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The usual suspects

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Jeff Toobin has a piece in the New Yorker pointing out that increasingly stratified economics of the legal profession reflect larger social trends:

In the legal world, the haves are doing better than fine. In 1985, average profits per partner in The American Lawyer’s list of leading law firms was $309,000 ($623,000 in current dollars); today, the profits per partner for roughly the same group is about $1.5 million. These numbers hide an even greater disparity. Those at the very top of the pyramid—firms such as Wachtell, Lipton, Rosen & Katz; Quinn Emanuel Urquhart & Sullivan; Cravath, Swain & Moore; and a handful of others—are thriving as never before, with annual profits per partner in the multimillions.

But those at the bottom of the pyramid—recent law-school graduates—are struggling. A recent article in The Atlantic recited the grim numbers . . . [Yet] law schools have continued to cycle students through their doors and load them up with debt, in spite of the reduced demand for legal education (and for lawyers). Eighty-five percent of graduates now carry at least a hundred thousand dollars in debt. Even dubious operations, like the Thomas Jefferson School of Law, in San Diego, have kept their doors (and palms) open.

It’s clear that the nation needs fewer law schools, for many that remain are only offering their students false hopes of employment in exchange for big debt. These students are getting the legal-education equivalent of the subprime loans that helped sink the national economy. In this case, though, the risk to the broader public is small, while the indebted students may struggle with the burden for the rest of their lives. (The vast middle of the legal academy—at the big state schools, for instance—is doing only a little better than the schools at the bottom. For a full view of the depressing facts, see the superb Law School Transparency Web site.)

As with law firms, the top law schools are doing fine. Graduates of the most highly regarded institutions may not have the cornucopia of options that their predecessors enjoyed a few years ago, but few, if any, will go jobless. These students have large loans, too, but they’ll be able to repay them. As in days past, they will migrate to the big firms, where, by and large, their prospects are bright. And the cycle will continue: the rich (in credentials, at least initially) prospering, and the poor struggling. So it goes for lawyers—and, it seems, for everyone else.

(The last paragraph overstates in my view the extent to which graduates of even the most elite law schools are insulated from financial disaster, but Toobin’s general point is correct).

Speaking of New Yorkers, here’s a nice illustration of the perverse economic structure of the system:

New York Law School is a large, perpetually unranked law school, occupying a fancy new building that it put up on prime Tribeca real estate.

The school charges nearly $50,000 per year in tuition, and estimates the nine-month cost of living for students as $23,591 — a realistic figure for anywhere within reasonable commuting distance — meaning that someone paying full tuition who finances the cost of attendance with federal loans will rack up around $273,000 in debt, including interest, by the time the first federal loan payment comes due six months after graduation. Even someone with a 50% scholarship who takes out federal loans will have $180,000 in non-dischargeable loan debt. (Last year, fully half of all NYLS students paid sticker tuition, and 96.5% paid more than 50% of the sticker price).

Job outcomes for 2013 grads:

56% of graduates did not get a legal job within nine months of graduation.

Nearly 30% had no full time work of any kind.

More than 100 of 562 graduates were completely unemployed nine months after graduation.

5.7% of graduates (at most) got jobs with salaries that would theoretically allow them to begin to repay in a timely manner the average graduate’s debt load, even with that debt being paid back on the government’s 25-year extended repayment plan.

Meanwhile, on the other side of the accounting ledger:

In FY2013 the school reported earning $106,725,026 in revenue. More than $71 million of this came in the form of tuition (slightly less than 10% of this tuition was redistributed to students receiving “scholarships,” i.e., cross-subsidized tuition discounts, paid for by their less fortunate brethern).

Most of the rest of the school’s income came from the fruits of its financial investments, made possible by the collection of tuition revenues over many years. Note that NYLS has a very small endowment relative to its revenues — $32.3 million at the end of FY2013. These funds are of course almost all restricted by the terms under which they were donated. Such restrictions don’t apply to the “donations” students (or more accurately taxpayers, via federal loans) make in the form of tuition payments.

As of the end of FY2013 NYLS owned, outside of any endowment restrictions, more than $158,000,000 in publicly-traded securities, and $110,000,000 in other securities. In addition, the school has been engaging in the most straightforward (from an accounting perspective at least) financial speculation, in the form of interest rate swaps. Gambling on these financial derivatives cost the school $17,548,000 in losses in FY2012, while earning it $13,038,000 in FY2013.

Where is all this money going? Apparently, to a handful of favored faculty members, who, even by the standards of contemporary law schools, are drawing stupendous salaries and other forms of compensation.

Consider Prof. Marshall Tracht. Prof. Tacht entered legal academia 20 years ago, published three law review articles on the way to getting tenure at Hofstra (and apparently not much else since, besides teaching materials and brief notes for practitioners), then moved over to NYLS in 2008.

I asked a couple of colleagues who write in the areas in which Prof. Tracht specializes if they had ever heard of him. They hadn’t. Nevertheless, Prof. Tracht was paid $451,477 by NYLS (or more precisely by NYLS’s students, or more precisely yet by the taxpayers who unwittingly lent those students the money that in due course found its way into the professor’s accounts).

Five other NYLS faculty members (not counting the dean, who was paid $468,635) were paid between $327,892 and $383,499 in FY2013.

What possible justification could there be for this sort of thing? Let’s round up the usual suspects:

(1) NYLS must compete for top scholars in order to preserve and enhance its scholarly reputation.

NYLS has no scholarly reputation in the legal academic world.

(2) NYLS must compete for top scholars in order to preserve and enhance its place in the law school rankings.

NYLS place in the law school rankings is that it is unranked, i.e., tied for last place with about 65 other schools.

(3) NYLS must compete for top scholars in order to attract students who will want to study under various luminaries of the profession.

See (1) and (2) supra.

(4) NYLS is merely charging what the market will bear, and distributing the proceeds of these efficient market transactions to key employees on the basis of institutional self-interest, which, in an efficient market, results, in the long run, in socially beneficial outcomes.

This sounds somewhat more plausible if you say it to yourself in a robot voice.

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  • LeeEsq

    This is surprising information about my law school. I graduated NYLS in 2005. It took me a year to get a job afterwards but I attributed it to my midling grades. I thought the quality of instruction was basically at least decent.

    • Marek

      I didn’t see anything in the post criticizing the quality of instruction as such.

      • The Dark Avenger

        Yeah, the pass rate reflects on the quality of the student, not the instruction per se.

        • matt w

          That seems like a pretty brutal statement as to the utility of law school instruction.

          • rewenzo

            Not really. Law schools don’t really teach to the bar exam or even make an effort to prepare you. By the time the Bar rolls around, you’ve probably forgotten everything you learned in 1L about torts and contract and criminal law. And you probably spent as little time on T&E as possible. Studying for the bar is pretty much a self taught operation, usually with the aid of a professional study program like Kaplan’s.

            My guess is that all law schools are pretty much the same in teaching methods and that there’s not a huge difference in quality. The biggest reason for the discrepancy in Harvard and NYLS’ bar passage rates is probably due to the fact that every non-legacy in Harvard is a really good student.

            • Brentus Maximus

              I firmly believe there is a huge advantage to looking at material twice with time in between each phase of learning. For me it was much easier to refresh on a subject than it was to learn it for the first time, and everyone I have asked has echoed that sentiment.

              Because of that, I think there is great value in law schools teaching bar subjects. The students that take them are refreshing on the material in their bar study courses rather than learning anew, and that should make retention easier.

              Of course, I cannot attribute that to the instruction itself. Students’ focus on the material regardless of teaching methods or efficacy might be plenty for planting that early seed.

              • TriforceofNature

                The only subjects I’m really glad I took are Evidence and Crim Pro. I cannot even begin to imagine learning Evidence for the first time while studying for the bar. It absolutely astounds me that Evidence is not required at most schools. I always thought Evidence was the trickiest law school class, and trickiest bar subject, everything else is pretty easy to learn in a couple of months. So for the MBE, absolutely take all the subjects.

                Anyway, I passed New York, having never even heard of the CPLR (New York Civil Procedure) prior to cracking my Kaplan books, never taken Family Law (best interest of the child!), Trusts and Estates, Commercial Paper, Secured Transactions.

                Look at where you’re taking the bar. Look at the essay topic frequency. If a topic comes up less frequently than 30 or 40% of the time, I would never take it just to take a bar class. I’m glad I took Corporations because it was heavily tested, but Secured Transactions is so infrequently tested that I didn’t regret not taking the class or even waste much time studying for.

                The bottom line, though, is that there are 1) only so many testable topics within the tested subject areas, and 2) only so many ways of testing said testable topics. It’s about learning how to take the exam as much (if not more) as it is learning the actual material.

            • BoredJD

              And that’s assuming the classes even taught you all that you needed to know in the first place. I went through Torts without learning about libel. We spent a lot of criminal law learning death penalty cases and the various “purposes of confinement”- I think the only crime we learned about was murder.

            • TriforceofNature

              It’s my understanding that legacy is much less powerful when it comes to graduate and professional admissions, but then maybe Harvard’s a different beast.

        • BoredJD

          It also reflects on the % of students who can get jobs at firms/employers who will pay for their bar prep classes and give them stipends for living expenses. That’s basically biglaw.

  • Mike in DC

    Reducing the number of law school grads only keeps the problem from getting worse. But if 50% of the grads since 2008 are unemployed or u deremployed, saddled with 6 figure debt, the obvious question is : how do we get out of this mess? Who is going to help us? If there’s some sort of plurality agreement within the profession that “something somethhould be done”, then who is going to step up and do something? I’m tired of getting the shrug and the unspoken “hey, guess you’re screwed, sorry you made a bad choice”(actually, sometime it is spoken).
    My debt load is up to 360,000, by the way, thanks to forbearance and rollover of interest (I lacked the resources to even manage the income based repayment option).
    Where’s my bailout?

    • NewishLawyer

      The problem is that this is a collective action problem. It doesn’t make sense for any one to hire more associates than they need. The Bar Associations are panicked and the law schools are panicked if only for their own futures and abilities to get dues paying members. But the real issue is that the only thing that will make things better is to hire more associates and no one wants to do that because it is an overhead cost.

      I’ve had jobs where they really liked me but did not give me a full-time associate offer because they ran out of lawyer work for me to do. Firms have learned to be leaner and use case assistants and paralegals for more and have a need for fewer associates. The new model seems to be small-firms with partners only (maybe one or two associates).

      So the best the bar associations can do is offer fre CLEs and “mentorship” and hope enough people who hang their own shingle eventually prosper.

      • Marek

        Well, hiring more associates isn’t the only thing that will help. Closing 1/3 of law schools would help to stop adding to the oversupply of new lawyers.

        • NewishLawyer

          Which law schools and how?

          I’m not saying it is impossible but it is one of those things that is easy to say as an Internet tough person but not have any clue on how to handle it in real life.

          As I’ve mentioned before there are lots of law schools that used to be well-respected regional ones that got destroyed by the US News rankings making everything a national horse race. This includes Suffolk in Boston, USF in San Francisco, maybe NYLS in New York (they’ve been around since the early 1900s so are not quite as much a joke as Cooley. I would love to know the reputation and demographics NYLS had pre-US News rankings.)

          • Hogan

            Maybe we need something like the base closing commission we had for the military

          • Marek

            Hey, you said “the only thing.” Or, every school could reduce enrollment by 1/3. It doesn’t seem less likely than law firms hiring extraneous associates.

          • Scott Lemieux

            The second Justice Harlan was an NYLS grad; whether that was a fluke or it used to be a serious school I dunno.

            • Paul Campos

              Also Wallace Stevens and Robert Wagner.

              The problem with NYLS is the same as that with dozens of other formerly respectable regional law schools, that once upon a time charged modest prices and had no pseudo-academic pretensions.

              • The Dark Avenger

                Now, Wallace Stevens: There was a lawyer. He’d write your brief in free verse or iambic pentameter, no extra charge.

          • Morse Code for J

            Your school’s eligibility for federal student aid is somehow made proportional to the ability of your graduates to repay their debt, as expressed by the average portion of their debt being covered by government forbearance in IBR/PAYE.

            This would require the Department of Education’s balls to drop and the Congress to stay out of its way, which are difficult though not impossible events to imagine.

          • JustRuss

            Maybe we could cut off, or at least cap, the government-guaranteed loans for law students and let the free market work it’s magic? Not usually how I roll, but given that law school has become insanely expensive and we have glut of lawyers…..

            • BoredJD

              I’m usually not a huge fan of this proposal either. I don’t think it’ll lower tuitions for most UGs- people will beg/borrow/steal money to fund their educations because the American middle class is obsessed with the idea that the more expensive the school the better the job prospects.

              But in the law school model I have no doubt it would work because law schools essentially have the same funding model as for-profits. They’re almost entirely dependent on federal loans. If Congress decides to scrap the GRADPLUS program during the HEA reauthorization (they won’t) it is game over for the fat cats.

              • BoredJD

                We might very well get a GRADPLUS cap next year. Along with, of course, a bunch of provisions intended to clear the way for for-profit colleges to “innovate” and “maximize efficiencies”:

                http://www.heritage.org/research/reports/2014/08/reauthorizing-the-higher-education-acttoward-policies-that-increase-access-and-lower-costs

                • Unemployed_Northeastern

                  Yes, Senator Lamar Alexander is going to try to revamp all Title IV federal student loans, and yes, as a part of that, there will be new lending caps: $50k-ish for undergrad, which is a nearly 2/3 increase over current federal lending limits for dependent students, and a $150k grad school cap, which is an obvious decrease from the current infinity dollars. It is not clear from Alexander’s HEA renewal proposal whether that $150k grad school cap is lifetime or per-degree. In any event, it would seemingly sink tuition levels at law, biz, and med schools. Except it won’t.

                  Lest we forget, GradPLUS loans only came about in 2006. Before that, one could only borrow something like $20.5k per year in grad Stafford Loans, and maybe a few grand in Perkins Loans if you were lucky. Law school tuition & living expenses cost way more than $20.5k in 2006. Private loans, my dear BoredJD. Private loans.

                  Read any old “how much do you owe thread on JD Underground. Everyone owed $60k federal and $80k to $120k or more in private loans. Some owed only private loans, being told by their FA offices that they were superior because of lower interest rates and (pre-2005) were dischargeable in bankruptcy.

                  So, what is the state of private lending today? Growing. Growing at a rate we haven’t seen in nearly a decade. Almost $8 billion in new private loans were originated in 2013. Investor demand for SLABS (Student Loan Asset-Backed Securities) is at a post-recession high, and only private loans can be bundled anymore. And just like with mortgage ABS products, selling SLABS takes the risk of those loans off the lenders’ books. Sallie Mae is now just a bank, having spun off her administration, collection, and other ancillary businesses into Navient. AccessGroup, that non-profit grad school-only lender that is owned by the 200 accredited law schools as a membership corporation, sits on hundreds of millions of dollars lying idle. I’m sure Nelnet and the other big players wouldn’t mind getting back in the game. Long story short, Alexander’s proposal is just a gambit to get the private lenders back in the game. And lest we forget, private student loans 1) are not dischargeable in bankruptcy, 2) are not eligible for IBR/PAYE/PSLF* and 3) generally do not even offer forbearance, deferral, or hardship extensions. Find a really high-paying job in six months or else.

                  *Senator Sherrod Brown of Ohio tried getting private loans to be eligible for those income-based repayment programs back in 2010. Unfortunately, the very powerful American Securitization Forum outmaneuvered and outlobbied him.

            • Brett

              I’d be in support of that if the implicit federal subsidy was turned into direct support for law schools at public universities to get their tuition and fees down.

          • TriforceofNature

            But how on earth is proposing that firms hire more associates more realistic? My aunt is a small firm lawyer in Florida (doing mainly real estate work). She has a small firm-3 partners. And she’s told me that her business is really razor’s edge. They can afford secretaries and a couple of paralegals but no associates at a salary that would be respectable for someone with that amount of debt or education.

            I happen to believe that every state deserves to have at least one public law school-Every state needs prosecutors and judges and public defenders and small town generalists.

            So CUNY? Keep it. Buffalo? Keep it. Columbia and NYU grads do well for the most part. New York Law, Brooklyn Law, Touro? No offense but they really shouldn’t exist in this economy. I’d say Fordham is more of a borderline case.

            I wish the ABA could sack up and be more like the AMA but I suppose that’s asking too much. I could move back to Florida and my aunt could throw some assignments my way and help me land some contract work, but she doesn’t have enough business to hire me full time. Neither do her friends. So “convincing firms to belt tighten and hire more associates in place of paralegals and case assistants” is way too diffuse and frankly seems a little head in the clouds. At least for law school closures it’s very visible thanks to work like Campos and there actually are pressure points, even if difficult.

            There are too many graduates chasing too few jobs. Law firm largesse of squeezing in a couple more entry level associates is like using a kitchen fire extinguisher to try to put out the fire in the Twin Towers on 9/11.

            I was hoping the problem would sort of solve itself (fewer applicants) but maybe not for another several years. For now it just seems like the intellectual quality of the new pool at the bottom end (140s LSATs) is just getting weaker and weaker. So the people who couldn’t get in when even the bottom tier schools where mildly competitive are now guaranteed a spot. There’s a sucker born every minute. I guess I was a sucker too.

            • TriforceofNature

              I didn’t get to edit that in time. I don’t think encouraging solo practice is a viable long term solution. Even though I may be forced to go down that route, I really don’t want to and would never endorse solo practice right out of law school. We need law school closures. Yes it’s an uphill battle, but that’s not an excuse to not fight the battle. Campos has been doing it for years.

              • NewishLawyer

                I don’t think encouraging solo practice is viable either but I do know a few people who were able to give themselves enough experience to get hired by firms from doing it for periods than ranged from 6 months to 2 years.

                There obviously firms like your aunt’s and others which truly cannot justify hiring an associate or two based on the amount of work they have. There are obviously also big places that learned to get more profit-per-partner by being leaner organizations. This raises an income inequality issue. Why do partners need to make 1.8 million instead of 1.3 million or whatever.

                Campos in raising the issue of over-supply but no school has closed yet and I wonder when one will. If Thomas Jefferson could survive than it does not bode well for closings.

                The big issue I think is that for many years (potentially decades), law school is where you went if you majored in the arts and humanities and could not figure out how to make a living otherwise. There were people with PhDs in my law school (and not patent lawyers). I’m not the only theatre or arts person that I know who went to law school after spending their 20s doing odd jobs and non-paying theatre work.

                For a long time this worked. I have some evidence that it might have been a rule everywhere. Stefan Zweig wrote in his memoir that many turn of the century Austrian lawyers had artists pretensions in their youth before they figured out they needed to make a living. Then suddenly, it did not work. But you still have the problem that you have lots of arts and humanities types who went to law school because they couldn’t get jobs doing anything else and now can’t but are smart not to attend law school maybe.

                So this is why Obama slipped and made that quip about how studying a trade might be more beneficial than studying art history. I disliked it but he has some point in our ruthlessly practical age. But I do not look forward to a future where most of the university is dedicated to practical subjects like business and STEM.

                • TriforceofNature

                  This raises an income inequality issue. Why do partners need to make 1.8 million instead of 1.3 million or whatever.

                  I agree with you there, but again, I think this is even less viable than trying to close law schools. Asking well-to-do lawyers and firms to hire more associates instead of making a ton of money is not a policy solution. It’s something you think should happen, which is great, I don’t disagree, but there’s no way to actually do it. I absolutely think those people should be taxed a hell of a lot more but there’s no solution to young lawyer unemployment lurking there.

                  I’m sure you could find many successful solo or small partnerships (though they’re not the norm) where the partners are making well into the six figures. If they know the kid and really like him or her (son in law, or maybe a mentoring type deal), maybe, maybe an especially generous person/partnership will decide to take a temporary paycut and pay their new associate, let’s be generous, and say $80,000. If I’m a solo or in a small partnership, I’ve probably got a lot of overhead and a lot of stress and a lot of life expenses, and even if I’m making a comfortable $400,000, I’m not going to take a 5 figure pay cut out of the kindness of my heart.

                  And I don’t see how you incentivize or force Cravath to hire more associates and the partners “only” make $800,000 instead of $1.5 million. Both scenarios may be the right thing to do, but I don’t see many people doing it. They should all be paying more in taxes, of course, but they’re not the answer to employment for young lawyers.

                  And I’m sure going solo can help some people find jobs, but for the majority of people it just seems like a bad call.

                  But even in the most positive light, these things are stopgaps, not solutions. We need to close some law schools. A lot of law schools.

                • TriforceofNature

                  I’m not the only theatre or arts person that I know who went to law school after spending their 20s doing odd jobs and non-paying theatre work.

                  I hear you there, sometimes I wish I hadn’t taken any time off after college. If I had gone straight through, I’d have had a lot less life experience, but I’d also have graduated before everything went to shit. Then again, maybe it would have been worse, who knows.

            • New York has 15 law schools and imports lawyers from all over the rest of the country — and the world. In the current climate 15 law schools is at least five too many, and if we could cut that by half that’d be even better.

              Let me start by saying that I am confident that all of these schools have produced capable lawyers. I know capable lawyers from most of them. If we weren’t in a place where we were exploiting law students I’d say let ’em all be. Since we are in that place, however, let’s see how we can carve the number of law schools down. I don’t like or trust US News rankings, so I won’t use them. Here are the schools:
              Albany Law School, Union University.
              Benjamin N. Cardozo School of Law, Yeshiva University
              Brooklyn Law School
              University at Buffalo Law School, SUNY
              Columbia University Law School
              Cornell Law School
              City University of New York School of Law
              Fordham University School of Law
              Hofstra University School of Law
              Touro College Jacob D. Fuchsberg Law Center
              New York Law School
              New York University School of Law
              Pace University School of Law
              St. John’s University School of Law
              Syracuse University College of Law

              There are two public institutions here: Buffalo and CUNY. Sorry, CUNY, you are redundant. There are two Catholic law schools here: Fordham and St. Johns. They should merge. Unless Cardozo is doing something amazing that I don’t know about I don’t see what it is bringing to the party. Lose it. There are two Ivies and NYU. Cornell’s law school isn’t All That, but given New York’s spread of population I think an upstate Ivy and a NYC Ivy is something we can live with. NYU is, frankly, one of the very best schools in the country. Long Island has two law schools, which is at least two too many: I’d keep Hofstra, and get rid of Touro, and you could talk me into Hofstra. It seems to me that a pretty good rule of thumb is to get rid of any law school that is not a part of a university. Sorry, Brooklyn. Frankly, Albany’s tie to Union has always seemed tenuous, so we can cut it loose, too. Likewise New York Law, and Pace. I see no need for Syracuse– if you want to go to law school in a cold, grey upstate place go to Buffalo or Cornell.

              What’s that leave us?

              University at Buffalo Law School, SUNY
              Columbia University Law School
              Cornell Law School
              Fordham University School of Law (Merge w/St. Johns)
              Hofstra University School of Law
              New York University School of Law
              St. John’s University School of Law (Merge w/Fordham)
              At a stroke I have reduced New York’s contribution to the present legal crisis by nine law schools. Does my list seem so drastic? Buffalo, Columbia, Cornell, Fordham/St. Johns, Hofstra and NYU. All well-respected, good geographical diversity, reasonable range of tuition. I am sure that many will find this list objectionable, but here’s what I find objectionable: Students graduating with non-dischargable debt and no realistic prospects for employment in their field. Any institution of higher learning that isn’t troubled by that is, I think, acting in bad faith.

              You can play this amusing game with almost any state. Did you know that Alabama has five law schools? How many can you name? Before I looked into it I’d have figured it would have had two at the outside: Alabama and maybe a historically black institution. As far as I can tell there is no HBCU law school in Alabama. What they’ve got are a law school at ‘Bama (Roll Tide!); the Birmingham School of Law (providing “high quality affordable legal education to individuals who choose not to attend a traditional law school for financial, family or occupational reasons”); the Cumberland School of Law, at Samford University (the 11th oldest law school in the United States– Cordell Hull attended Cumberland, which moved to Birmingham from Tennessee in 1961);the Miles College School of Law a stand-alone entity, unaffiliated with any university, founded in 1974; and Faulkner (“As part of the Faulkner University community, the School of Law shares Faulkner University’s mission to glorify God by embracing academic excellence and emphasizing a strong commitment to integrity within a caring Christian environment.”) This Gavin Stevens fan is sad to report that just as there is no connection between Miles Davis and Miles College School of Law there is likewise no connection to William Faulkner at Faulkner.

              So here’s my question: Does the Yellowhammer State, with a population of nearly 5 million folks, need five law schools? Why? One’s basically a night school; one looks sketchy and religious; Faulkner is just plain old religious; and one– Cumberland– is a Tier 3 school that wasn’t useful enough to its hometown to hang on there. I mean, it’s not like any of these places are rolling out civil rights lawyers, are they?

              • TriforceofNature

                I disagree with you on CUNY-I think there should be a downstate public law school. Other than that I think you’re right.

                I generally think that public law schools should only be shuttered once the non-top private schools are shuttered and we still haven’t closed enough.

                I’m not sure where I’d draw the line on “top privates”. Georgetown has had pretty atrocious employment outcomes for a “top” school-I would say close it and GW and American and Catholic and Howard. But I think that leaves DC without a law school-it needs legal aid lawyers, not just K street lawyers, so they can keep one I guess.

                I would honestly, in a perfect world, close all private law schools outside of the Top 14-20ish. I think we would be fine.

              • TriforceofNature

                Hey! Charlie Crist went to Cumberland!

              • BoredJD

                I disagree with you on CUNY (tuition+fees 15K). Other than that, I like the analysis.

    • Murc

      If I had my way, we’d declare a Day of Jubilee for all student debt, with zero compensation for the holders of their notes, and higher education would be completely socialized, the same way primary and secondary education is.

      Sadly, this seems unlikely.

      • Brett

        Primary and Secondary Education aren’t completely socialized in this country. We operate a public system for them, but you could get the same thing by making the public colleges and universities free of tuition charges (which would also make them much more competitive to get into, but might raise quality).

  • NewishLawyer

    Out of curiosity, why do you think Toobin overstates the case about why HYS Law grads are insulated from financial or career difficulty? Someone will always hire you if you are HYS probably. I suppose they could develop horrible habits which would cause them to lose everything though?

    Tobin sounds a bit right. My alma mater was known for most of its history for supplying the bench and bar of San Francisco. Kevin Starr mentions this in his magnum opus history of California numerous times. Older lawyers (boomers and early Generation Xers and others) can recall a time when USF was really well respected in San Francisco and up until around 2000-2002 (maybe a bit later) it was pretty easy for USF grads to get jobs in the Bay Area. Not as much anymore. We went from being a well-respected regional law school to something that is almost but not quite a laughing stock. There are plenty of USFers who love the school and work as lawyers in the Bay Area but the graduates from the last few years have suffered greatly.

    • Paul Campos

      Even if we limit the “top law schools” to HYS, there’s nothing that says a third-year associate at a big firm that gets stealth laid-off is going to land on his or her feet. There are HYS people on the doc review circuit (which is also drying up btw).

      If we extend the concept of a top school more realistically the top 12-14 schools (out of 201 ABA schools), then there are plenty of people who graduate in dire straits.

      • Denverite

        I always look at it as a sliding scale. You’re not really guaranteed anything, even from HYS, a decade out, but your chances of doing well are a lot higher from a top school — well in excess of 50%, IME — than other places.

      • Marek

        Also, not all HYS grads go to biglaw, or can.

        • Denverite

          I dunno. If by “not all” you mean like one or two anti-social people [ETA: I had a potentially insulting term in here] at the very bottom of the class, maybe, but in general, the degree has enough cache that even people at the bottom can get some generic biglaw job.

          Now, a lot don’t want them, but that’s different.

          • Hogan

            aspies

            Um. Not cool.

            • Denverite

              That’s why I removed it and put in why I did.

              ETA: But sorry for being insulting.

              • Hogan

                Good catch. Sorry I didn’t give you the chance to correct first.

                • Denverite

                  No worries, it was my bad behavior to start with.

                  (For the record and posterity’s sake, I removed the insulting term before Hogan [properly] called me on it.)

      • Nobdy

        Not to mention the golden handcuffs effect. Even if you don’t get fired most people dislike big law, and your job eats your life. Sure you might not be economically destitute, but is that the only measure of a good outcome?

      • Crusty

        Understandably, young lawyers are focused on that first or second job, but your career needs to last way longer than that. Suppose a young HYS grad goes to a nice firm, realizes he’s not going to make partner/doesn’t want to be a partner and after six years, gets a nice job working somewhere like an investment bank or pharmaceutical company, as in-house counsel. Say he stays there for another six years or so, and the business he works for merges with another, and all of a sudden, the new merged entity feels it has redundant legal departments, and half are let go. Now, that HYS grad is twelve years out of school with no job and no book of business, and no skills that a seventh or eight year doesn’t have. Not an easy landing for him or her, despite HYS on the resume.

        The profession’s got some other serious issues about long term career options. Nobody’s particularly interested in these, but they’re serious. There’s very little training being done for younger lawyers and there aren’t opportunities for experienced, non-rain making senior lawyers. You might say tough, go out and get some business. Well sure, but in an environment where your firm is only looking for institutional clients, there are only so many institutions. Anyway, what were we talking about? Oh yeah, don’t go to law school.

    • L2P

      I don’t know exactly what Paul’s thinking about, but he’s right about the problems for Top 20 grads.

      There’s three hurdles a lawyer must leap to retire with a successful career. First, at graduation getting the first job. Second, making partner/of counsel/decently paid in government or public sector. Finally, not being let go for cheaper lawyers (or a loss of your practice area/change in billing that makes your area obsolete financially).

      HYS help with the first hurdle. You will get a good job. HYS doesn’t help much with hurdle 2. Once you’re working, no one cares about your credentials. It generally helps only to the extent that it helps networking (the AG is a fellow alum/in house counsel was a classmate/etc). It does absolutely nothing for the third hurdle; HYS doesn’t stop tax work from being unprofitable* or your firm from collapsing.

      *Unprofitable in the Big Firm sense of not being able to bill your clients $1,000/hour.

      I have lots of friends from HYS who were doing fine until LeBoeuf collapsed, or used to do estate work and now or struggling solo instead of being a partners, or had the firm tell them that their clients didn’t pay enough anymore and needed a different book of business. That’s hard for a 30 year old attorney to address. It’s virtually impossible for a 40 year old to recover from that.

      • Denverite

        I know someone with great grades from a tip top school have his biglaw firm go under AND his federal clerkship judge die during his 3L year. He ended up OK — less prestigious law firm and a less prestigious clerkship a few years after graduation, but jeez. Talk about the only luck is bad luck.

        • sparks

          You know, when massively bad things were happening in my profession years ago, two recent law school grads played the world’s tiniest violin for me when they heard what I’d been through. I’m evincing no real sympathy from reading your account here.

          • TriforceofNature

            What did Denverite ever do to you? When my dentist was making small talk with me and was a dick about my job situation I didn’t take it out on every dentist I ever met. What’s your profession anyway?

          • BoredJD

            Don’t worry, I think lawyers are used to it. But I do hope you feel some sympathy for the legions of non-lawyer support staff who are out of work and probably out of a job for good (the first ones to go are always the staff members).

  • Denverite

    You forgot:

    (5) NYLS needs to pay faculty top salaries to recruit new professors and keep current professors from moving back into a lucrative law practice.

    Take the top twenty candidates on the law teaching market who struck out this year. Compare any of them to any faculty member at NYLS who was hired more than a decade ago. Who has a better CV? Also, call a legal recruiter. Offer him or her $10,000 if he or she can find a big law firm who is willing to hire those same professors (out 10+ years) at a salary more than half of what he or she is making right now. Wait for the recruiter to stop laughing. Apologize for wasting three minutes of his or her time.

  • NewishLawyer

    FWIW (which probably is not much) here are my anecdotal observations on job searching.

    1. Some markets are much healthier and recovered more than others. NYC is much healthier than the SF-Bay Area. LA land is also probably healthier.

    2. If you can be a member of the patent bar, you can probably find a job.

    3. The job postings I see are hyper-specific and there are more postings for people with 3-4 or 5-8 years of experience than 0-3. The firms don’t want to do any on the job training. They also don’t want to deal with switch hitters and will say so specifically sometimes (i.e. no plaintiff to defense or vice-versa). My biggest problems right now are a lack of depo and trial experience because no one lets freelancers take or defend depositions.

    • rewenzo

      I graduated in 2012 from NYU. My experience jives with yours:

      1. NYC is a relatively healthy market, although I think it depends on your practice area. My experience is that all the job growth is in corporate and securities. Tax and bankruptcy are also strong and resistant to downturns. There’s lots of demand for patent guys, but that’s not so much a New York thing as it is a California and maybe BOS/DC thing.

      2. Agreed in regards to the patent bar. My school wasn’t a “you are guaranteed a $160,000 job if you want it” place – unless you were a patent guy, in which case your grades didn’t matter at all. Soft IP, on the other hand – good luck with all that.

      3. I think firms are looking for the magical 3-4 years of experience because the market’s been flooded with these laid off 3rd year associates. Why should they hire some kid with pretensions of making partner who they’ll have to train to review docs when they can cast a life preserver to some guy who knows his way around a brief who’s just happy to be employed and can be fired again just as easily?

      4. Some firms have programs to hire new grads at reduced rates. Duval & Stachenfeld has an extreme version of this where they hire new associates at two tracks. One at $160,000, one at like $70,000. The guys in the lower track are on probation and will be voted on by their colleagues making more money than them as to whether they’ll stay or not.

      Some large firms also have staff attorney positions, which could be on a 3 month contract basis but are regularly renewed. You’re not on track for partner or anything, and they pay less than $160k but you’re still earning a good salary. Trouble is, a lot of these firms keep these position secret so you have to apply at the right time or know someone who works there, which grads of top law schools will.

  • Murc

    You know, I am generally in favor of Professors being paid handsomely, and don’t look down on Professors who only teach rather than doing research. (Indeed, I think we need more of them!) And that level of compensation would pass by me without an eyeblink… if it weren’t for the fact that it is, basically, grifters cashing in on the short con.

    Those people are bad and should feel bad.

  • bobbo1

    And let’s not forget about the law firm staff – secretaries, copiers, runners, etc. – imagine the salary for the lowest lawyer on the totum pole and divide by four

  • NewishLawyer

    My parents are seemingly enamoured of the “old school” go knocking on doors with resume in hand version of job searching.

    I’m doubtful on the merits of this being useful. Maybe once upon a time but parents seem to love giving advice like this.

    • The Dark Avenger

      If the people hiring are your parents age, or mine, for example, (55), then I would pronounce their strategy sound. Besides, you could always use a good walk.

    • FMguru

      Is your dad Old Economy Steve?

      • NewishLawyer

        Not quite but a little bit.

        He did graduate from law school in the 1970s (night student) and was divorced and paying alimony. It took him a year to find his first law job which paid less than his teaching job.* And he also used to argue court cases at night in small claims court for the experience.**

        *You used to get a deferment from the draft for teaching in an socio-economically disadvantaged school district. My dad taught in Harlem. I think he once said that his students called him “whitey”.

        **Lawyers in small-claims court is not allowed in California. I do know another lawyer who was always solo but admitted that it is much harder now because the costs are higher and you can no longer really bring “soft tissue” car crash cases to court to cut your teeth and gain experience. Said lawyer also used to live in an SRO for 50 dollars a week.

        • LeeEsq

          I can’t even imagine the logic behind prohibiting lawyers in small claims court. Judges hate having to deal with pro se litigants because they generally need their hand guided through the process. Even a not so skilled lawyer makes things run considerably smoother for the judge.

          • The Dark Avenger

            Small claims cases in California are limited to claims of 10K$ and under. Not exactly a threat to the profession, IMHO.

  • BoredJD

    What Harper did well in his book and what Toobin missed, although it’s a good piece, is linking the mentality of the biglaw partners at the failed firms with that of the law school professors at the failing law schools. Both think of themselves as the Legal 1%, albeit in slightly different ways.

    Both, I think, have this mentality that their hard work, moxie and natural smarts got them to where they are now and this entitles them to reap the rewards and be cushioned from the blows of an unforgiving world. But at the same time, they are Not Responsible for the failings of their institutions. That’s the fault of broader cultural factors, or systemic influences from the outside. It’s a neat form of mental gymnastics.

    I was reminded of many defenses made by law professors as I read the quote from that Taibbi article where Eric Holder was explaining why DOJ wasn’t more aggressively pursuing banking executives for their role in the crisis: “any misconduct could again be considered more a symptom of the institution’s culture than a result of the willful actions of any single individual.” It’s not our fault- the government and the students forced us to take this money.

  • Manju

    Campos has tenure, right? Because this is what its for.

  • Dr. Ronnie James, DO

    Another commenter above suggested the base closure commission as a model. On a similar note, as a health wonk, I’m struck by how the medical profession was in similar straits 100 years ago: too many schools, too many students receiving poor instruction, etc.

    Then the Flexner Report (via the Carnegie Foundation) basically created new standards and regulatory models that addressed all the major problems at once. In one fell swoop, it put in place almost every aspect of medical training we have had for the last 100 years, with very few changes. It also resulted in roughly half the medical schools existing at the time closing in just a few years, greatly improving physician training (and ensuring doctors have had virtually full employment for a century). Granted, we’re now stuck with other problems re the physician workforce, but it’s an interesting paradigm:

    http://en.m.wikipedia.org/wiki/Flexner_Report

    • NewishLawyer

      The interesting thing is that a student at a mid-tier school probably receives something closer to practical instruction than a student at HYS. HYS are really built on much more theoretical and policy wonk models than your average law school.

      Not that your average law school is necessarily producing practical lawyers but the from what I’ve heard HYS students don’t learn about the 4 parts of a Negligence tort until BarBri. They get something more wonk-tastic about whether there are better alternatives to tort law for injured people.

      • Barry_D

        It will always be that way, and has been in multiple fields. The elite can worry about theory first, and get practical training on the job. The rest can’t.

        TL;DR – HYS are in a different world from us.

      • Srsly Dad Y

        Reminds me how I took Natural Resources Law because I actually wanted to learn it. We spent the first two days debating “What is a natural resource?” and it basically never got more specific.

      • Denverite

        The point of law school (and perhaps even more, the admissions process) is sorting. Learning anything in the process is just gravy.

      • Marek

        I understand the point of the story, but Torts is a required class at HLS, and includes the elements of proof.

  • Brett

    This sounds somewhat more plausible if you say it to yourself in a robot voice.

    It’s a reminder that it can take a long-assed time for your reputation to match your results in the marketplace, especially if you’re not under a ton of financial heat and are free-riding off of a reputation from when you were actually good.

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  • SausalitoSurfer

    A friend who works as a legal secretary at a large firm tells me that partner billing rates for 2015 exceed $1,000/hour. Senior associates will be billing $700+ and paralegals are $300/hour.

  • ricegol

    Campos has been relatively quiet the last few months – but comes out of his cage throwing haymakers – BRAVO and we must all bow before the master.

    For a “mainstream” news source, Toobin’s piece was very good to excellent. I also thought Toobin was a little too sanguine about the prospects of T-14 grads – while the employment data is “better” than at lower-tier schools, it is still unacceptable given the amount of debt. remember that while a good percentage of the students come from parental money, those who don’t are staring at 150k in debt and HAVE to get that biglaw job for at least 4-5 years – there is no luxury to go public interest or some other alternative type of practice.

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