Paul L. Caron

Monday, October 17, 2011

Campos: Occupy Wall Street and Law Schools

OccupyThe Daily Beast/Newsweek, Occupy Wall Street's Age Divide, by Paul Campos (Colorado, Inside the Law School Scam):

I am a baby boomer. Like many people my age, I have a high-paying and generally pleasant job, which features excellent benefits and a flexible work schedule. I’m also one of those people who, not long ago, would have dismissed the Occupy Wall Street protesters as just another bunch of spoiled kids, indulging in political street theater, while lacking any serious and constructive agenda. ...

99%I am, in other words, part of what could be called the Clueless Generation. The Clueless Generation is made up of middle-aged, professionally successful people, who grew up in a nation that featured a mostly thriving economy, low-cost higher education, and some minimal commitment to economic justice. As a consequence, we graduated from school with little or no debt, got good jobs that featured real possibilities for advancement, and have on the whole ended up doing very well for ourselves. ...

A lot of us have also become insufferably smug and complacent. Over the past year I was lucky enough to be jolted out of my own smugness and complacency by a series of painful encounters with recent law school graduates. I began to investigate the question of how many law graduates were getting jobs as lawyers, and discovered that a shocking percentage—more than half—were not.

Since I went to law school in the 1980s, the cost of legal education has quadrupled in real terms, thereby ensuring most current law students will graduate with six figures of debt from law school alone. Meanwhile legal employers are downsizing and outsourcing, to the point where the ratio between new lawyers and new jobs for lawyers is approximately two to one. And most of the new jobs don’t pay enough to allow even those who are lucky enough to get them to pay their educational debts.

My attempts to bring this economic and human crisis to the attention of the law-school world have been met mostly with denial and incomprehension. It seems the Clueless Generation is largely incapable of grasping that this is no ordinary downturn in the business cycle, but rather that America is no longer the same country in which we were so fortunate to come of age.

For the still largely unacknowledged crisis in legal education merely mirrors the vastly larger crisis in our society as a whole. Millions of young adults are graduating from college and professional schools with massive amounts of educational debt—debt that, thanks to sweetheart legislative deals which lined the pockets of bankers, cannot be discharged in bankruptcy. In just the past decade, total outstanding educational debt in America has risen more than five-fold, from $180 billion to nearly one trillion dollars. ...

What the Clueless Generation finds difficult to comprehend is that literally millions of highly educated and hardworking young Americans—people who followed all the rules and did everything we told them to do – are either severely underemployed or have no jobs of any kind. Meanwhile, they struggle with the massive educational debts they incurred after the baby boomers decided that access to the bargain-priced higher education from which we benefitted wasn’t so important after all.

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It is really not so complicated.

1% control and manipulate the economy, committing fraud and tax evasion pretty much at will.

1% control and manipulate the federal government, by owning politicians.

The 99% are not happy.

Middle aged and older Americans are being beaten down also, just to be clear.

[401(k) statements have been arriving, and the middle class is really, really not happy.]

Posted by: save_the_rustbelt | Oct 17, 2011 4:34:33 AM

He neglects to mention that he probably voted democrat all his life and that his party fully supported making student loans non-dischargeable in bankruptcy. And controlled by the govt. to boot.

As is typical, once his demographic cohort got theirs, they pulled the ladder up behind them.

Oh, and that the law firm he works for is fully on-board with outsourcing legal work to India.

Posted by: Jack | Oct 17, 2011 5:24:10 AM

"What the Clueless Generation finds difficult to comprehend is that literally millions of highly educated and hardworking young Americans—people who followed all the rules and did everything we told them to do – are either severely underemployed or have no jobs of any kind. Meanwhile, they struggle with the massive educational debts they incurred after the baby boomers decided that access to the bargain-priced higher education from which we benefitted wasn’t so important after all."

Ah . . . not really.

I have three sons. Two went to college and graduated. One is still in college. Both of the graduates are gainfully employed. (The one in college works summers.) Those three did exactly what I told them to do -- work hard, go to college and (listen carefully here because many of my sons' generation did not) get a degree in *something that will get you a steady job* or learn a skilled trade (there is a screaming need for CNC operators), and do not go head over heels in debt to get an education.

I gave that same advice to my nieces and nephews.

My sons either got scholarships (the oldest) or attended community colleges while living at home for the first two years before transfering to excellent state schools to finish their degrees. All saved up money prior to college. All got (or are going after) engineering degrees. None of them left college with excessive student loans, despite offers of "free money" from their schools.

As I said, my kids have jobs. There is still a screaming demand for people to fill engineering jobs. Hey, their 50-something father found a new job in engineering just 32 days after getting laid-off from the last one. And I am not *that* outstanding an engineer. So please don't tell me that there are no jobs for engineers. (My company and my middle son's company have numerous openings even now.)

As for my nieces and nephews? They all got liberal arts degrees. They went to expensive private or out-of-state colleges because those were more prestigious than the sucky community colleges or in-state schools their cousins chose to attend. They all accumulated student loan debt. They partied for four years while taking cupcake courses. They are have minimum wage or low-paying jobs.

Of course their parents told them to "follow their dreams."

And they feel my kids "got lucky" and should bail them out.

To quote John Wayne: "Life is hard. It's even harder when you are stupid."

Posted by: Mark L | Oct 17, 2011 5:38:19 AM

Well, income redistribution will never be easier and less controversial. Any Baby Boomer who feels that his life returns are likely to exceed those of his children to an extent not explainable by the quality of the personal choices of all involved has every opportunity to share his success with his descendants and their families. That is why we worked our asses off; that's what we saved for. Any plan that goes beyond suggesting the need for parents to keep this in mind are either indulgences in self-righteousness or the leading edge of different forms of injustice.

Posted by: MG | Oct 17, 2011 5:44:26 AM

And I blame the Federal Government's student loan programs for this disaster. Not everybody needs a degree and we need the plumber just as much as we need the hydraulics engineer.

Posted by: Zain | Oct 17, 2011 5:44:26 AM

I never assumed I would "get a job" after law school. I assumed I could practice law. And yet, I wasn't even prepared by law school for that, only to write memos. Practicing law was something I had to teach myself after law school.

My real property teacher said he had no idea how to prepare a deed, but he could explain fee tails, which have been outlawed for hundreds of years, in detail, and expected us to learn about them as well.

Posted by: MarkInFla | Oct 17, 2011 5:56:38 AM

"we told them to do"? Who is this we, he speaks of? He must only be talking to the other loser early boomers who couldn't be bothered to teach the children well. Instead the rigged the game for the kids all along the way. Well, the kids should have listened to young early boomers to "Never trust anyone over 30".

And there is no evidence of millions of highly educated and hardworking young Americans being unemployed. There are millions of highly credentialed unemployed. And they don't come into the job as hardworking, but most do respond to a swift kick in the backside they should have gotten at 14.

What is this "underemployed"? You got a job, you do your job to the best of your abilities. And you look for a better job if you think you can do more. Perhaps the job doesn't match the credentials but perhaps it matches the usefulness of those credentials. Just because you have a Masters in things only your professors care about, doesn't mean you will get paid to think about those things or that your studies of those things in anyway made you more useful to an employer than a high school drop out. So get over it. Oh, and the higher your credential the less useful you can become especially when you add in a false sense of entitlement.

But there is a problem, I propose that we let them clear student loans through bankruptcy after a 5 or 10 yr period of legitimate efforts to pay them off, only they lose the credential. They can keep and use the education but the credential is rescinded.

Posted by: JKB | Oct 17, 2011 6:00:42 AM

He states:

"Millions of young adults are graduating from college and professional schools with massive amounts of educational debt—debt that, thanks to sweetheart legislative deals which lined the pockets of bankers, cannot be discharged in bankruptcy. In just the past decade, total outstanding educational debt in America has risen more than five-fold, from $180 billion to nearly one trillion dollars. ..."

Who in their right mind would ever loan this money to them, at low rates of interest, if it could be discharged by bankruptcy? I don't think this provision was caused by "sweetheart deals", it followed from necessity.

Posted by: Mick Langan | Oct 17, 2011 6:17:59 AM

The useless degree to a certain extent is true at all levels. I was in the IT industry beginning in the 70's. Then anybody with a degree in CS worked for a computer manufacturer. All the work at regular companies was done by people without degrees or with something else. Since then a bachelors degree is required, (doing the job doesn't really require it), and often now I see companies looking for a Master's. Why, it cuts down on the number of job applications that you have to look at.
We have created a credentialed society that looks good but is not really necessary. Research Universities push students towards a PhD but when I got mine in 2008, after 28 years in the IT industry, there was 13 faculty jobs and about 1,000 people graduating with the PhD. Do I have one, no. I am a lecturer, making an okay living but enjoying it tremendously. I was downsized like crazy in the IT industry because I got "too experienced" to be hired anymore.
I tell people look at the building trades - to a major extent those skills will keep you employed and often better than a college required job.

Posted by: Rich | Oct 17, 2011 6:42:26 AM

He's right about one thing. He's certainly clueless. And stubbornly sticks to it.

Posted by: BlogDog | Oct 17, 2011 6:52:35 AM

I like JKG's idea. And as an early "Boomer" who didn't do all that stupid stuff, I get pretty doggoned tired of all those weenies apologizing in my [and others'] name.

I've been telling my kids and my students for many, many years about not taking out big loans to get worthless degrees. [I'm still amazed at the sheeplike looks I get from undergraduates with a low B GPA and bunny courses and degree when I tell them they probably shouldn't go to law school. Evidently tv shows have convinced them that all lawyers make big money forever.]

The "real Rules of the Game" are no different than they have been since at least the early 1900s. The fact that some people decided the Game had changed doesn't matter.

I truly would like to see some of the pain abated, but stupid doesn't change unless it is forced to.

Posted by: JorgXMcKie | Oct 17, 2011 6:54:36 AM

I appreciate that student loan debt is a huge problem for a lot of recent law school grads, but I reject the notion that older generations of lawyers are somehow responsible for it, let alone that they're "clueless" for not personally agonizing over their younger counterparts' financial misfortunes.

Making student loan debt dischargeable in bankruptcy is being bandied about as a supposed easy fix to this problem, but it would amount to a bailout. Banks that hold the student loan assets would presumably take a huge hit as a result of the wave of bankruptcy filings that would ensue. Obviously a lot of other kinds of debt (credit cards, for example) would be wiped out from those filings as well. Who is going to make up those losses? Taxpayers? Consumers? Other borrowers? No thanks.

Posted by: Conrad | Oct 17, 2011 7:01:48 AM

I have little sympathy for people who went to law school. If they were too blinded by dollar signs to do the research and realize the marketing simply couldn't be true, that's their problem. I have $40k of grad school debt for a degree I now don't even use. I found a job I could actually do, something completely different than anything I got my degree in. It was a big pay cut from what I expected to make, but I am working and slowly over the next three decades hopefully I can pay that debt off. I'm not asking for additional assistance from anyone, it was my mistake to make and mine to solve.

Posted by: Ben | Oct 17, 2011 7:37:37 AM

This is a problem all law schools share. Enrollment should be cut. Everywhere. The people at the higher ranked schools cannot just sit back and say - "well, we can raise enrollment because people are still hiring our grads" -- and then take larger and larger entering and transfer classes. When higher ranked schools take on larger transfer classes, lower ranked schools then add to their entering classes to make up the difference. This collectively adds to the market glut just as much as Cooley opening a new campus.

Posted by: Jeffrey | Oct 17, 2011 8:16:58 AM

Love it MarkinFla. My experience was much the same. I graduated from a T14 school (many years before USN&WR popularized such entities), knowing lots of interesting legal theory, taught to me by extremely bright, arrogant, and socially maladjusted former SCOTUS law clerks. Fortunately, my tuition for three years totaled about $10k. My first job (lasting 33 years) was with the U.S. Dept. of Justice, where I was paid about $5k less than a first year associate in a big law firm. I learned trial practice from some old DOJ codgers who had learned to try cases by trying cases. When I retired 33 years later, I was still making $5k less than a first year associate in a big law firm. But at least I can call myself a trial lawyer without wincing.

Posted by: Publius Novus | Oct 17, 2011 8:48:24 AM

We need to have a national conversation about innovative economics in the age of austerity. Two outstanding issues in our national debt are home mortgages and student loans. They are a drag in the national economy. Perhaps we should consider a cram down for both. Reduce principal and interest for home mortgages and make student loans dischargeable in bankruptcy.

Yes, there will be screaming about that, but I suspect most of the screaming will be done by the wealthy 1 percenters.

This will, of course, result in an increase in interest rates for home mortgages and student loans, but, I could argue that this would be ultimately beneficial in the long run.

Posted by: Anonymous | Oct 17, 2011 10:15:03 AM

Let's review the bidding. There are a lot of young people who have huge debts which they incurred to pay for "educations" that left them unemployable. And the people who should feel guilty about this are older people whose educations enabled them to get jobs?

What about the people who have jobs providing lousy educations? Where is their accountability? Why are they allowed to tell absurd, self-serving lies to gullible young people and stick them with unpayable debts? If the universities had to guarantee their product, there would be a lot fewer majors ending in "Studies".

Posted by: Jerome | Oct 17, 2011 10:28:01 AM

Wow, that sign about says it all. If there were TRUE transparency in the educational marketplace, then I believe the problem would take care of itself. The paradox of higher ed is that it has become one of the biggest drains on economic efficiency.

Posted by: Matt | Oct 17, 2011 3:21:56 PM

Professor, do you really believe there is or was a law school advertising a 99.9% employment rate post graduation? I understand the trend to bash law schools and graduate schools in general fueled by an excess of liberal federal loans, but a healthy dose of skepticism is needed here. And if this sap really believed it, well, maybe they weren't law school material.

Let's not all bow down every time the victim card is played, even if it's in accord with the view that there is a growing bubble in higher education.

Posted by: BoulderGuy | Oct 17, 2011 4:10:44 PM

Anonymous at 1:15 -- like your "cram down" idea. Let's give it a try.

Come to work for me. I'll pay you a modest salary, but promise a large performance bonus if you can make me rich. If you get there and demand your bonus, I'll cram down my debt to you.

This would be ultimately beneficial in the long run. I'd get rich. You'd win the philosophical debate. A win-win solution.

Please get in touch soon.

Posted by: Jake | Oct 17, 2011 6:42:13 PM

Nell Lynch Nell Lynch I'm a baby boomer and I graduated college at the beginning of our nation's worst recession in history, 1973. I got a job paying $9000 a year, just barely enough to support myself at the time. For the next 8 year I sometimes had to make the choice between buying gas to get myself to work, and buying lunch. If I got a parking ticket I had to do without dinner for a few nights. I don't know what baby boomer generation this guy is from, but it's not mine. He obviously wasn't looking for a way to support himself in the 1970's. My brother quit law school in 1973 because half of the school's graduating class at that time couldn't find jobs as lawyers either. Our protests usually weren't about not getting our share of things, they were about peace and racial and gender equality. How dare anyone call us the Clueless generation when all of America, especially this young generation of "occupiers" has benefited and lived the results of real and focused civil disobedience that actually changed America, brought about by the baby boomer generation. Obviously those college degrees you're paying off didn't include lessons in American history.

Posted by: Nell Lynch | Oct 18, 2011 5:29:25 PM

I am glad that many people in this thread feel happy and comfortable with the way that things are going in our country. Other people, however, do not feel the same way.

This disparity is generally the driving force behind our nation's economic unhappiness over choices made in the last 30 years.

Posted by: Anonymous | Oct 19, 2011 7:37:01 AM

$9,000 a year in 1973 is equivalent to $43664.77 today. This is a salary that most college grads would gladly take today, even though their tuition costs have increased by an order of magnitude in comparison to 1973. So you graduated with little/no debt due to low tuition costs and made solid money, but still had trouble deciding between buying $0.19/gallon gas or a 5-cent coke and a 25-cent burger? I don't doubt that some boomers weren't as comfortable as Campos, but you're definitely clueless about inflation.

Posted by: ry | Oct 19, 2011 7:58:49 AM