Moving On

Well folks, after nearly five years of blogging on legal education and the economy in general, I’ve decided to end this project and take a job (at greatly reduced pay) as the chief copywriter for J.D. Premium Loan LLC’s Web site. Thank you all loyal readers, and I hope you’ll invest in my new project.

Lawyer Employment Grows in 2014, Wages Flat

…Which is unsurprising.

Last week, the Bureau of Labor Statistics (BLS) updated its Occupational Employment Statistics (OES) program data for 2014, and since the topic of what the BLS programs are actually measuring came up in the context of the latest analysis on the alleged J.D. premium, now is a good time to report on the data. Here is what lawyer employment looks like over time based on various BLS measures.

Lawyer Employment by BLS Measure

Aside from some growth in 2014, of interest is the discrepancy between the Current Population Survey’s (CPS’s) and the Employment Projection program’s (EP program’s) lawyer estimates. It’s been there for a while. Technically, the CPS is considered more reliable, but when discussing lawyer projections, the EP program’s numbers are appropriate. The CPS measures people in an occupation, not the number of job positions, which can be held by multiple persons. I think the CPS overstates the number of employed lawyers. Both measures include part-time lawyers and self-employed lawyers in all industries.

The CPS’s full-time wage and salary lawyer measure is similar to the OES program’s measure as they both exclude self-employed attorneys, but the OES program includes part-time workers. Finally, the number of legal sector attorneys is the subset of the OES lawyers working in the legal sector, and according to the link above, 71 percent of all lawyer positions are in the legal sector.

As for lawyers’ wages, they’re largely flat, but the median has fallen since 2009.

W&S Lawyer & Paralegal Hourly Wages (Constant $)

It’s useful to compare lawyers’ wages to paralegals’. This year, the top 10 percent of paralegals earned more than the bottom 25 percent of wage and salaried lawyers, but some of that is probably a comparison between full-time and part-time workers.

Detailed information on what the BLS programs measure can be found on the lawyer overproduction page, which I strongly recommend for anyone who is unfamiliar on the materials (*cough* law profs *cough*–Sorry, allergies). Although, it has not been updated regarding the BLS’s proposal to alter the replacement estimate used in the lawyer projections. That will come later. Lawyer employment in and of itself is not a bellwether for the future of the legal profession; it’s just worth tracking. Aside from the lawyer overproduction page, readers are advised to look at my criteria for predicting improvements in law graduate outcomes.

That’s all for now. Peace.

America’s Doomed Democracy, or Vox’s Adventure in the ‘Prophetic Fallacy’

A few of my grad school buddies referred me to Vox‘s “American Democracy is Doomed,” by Matthew Yglesias. My erstwhile colleagues crowed in agreement with the author about how everyone is complacent, believing that IT can’t happen here, IT being a cataclysmic collapse of the U.S. government, possibly (hopefully?) including chaos, rioting, hyperinflation, etc. You know, the kind of stuff that only happens in other people’s countries.

As a one-time student of comparative politics (obviously) I’m ambivalent of discussions of IT. On the one hand, yes, IT can happen here, and IT is more likely to occur when Americans think they’re immune to IT for no better reason than “America the fuck-yeah.” On the other hand, Vox‘s argument isn’t nearly as persuasive as my colleagues wish.

To summarize: In times of political gridlock, presidential systems, characterized by their separation of powers between the executive and the legislature, are structurally weaker than parliamentary governments. The latter can rely on flexible legal mechanisms to form governments and do the people’s work, or if not, elect a new government that does. Vox says that the current gridlock in the U.S. government is due to polarization over ideology rather than patronage opportunities as it was a century ago. Ideological polarization is more destabilizing because it’s far less open to compromise. Consequently, it’s no accident that we live in a political era of “Constitutional hardball,” in which the parties (legalistically) break with existing political norms to move their agendas forward. Presidents expand their power via executive orders, Senators use the “nuclear option” to abolish filibuster rules, and state legislatures redraw their Congressional districts mid-decade.

Vox then predicts that a crisis will cause the U.S. system to fail in 20 to 30 years, its long stability only an accident of history. Our fate shall be that of Latin American banana republics—the states where presidential democracy goes to die. Everyone with sense uses parliamentary systems.

I admit I’m sympathetic to the structural argument against presidential democracy, but allow me to raise a few contrary points.

(1) We have really bad cases here.

There are structural reasons in favor of the United States’ future success. It’s in a temperate (for now) chunk of North America, a continent that lacks an east-west mountain range to break up weather patterns to blight us with rainy and dry seasons. Thus, its climate is as favorable to industrialization as to just producing commodities, which tends to devolve into corruption. It’s institutionally descended from competent British political structures, and its present government was founded by enlightenment junkies. The Constitution’s underrated Equal Footing Doctrine has helped create a federal republic that prevents one or two states from dominating all the others. Finally, its biggest domestic and constitutional disaster, the Civil War, might have been prevented if James Buchanan had more aggressively confronted secessionism as Andrew Jackson had two decades earlier. State governments, founded along the same model as the federal government, rarely suffer constitutional crisis that require federal intervention. There is little evidence that the unicameral Nebraska is a beacon of democracy compared to the other fifty states.

In short, as of 1800, I don’t think betting against the U.S. was such a great idea, even if you allow for some variation in its leaders.

By contrast, Latin America is hot or mountainous. Its countries’ institutions are descended from extractive Spanish colonial systems, which have contributed to their replacement with ineffective revolutionary Marxist, macroeconomic populistic ones. They’re cursed with natural resources, including cocaine. Importantly, they also have a “size problem” vis-à-vis the United States. The U.S. is one large “successful” case compared to Latin America’s many smaller failures. U.S. policies can influence Latin American states more than vice-versa, e.g. the cocaine. (Changes in U.S. drug policies would be quite beneficial to Latin America, irrespective of their governments.)

The best example of presidential failure Vox can offer is Honduras’ 2008 constitutional crisis, but that’s a chronically poor, hot country. Perhaps Egypt in 2012-13 would have been a better example.

In sum, it’s not so obvious that parliamentary systems would serve these presidential countries better.

(2) Parliamentary systems don’t always work well either.

Vox raises examples of imposed parliamentary governments and cites them as successes, including Japan’s. Japan does not have a model parliamentary system. Its bicameral parliamentary legislature can cause needless gridlock, and the substantive organization of the more powerful lower house’s districts ensure than rural voters have very disproportionate votes compared to urban ones. In fact, many of Japan’s elections have been held unconstitutional by its own supreme court. Go figure. It is for structural reasons that the Liberal Democratic Party has been in power for decades and has so easily returned to power when it has lost it. During the Cold War, Japan could never be allowed to fail, despite its structural weaknesses (“over-strengths”?). The same goes for West Germany.

Parliamentary systems, for their part, have their own structural problems. Elected governments can recklessly enact damaging legislation that can’t be undone, like Margaret Thatcher’s government, which privatized many of the U.K.’s public utilities and left that country much worse off. Once privatized, utilities can’t be so easily unprivatized.

Parliaments can collapse too. Weimar Germany was totally gridlocked without intervention by President Hindenburg. That might be construed as an argument against presidential power, but the gridlock occurred within the legislature first, not between the legislature and the executive, and the Weimar president wasn’t a powerful, separate political institution as it is in the U.S., though he could select chancellors.

Finally, Europe with all its parliaments has done a worse job fixing their economies after the Great Recession. The U.S. response, while awful, has still been better. I hardly doubt anyone wants Hungary’s rigged parliament for themselves.

(3) Gridlock is the symptom, not the cause.

The more accurate description of the issue Vox is respond to is that democracy’s biggest problem, irrespective of systems of government, is when the minority rejects the legitimacy of the majority’s rule. In other words, the system’s failure doesn’t lead to the collapse; rather, the collapse leads to the system’s failure. The question we’re concerned with, though, is how does that play out institutionally? In Japan, the system is so lopsided that minority parties have token political power. As long as the people are mostly satisfied, though, they grit and bear it. This is barely a success.

In the U.S., there was one attempt at minority secession. Now, it appears the minority wants to rule the majority against their will. They can’t, so they dig their heels in at every turn. Here I found Vox to be straining to take the both-parties-are-responsible-for-gridlock line while feinting at self-satisfied centrists who regularly do so. Did the Senate Democrats use the filibuster to oppose judicial nominees in the mid-2000s? Yes. Does Obama assertively use executive orders (immigration prioritization) and existing legislation (the Clean Air Act on carbon emissions) to enact his agenda? Yes. Is that equivalent to Republicans who more recently threatened to default on the national debt or shut down the government to repeal a health care law? Ha ha. No.

When the parties are reversed, things work differently. If Democrats controlled Congress and faced a Republican president, they wouldn’t obstruct the budget, prevent the president from appointing his officers, or threaten to default on government bonds just to defund popular legislation. They might be pushovers as an opposition party, but they’re much more willing to patriotically compromise. Vox‘s counterpoint that George W. Bush was a gregarious fella (a debatable point) hated by Democrats ignores the fact that when Democrats did control Congress during his administration (barely), they didn’t wage a scorched earth campaign to utterly undermine him.

If anything, the lesson for Democrats is that they need to articulate to the public that the Republicans’ “Constitutional hardball” is selfish anti-majoritarianism, not principled opposition.

(4) Beware the “prophetic fallacy.”

I think Vox uses its structural arguments to then advance vague, unfalsifiable predictions about the future, the “prophetic fallacy.” Yes, some day every government will fall, and among them the U.S. will be appreciated as the nation-state that gave humanity popular sovereignty and the first lunar landings. But that’s not the same thing as successfully arguing that the U.S. government will fail for structural reasons whereas a parliamentary one would not. Vox ignores too many variables like geography, climate, history, and external international factors to make that case.

To some extent, Vox‘s argument shoehorns political reality (the “symptoms” in the previous section) into its structural thesis without discussing the future of that political reality. For one, the Republican Party supposedly has serious demographic problems. Simultaneously, it’s not an accident that Democrats’ presidential candidates regularly win the popular vote and northern and coastal states. Aside from not confronting Republican obstructionism more publicly, their biggest mistake is their watered-down economic policies against abstract inequality and pro-trade for the corporate elite. (But hey, we all know there are clear ideological differences between the parties, right?) The biggest reasons they don’t control Congress are gerrymandering in the House and slow turnover in the Senate. I don’t think anyone seriously expects Republic control come 2017.

Vox then resorts to fear-mongering:

What if a disputed presidential election coincided with a Supreme Court vacancy? What if the simultaneous deaths of the president and vice president brought to power a House Speaker from the opposite party? What if neither party secured a majority of electoral votes and a presidential election wound up being decided by a vote of the lame duck House of Representatives? What if highly partisan state legislatures start using their constitutional authority to rig the presidential contest?

Okay, I can play this game too. What if demographics and odious Republic presidential nominees help Democrats take over Congress? What if Congress then amends the Reapportionment Act to require states with more than five representatives to draw multimember proportional representation districts? What if global warming shifts party alignments to the wet east versus the dry west?

Vox just assumes political gridlock will go on forever without discussing why, and then it sneaks this assumption into its incomplete structural doom scenario.

My principal point in today’s frolic is to say that people shouldn’t be swayed by the mediocre comparative politics (and international politics) or the rhetorical sleight-of-hand Vox uses to argue that the U.S. constitutional system is doomed to collapse for structural reasons. I’m in favor of structural reform in the U.S., particularly making Congress more representative of the country and the president more vulnerable to Congressional disapproval, whether by lighter impeachment/conviction standards or shorter terms of office. Regular readers might be surprised to hear this, but I’m optimistic about what the U.S. will look like 20 to 30 years from now.

What I don’t want to see in 20 to 30 years from now is Vox writers—Yglesias or otherwise—using evidence of salutary political changes that contribute to systemic reform to vindicate this article. Vox promises humiliating crisis; the future had better deliver. IT ala Honduras does not equal “reform” like the Progressive Era. That’s the “prophetic fallacy.”

GUEST POST—Smokin’ Bucketful of Awesome (Flow Chart Edition)

(Connecticut attorney Samuel Browning, a friend of The Law School Tuition Bubble, obtained permission from law professor Bernie Burk to create a flow chart version of a series of posts Burk wrote on The Faculty Lounge in June 2014 that characterized law school outcomes as between either “A Smokin’ Bucketful of Awesome” or “A Smoking Pile of Scrap.” Mr. Browning’s chart appears here with only minor proofreading on my part, so any unclear points, variances from Burk’s posts, or errors are his own. Actual hyperlinks to Burk’s articles are included at the bottom. Click on the flow chart to enlarge it in your browser.)

Smokin' Bucketful of Awesome (Flow Chart)

********************

http://www.thefacultylounge.org/2014/06/more-thoughts-on-self-delusion-in-the-legal-academy-and-an-effort-to-engage-the-aals.html

http://www.thefacultylounge.org/2014/06/self-delusion-spreads-from-professional-to-graduate-education-consternation-curiously-absent.html

http://www.thefacultylounge.org/2014/06/still-more-thoughts-on-self-delusion-in-the-legal-academy-or-accepting-the-difference-between-a-smok.html

Correction: 13 Schools Didn’t Report Graduate Debt to U.S. News

I wrote in my post on 2014 law graduate debt that Seton Hall did not report graduate debt data to U.S. News. Due to an accidental error in my data collection I omitted it, and I have now updated the original post on the topic. Excepting Belmont, it appears that 13 law schools did not submit graduate debt data to U.S. News, so that’s an improvement. I will not report any additional corrections, making changes only to the post itself.

71 Percent of Lawyers Work in the Legal Services Sector

71 percent of employed lawyers, that is. We’re not talking about people who are on the rolls but aren’t working.

I haven’t carefully read through all of Michael Simkovic’s and Frank McIntyre’s most recent analysis in law graduate earnings, but it looks like they’re still uninterested in exploring the possibility that law grads’ earnings are attributable to demand-side factors, like price or income elasticity of demand for lawyers’ services. Because they don’t show us that law students who complete all the required law school course work without graduating have the same earnings as law graduates, anything they say about a JD premium is premature. Such an analysis is crucial because one of their own citations, David Card’s 1999, “The Causal Effect of Education on Earnings,” indicates that law grads earn substantially more than the trend would suggest. This finding screams for testing, but Simkovic and McIntyre aren’t careful enough researchers to do that.

Thus, it follows that their comparisons between law grads and college grads in “Timing Law School” are equally inadmissible. Indeed, I may not bother commenting on “Timing” at length at all.

However, I did decide that a little procrastination is good for the human spirit (and entertaining to the reader), so I poked around “Timing” to see what errors I could find. I’ll showcase one.

On page 17 Simkovic and McIntyre write:

Based on initial outcomes for recent graduates and qualitative factors, Henderson and Zahorsky argue that the legal profession is experiencing a “structural shift” due to globalization and technological change.34 Others point to a decline in the size of “legal services” (law firms) relative to GDP.35 What this means for law school graduates is uncertain, since most legal services workers are not lawyers,36 and many law graduates work in fields other than legal services.37

Footnote 36 uses the Bureau of Labor Statistics’ Occupational Employment Statistics (OES) database to show that “out of more than 1.1 million legal services workers, only 375 thousand were lawyers. Other occupations include paralegals, secretaries, bookkeepers and computer support and business specialists.”

And footnote 37 says:

Around 60 percent of law graduates practice law. Simkovic and McIntyre, supra [“Economic Value of a Law Degree”] at 252. Of those working as lawyers, around 65 percent work in “legal services.” United States Department of Labor, Bureau of Labor Statistics, supra note 36. Some of the non-lawyers working in legal services have law degrees.

In other words, the authors bury in a footnote the fact that 65 percent of lawyers work in legal services, so they can claim that it’s unclear how economic swings affecting the legal services sector would in turn affect law grads because most workers there aren’t lawyers. Being mindful of the distinction between law grads and lawyers, it’s nevertheless pretty bizarre to believe that the one industry law school prepares people for most would have a trivial impact on their earnings. The only alternative interpretation is for Simkovic and McIntyre to show that the legal sector is laying off everyone but its lawyers—and admittedly (again, in a footnote) malemployed law grads.

The foregoing aside, their math is still incorrect. It’s true that 375,000 legal sector lawyers out of the 592,670 total in the OES equals 63 percent, but that’s not the full number of lawyers. Why? Because the OES omits self-employed workers, which feature prominently in the legal profession. This is an pitfall that I either first noticed or was pointed out to me when I started writing on law schools nearly five years ago, so it’s amusing to see Simkovic and McIntyre make it.

In 2012, the BLS’s Employment Projections program found 759,800 employed lawyers, of which 374,900 were legal sector wage-and-salary employees. According to the BLS’s estimate of the distribution of lawyers among industries (xls), 165,700 lawyers were self-employed workers. It’s just about impossible for these folks to not be working in the legal sector, and indeed, if one looks at the Bureau of Economic Analysis’ National Income and Product Accounts tables, one finds that self-employed workers are included in the category “Persons Engaged in Production by Industry” (Table 6.8D).

As a result, 540,600 lawyers out of 759,800 lawyers—71 percent—work in the legal services sector, not 63 percent. These scant 8 percentage points sure make it look more persuasive to me that what goes on in the legal sector influences law grads’ earnings. (Oh, and I add that another 17 percent of all lawyers work in government. Is that sector robustly hiring lawyers?)

I don’t expect those 8 percentage points to persuade Simkovic and McIntyre, though. They’ve gotten plenty of mileage asking the legal profession to accept on an untested, pure human capital hypothesis that law school pays off even if the legal sector implodes. They can at least include self-employed lawyers in their adverse footnotes.

13 Law Schools Didn’t Report 2014 Graduate Debt to U.S. News, Again

[UPDATE: Seton Hall’s average graduate debt datum is now accounted for in this post, lowering the number of non-reporting law schools to 13 this year. Without altering the substantive points of the post, please consider the necessary changes having been made.]

The record was 14 last year, which was still too high.

Each year U.S. News ranks law schools based on how much debt their graduates take on. The figure excludes accrued interest, but it’s probably the best estimate of the cost of attendance at a particular law school. It’s also, unfortunately, the only source for this information as the ABA does not publicize it in the 509 Information Reports. Here’s this year’s list of absentees and their debt levels in their last reported year:

  • Arizona Summit – $190,471 (2015, can be found on the school’s Web site [Interestingly, no one took out private loans…])
  • New England – $132,246 (2014)
  • Seton Hall – $127,075 (2014)
  • Faulkner – $122,187 (2014)
  • Missouri (Kansas City) – $103,038 (2014)
  • Southern Illinois – $67,966 (2014)
  • Appalachian – $114,740 (2013)
  • Atlanta’s John Marshall – $142,515 (2013)
  • Florida A&M – $96,934 (2012)
  • La Verne – $112,628 (2013)
  • Rutgers-Camden – $93,990 (2013)
  • Southwestern – $147,976 (2013)
  • Texas Southern – $99,992 (2013)
  • WMU Cooley – $122,395 (2013)

I’m excluding the three Puerto Rico law schools and Widener Harrisburg because U.S. News usually does too. In point of fact, Belmont had 119 graduates last year, so it probably should have been included as well, but I’ll be lenient today. I’d hate to see the record broken.

These schools account for 3,361 3,076 graduates out of 43,118 (excl. Puerto Rico), or 8 7 percent of the total.

The unweighted average private law school graduate debt rose from $124,638 last year to $127,740 127,743 this year (2.4% 2.5%). For public law schools: $88,287 in 2013 to $89,471 in 2014 (1.3%). I haven’t QC-ed this year’s figures, but I’m confident they’re right.

Other amusing facts:

  • Kudos to Barry and District of Columbia for correctly reporting their graduates’ debt levels this year. In 2014, both schools reported what must have been their graduates’ debt for their final year.
  • I’m curious why some schools saw large leaps in debt, e.g. South Dakota (45%), Arkansas (Little Rock) (33%), Baylor (30%), Elon (22%), and Pace (20%). It doesn’t appear they blatantly misreported last year, but these are odd fluctuations, particularly given that some of these schools saw 15% drops in debt disbursed last year.
  • Big ol’ raspberry to Howard for reporting what must be its graduates’ final year of debt: $24,021. Last year, it reported $123,485.
  • Although the ABA hasn’t “acquiesced” yet, it’s nice to see Hamline’s numbers reported. I expected them to not appear.

That is all.

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