I have a piece in Salon about the Voting Rights Act case the supremes heard today.
Also, I’m closing down my other place. I’ll still report and comment on the law school mess here from time to time.
Steven Brill of The American Lawyer and CourtTV fame has a very long story in the new issue of Time on some of the more absurd financial dysfunctions of The Best Health Care System in the World(tm). In short, TBHCSITW has managed to do to society at large approximately what law schools have done to their students:
When we debate health care policy, we seem to jump right to the issue of who should pay the bills, blowing past what should be the first question: Why exactly are the bills so high?
This is same question that ought to be asked of the many law school apologists who treat the increase in the cost of legal education as something akin to a law of thermodynamics, as opposed to a fabulously successful exercise in
rent-seeking by people who have captured a regulatory process.
Critiquing that exercise highlights how the law school cartel has managed to do something which has completely eluded the bar as a whole. A question well worth investigating is why the licensed members of The Best Legal System in the World(tm) have, in comparison to their medical brethren, been so unsuccessful at using their own cartel to protect the economic position of lawyers, as opposed to that of law schools.
Consider some numbers:
In 1989, legal services accounted for approximately $157 billion, in 2005 dollars, of US GDP. In 2011 that same figure (again in 2005 dollars) was $156 billion. Over this time GDP increased by 68% in constant dollars, which means that, as a share of the economy, the legal sector shrank by approximately 41% over the past two decades.
Meanwhile law schools have increased graduate output by 24% over this same time frame, while the cost of private law school tuition doubled in real terms, and that of resident public law school tuition increased by a factor of nearly five. In other words, we’ve radically increased both the price and the supply of something (a license to practice law) whose relative economic value has been collapsing.
The situation in the medical profession has been the precise opposite. After medical school admissions
rose rapidly from the mid-1960s through the 1970s, the AMA reacted to warnings that there would soon be a “glut” of doctors by essentially freezing medical school graduate totals for three decades (Medical schools graduated around 16,000 to 17,000 people every year between 1980 and 2008. Finally, in reaction to new warnings that the country is facing a severe shortage of doctors, medical school admissions began to rise again about five years ago).
The most striking contrast between the situation in law and medicine is, that while economic demand for legal services has, relatively speaking, been contracting radically (note to law school administrators: economic demand = people having enough money to pay for something they’re willing to use that money to pay for), that for medical services has gone through the roof. Between 1980 and 2008, the proportion of American GDP devoted to the health care sector increased by an astounding 77.8%.
Now of course doctors only captured part, and perhaps a relatively small part, of that increased demand in the form of their direct compensation. But what the AMA has been remarkably good at ensuring is that, with trivial exceptions, everyone who graduates from medical school gets to be a practicing physician for more or less as long as they want to be. That is, in the context of capitalism’s gusts of creative destruction, an extraordinarily valuable benefit — and it’s why comparisons between the “average” compensation of doctors and lawyers, or, more far more accurately, between graduates of medical schools and law schools, are essentially meaningless.
Here’s Brill’s description of the plight of large numbers of patients within the contemporary American health care system: “They are powerless buyers in a seller’s market where the only sure thing is the profit of the sellers.” That would also make for a good description of large numbers of law students within the contemporary system of legal education. Of course law school apologists would respond that buyers of legal education are not powerless in comparison to, say, buyers of health care who are suffering a medical emergency or from a serious illness. And that’s true — which is precisely why, now that the power of better information has been placed into their hands, applications to law school are collapsing even faster than the economic demand for legal services.
In an example of what could be called the ongoing Dilbertization of academic life, every year CU law school faculty members are required to do a “self-evaluation,” which is supposed to supplement and enlarge upon the formal report of professional activities which all faculty at the university are asked to submit.
This year’s version of what seems vaguely like a hybrid between the rituals concocted by business consultants and Maoist cadres contains the following question:
For the period since January 2011, please discuss your engagement in the life of the law school, focusing on the following:
Please describe your support for and involvement with the effort to recruit admitted applicants (e.g., making phone calls, meeting with interested students, participating in Admitted Students lunches, etc.).
I suppose it would come as a great surprise to the administrative class that comes up with this stuff to be told that, under current circumstances in particular, this sort of question is extremely inappropriate. For instance, compare it with this hypothetical question:
Please describe your support for and involvement with the effort the convey to the larger community that the American legal system is the best in the world.
Everyone, I imagine, would recognize that evaluating faculty members on the basis of the extent to which they participated in such an effort would be indefensible, given that such an evaluative process would reward and punish faculty on the basis of their willingness to support a controversial intellectual and political position, even though it’s one that law school deans as a pragmatic matter treat as self-evidently true upon certain occasions.
Expecting faculty to uncritically “recruit” admitted applicants could only be a reasonable expectation if, at a minimum, one takes the view that literally everyone the law school’s admissions committee decides to admit would be better off accepting rather than declining that invitation. A significant number of the faculty at my school disagree with that view, although perhaps only one of them would be so tactless as to say so in public. Telling these people that they’re being evaluated on the basis of their willingness to mortify their consciences on this particular point is wrong. Actually doing so is even more indefensible. (This is not a hypothetical: I know of at least one faculty member who was sanctioned in the evaluation process for giving candid advice to an admitted student who solicited it, and who enrolled subsequently at a top ten law school. For those interested my response to the self-evaluation question was: “I believe this question is framed incorrectly, as I don’t believe faculty members should be ‘recruiting’ admitted applicants. I do believe it’s a faculty member’s proper institutional role to give candid and helpful feedback to admitted or prospective applicants when they ask for such feedback, which I have done on numerous occasions.”).
What I find particularly interesting about this is the extent to which university administrators have now internalized the norms of profit-maximizing businesses. In this evaluative context, recruiting admitted students is thought of as moving product, and apparently it would no more occur to an administrator that a faculty member would object to be asked to participate uncritically in this enterprise than it would occur to the manager of a car dealership that members of his sales force might object to being asked to participate uncritically in the enterprise of selling the dealership’s stock.
And of course this is not only a problem at law schools. As academia gets increasingly indistinguishable from any other business, the tension between the demands of profit maximization (in the context of technical non-profits profit maximization means running the institution for the financial benefit of its most powerful internal stakeholders, i.e., administrators, and to a lesser extent tenure-track faculty) and intellectual honesty become ever-more severe.
In the end, if universities are going to be run like businesses, they should be treated as such — from paying taxes, to being laughed at when they ask alumni for donations. After all, Toyota doesn’t call you up five years after you bought a Corolla, to ask you to give them some money out of sheer gratitude for the “quality” of their “product.”
Ronald Dworkin has died.
This incident reminded me of the following story:
A few years ago Dworkin wrote a remembrance of Learned Hand, for whom Dworkin clerked. At the time Dworkin was engaged, and he was keen to know if Hand was going to follow the policy of other judges in Hand’s circuit, which was to use their government-funded administrative budgets to give clerks a bonus in the form of a month’s extra salary at the end of the clerk’s term. So Dworkin inquired anxiously of the judge if he could expect to receive the bonus.
Hand explained to Dworkin that he disapproved of this practice, because he thought it was wasting taxpayer dollars, and that it was especially unjustifiable in his case, since Hand had already taken senior status, and was technically retired.
Shortly afterwards Dworkin sent Hand an invitation to his wedding. Hand’s reply included a personal check, equal to a month of Dworkin’s salary.
I’m a casual fan of the NBA, while my wife is a fairly hardcore Nuggets supporter. (Oddly she developed her initial affection for the team about seven years ago when she was working in the Denver DA’s office, within the confines of which the then-roster was known collectively as the Thuggets). So we watch most of their games on TV.
Last night the broadcast cuts into the game with highlights from Philly v. Charlotte, which among other things feature Gerald Henderson hitting a jump shot.
Me: Gerald Henderson is still in the league? He must be close to 40!
Spouse: Who’s Gerald Henderson?
Me: You know, the guy who used to be on the Celtics.
A quick check of the internets reveals that Gerald Henderson, formerly of the Boston Celtics, played his last NBA game 21 years ago. The guy hitting the jump shot is his son.
I have a piece here on this week’s kerfuffle over the relationship between Chris Christie’s weight and his presidential ambitions.
Yesterday I wrote at length about some of the most egregious misrepresentations in University of Denver law school dean Martin Katz’s plea for more applicants. My colleague Deborah Merritt reveals that I failed to note perhaps the most outrageous feature of Katz’s “analysis” of why his law school remains an excellent value proposition:
Katz opens by appealing to authority. He tells potential applicants:
Last year, Forbes magazine – a respected source on value investing – touted the value of a legal education, referring to law school as a “relatively low-risk investment that will have an impact on your future and can pay exceptional dividends over a lifetime.”
This advice seems to fly in the face of the chorus of critics of legal education who would have you believe that going to law school today would be a terrible investment. So who is right? Forbes or the critics?
Though popular perceptions might lead you to follow the critics, the smart money should follow Forbes’ advice.
Trust Forbes, not the critics! It’s a good line, except that Forbes did not endorse legal education in the way that Katz implies. The column cited by Katz was not written by “Forbes” or by any member of its editorial staff. It was written by a Forbes “contributor” named Shawn O’Connor. O’Connor is the CEO of StratusPrep, a company that offers LSAT test prep classes and law school admissions coaching.
Stratus will happily charge you $1,599 for its basic LSAT prep course. If you want more, you can pay for plenty of other services–all the way up to $7,180 for the “Diamond, All-in-One Package” that includes the LSAT class, 10 hours of LSAT tutoring, law school admissions counseling, and a law school “boot camp.” Do you think O’Connor has a financial self interest in urging people to consider law school? Do you think his recommendation carries different weight than one from “Forbes”?
A sidebar to O’Connor’s post explicitly states that “[t]he opinions expressed are those of the writer,” not those of Forbes. That’s a distinction that Dean Katz doesn’t bother to make in telling prospective students that Forbes, “a respected source on value investing,” has “touted the value of a legal education.” If Dean Katz wants to tell applicants that the CEO of a company that makes lots of money selling LSAT prep courses has “touted the value of a legal education,” that’s fine. But he should be honest about his sources.
Forbes has published numerous columns about law schools and the legal job market. Contributor Peter Cohan, a management consultant and venture capitalist, asked just last week: Does America Need 202 Law Schools? Cohan suggested that “law schools are highly profitable for the professors and administrators,” that “radical changes in the way law is practiced means that the high tuitions imposed on aspiring lawyers to get that law degree are less likely to pay off,” and that “law schools do not want to teach students the nuts and bolts of lawyering.”
And then there was J. Maureen Henderson’s column headlined Why Attending Law School Is the Worst Career Decision You’ll Ever Make. Henderson, another Forbes contributor, described the “misleading stats” disseminated by law schools, the “scant 8% of 2011 grads [who] are working at firms that employ 250 or more attorneys,” and the “dismal” starting salaries for lawyers in small towns or rural areas.
There was even a column by my law school classmate, Deborah Jacobs (who is actually on the Forbes staff as a Senior Editor) detailing The Case Against Law School. In that column, updated just last week, Jacobs discusses the high debt incurred by law students, the “abysmal job market,” and the ways in which technology, outsourcing, and other practices continue to squeeze that market.
I’m not going to catalogue all of the posts about law school published by Forbes. There may be other contributors, like O’Connor, who think law school is a good investment. That’s not the point. The point is that “Forbes” has not “touted the value of legal education” and Dean Katz should know that.
ABA Accreditation Standards, Rule 509:
Standard 509. CONSUMER INFORMATION
(a) All consumer information that a law school reports, publicizes or distributes
shall be complete, accurate and not misleading to a reasonable law school
student or applicant. Schools shall use due diligence in obtaining and verifying
consumer information. Violations of these obligations may result in sanctions
under Rule 16 of the Rules of Procedure for Approval of Law Schools.
Last spring I participated in a “debate” with Martin Katz, dean of the University of Denver’s law school, at a bar association event. It turned out not to be much of a debate: I presented the argument I published subsequently in my article The Crisis of the American School, and Katz, who had read a draft of the article, said he basically agreed with that argument.
I don’t actually know Katz, but from the few encounters I’ve had with him over the years, he seems like a very bright guy, as well as a pleasant, charming person. These qualities naturally made me want to think well of him. On the other hand, because I realize such qualities are useful if you’re a politician, or a university administrator, or an investment banker, or a serial killer, etc., I’m also aware that as a rational matter being smart and pleasant and charming has exactly nothing to do with one’s character, or lack thereof.
This time the rich people are trapped in the Super Dome.
The New York Times has a front-page story about the ongoing collapse in the number of people applying to law school (from 100,700 in 2004 down to about 54,000 this cycle, with a 38% total decline over the last three years alone). The story features some nice quotes from Brian Tamanaha and Bill Henderson regarding the dysfunctional economics of law school, which is important, because as any legal philosopher can tell you, in this culture the ontological status of an epistemological insight is greatly enhanced when it appears on the front page of the NYT. (“They wouldn’t print it if it wasn’t true.” F. Nietzsche, trans. J. Jackson.)
Oddly, the story fails to mention the crucial role the law school transparency movement, to which the Times gave such valuable attention in 2011 in a series of prominent stories, has had in all this. It’s hardly a coincidence that most of the collapse of the applicant pool has taken place over the last two years, which happens to be when something resembling accurate employment and salary statistics have been extracted from law schools via political pressure.
The story also features this strange claim:
“We have a significant mismatch between demand and supply,” said Gillian K. Hadfield, professor of law and economics at the University of Southern California. “It’s not a problem of producing too many lawyers. Actually, we have an exploding demand for both ordinary folk lawyers and big corporate ones.”
She said that, given the structure of the legal profession, it was hard to make a living dealing with matters like mortgage and divorce, and that big corporations were dissatisfied with what they see as the overly academic training at elite law schools.
This is a very peculiar use of the word “demand.” Big corporations have put the squeeze on BigLaw, because they’ve decided they will no longer subsidize the training of junior associates to do work people trained to be lawyers should do. Even more problematically for the Cravath model, they’ve also decided they won’t pay BigLaw rates any more for essentially clerical work. So firms can’t bill out a lot of what first and second year associates do, and a lot of other work that such people did is now outsourced to the document review mills and to non-lawyers.
In other words, client demand for various services that used to fatten the bottom lines of the big firms has imploded, not exploded, because it has been shifted to other service providers, or is no longer billable when performed by the firms themselves. This is a structural not a cyclical shift: it’s not as if GCs are going to decide that when and if more deals are being done it’ll be OK for firms to bill out monkey work at $300 an hour again.
The “overly academic training” at law schools has nothing to do with this. That’s an issue about failing to train people to do legal work. The collapse in demand from BigLaw clients is a product of the realization that a large amount of work traditionally done by lawyers can be done by non-lawyers with either no loss of quality, or not enough loss to make it worthwhile to pay the added cost of having lawyers do it.
The claim about “ordinary folk” is even stranger, but it’s one that’s being made a lot these days by legal academics desperately searching for a raison d’ paycheck. The argument goes something like this:
(1) Many people in this country who could benefit from legal services aren’t getting those services because they’re too expensive.
(2) Those services are too expensive because law school costs too much.
(3) If future lawyers could go to law school without incurring so much debt, they could afford to offer legal services at a price that far more people could afford to pay.
(1) is certainly true. (2) and (3) are just wrong, and obviously so.
The cost of legal services has almost nothing to do with the cost of law school. Why would it? No client cares about how much it cost you to get a law degree, which means that no client is willing to pay more for legal services because a lawyer has a lot of educational debt. This theoretical claim is confirmed by empirical observation: there are literally hundreds of thousands of lawyers in America who went to law school when it was radically cheaper than it is today, and it’s not as if they charge lower rates than recent law graduates (if anything they charge on average more more, because clients will to some extent pay for experience as a proxy for competence).
There are also hundreds of thousands of people with law licenses who are barely making a living by practicing law (A 2009 survey of Alabama lawyers found that 23% of the respondents with active law licenses had an income of less than $25,000 in the previous year). Such people are charging the absolute minimum they can charge while still maintaining an ongoing business.
The notion that the hundreds of thousands of lawyers in solo or very small practices in this country could somehow operate by billing out their services at X dollars per hour (with X being a figure that lots of “ordinary folk” currently priced out of the market for legal services could pay) if only law school didn’t cost so much is one of those ideas that sounds intuitively plausible until you actually think about it for three minutes, which is apparently why people in legal academia don’t.
The reason ordinary folk don’t pay for legal services even when in theory they could benefit from them is exactly the same reason they don’t pay for a lot of things they could in theory benefit from: because they don’t have any money for those things after paying for more pressing needs like food, shelter, clothing, medical expenses, transportation to work, etc.
Comments such as Hadfield’s indicate the lengths that legal academics will go to in order to talk themselves into believing that the basic problem isn’t really the basic problem. And that problem is that the economic demand in this country for people with law degrees will employ (at best) half the people who are paying us to grant them law degrees.