Lowering Law School Tuition Mainly Benefits Students, Taxpayers

Gotta be quick, but Brooklyn Law School dean Nicholas Allard writes in The Chronicle of Higher Education, “Lowering Law-School Tuition Benefits Everyone, Not Just the Students,” which deserves comment.

The fact is that the financial model of law schools is broken. Unless the schools do what they can to make legal education more affordable, they will price themselves out of business, contribute to the high cost of legal services that most people need, and widen the gap in access to justice.

The first sentence is true, but the rest is questionable. Many people will not go to law school at any price, but some schools will survive if they slash tuition. However, tuition has little to do with the cost of legal services and access to justice (not the justice of rents to legal educators).

Allard appears to believe that high tuition leads to high debt, which leads to lawyers not taking public interest jobs that pay less then courtroom janitors. It’s odd because two paragraphs later, he mentions Public Service Loan Forgiveness and Pay-As-You-Earn, which falsify his thesis. If highly indebted graduates want to serve the poor, they should be able to under the current loan-repayment framework. Sure, the proposed caps on PSLF would be bad for debtors and are based on the belief that they over-borrowed rather than the schools over-pricing, the government over-lending, or the jobs-underpaying, but graduates do not often pass up public interest in favor of biglaw. Not everyone gets such a choice.

It is a shameful canard that student loans and indebtedness are the cause of high tuition. They are not; they are the symptom. Tuitions at law schools are soaring … because of the way law schools spend money in pursuit of rankings rather than investing in students, education, professional training, and scholarship.

Not sure what Allard means here, but I think it’s the closest I’ve seen to a law school dean rejecting the Bennett hypothesis. Without excessive federal lending, law schools couldn’t raise their costs. It’s the means of the tuition bubble, not the motive and opportunity—if you fancy looking at this like a murder mystery.

With political currents eroding America’s historic and successful support for higher education, we can’t expect anyone else to help. We must do what we can to break this cycle ourselves. By making law school expensive for motivated, talented women and men, we are shortchanging ourselves. In this country, lawyers have played the central role as guardians of our democratic republic and architects of economic opportunity and prosperity. They will be needed even more in the future.

Political support for legal education has not been a success. It’s created too many law schools, too many law school graduates, and too much unpayable student debt. For example, the NALP just reported that the percent of 2013 graduates employed at all in February 2014 had fallen—negligibly—to 84.5 percent, even though late last year Dean Allard predicted, “[T]he employment rates reported in 2014 will be substantially higher than in 2013.” (More on the NALP report another time.)

Look, good on Brooklyn Law School for unilaterally cutting its tuition next year. It may not be a voluntary rather than demonstrative act like if an elite law school did it to buck the U.S. News rankings, but we can have competent lawyers without student loans and expensive law schools.

On a 25-year fixed repayment the average 2013 Brooklyn Law grad would have to cough up over $750 a month to make his or her student loan payments on $110,000 in debt. Even under the old IBR system, that would require an income of $121,600 per year from day one to escape loan cancelation after 25 years. Since many BLS grads don’t make that kind of income, many will undoubtedly take PAYE and the government will have to write-down the losses. Thus, Allard is right: The beneficiaries of lower law school tuition aren’t just law students but everyone else. Although, it is a “shameful canard” to imply that the federal loan program is a blessing for everyone but law schools and a handful of lucky law students.

After the JD Wave 0

Last month I wrote an article for the The Am Law Daily about the After the JD project, a longitudinal study that measures employment outcomes for people who passed the bar exam in 2000. I thought it might be interesting to offer, as an appendix, the Official Guide‘s employment outcomes for Y2K law grads (they’re in the ’03 edition). Obviously, this isn’t a perfect fit as some people who passed the bar in 2000 graduated earlier, but the overlap should be fairly significant.

Back in those days, though, the Official Guide wasn’t the treasure trove of knowledge that the ABA’s employment questionnaire reports are now, and it’s certainly not as detailed as the After the JD’s information is. However, for those interested in getting a sense of the legal market many of the After the JD cohort entered into by law school, look no further.

To conserve blog space, the tables will follow the jump.

Continue reading

Record 14 Law Schools Didn’t Report 2013 Graduate Debt to U.S. News

Record, that is, going back to 2009. If you have data from earlier, lemme know.

Each year, accompanying the U.S. News rankings is the online magazine’s list of law schools by graduate debt. The law schools are required to report this information to the ABA, but the ABA inexplicably doesn’t release it to the public, even though it’s one of the most useful things people studying law schools would like to know about. Instead, the ABA takes an unweighted average of the numbers and posts it in this pdf. Thus, for some reason, we must rely on U.S. News, and of course, law schools can decline to transmit their graduates’ average debt numbers.

On average, about four law schools (excluding Widener University’s Harrisburg campus, the three Puerto Rico law schools, and Belmont because I don’t think it’s had any graduates yet) don’t report average graduate debt levels. The previous record was six in 2010. This year, as many as fourteen chose not to. Here’s the list and their last reported average graduate debt levels:

Arizona Summit (formerly Phoenix) – $162,627 [UPDATE: Per the comments below, Arizona Summit Law School's Web site posts its 2012-13 graduates' average amount borrowed as $184,825.]

Southwestern – $147,976

Atlanta’s John Marshall – $142,515

Cornell – $140,000

Touro – $137,781

Campbell – $130,428

Santa Clara – $129,621

Loyola (La.) – $124,335

Thomas M. Cooley – $122,395

Appalachian – $114,740

La Verne – $112,628

Texas Southern – $99,992

Florida A&M (two years in a row) – $96,934

Rutgers-Camden – $93,990

Most of the non-reporters are private law schools and five are free-standing privates. Four are in California. All of them tend to have higher debt levels than the norm, so any weighted-average law school debt figure will skew downward. This is important because the unweighted average law school debt level appears to have declined, but that’s attributable to non-reporting—not reduced average costs or less Grad PLUS borrowing. Last year these schools graduated 3,724 students, eight percent of the total.

Other law schools deserve dishonorable mention for misreporting:

  • Barry University didn’t report its average graduate debt level last year, but two years ago it was $137,680; this year it’s only $47,799, suggesting it reported its third-year students’ annual debt and not graduate debt like it was supposed to. There was a flap about this last year, so it’s surprising anyone would make this mistake again. (Why U.S. News doesn’t notice is another matter.)
  • Southern University Law Center’s graduate debt spiked from $21,911 last year to $80,542 this year, indicating it’d been misreporting in previous years. Credit for the correction, discredit for misreporting in previous years.

Honorable mentions:

  • University of District of Columbia reported its average graduate debt for the first time in three years.
  • University of Indiana-Indianapolis reported its average graduate debt for the first time in four years.
  • No law school that reported its average graduate debt omitted the percent of graduates who had student loan debt. This had occurred in previous years but not this year.

I don’t know why law schools neglect to report their average graduate debt levels. If I were paranoid, I’d say that it makes high-debt/poor-outcome schools look unappealing, and since there’s no punishment for not reporting, they don’t. I do think it’s bad for law schools to not report average debt levels, and the high number of non-reports this year doesn’t make law schools look particularly transparent in general.

[UPDATE: Forgot to mention that the numbers thrown around here are average amounts borrowed and not average indebtedness, which would include accrued interest.]

Which Law Schools Saw the Biggest Full-Time Enrollment Drops in 2013?

…Is the question of the day. The bigger question is, enrollment drop since when? Most of the time media outlets will report law schools’ cumulative percent declines since the overall enrollment peak in 2010, but those aren’t necessarily descriptive. It might be more valuable to measure enrollment declines since previous trough years. For the mean average law school, those would be 2007 and 1999.

Full-Time Law School Enrollment (ex P.R.)

(Source: Official Guide, 2013 data here (PDF), author’s calculations)

You might also want to ask, why not include part-time or post-J.D. students? There are a bunch of reasons, and laziness isn’t one of them. One, full-time programs are the bread and butter of law schools. Two, we care more about the younger crowd, who tend to be full-timers and are more likely to pay full tuition. Three, in any given year part-timers are not even 20 percent of all J.D. students. Nowadays, their share is even less… I could go on but I won’t.

If you remove the 23 law schools that were accredited since 1999 (!), the two average trough years remain the same, and the most-recent trough year for all law students moves from 2006 to 2007, which makes this analysis cleaner. Yay!

So, here’s a table of cumulative law school enrollment declines that’s sorted by the average of law schools’ 1999 and 2007 declines (not shown). Why that average? Because we want to see which law schools are really breaking from their enrollment trends. Schools like Quinnipiac, for example, have seen large enrollment drops since 1999, but not so much in 2007, meaning they shrank significantly in the previous decade and not more recently. I’ve also included the commonly used cumulative decline since 2010, as well as a ranking for that on the rightmost column.


1. Catholic -47.7% -43.7% -39.1% 5.
2. Tulsa -42.5% -43.8% -31.0% 15.
3. Seton Hall -42.6% -33.9% -32.2% 14.
4. Iowa -38.1% -35.1% -28.4% 21.
5. Case Western Reserve -32.6% -38.3% -33.0% 10.
6. Hamline -30.8% -37.4% -32.9% 12.
7. Western New England -25.9% -40.8% -39.3% 4.
8. Cleveland State -31.8% -34.8% -27.6% 23.
9. Wayne State -35.9% -30.6% -30.7% 17.
10. Golden Gate -20.9% -37.5% -45.5% 1.
11. New Hampshire -24.5% -32.3% -35.3% 8.
12. Kansas -32.1% -24.6% -25.6% 27.
13. Dayton -28.8% -24.1% -38.5% 6.
14. Widener -29.6% -21.3% -30.9% 16.
15. Capital -21.1% -29.0% -32.9% 11.
16. McGeorge -29.3% -20.3% -32.3% 13.
17. Samford -30.2% -17.4% -16.7% 62.
18. Florida, University of -20.1% -26.8% -9.6% 100.
19. Regent -20.3% -24.7% -19.6% 48.
20. Texas -25.9% -19.1% -9.4% 102.
21. Thomas M. Cooley -16.6% -27.9% -44.1% 3.
22. Temple -23.8% -20.3% -24.6% 32.
23. Wisconsin -20.3% -22.8% -17.5% 56.
24. Quinnipiac -49.8% 7.2% -25.9% 26.
25. Toledo -24.1% -18.4% -22.2% 42.
26. Missouri (Columbia) -27.7% -14.5% -13.1% 84.
27. Washburn -17.5% -23.8% -25.3% 28.
28. Ohio Northern -17.2% -24.1% -24.6% 31.
29. Boston University -24.2% -17.1% -17.7% 55.
30. Lewis and Clark -16.7% -23.8% -22.7% 39.
31. Gonzaga -10.8% -29.5% -23.1% 36.
32. Houston -18.8% -21.1% -11.7% 91.
33. New York Law School -9.9% -28.8% -44.4% 2.
34. Widener (Harrisburg) -8.1% -30.5% -38.3% 7.
35. Vermont -13.2% -24.0% -30.5% 18.
36. Southern Methodist -28.0% -6.8% -4.6% 140.
37. Albany -15.2% -19.2% -23.2% 34.
38. Villanova -15.9% -18.3% -22.4% 40.
39. Duquesne -8.0% -26.2% -23.6% 33.
40. Tulane -26.8% -7.3% -9.4% 103.
41. Memphis -19.5% -14.2% -16.9% 60.
42. California Western -9.1% -23.0% -26.1% 25.
43. Brooklyn -8.3% -23.4% -29.7% 20.
44. Oregon -13.8% -17.4% -17.1% 58.
45. Pittsburgh -13.9% -17.4% -20.2% 47.
46. Oklahoma -20.6% -9.4% -14.0% 78.
47. Texas Southern -20.3% -8.6% -6.7% 127.
48. Syracuse -20.7% -8.2% -4.7% 137.
49. Seattle -6.8% -21.9% -18.3% 53.
50. George Mason -0.5% -27.8% -28.1% 22.
51. SUNY Buffalo -8.2% -18.6% -12.4% 86.
52. Penn State -9.4% -17.1% -23.0% 37.
53. Rutgers (Camden) -16.2% -9.8% -11.7% 92.
54. St. Mary’s -16.4% -9.4% -6.2% 129.
55. San Francisco -7.6% -17.1% -21.7% 45.
56. Ohio State -10.0% -14.2% -17.2% 57.
57. St. Louis 1.6% -25.5% -30.1% 19.
58. West Virginia -8.9% -14.2% -7.3% 123.
59. Arizona -11.8% -10.8% -13.9% 81.
60. Willamette -12.3% -9.6% -15.8% 67.
61. Creighton -6.6% -15.3% -16.8% 61.
62. Alabama -15.9% -5.5% -8.6% 110.
63. California-Hastings -5.9% -14.3% -16.5% 64.
64. Illinois -12.0% -7.5% -15.2% 71.
65. South Carolina -12.6% -6.9% -9.1% 105.
66. Brigham Young -8.8% -9.8% -7.0% 125.
67. Boston College -12.1% -6.4% -8.5% 112.
68. Florida State -4.1% -14.3% -15.9% 66.
69. Akron -12.6% -5.2% 4.7% 179.
70. Connecticut 0.2% -16.9% -8.6% 111.
71. Missouri (Kansas City) -7.0% -9.2% -7.6% 117.
72. California-Davis -2.3% -13.5% -15.3% 70.
73. Denver -1.3% -14.4% -4.7% 138.
74. Utah -4.1% -10.8% -11.9% 90.
75. Virginia -3.9% -10.8% -5.2% 134.
76. Tennessee -8.7% -5.8% -8.3% 113.
77. Santa Clara 0.2% -14.3% -16.7% 63.
78. Pepperdine -9.2% -4.9% -9.7% 98.
79. Southern Illinois -10.5% -3.4% -10.5% 97.
80. Mississippi -2.9% -10.8% -10.7% 96.
81. St. John’s -2.9% -10.3% -12.2% 88.
82. Notre Dame -5.5% -7.6% -7.8% 115.
83. DePaul -8.3% -3.4% -15.6% 68.
84. William Mitchell 10.4% -21.9% -17.1% 59.
85. City University -2.8% -8.3% -13.7% 83.
86. Richmond -4.0% -6.4% 0.7% 171.
87. Northeastern -1.6% -8.8% -9.5% 101.
88. Michigan -1.6% -8.5% -7.4% 122.
89. Cincinnati -7.0% -3.1% -15.4% 69.
90. Arkansas (Fayetteville) -0.5% -9.1% -5.1% 135.
91. Wyoming -6.0% -3.1% -4.3% 141.
92. District of Columbia 12.5% -20.3% -26.2% 24.
93. Indiana (Indianapolis) 2.7% -10.2% -2.4% 154.
94. Minnesota 2.3% -9.1% -4.1% 143.
95. San Diego 3.1% -9.4% -16.2% 65.
96. Georgia -3.0% -3.3% -11.7% 93.
97. Hofstra -0.2% -5.6% -13.1% 85.
98. Nova Southeastern 0.0% -5.7% -18.8% 52.
99. Kentucky 0.0% -5.6% -4.1% 145.
100. Hawaii 1.7% -7.0% -19.0% 51.
101. Nebraska 0.0% -4.8% -8.3% 114.
102. Vanderbilt 1.1% -5.8% -3.4% 150.
103. Loyola Marymount (CA) -1.7% -2.8% -3.8% 146.
104. Louisiana State -8.2% 3.7% -5.0% 136.
105. Drake 8.0% -12.3% -19.5% 49.
106. Pace 6.7% -10.3% -22.1% 43.
107. Rutgers (Newark) 3.2% -6.3% -14.3% 77.
108. California-Los Angeles 1.9% -4.9% -2.4% 153.
109. George Washington 5.9% -8.9% -8.7% 109.
110. New Mexico -1.7% -0.9% -2.0% 157.
111. Illinois Institute of Technology -3.9% 1.6% -2.8% 151.
112. Howard 2.8% -4.9% -14.0% 79.
113. Oklahoma City 14.0% -15.6% -25.0% 29.
114. Maine -0.8% -0.4% -9.0% 107.
115. Maryland 4.2% -5.2% -12.4% 87.
116. Washington University 13.6% -14.2% -23.1% 35.
117. Southern California -1.0% 0.7% -7.5% 118.
118. Loyola (LA) 16.9% -17.0% -14.7% 75.
119. California-Berkeley 1.1% -1.2% -6.8% 126.
120. Texas Tech 7.6% -7.5% -4.6% 139.
121. Stetson 8.7% -8.4% -19.1% 50.
122. Colorado 4.7% -3.0% -5.9% 131.
123. Mississippi College 18.6% -16.9% -18.1% 54.
124. Montana 6.4% -2.0% -2.7% 152.
125. Pennsylvania 4.2% 0.5% -2.0% 156.
126. Harvard 5.2% 0.4% 0.5% 169.
127. South Dakota 12.5% -6.8% 2.0% 174.
128. Duke -2.0% 7.9% -2.3% 155.
129. Northern Illinois 11.9% -5.8% -9.0% 106.
130. New York University 6.8% -0.4% -0.9% 163.
131. Mercer 7.2% -0.7% 1.4% 173.
132. Miami 15.6% -8.8% -14.4% 76.
133. Baltimore 8.1% -0.9% -10.8% 95.
134. Columbia 6.9% 1.0% -7.1% 124.
135. Indiana (Bloomington) 4.9% 3.1% -1.2% 161.
136. Suffolk 5.4% 2.9% -3.6% 148.
137. North Carolina 5.4% 3.0% -7.5% 119.
138. New England 14.2% -5.5% -15.1% 72.
139. Chicago 8.3% 0.8% -3.5% 149.
140. South Texas 10.4% -0.2% -7.4% 120.
141. Idaho 7.5% 2.9% -9.2% 104.
142. Cardozo 7.4% 3.7% -4.1% 144.
143. Washington 8.9% 2.5% -1.6% 159.
144. Southwestern 13.4% -1.7% -7.4% 121.
145. Stanford 5.3% 6.7% 0.5% 170.
146. Wake Forest 6.4% 6.6% -1.0% 162.
147. Arizona State 17.9% -4.7% -7.7% 116.
148. Cornell 10.6% 3.6% -1.8% 158.
149. Whittier 5.7% 8.9% -14.7% 74.
150. Yale 8.5% 6.7% -0.6% 167.
151. Northwestern 17.4% -1.0% -6.6% 128.
152. William and Mary 15.8% 1.0% -0.8% 165.
153. Arkansas (Little Rock) 17.8% -0.3% -13.9% 80.
154. Georgia State 18.7% -0.8% 2.6% 176.
155. Washington and Lee 14.8% 6.1% 2.9% 177.
156. Fordham 29.0% -6.9% -8.9% 108.
157. Valparaiso 26.0% -1.2% -9.6% 99.
158. Western State 16.7% 8.1% -11.9% 89.
159. North Dakota 28.2% -3.2% -5.9% 132.
160. Touro 37.3% -11.7% -24.6% 30.
161. John Marshall (Chicago) 34.9% -9.1% -13.8% 82.
162. St. Thomas (FL) 27.9% -0.3% -15.0% 73.
163. Georgetown 25.3% 5.5% 4.2% 178.
164. Thomas Jefferson 43.5% -5.7% -20.2% 46.
165. Marquette 30.6% 9.6% -0.7% 166.
166. Loyola (IL) 31.0% 9.7% -1.6% 160.
167. American 42.0% -0.5% -0.2% 168.
168. Louisville 30.6% 12.4% -4.2% 142.
169. Emory 31.7% 14.4% 2.4% 175.
170. Michigan State 38.8% 9.1% -5.6% 133.
171. Roger Williams 81.0% -24.5% -22.2% 41.
172. Texas Wesleyan 59.0% 5.9% -3.7% 147.
173. Campbell 42.1% 24.5% -6.2% 130.
174. Southern University 52.1% 27.9% -0.8% 164.
175. Northern Kentucky 80.4% 9.2% -11.5% 94.
176. Detroit Mercy 115.5% -24.5% -22.0% 44.
177. North Carolina Central 94.5% 3.8% 1.0% 172.
178. Chapman 326.3% -11.0% -22.7% 38.
179. Florida Coastal 367.9% -9.9% -34.1% 9.
TOTAL -1.0% -10.0% -13.5%
MEAN AVERAGE 4.0% -10.0% -13.8%
MEDIAN AVERAGE -1.6% -8.6% -11.9%

Some observations:

  • Florida Coastal is the real oddball because it’s been league average since 2007 but is way higher than 1999 when it began its expansion phase. Nevertheless, it’s in the top-10 for cumulative full-time enrollment declines since 2010. I’m fine with this result as the goal of this exercise is to find which “established” schools had the most consistent enrollment declines, and newer schools, especially freestanders and for-profits, aren’t very typical. Nor, for that matter, are schools that rely heavily on part-time students.
  • A bunch of the schools at the top of the list never really benefited from the 2010 peak, which shouldn’t be too surprising if you think about it.
  • Elite law schools tend to be at the bottom of both rankings columns, showing that they have much more control over their student bodies than non-elite schools.
  • I’m a little surprised to see Iowa and Wisconsin so high up the list. Texas’ case is a little different, I think, because it may’ve tried to become more selective over the years.
  • Can’t say the same about Case Western or Seton Hall, given what some of their faculty have been saying publicly, but that’s just synthesis via cynicism.
  • Also can’t say the same thing about Boston University; it consistently has a low acceptance rate and a low matriculation yield, implying that it’s everyone’s safety school. There are a few schools in U.S. News‘ 10-30 that are fairly similar (Southern California, Boston College, George Washington, Georgetown, Duke, etc.), but they appear to be doing better than BU.
  • Another way I may do this exercise in the future is to sort the schools by statistical area. It might help illuminate which local schools are more popular than others, regardless of what the rankings say.
  • As many as 11 law schools have seen a positive cumulative enrollment changes since 2010.
  • 83 schools have positive cumulative enrollments since 1999, but don’t worry, almost all of them have larger full-time faculties and the ones that don’t may’ve submitted erroneous faculty data to the Official Guide.

That’s all I’ve got. Peace.

Brilliant People Still Applying to Law School

…Or at least “people who can crush standardized tests” are still applying to law school.

[Mini-Update: For those who've read Jerry Organ's recent writing on the subject, I don't imply that he's one of the people arguing that the "wrong people" are applying to law school because he didn't argue that. Two, the reason he found a greater high-end LSAT decline than I did is that he estimated the applicant profiles into 2013 and I didn't. His projections may prove correct, but at the very least the initial decline started in the upper-middle LSAT band and has accelerated to the high end.]

I’m not going to go out of my way to cite them, but I’ve seen it asserted that the “wrong people” are choosing not to apply to law school. By “wrong people” they mean those with high GPAs and LSAT scores, aka those who keep civilization from fragmenting into warring states. Focusing only on LSAT scores—as they’re most comparable—the story is a little more complicated. Sure, the collapse in applicants has skewed towards the high end of the LSAT spectrum, but for the most part, the decline has been in the middle.

Here’s 2012 compared to 2010.

No. Applicants by LSAT Score

And here’s the percent decline in each bracket.

Percent Change Number of Applicants by LSAT Score Bracket

So yes, there’s been a big drop at the high end, but overall the decline has been distributed normally as the first chart implies. Here’s the apportionment:

Percent Fewer Applicants Share of Total Decline by Lsat Score

(n=-20,479 applicants)

Pretty much a bell curve. Importantly, more than 60 percent would’ve gotten an LSAT score below 160. The 165+ range doesn’t account for 15 percent of the total decline. Lesson: Those concerned that the best and brightest aren’t interested in law school can rest easy; no warring states! It’s the upper-middle brackets, 150-164 (64 percent!), that are driving the applicant drop.

(Source: LSAC National Decision Profiles)

And for some fun, here’s the decline in law schools’ full-time matriculants’ LSAT scores by their 2014 edition U.S. News rankings.

2010-2012 LSAT Score Decline by U.S. News Category (2014 Edition)

(Slight whoopsie: the middle set of bars should be 51-100. Also, not published (“NP”) includes the unranked University of La Verne, not that it makes much of a difference.)

Looking at this makes me wonder aloud: How far can these numbers drop before employers start worrying about credential dilution at some higher-ranked schools? Or does the sheepskin outweigh the entering credentials?

GUEST POST—Don’t Go to Law School (Unless) (Flow Chart Edition)

(Connecticut attorney Samuel Browning obtained permission from Paul Campos to create a flow chart version of the book Don’t Go to Law School (Unless). Mr. Browning’s herculean effort is displayed here as a single graphic taken from his spreadsheet with only some proofreading on my part. I have not read the book, so any unclear points and errors are the author’s own.)

Browning--DGTLSU Flow Chart (2.0)


LSTB Is on Holiday

I’m taking a rare vacation, which may hamper blogging. In the meantime, outgoing Illinois State Bar Association president John E. Thies has written a letter to the editor at The Am Law Daily criticizing my article on state bar association proposals, “State Bar Proposals Fail to Address Law Students’ Woes.”

The good news is I have little quarrel with Thies as even he recognizes at the end of his letter. We agree on some of the means to reform but not the reasons, which is important but not important enough to dedicate an enormous number of mental clock cycles in rejoinder, and since I didn’t make any material misstatements of fact in my article I’ll spare The Am Law Daily any corrections. (They can thank me later.)

(1)  My argument was indirect, but I think my examples illustrated that the Special Committee claimed debt created a price floor. In fact, its report said “EXCESSIVE LAW SCHOOL DEBT DECREASES THE QUANTITY AND QUALITY OF LEGAL SERVICES AVAILABLE TO THE PUBLIC.” That sure sounds like a price floor to me. Then in his third paragraph, Thies agrees with me that the “public’s ability to pay” is keeping lawyer earnings down, which makes the rest of his letter confusing. Is he agreeing with me or not?

(2)  As for Thies’ examples of attorneys’ employment choices due to debt. They should have access to IBR/ICR (more on that below), and in some situations it sounded like the employers wanted experienced lawyers, not recent graduates.

(3)  Thus, Thies presents an economic theory stating that low-skill lawyers are discouraged from the profession by debt, creating a long-term shortage of high-skill lawyers. It sounds to me that when demand is slack for lawyers, new graduates don’t get hired. Indeed, this has been going on for a while as the profession is graying. As Thies and I agreed (I think), poor people are poor. This causes lawyer unemployment.

(4)  Regarding IBR and interest capitalization, 20 U.S.C. 1098e(b)(3) says that so long as the debtor has a “partial financial hardship” interest does not capitalize onto principal, which applies to the lawyers Thies mentions. Once someone no longer has a PFH, then the interest gets capitalized, but that’s when IBR essentially turns into a 10-year repayment plan. If anything, Thies’ lawyers would be better off staying at lower-paying jobs to prevent interest capitalization. (I guess the trick is to defer compensation until after the loans are canceled. Talk about bad incentives.)

The Department of Education prints this too. Only Illinois’ three public law schools’ graduates had less than $100,000 in disbursed debt on average at graduation as of 2012. Even U of Illinois’ was $95,830. These debtors will have to fork out $8,500 per year on a 25-year repayment plan unless it’s a graduated plan. Good luck to them if they can afford it, but they’ll almost certainly choose IBR since they’re either unemployed or it costs them less in the long run thanks to cancelation.

(5)  My fear isn’t of the John E. Thieses of the world but of the kinds of people who will be whispering the Philip Schrag (or worse Simkovic and McIntyre) argument into legislators’ ears that we’re wrong about student loan debt so keep shoveling the law schools money. (Better yet, pay the law schools up front and the government will recoup the costs by income taxes.)

(6)  It’s asking a bit much of the Special Committee, but why do graduates from NIU and SIU have less debt yet poorer outcomes than other Illinois law school grads? If that’s so, then it’s time to consider shutting them down because they’re unnecessary. And if U of Illinois is going to charge $38,500 (2012) for in-state students and defraud the ABA just to maintain its place in the U.S. News rankings, then it’s abandoned its public mission and should be shut down too.

Now for some ROCK AND ROLL!!!!!



Okay it’s soul, but the video is genius.

At University of Louisville, Life Imitates Life

Debra Cassens Weiss, “Former Law School Admissions Director Is Accused of Secretly Raising Scholarship Offers,” ABA Journal.

Brandon Lane Hamilton has been charged with unlawfully accessing a computer. … He is accused of going into the computer system and raising scholarship offers. …

The law school is honoring the scholarship offers, which were about $2.4 million higher than the allotted budget. The school has said it will use endowment money and “rainy day funds” to make up the difference for the 104 students who benefited.

Interim law dean Susan Duncan discovered the scholarship issue on her sixth day on the job. She says safeguards are now in place to prevent a future problem.

I few weeks ago I saw Ewan McGregor play Nick Leeson in the movie Rogue Trader, the story of how Leeson destroyed the ancient Barings Bank by fraudulently betting huge amounts of its money in the Singapore International Monetary Exchange in the early 1990s. I’m not saying it was a masterpiece of cinema (it was based on the autobiography Leeson wrote from a Singaporean prison), but I’m reminded of it because Hamilton here, unlike, say, Paul “That-way-I-can-trap-about-20-of-the-little-bastards-with-high-GPAs-that-count-and-no-LSAT-score-to-count-against-my-median” Pless of University of Illinois, it was the university that was defrauded instead of U.S. News and World Report. As a bonus, the law students ended up coming out ahead with more scholarship dough.

Can’t say the same about the Louisville students in other programs who might’ve benefited more from the extra $2.4 million though.

The ‘Law School Rankings’ Are NOT Influential

…Otherwise more people would be searching for them on Google.

01 Google Trends Index

The Google Trends of “LSAT” made the rounds a while ago, so I can’t believe no one thought to give the infamous U.S. News law school rankings the same treatment. (I think “law school rankings” captures their influentiality better than “us news” or its derivatives do.) In November 2012, “law school rankings” was not even a tenth as popular as it was in March 2004. That week was a bit of an outlier, as you can see, but it shouldn’t be too surprising as I believe 2004 was the year after the magazine expanded from 50 to 100 ranked law schools. I guess everyone wanted to see how volatile the new rankings were. If you look at the broad 52-week moving average, “law school rankings” starts at 45.65 in week 1, January 2005, and drops to 12.88 last week, a 72 percent decline.

What’s striking is how law school-related searches bubbled upward at about the time Lehman was collapsing, but to no avail. The decline resumes after the October 2009 LSAT, which you can see here:

02 Google Trends Index

Here are the 13-week moving averages, showing how all-encompassing the October LSAT is. You can see the compression between the peaks and the troughs that occurs as the years go on.

03 Google Trends Index

And here are some test prep search terms to top things off.

04 Google Trends Index

Again, October 2009 was peak law school, even if commentators at the time didn’t believe it.

Generally, Google tells us that the law school terms are 70 percent less popular than they were in the mid-2000s and 45 percent less popular than in October 2009. The indexes’ diminution will continue into next year, so don’t say the rankings are influential: People ain’t buyin’ it—or at least, they ain’t searching for it on Google.

Dean Lawrence Mitchell Does Not Know Why Case Western’s Tuition Has Gone Up

…Or he deliberately misled Bloomberg‘s Lee Pacchia in an interview you can view courtesy of TaxProf Blog‘s “Case Western Dean: There Is No Oversupply of Lawyers.”

Dean Mitchell wishes to continue discussing law schools despite the poor reception of his November 2012 New York Times op-ed. Although early on he jokes that people accused him of kidnapping the Lindbergh baby, I think a line he gives at 13:33 reveals more about his perception of the debate:

One of the things the ‘Attack on Law Schools’—if I may call it that—disregards, or doesn’t assume, is that we’re working hard in good faith. You’re talking about people who, all of whom have significant opportunity costs that have gone into this business for the sake of trying to do something good.

In my opinion, bad faith doesn’t require cynically lying to make money, but defending the legal education system by raising discredited arguments, ignoring contradictory evidence, and filling knowledge gaps with conjecture qualify. Reasonable people might disagree with that definition, but I think what Dean Mitchell said in the interview, to say nothing of his selective use of Occupational Outlook Handbook information in his op-ed, suffices.

For example, Dean Mitchell peppers the interview with characterizations of law school graduates as lazy, greedy, and entitled. Thirty-eight percent of Case Western’s graduates are underemployed? It’s because they left Ohio for other cities. It’s because they won’t take lower-paying government jobs. It’s because they refuse to start small practices in the sticks. It’s because they aren’t interested in serving the poor. Then Dean Mitchell whirls around and says everything is fine: Data nine months from graduation don’t tell us of all the success stories one-year or a year-and-a-half out; law is a 40-to-50-year career so it’s premature to say the system is failing; hearsay from the admissions staff says we should be “confident” about graduates’ outcomes.

Instead of spending this post on the oversupply problem (to which I’ll only add that Pacchia discussed only new jobs and didn’t include replacements, which makes the ratio 400,000 to 212,000, not 74,000), I’m more interested in the dean’s discussion of why tuition has gone up, which I’ll present reverse-chronologically from the interview. Pacchia asks (4:35):

When we talk to people about these issues, we keep going back to the fact that tuition growth has outstripped job growth, or wage growth over the past almost two decades at a torrid pace. Why does the cost of law school tuition keep going up?

And Dean Mitchell answers:

That’s a question that any responsible law school administrator thinks about all the time. First, I point out that at my school, 20 percent of my revenue comes from our endowment, so- and believe me when I’ve spent my budget there’s nothing left. So it’s not even that our students are paying the full amount of their education. In fact, every student is subsidized to the tune of at least 20 percent simply from the income on endowment.

Where does the high price come from? Well, you know, I was looking- thinking about the ’85 to 2011 increase is often cited as being the number to look at. And medical school at 63 percent, for example. In 1985 medical school cost four times what law school cost. Also in 1985—or within a couple of years thereafter—you have a tremendous growth in starting salaries of law firms on Wall Street. Now almost anybody who teaches law could or did have one of those law jobs. I pay my faculty probably median about what the starting salary on Wall Street is. You’ve got to pay talented people to be professors, so that’s certainly one reason for the increase.

Additionally, we pay the bills like everybody else. We’ve got to pay for heating, we’ve got to pay for lighting, and we’ve developed programs for example: clinics and experiential education have exploded. That’s a very expensive form of education. You have a highly paid teacher, or a relatively highly paid teacher, teaching very small numbers of students. So when people talk about law schools as traditional cash cows, they’re imagining a time when you teach 150 kids in a class. You have a relatively small faculty doing it. You are able to charge whatever the market bore of course, but you turn a big chunk of it over to the university. I don’t turn a big chunk to the university, and I’m not teaching 150 kids in each class. So as the demands for higher quality education have increased, and as we’ve responded to that with smaller class sizes, with more skills programs, with more- other kinds of experiential endeavors, with more externships, we increase the costs.

I’m willing to grant Dean Mitchell the third paragraph, but the first paragraph is a non-sequitur. Debt is debt; underemployment is underemployment. The endowment isn’t relevant to either. The second paragraph, however, is just plain inaccurate—and not just because Pacchia said wages haven’t kept up while the dean says they grew tremendously. From the Digest of Education Statistics Table 348, we find that medical school didn’t cost quadruple law school, and law school’s costs have increased more rapidly since 1988 (close enough to 1985).

Real Annual Private Professional School Tuition (2010 $)

Real Private Professional School Tuition Annualized Growth Rate (1988-2008)

Moreover, the effective hourly wage for law professors is significantly higher than it is for first-year associates, and there are always plenty of people applying for law professor jobs who would gladly work for less pay and more classes. This is the weak link in Dean Mitchell’s response: Why does a law school need “talented people” to be professors? Can’t mediocrity get students past a bar exam?

Yes, but it won’t help Case Western win the zero-sum rankings dog-pile, and Dean Mitchell neglected to point out how tuition dollars also go to scholarships to attract high-caliber applicants, even though he acknowledges scholarships in the previous exchange (2:30):


That said, the economics of the situation are troubling. Case Western, like many schools charges over $40,000 a year in tuition—I think it’s 42—yet six months after graduation, your institution had 38 percent of the class of 2011 that were either unemployed, underemployed—that is in short-term jobs or part-time jobs—or going on to get another degree. Aren’t too many of your graduates finding themselves in a position where they’re leaving school with enormous debts yet no real means to pay them off?

Dean Mitchell:

This is certainly a- debt is a problem, high tuition is a problem. I should point out that 90 percent of my class receives financial aid at a mean financial aid offer of $25,000 a year. So, people talk about the sticker prices of law schools, but we discount fairly heavily. Now, that’s not to say there aren’t students paying full freight, or there are students paying most of the way, and it’s very, very expensive. And of course, it’s important that they get jobs that they can ultimately pay that debt back, with the proceeds from, the income from.

At the same time, when you look at that 38 percent, you’re looking at a nine month picture out. Now first place, the ABA has been refining reporting statistics, along with NALP. We are- we have from the very first tried our very best to be as transparent as we can. And if you look at some of the situations of some of those students, many of them are in- you say “underemployed.” They’re in volunteer positions; they’re in positions where they receive small stipends. A school like ours, about 65 percent of our students leave the state of Ohio and go to major cities where because they’re not in law school there, it takes them more time to find jobs. I haven’t myself taken a snapshot a year out, but from- I’ve talked to my admissions staff a lot, and I suspect if you look a year out, things would change dramatically. I’m really confident if you looked a year-and-a-half out, they would.

Notice how Dean Mitchell abruptly switches from people paying full freight to minimizing the underemployment problem? Pacchia lacks my awesome powers of time travel (maybe he should drop acid before his interviews?), but the follow-up question is, where does the law school get the money to pay for scholarships for 90 percent of the students? Who is paying full freight?

Using 12 years’ worth of Official Guide data—which Pacchia definitely wouldn’t have no matter how much acid he dropped—here’s how Case Western’s scholarship structure has transformed since 1999 for full-time students (it only has a few part-timers):

Case Western Percent Full-Time Grant and Scholarship Recipients

According to Dean Mitchell, the red “No Grant” blob has now contracted to 10 percent, one-third what it was even in 2010-11. Unless the law school received either a massive grant or an enormous bequest (and they didn’t blow it on a swank building), all these <50 percent tuition scholarships had to come from tuition:

Case Western Full-Time Tuition, Median Scholarship, & Annual Loan Limit (Current $)

Note how the median grant is now actually less in both nominal dollars and percent of total tuition than it was in 1999. The good news for the 15 percent of students who received at least the median grant back then is that their Stafford loans more than covered the shortfall. Today that’s not possible, meaning that even those who receive the median grant will have to take out a Grad PLUS loan, a private loan, or get the money from somewhere else. If we look at the glass-half-empty version, i.e. the percent of full-time Case Western students who receive the median grant or less, we find that they pay an increasing portion of whatever’s left:

Case Western Full-Time Tuition, Median Scholarship, & Annual Loan Limit (Current $) (GHE)

Sixty-five percent of its 2010-11 full-time students had to cover 25-50 percent of their tuition with something other than Staffords. Thirty percent had to cover half their tuition outside of Staffords when in 1999 they were only down five percent. I wish the Official Guide were more forthcoming about how many 1Ls receive scholarships out of the total, but common sense tells us that it’s a high proportion, and even those who retain their scholarships after their first year will have to eat the next tuition increase to pay for … more scholarships for 1Ls. The system has evolved from one in which a handful of students receive generous portions to one in which most students get a few thousand bucks thrown their way, but it’s spread more thinly each year. Case Western does not have a tuition guarantee program.

This absurdity is only sustainable so long as there are students willing to pay ever increasing amounts of money to entice handsomer applicants than themselves to Case Western. Dean Mitchell doesn’t know or withheld that the students who pay full freight, near full freight, and every tuition increase in between are the law school’s bulwark against a rankings slide, even if there’s a high probability those graduates won’t be able to repay their loans without IBR/ICR or miracling high-paying jobs. These students’ continued access to unlimited federal students loans is the sine qua non of Case Western’s financial model.

Pacchia didn’t pursue this line of questioning, but file it away for the next time a law school dean wants to have a “good faith” dialogue about the non-crisis entitled law graduates face.


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