Paul L. Caron

Tuesday, January 20, 2009

Is the Law Professor Gravy Train Over?

New York Times (Jan. 18, 2009):  The Last Professor, by Stanley Fish:

I have argued that higher education, properly understood, is distinguished by the absence of a direct and designed relationship between its activities and measurable effects in the world. ...

It may be fun to argue its merits (as I have done), but that argument may be merely academic – in the pejorative sense of the word – if it has no support in the real world from which it rhetorically distances itself. In today’s climate, does it have a chance?

In a new book, The Last Professors: The Corporate University and the Fate of the Humanities, Frank Donoghue ... asks that question and answers “No.” ... Except in a few private wealthy universities (functioning almost as museums), the splendid and supported irrelevance of humanist inquiry for its own sake is already a thing of the past. ...

One vision, rooted in an “ethic of productivity” and efficiency, has, he tells us, already won the day; and the proof is that in the very colleges and universities where the life of the mind is routinely celebrated, the material conditions of the workplace are configured by the business model that scorns it. The best evidence for this is the shrinking number of tenured and tenure-track faculty and the corresponding rise of adjuncts, part-timers more akin to itinerant workers than to embedded professionals. ... Universities under increasing financial pressure, he explains, do not “hire the most experienced teachers, but rather the cheapest teachers.” Tenured and tenure-track teachers now make up only 35% of the pedagogical workforce and “this number is steadily falling.” ...

People sometimes believe that they were born too late or too early. After reading Donoghue’s book, I feel that I have timed it just right, for it seems that I have had a career that would not have been available to me had I entered the world 50 years later. Just lucky, I guess. 

Forbes (Jan. 14, 2009):  The Great College Hoax, by Kathy Kristof:

Accepted into the California Western School of Law, a private San Diego institution, [Joel] Kellum couldn't swing the $36,000 in annual tuition with financial aid and part-time work. So he did what friends and professors said was the smart move and took out $60,000 in student loans.

Kellum's law school sweetheart, Jennifer Coultas, did much the same. By the time they graduated in 1995, the couple was $194,000 in debt. They eventually married and each landed a six-figure job. Yet even with Kellum moonlighting, they had to scrounge to come up with $145,000 in loan payments. With interest accruing at up to 12% a year, that whittled away only $21,000 in principal. Their remaining bill: $173,000 and counting.

Kellum and Coultas divorced last year. Each cites their struggle with law school debt as a major source of stress on their marriage. "Two people with this much debt just shouldn't be together," Kellum says.

The two disillusioned attorneys were victims of an unfolding education hoax on the middle class that's just as insidious, and nearly as sweeping, as the housing debacle. The ingredients are strikingly similar, too: Misguided easy-money policies that are encouraging the masses to go into debt; a self-serving establishment trading in half-truths that exaggerate the value of its product; plus a Wall Street money machine dabbling in outright fraud as it foists unaffordable debt on the most vulnerable marks. ...

Not only are college numbers spun. Some are patently spurious, says Richard Sander, a law professor at UCLA. Law schools lure in minority students to improve diversity rankings without disclosing that less than half of African-Americans who enter these programs ever pass the bar. Schools goose employment statistics by temporarily hiring new grads and spotlighting kids who land top-paying jobs, while glossing over far-lower average incomes. The one certainty: The average law grad owes $100,000 in student debt. "There are a lot of aspects of selling education that are tinged with consumer fraud," Sander says. "There is a definite conspiracy to lead students down a primrose path."

AALS Committee on Research Program (Jan. 9, 2009), Citations, SSRN Downloads, U.S. News, Carnegie, Bar Passage, Careers: Competing Methods of Assessing Law Schools (podcast):

  • Bill Henderson (Indiana):
    • 25:30: "Employment outcomes do not turn on your U.S. News ranking."
    • 25:55:  At 50 law schools, 20% of the students are either unemployed, flunked out, or are unknown, yet the ABA and LSAC disavow the use of data to rank law schools.
  • Richard Matasar (Dean, New York Law School):
    • 1:16:50: "We are an input-focused business, and outputs are what the students are paying for."
    • 1:20:40:  "Law school needs to be about what people need -- not what we're good at. ...  Most of us are social misfits, and we're the ones who've been designated to teach the students how to work interpersonal skills."
    • 1:21:20:  "We should be ashamed of ourselves.  We own our students' outcomes. We took them. We took their money. We live on their money to pay to come to San Diego. And if they don't have a good outcome in life, we're exploiting them. It's our responsibility to own the outcomes of our institutions. If they're not doing well ... it's gotta be fixed. Or we should shut the damn place down. And that's a moral responsibility that we bear in the academy. It's a leadership responsibility that each of us has. And damn the U.S. News if it affects our rankings. The kids are not gonna show up. Do you know that LSAT registrations are flat to down this year. That students' applications to law school are flat to down in a substantial number of law schools. That's never happened in a downturn in the economy before. They're catching on. Maybe this thing they are doing is not so valuable. Maybe the chance at being in the top 10% is not a good enough lottery shot in order to effectively spend $120,000 and see it blow up at the end of three years of law school.
  • Jason Solomon (Georgia):
    • 1:29:20: "We're mad as heck and we can't take it anymore. ... To the panelists and others in the room: what are we going to do?  Are people from AALS leadership here?"
  • Bryant G. Garth (Dean, Southwestern):
    • 1:32:00:  "This group has stonewalled completely and killed any kind of real consumer information for 20 or 30 years, and that's what made U.S. News own this particular enterprise. And it's something that maybe those that stonewalled for some long might have to take some initiative and responsibility in remedying the situation we find ourselves in."

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"...Why should anyone perpetuate a system of student loans where only 10% of graduates are able to make a living? The other 90%, and society as a whole suffers, when people go into default. Society suffers when large numbers of people have to draw unemployment, or when large numbers of people cannot afford health insurance...."

"...Americans understand this. The anger at the banking industry, and the fury at CEO compensation are just the beginning..."

Yeah, right. What do you really think is going to change? The only way to take care of the problem is to get rid of the crack cocaine that drives the system - federal student loans made possible by Uncle Sam, with artificially low interest rates, to boot. Take this away and the schools lose their ammunition to raise prices. Hell, half of the TTTs would be out of business immediately.

However, you (yes, you) would scream bloody murder if congress ever did this, which they of course know all too well. Congress does what all sensible politicians do and instead of being honest with voters they feed them the crap they respond to, in this case empty promises to "make college more affordable" by providing even more crack cocaine loans to the lemmings and their middle class parents. The law schools in turn say thanks, suckers! and jack up tuition. Middle class parents everywhere willingly oblige, whatever the price, as they're so desperate to have their kids "do better than they did" as well as have something to brag about at the next cocktail party.

Want somebody to blame? Look in the mirror.

Posted by: hahaha | Feb 3, 2009 11:28:30 PM

I am a registered nurse and an attorney and my dual degrees have served me well. I do however tell nurses who contact me about law school to do their research and really consider their options before taking the plunge.

Posted by: Latonia | Feb 3, 2009 6:58:00 PM

I have a problem with the numbers in the Forbes article. They don't add up. 12% (simple) interest of $194,000 is $23,280 per year. How do you get $145,000 in loan payments equaling only $21,000 in principal plus a rough estimate of $23,300 or $24,000 in interest? Maybe the couple's total student loan bills were $45,000 and not $145,000. But that would make the story much less compelling.

There are a lot of flaws with this story. Both of them eventually got 6 figure jobs, yet they still couldn't pay off their debt?

Posted by: ............ | Feb 3, 2009 2:34:04 PM

The Education Industry is much like OPEC, regulating supply in response to demand. Instead of building more universities to produce more lawyers, we regulate the building of universities and colleges to thereby regulate the production of educated workers. How else do you expect to keep artificially inflated lawyer fees from deflating? This is happening right now in the housing industry, the banking industry, the oil industry, and more. This is nothing more than an education cartel. Abraham Lincoln was self taught, open exams to all people rather than to the select few "produced" by the Educational Industry.

Posted by: Kiba | Jan 28, 2009 6:57:13 PM

We plainly have far too many law schools. Not that standardized tests tell the whole story, but when you have a host of law schools whose institutional median LSAT scores are at, near or below the national median score, something is clearly out of whack. During the last several decades, law schools popped up everywhere because they provided a profitable way for lazy (albeit highly credentialed) lawyers to make a buck with little effort. No doubt, many of these schools are truly predatory.

That said, prospective lawyers also need to take ownership of their life plans. Before I went to law school 13 years ago, I resolved not to go unless I got into a top tier school. I do not believe that great lawyers necessarily must come from such schools. But that's largely the view of the legal marketplace (which makes exceptions for the top few per cent of the class at less prestigious schools). The problem really is that many would-be lawyers simply fail to do their research beforehand. And while the situation is bad now, the massive oversupply of lawyers is nothing new. So go into the process with your eyes open.

Posted by: Nick | Jan 27, 2009 9:07:36 PM

Oh man, that must have been so scary when that guy put a gun to your head and forced you to go to law school.

Did you really think law school was a magic money machine where you could invest $120k and get out $80k a year for the rest of your life? Did you really think freaking law school is the best investment in the history of mankind? If so, you are an idiot. Nobody is guaranteed a job. If you can't find one, hang a shingle. These comments are pathetic.

Posted by: ch | Jan 25, 2009 9:59:09 PM

I agree with almost every comment so far. As a 3L looking for a job that doesn't exist facing mountains of debt, I am ashamed, depressed, and increasingly unhappy.

I worked at non for profits before law school thinking that getting my JD would give me a shot at the higher paid non profit positions (40,000 a year maybe) but now that I realize the debt will cripple that possibility and limit the jobs I can actually take (since 20,000 a year won't pay my bills and my DEBT) I am completely dis-enfranchised.

Also the government programs for debt forgiveness require you to consolidate your debt and just like getting credit none of the lenders are currently allowing people to consolidate. So that option isn't always as viable as it appears.

Law School is a scam and I am sorry it has happened to so many good people. All my friends I have made in school our genuine sweet people who now have become increasingly anxious. We all would have been better without the degree no matter how many times they try to convince themselves otherwise.

Posted by: 3L | Jan 23, 2009 7:53:21 PM

A few points from someone who is currently in law school (full disclosure: my school is ranked around 75th in the nation).

(1) Why is this complaint only being made now? Have law schools only recently begun taking advantage of students? Or is the complaint being made now because it is convenient to blame law schools when the economy sucks and people all over are having a tough time finding a job? This seems like the same argument underwater homeowners are making - when housing prices were going up, I made money because I am smart...when housing prices began to decline, I lost money because I was scammed. The free market doesn't work that way my friends - you must live with the good results and the bad and take accountability for both.

(2) I attend a public university and am a resident in the state where school is located. In-state tuition at a public law school is not expensive. In fact, I would call it a bargain. It probably costs less than or the same amount as one year of private law school.

If you pay $120K to attend a private law school ranked outside of the Top 50, then you are stupid, plain and simple. You have not weighed the costs and benefits of your decision and probably should be denied admission to graduate school because of your stupidity.

I honestly do not understand how these weak private programs exist. Well actually I do - they exist because there are a bunch of stupid people who are willing to pay to attend. So I'll rephrase - I don't understand how so many Americans make this dumb choice year after year - wouldn't the students from the previous graduating class tell them its not worth it???

(3) Are you not considering the fact that a lot of people just want to be lawyers? Not everyone goes to law school to get a big firm job. Plenty of students at my school want to be prosecutors or public defenders or work for public interest organizations. Granted it would be dumb to pay private tuition if you want to take a lower paying job like the ones mentioned above.

Posted by: JDH | Jan 23, 2009 6:23:20 AM

I have a problem with the numbers in the Forbes article. They don't add up. 12% (simple) interest of $194,000 is $23,280 per year. How do you get $145,000 in loan payments equaling only $21,000 in principal plus a rough estimate of $23,300 or $24,000 in interest? Maybe the couple's total student loan bills were $45,000 and not $145,000. But that would make the story much less compelling.

Posted by: cathy | Jan 23, 2009 6:19:45 AM

I laugh at those lawyers on this blog bloviate about some greater purpose in the law, condemning students and attorneys who went to law school to make money. As though the practice of law is some constitutes some greater contribution to our society.

Meanwhile, the past decade has given us prestigious law firms which were so obsessed with their profit-per-partner business model that they escalated hourly rates past the point of no return. Corporations - the sole entities who could actually afford to pay $1,000 per hour to a lawyer in a big case - finally stood up and proclaimed "we are not going to pay your insane rates anymore." Hence, prestigious firms are now going out of business. These are the same folks who gladhanded each other between speeches at their "ethics" seminars that the rest of us had to pay $400 to attend due to CLE obligations.

Law Schools deserve blame for selling a false dream that never existed in the first place. It would have been a hell of a lot cheaper for those of us who relied on their employment after graduation numbers if they had not been skewing the data, and instead had been providing a sober outlook for what the practice of law entailed for 70% of those in the profession - namely a large amount of student debt coupled with diminishing employment prospects.

Posted by: agpc | Jan 21, 2009 6:36:17 PM

Let's look at this in the context of the housing crisis.

Say 100 people bought homes with subprime mortgages. 10 people were able to keep their homes. 90 people lost their homes to for3closure. This is not a good net result for society.

90 homes are now abandoned. Their value declines, making them a burden on the banks who own securities based on these mortgages. These homes then become a burden on society, because they cause homes nearby to fall in value.

A system that benefits a small minority, while placing a heavy burden on the large majority, is not sustainable. Everyone suffers. The global economy is in shambles because of it.

Why should anyone perpetuate a system of student loans where only 10% of graduates are able to make a living? The other 90%, and society as a whole suffers, when people go into default. Society suffers when large numbers of people have to draw unemployment, or when large numbers of people cannot afford health insurance.

Americans understand this. The anger at the banking industry, and the fury at CEO compensation are just the beginning.

Posted by: SB | Jan 21, 2009 5:20:36 PM

I entered law school under the impression that I was going to get a job that would pay at least the same as my Union job, but without having to perform the physical work. I was making 90k plus including overtime, and I had deceided, what career would provide me with similar wages? I was not afraid of working long hours, having already been working 50-60 a week for 20+ years.
Silly, silly me thinking that I would be able to make six figures as an attorney. How was I to judge how I would rank in my lawschool and that this was the ONE of the biggest qualifications for a job. How about that I went part time at night while working full time? How about that I am limited to the schools I could apply because I was still working? I had students in my evening classes that didn't have a job and I was competing with them for grades.

Law schools are just a business like any other. Optimize the bottom line, make more, and that is it. They do not care about the students one bit.

Posted by: who knew? | Jan 21, 2009 2:29:52 PM

The truth is that the law schools engage in outright lying. The employment statistics for my school are completely false. One makes a reasonable good faith reliance on a law school's employment statistics. It is not feasible for an applicant to hire a forensic accountant to conduct an audit of every career center. Nor is it feasible for the applicant to conduct a study on his/her own. I graduated from a decent school, passed the bar, am unemployed and the career center can't help me. If this is not an indictment of the American education system I don't know what is. I was told that I should get an education to achieve the so called "American dream" and all I have now is a pile of debt.

Posted by: davidfriedlander | Jan 21, 2009 1:18:31 PM

I thought the new loan repayment laws would allow 10% of income payment/mth on salary above 150% of the poverty level on consolidated federal loans over a 25 year period. Further, I understood the new law also dismisses debt after 25 years, and ten years or 120 payments spent in public interest law, consecutive or not.

Second, as a recently admitted "underrepresented minority" 1L trying to do the right and responsible thing, I find it criminal that many (most) law schools and scholarship funds offer NO assistance to part-time students who cannot afford, cannot, or do not want to take out Grad Plus or private loans to pay the difference between the 20.5K Stafford will pay and the remainder of tuition and fees and the cost of attendance. I for instance, "in light of my impressive credentials" was being considered for a scholarship at one school I am admitted to, only to find out that it was a "mistake" on the part of the Asst. Dean of Admissions part for not realizing I was part-time. When pointing out this dilemma, in a private aside chat, with the said Asst. Dean during one of the law schools "informal chats," I was told to "just relax" and brushed off while he responded to a full time student in regular chat about how prestigious said scholarship was and that that is why she should apply.

Get a good job? Learning to practice vs theory a plus? Give me a break. How about a remedial ethics course and gut check for the deans, administrators and scholarship foundations leading us down this further marginalizing path of debt? And what about part-timers?

What a joke. and btw, and contrary to popular opinion here, many of us older than average students are not going into law because of the money, we are going into it because we have a passion for the law and for trying to help the avg american out--something the law hasn't focused a lot of attention on either. Maybe it is time for a paradigm shift? Thanks to Stanley Fish for the reader response opportunity--hope it amounts to more than just thought and words.

Shame. Shame.

Posted by: 1L | Jan 21, 2009 11:12:35 AM

Grueling admissions process? Your joking right? You take a test and write a paragraph, that no one actually reads. Applying to b-school (5 essays, which were actually read, 3 rounds of interviews and 2 GMATs) was much more involved, but still I wouldn't call it grueling, not even close.
That's the real problem with law schools... they attract people with 0 perspective.

Posted by: | Jan 21, 2009 10:18:10 AM

You chose to incur $150,000 of debt for a 10% chance at a good job. In fact, choice isn't the right word. You begged for it. You went through a grueling application process just for the chance. You weren't one of the few who got good jobs. You were in the majority of grads who got bad jobs. You knew these odds going in, and now you want to get a "redo." Sorry, there are no redos in life.

And let this be a lesson to the 5,600 kids applying to schools like NYLS right now. You could very well wind up in the same crummy situation you are in right now. But do you think this warning will stop them from applying? Not a chance. Because NYLS offers some chance at a good job. Their current situaton offers zero chance.

Posted by: Reality | Jan 21, 2009 9:18:05 AM

As my law firm interviews potential associates, we have found that a lot of the smaller schools have shifted the focus of their education to practical application rather than legal theory. It seems that their students are much better prepared to practice law from day one than the students from larger schools. This is refreshing in that we do not have to teach them how to practice after we hire them. I believe this is the future of education, and it will increase student's chances of employment after graduation.

Posted by: Josh | Jan 21, 2009 6:03:47 AM

And closing down law schools won't eliminate poverty. The reason most kids go to a tier 2/3/4 ("TTT") law school is because they've graduated college and can't find a job (other than waiter, telemarketer, admin and so on.) No one forces them to attend. They are the ones who go through a grueling application process to get in. 5-10% of these kids wind up with good jobs. Without law school 0% of them would have good jobs.

So better that the other 95% gets saddled with 150k of nondischargeable debt?

What are you on?

Posted by: Whatareyousmoking | Jan 21, 2009 3:09:44 AM

Yeah, uh, Reality? You do realize that now close to 100% of these students have crushing levels of debt that cannot be discharged in bankruptcy? The schools misled students into spending $100,000 and three years of forgeone opportunities, based on the .05% return. That is horribly irresponsible.

Posted by: IU grad | Jan 20, 2009 8:07:18 PM

New York Law School received 5,600 applications last year for about 500 spots.

Touro law school received 2,200 applications for 250 spots.

So although apps are down, they're not down enough to put any schools out of business.

And closing down law schools won't eliminate poverty. The reason most kids go to a tier 2/3/4 ("TTT") law school is because they've graduated college and can't find a job (other than waiter, telemarketer, admin and so on.) No one forces them to attend. They are the ones who go through a grueling application process to get in. 5-10% of these kids wind up with good jobs. Without law school 0% of them would have good jobs.

Posted by: Reality | Jan 20, 2009 12:14:56 PM

Gee. Less than half of entering black students ever pass the bar? Apparently things have softened up since I went to law school back in the dark ages of the 70s. Each of the classes was reduced by one-third each year, and even the classroom size was based on this hard fact of law school life. At the end, one-third of us were left to make it to the bar. Then, in California at least, about one-third of us taking the exam actually passed. Survival of the fittest. Admittedly, the top tier schools passed at a higher rate, but it was tough, tough, tough. No wonder there are so damned many lawyers and so few good ones. I think that has very little to do with race, and a great deal to do with too many false incentives to get into a profession that is truly on the skids.

Posted by: LawhawkSF | Jan 20, 2009 11:57:49 AM

What I find most interesting about this is that the law schools that emphasize scholarship continue to attract the best students, while those that talk about providing "outputs" to students typically attract weaker ones. So who is really doing what students want and who isn't? Universities, and law schools, that fail to maintain scholarly excellence will always be also-rans.

Posted by: mike livingston | Jan 20, 2009 7:45:56 AM

The points made clearly extend beyond law school to higher education in general.

One question not addressed is how an even modestly-efficient market has not responded to the over-pricing of education. Are the incentives and feedback mechanisms so mismatched as to preclude correction?

Posted by: Robert Arvanitis | Jan 20, 2009 7:37:45 AM