, your job responsibility is to do whatever you want”.