NY TIMES OP-ED FOLLOW UP

My August 25 Op-Ed in The New York Times went viral. It became number one on the Times’ “most-emailed” list. It rose to the top-five in “most viewed,” “most shared on Facebook,” and “most tweeted.” Within hours of publication, it generated more than 600 comments.

It also produced letters to the editor, three of which the Times chose to publish on September 2. Two are from law professors whose responses reveal why the current crisis in legal education is so intractable.

Letter #1

Milan Markovic is an associate professor of law at Texas A&M. He argues that current law students will soon have better job prospects because there are fewer of them:

“Not all of these students will graduate and pass the bar, but those who do will face much less competition for legal jobs even if the economy fails to improve.”

Professor Markovic perpetuates the sloppy analysis infecting virtually all academic discussion about law student debt and the crisis in legal education. In particular, his macroeconomic prediction about the fate of future graduates ignores a crucial fact: job opportunities vary dramatically according to school.

A 2018 graduate from Professor Markovic’s school — Texas A&M — will not have employment prospects comparable to students at top schools that regularly place more than 90 percent of their new graduates in full-time long-term bar passage-required positions. In that key category, Texas A&M’s employment rate for 2014 graduates was 52 percent.

Likewise, only three Texas A&M graduates in the class of 2014 began their careers at firms where attorney compensation is highest (that is, firms with more than 100 lawyers). Like the JD-required employment rate, big firm placement is another indicia of a school’s relevant market. That’s not a value judgment; it’s just true.

In fact, Professor Markovic is a living example of the distinct legal education submarkets. In 2006, he graduated from the Georgetown Law Center, which placed 281 of its class of 2014 graduates — more than Texas A&M’s entire 232-member class — in firms of more than 100 lawyers. Before Professor Markovic began teaching in 2010, he spent four years as an associate in two big law firms — Sidley Austin and Baker & Hostetler.

Let’s Run the Experiment

Professor Markovic objects to introducing law school accountability for employment outcomes. He argues that any reduction in federal funding “will not lead to less demand for law school or other graduate programs. Rather, students will turn to the private loan market, and private lenders will be only too happy to lend because graduate school loans — and particularly those allocated to law students and medical students — have historically been very profitable.”

Let’s run that experiment. But first, let’s create something resembling a functional market for legal education. Start by adopting my proposed sliding scale of federal loan guarantees based on each individual law school’s employment outcomes. In such a system, a school’s poor job prospects would mean a reduced loan guarantee amount for its students. Then implement one more change to the present regime: make law school debt dischargeable in bankruptcy.

Will private lenders be “only too happy” to make six-figure loans to students at any marginal law school, including places where fewer than half of graduates are finding jobs requiring a JD? Let a real market decide.

Letter #2

Professor Jeremy Paul is dean at Northeastern University School of Law. His letter to the Times editor notes correctly that many Americans cannot afford legal services and analogizes the situation to doctors.

“No one would say we had an oversupply of medical students if millions of Americans resorted to self-medication and treatment because they could not pay for a doctor,” he writes.

One commenter to Tax Prof Blog countered Professor Paul’s analogy with this one: “How can anyone say there are too many restaurants when there are still so many starving and malnourished people in the world? That’s how 12-year-olds think, not lawyers, which I’ve heard is law school’s reason for being.”

For the indigent needing legal services, there are not enough lawyers. But that’s because our society isn’t willing to pay for them. Based on the funding trends for the Legal Services Corporation and the federal government’s current obsession with austerity, the future in that respect is bleak. Compared to 1985, Congressional appropriations to the LSC are down 50 percent (in constant 2013 dollars).

Other than complain about the government’s failure to make the universal right to counsel in civil cases a priority, I can’t do anything about that problem. Neither can Professor Paul. But politicians’ reluctance to fund legal aid positions does not justify burdening today’s graduates with enormous educational debt for a JD that won’t lead to a paid position requiring that degree.

Experiments with Other People’s Student Loan Money

Professor Paul also observes that some law schools and bar associations are launching “incubator programs aimed at helping law graduates to serve clients of modest means.” That’s true. I was on the committee that developed such a program with the Chicago Bar Foundation. Will they result in more solo practitioners who, over the long-term, can squeeze out a living and a satisfying legal career? No one knows. But the participants in those programs are a drop in the bucket compared to the vast numbers of law graduates annually who can’t find JD-required jobs.

Like Professor Markovic, Dean Paul knows there’s no unitary legal education market. He graduated from Harvard Law School in 1981. For Northeastern Law School — where he has been dean since 2012 — the full-time long-term bar passage-required employment rate for the class of 2014 was 53 percent.

Completing the Circle

Professor Paul’s final observation is that “studies show that a law degree remains a sound investment…”

Which takes us back to the pervasive and persistent academic canard that aggregate data matter to individual decisions about attending particular schools. What study tracks outcomes by individual law school to “show that a law degree remains a sound investment” for graduates of every school?

No such study exists. But for those determined to resist necessary change in the broken system for funding legal education, magical thinking combines with confirmation bias to trump reality every time. Federal student loan subsidies unrelated to student outcomes encourage otherwise thoughtful legal academics to become unabashed salespeople.

Think of it as your tax dollar at work.

Would Professor Markovic and Dean Paul — among many others who similarly ignore the crisis in legal education — counsel their own children to attend a marginal law school that, upon graduation, assured them of six-figure debt but offered only dismal JD-required employment prospects? It probably depends on how they feel about their kids.

5 thoughts on “NY TIMES OP-ED FOLLOW UP

  1. I am a Texas A&M alumnus, and I am so disappointed with TAMU over buying Wesleyan and garnering their own law school that I will not donate anything to them. It’s pains me to say that as an Aggie, but it pains me more than TAMU is taking advantage of students when they ought to know better. Not exactly an “Aggie Code of Honor” sort of endeavor.

    Markovic his a nice resume, but let’s be honest here – he wants a cushy LawProf gig; who cares about actual student outcomes. It’s all a shame, really.

  2. It should be noted that the Class of 2014 represents the first time since the heightened ABA disclosures began with the Co2011 that Northeastern Law managed to put more than half of their graduating class into FT, LT, license-required jobs at any salary. Over the last four years, they have not managed to average 50%, meaning they didn’t even successfully place two years’ worth of graduates in those four years.

  3. You ask if a professor would counsel their own children to attend a marginal law school that, upon graduation, assured them of six-figure debt but offered only dismal JD-required employment prospects?

    You fail to understand that law school is a no lose opportunity thanks to the gov’t repayment programs. If my child did not have any good options after college (and that’s most college grads today; if you didn’t get great grades or study something useful you’re likely looking at a job at starbucks), I’d suggest giving law school a shot. Why not. They get to live in a cool city like New York, LA, Washington DC etc. and the gov’t not only covers their tuition but also their living expenses. They can get more from the gov’t for living expenses than starbucks would pay.

    And its a heads you win, tails someone else loses deal. If they do great and get a job making lots of money they win. If they can’t get a job, they never have to pay more than 10% of their income (zero if they make below the poverty line) and then their debts are forgiven in 20 years. And if they get any job with state, federal, local gov’t or any non-profit, their debt is forgiven in 10 years.

    I’d say, if they don’t get the job they want after law school, do some more school. Maybe and LLM or a MBA. The gov’t is essentially paying them to do more school by loaning them money for living expenses they don’t have to pay back.

    Now you can be upset that this is a wasteful gov’t program but don’t claim it’s hurting students. Students are getting a three year vacation paid for by the government. And if you want to attack wasteful gov’t program there are plenty in defense and health care that waste ten times what law schools do.

    • I assume you’re being facetious. (You gave yourself away when you referred to law school as a “three-year vacation.” Only someone who had never been to law school — or was kidding — would make such a comment.)

      IBR is certainly a benefit to many students, but even if it survives ongoing efforts at government austerity, it’s not a reason to attend a marginal law school. For example, during the entire IBR pay-back period — 10 years for public service jobs; 20 years for all others — interest continues to accrue on the deferred principal. If a person drops out of the program before completing the requisite period, all of that accumulated interest and principal is due.

      Likewise, as the Dept. of Education explains, there are other pitfalls, such as the phantom income and resulting tax (for non-public service workers) that on loan balances that are forgiven at the end of the 20-year period:

      “Income-driven repayment plans may lower your federal student loan payments. However, whenever you make lower payments or extend your repayment period, you will likely pay more in interest over time—sometimes significantly more. In addition, under current Internal Revenue Service (IRS) rules, you may be required to pay income tax on any amount that is forgiven if you still have a remaining balance at the end of your repayment period for an income-driven repayment plan.”

      Meanwhile, those who by virtue of their qualification for IBR can’t afford very much get to fork over 10 percent of their discretionary income. That’s like an ongoing surtax on lower- and middle-income workers. Apart from the immediate constraints on spending, such payments will delay household formation — things like getting married, having kids, buying a home, saving for retirement, and the like.

      For that price, the student gets the worst three-year vacation ever.

  4. I see that Prof. Paul, the Dean at Northeastern Law, has never been a fulltime practicing lawyer. He did one stint as a “professor in residence” in DOJ’s appellate division in the late 1980s. This is part of the massive trouble in U.S. law schools. They are overrun and controlled by career academics, who never had any intention of practicing law — many wanted to study things like history or philosophy but realized that law professors get paid much more money than, say, history professors — because their salaries are supposed to be at least somewhat competitive with those paid to actual lawyers. It used to be that many law professors had distinguished careers BEFORE entering academia, and/or continued to be active participants in the legal profession. Now there is not even a pretense among many legal academics of having any experience in, or respect for, the actual practice of law. You would never see such a thing in academic medicine. Even medical researchers have to do more than merely theorize and pontificate. Most legal academics simply could not work as lawyers — yet they demand a pay scale commensurate with that kind of work, on top of the generous paid time off the job that practicing lawyers don’t get until they retire. I’m sad to see this, as I myself have a lot of respect for good lawyers.

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