Paul L. Caron

Friday, June 1, 2012

Brian Tamanaha's NY Times Op-Ed: Two Ways to Fix the Law School Mess

FailingNew York Times op-ed:  How to Make Law School Affordable by Brian Z. Tamanaha (Washington U.), author of the forthcoming Failing Law Schools (University of Chicago Press, 2012):

The economics of legal education are broken. The problem is that the cost of a law degree is now vastly out of proportion to the economic opportunities obtained by the majority of graduates. The average debt of law graduates tops $100,000, and most new lawyers do not earn salaries sufficient to make the monthly payments on this debt. More than one-third of law graduates in recent years have failed to obtain lawyer jobs. Thousands of new law graduates will enter a government-sponsored debt relief program, and many will never fully pay off their law school debt.

How did we get into this mess? And how do we get out?

Two factors have combined to produce this situation: the federal loan system and the ABA-imposed accreditation standards for law schools. Both need to be reformed.

First, consider the loan system. For more than three decades, law schools have steadily increased tuition because large numbers of students have been willing and able to pay whatever price the schools demanded. ... To restore some economic rationality, the federal loan system needs to demand greater accountability from law schools: those with a high proportion of recent graduates in financial trouble should lose their eligibility to receive money from federal loans. ... The money itself also needs to be reined in. One option is to cap the total amount that each law student can borrow from the government (at, say, a maximum of $125,000). ... [A]nother option is to cap the total amount of federal money that any individual law school can receive. ... Whichever cap is chosen, it will function properly only if the government refuses to guarantee private loans and if private loans can be discharged in bankruptcy, which would make banks leery of lending money to law students who are unlikely to repay. To make up for this, the law schools themselves would have to extend loans, thereby aligning their interests with the success of their students. 

Then there’s the problem of the ABA-imposed accreditation standards. ... [B]y imposing a “one size fits all” template, these standards ensure that there is little differentiation among law schools — no lower-cost options and no range of choices comparable to what exists at the undergraduate level among community colleges, teaching colleges and research universities. One solution to this problem is to strip away the accreditation requirements that mandate expenditures to support faculty scholarship — for example, deleting the requirement that the bulk of professors be in tenure-track positions, removing limits on teaching loads, not requiring paid research leaves for professors, not requiring substantial library collections and so forth. This would allow some law schools to focus on training competent lawyers at a reasonable cost while others remained committed to academic research. Law students would then be able to choose the type of legal education they desired and could afford.

If we don’t change the economics of legal education, not only will law schools continue to graduate streams of economic casualties each year, but we will also be erecting an enormous barrier to access to the legal profession: the next generation of American lawyers will consist of the offspring of wealthy families who have the freedom to pursue a variety of legal careers, while everyone else is forced to try to get a corporate law job — and those who fail will struggle under the burden of huge law school debt for decades.


Update:  Paul Campos (Colorado), And the New York Times Said Law Is Dead:

[L]et's consider what's going on ... in the legal sector. Over the last twelve months the legal sector has added a total of 4,800 jobs. Keep in mind that at best perhaps 70% of these jobs have been filled by attorneys, since the sector includes all support personnel (paralegals, administrative positions etc.). So we can estimate that there are about 3,000 more attorneys employed in America today than there were a year ago.

Now a certain number of people who were working as attorneys a year ago aren't today, because they've died, retired, moved into other lines of work, or have simply become unemployed. The BLS estimates the total annual "outflow" from the profession to be about 13,000 people at present. So that means that about 16,000 lawyer jobs have been filled over the last 12 months by people who weren't working as attorneys at the time they moved into these jobs.

Note this does not mean that 16,000 new law graduates got real legal jobs, since some unknown number of these jobs were filled by unemployed attorneys who moved back into the legal work force. It's true that the 2011 NALP stats claim that 25,654 of the nation's 44,258 2010 law graduates had a full-time job requiring a law degree nine months after graduation.  This blog has been dedicated to, among other things, explaining why that (atrocious) 42% functional unemployment rate for new lawyers is actually seriously understated.

The BLS statistics suggest that the real unemployment rate for new lawyers is more on the order of 63%, if "employment" is defined as having a real legal job, as opposed to the the almost unlimited number of fake legal and quasi-legal jobs the NALP statistics count as full-time employment requiring a law degree.

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Another factor is that students who take out loans assume they are guaranteed a well-paying job post-education, and in our current and foreseeable economy this is hardly the case, which just adds to the difficulty of repayment.

Posted by: tax debt relief | Jun 1, 2012 12:22:41 PM

The problem with all this is it assumes the only function of law schools is to get students high-paying jobs and thus a positive "return on investment." If that is true, why not simply abolish law schools, and allow the profession to provide its own training as in virtually every other country? The only possible justification for seven years of lawyer education is that there is something more to the profession than this, and none of this trendy handwringing really addresses this.

Posted by: michael livingston | Jun 2, 2012 10:08:32 AM