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Monday, September 19, 2005

Should We Scrap the Third Year of Law School?

Lawsch5Over at the Legal Affairs Debate Club this week, Laura Appleman (visiting prof., Hofstra Law School) and I are debating whether the third year of law school should be scrapped as well as other issues regarding the future of legal education.  We’re reprising a discussion we had a while back here at PrawfsBlawg while Laura was a guest blogger.  Our Prawfsblawg posts are here, here, and here.  Our debate will continue over at Legal Affairs Debate Club for the rest of this week.  Laura has lodged the first strike in the debate, contending that the third year should either be abolished or significantly restructured.  My response will appear soon.  Each day this week, we’ll continue to trade punches in the debate.  If you have thoughts and reactions, please feel free to air them here, as the Debate Club format doesn’t allow for comments. 

Posted by Daniel Solove on September 19, 2005 at 09:40 AM in Daniel Solove, Life of Law Schools | Permalink

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» too much law school / too little haiku from f/k/a
I spent some time at Prawsfblawg this afternoon, where the discussion is "should we scrap the third year of law school?" -- [Read More]

Tracked on Sep 19, 2005 6:23:17 PM

» Who's Gonna Kill 3L? from ambivalent imbroglio
Following up on yesterday's post about whether the cost of law school should prevent people from pursuing public interest careers, Andrew Raff points to an ongoing debate at the Legal Affairs Debate Club over the question: Abolish the third year of law... [Read More]

Tracked on Sep 23, 2005 10:52:40 AM

Comments

How interesting: Laura "can see why" law schools would want to keep a three year term on a purely financial basis. But she discerns no similar financial interests for law professors, who instead are merely interested "in having students for a longer period of time, for both teaching and mentoring purposes, both of which are better achieved in three years rather than two."

Posted by: David Giacalone | Sep 19, 2005 10:57:38 AM

Open up multiple paths to the law: (1) undergrad law degree followed by comprehensive exam and one year probationary status woking in a law job; (2) two-year JD degree plus exam (and one year probationary status?); and (3) full-on three-year JD.

The benefits: reduce legal profession's guild rents; increase diversity of lawyers; reduce student debt; reduce sway of biglaw stemming from student debt; enable cheaper representation of potential clients currently not served by the profession.

Posted by: John Steele | Sep 19, 2005 12:18:31 PM

A concern that seems to be ignored in the usual iterations of this debate, that I hope you and Laura will address, is this: do we already have too many people coming out of law school? I haven't been able (with only a casual search, admittedly) to find recent data about unemployment rates among lawyers (I'm sure the BJS has trend data somewhere), but there seems to be a common perception that it's increasing. If that's the case, do we want to increase the rate at which law school graduates enter the population?

Posted by: Paul Gowder | Sep 19, 2005 1:00:31 PM

"If that's the case, do we want to increase the rate at which law school graduates enter the population?"

Ah, command-and-control: I love it. Of course, if a person invests less money in his or her legal education, the costs of leaving the legal profession are lower. How many people remain unhappy lawyers because they can't make as much money doing something else, and they have school loans to repay? By reducing the costs of leaving the law, it's possible we might have fewer lawyers.

Posted by: Mike | Sep 19, 2005 1:40:39 PM

I haven't read the actual paper, but the abstract of this puppy suggests that economics might have some insight to offer. The key sentence: "Our evidence shows that countries with a higher proportion of engineering college majors grows faster; whereas countries with a higher proportion of law concentrators grows more slowly."

If their research is any good, it might suggest that even if there isn't an oversuppy of lawyers in the sense of outstripping demand, increasing the supply of lawyers relative to other professions may impair economic growth.

(I meant BLS in the previous comment of course.)

Posted by: Paul Gowder | Sep 19, 2005 1:43:03 PM

Mike: you make a very good point.

I'd suggest however that the solution to your objection is not to lower the cost of legal education ex ante. It is either (a) make law school loans dischargable in bankruptcy upon an agreement (or de facto compulsion via "character and fitness") not to remain in the profession, or (b) shrink the supply of law school loans. (Of course, A will do B.) This would reduce the expected investment of money in law school, making the costs of leaving lower, but would maintain the high investment of time as well as the high initial investment of money (or deterrent effect of taking out loans).

We can then reduce the negative impact of lawyer overpopulation and at the same time keep the costs of entry high enough that people are motivated to go to more productive occupations in the same economic cohort.

Posted by: Paul Gowder | Sep 19, 2005 1:50:52 PM

Dan, I think it's hard to argue that no law school should have a third year; certainly some are entitled to the view, like yours, that they would prefer to give their students three years of legal education. That particularly makes sense if you view law school as graduate studies in law, rather than just practical training to become a lawyer -- the third year gives you the time to study fluffy subjects that you'll never actually use in practice.

But why should 3 years of classes be a requirement for ABA accreditation? Why not get rid of the requirement and let the market sort it out?

Posted by: Bruce | Sep 19, 2005 3:09:58 PM

Paul, I don't think either of your solutions will ever happen, and I would not like to set a precedent that student loans can be discharged if the graduate can't find a job in a field that is related to the degree.

More important, neither "we" nor "they" should be deciding how many slots there will be or should be for law students. The number of law school graduates who are unemployed is not related to a shortage of work for them to do -- it's because they are pricing their services too high.

A study by Mario Pagliero in 2004 showed that "licensing increases annual entry salaries [in the American legal profession] by more than $20,000, "with a total welfare loss of over $6 billion. A 2003 EU report comparing levels of regulation in professions in the various member states, shows that lower levels of regulation result in increased competition and wealth creation (e.g., lower income per professional, more competitors in the marketplace, and more efficient units). A 1999 study by Stevens and Love concluded that attorney self-regulation operates in favor of the profession over the interests of the client -- limiting competition and raising fees and professional income.

One very onerous regulation is the required third year of law school. Nothing would stop schools from offering longer periods of matriculation or post-JD degrees, and nothing would stop employers from asking for longer study or particular types of continued experience when hiring lawyers for high-end legal possessions. However, much of the legal needs of Americans could clearly be met adequately by lawyers with a 2-year JD-degree.


Jimmy Carter was pretty close to the mark when he said that "Ninety percent of lawyers serve 10 percent of our people." It's been estimated that 150 million Americans have legal needs that go unmet because the cost of legal services is too high. If less expensive legal education allows more lawyers to serve the needs of low- and moderate-income Americans, we will be a better nation. See, e.g., my ethicalEsq post on Access to Legal Services.

Posted by: David Giacalone | Sep 19, 2005 4:06:40 PM

I think Paul raises a good point that is sort of ancillary to this whole discussion: why does American society collectively decide to compensate lawyers as well as it does? I agree that our society has set up an irrational set of incentives by not adequetly compensating scientists. In doing so, we are letting our legal system eat up dollars that should be going to investment in R & D.

(I think it's worth broadening this question to include the other unreasonably high-paid professions: top management of large companies and i-bankers. In each case, I think the manipulation of the market has unfairly allocated overly large compensation to these actors. CEO's, in my view, benefit from effectively setting their own compensation levels through control of compensation boards. I-bankers, meanwhile, use the market dominance of wall street in ways that counter-productively increase the number of mergers and acquisitions so as to be able to charge higher fees. But I digress.)

However, as a student, I kind of like law school, and don't mind being here for 3 years. I probably wouldn't feel this way if I went to a school where I was more worried about being able to get a job after graduation, though... This is probably another argument for letting the market (and not the ABA) sort out whether law school should be 2 or 3 years: lower-ranked law schools that have more problems placing grads can offer 2-year programs so that their students don't take on an unreasonable amount of debt, given the increased difficulty of scoring $125K jobs after graduation; higher-ranked schools can continue to allow their students to enjoy the academic side of law school for 3 years, as they shouldn't worry too greatly about not being able to pay back their student loans.

Posted by: Jeff V. | Sep 19, 2005 4:38:00 PM

David:

winter's first frost hits
a nest full of eggs --
stupid pigeon

(Basho I ain't.)

By which I mean: that's interesting, but I don't think it's true. My personal experiences on both sides of the public interest job market suggest to me that there's plenty of lawyers who are willing to take relatively low-paying jobs that serve the need of low-income Americans. (I.e. people who can't afford to pay anything for legal services. As for moderate income americans, who can afford to pay a little for legal services, that's what we have an insurance industry for, to collectivize and distribute those costs.) Rather, the problem is that there is insufficient funding in general for services to low income Americans.

Anecdotally, for example: I participated in the hiring of the director of a legal aid office in extreme rural Oregon. That job is very undesirable both in pay and in location, and was not well advertised either. Yet we had sufficient interest that we were able to interview three well-qualified candidates and select one with little trouble. We still had to turn down or failed to find and reach an insane percentage (no less than 80%) of the people who needed our services (including migrant farmworkers etc.), but we couldn't have hired more people, even at the subsistence wages we were offering, because there simply wasn't enough funding.

Provision of legal services to low-income Americans is solved by good old fashioned redistribution, not increasing the supply of lawyers.

Posted by: Paul Gowder | Sep 19, 2005 4:51:05 PM

Jeff: that solution would make the split between the law school "tiers" even more pronounced, as job seekers from higher-ranked law schools would be perceived as even better because they'd have a year more education.

Posted by: Paul Gowder | Sep 19, 2005 4:55:00 PM

I don't think there is a three-year requirement, per se, for accreditation. My understanding is that it is based on credit hours. Thus, at some schools students can graduate in 2.5 years if they are willing to go to summer school.

Posted by: anon | Sep 19, 2005 5:11:13 PM

Paul, The public interest sector is only a small part of this problem. Main street lawyers -- who purport to serve the needs of middle income Americans -- charge fees that are out of line with the complexity and skill-level of the services required by most consumers. Their fees price consumers out of the market. Your easier-said-than-done insurance "solution" is unlikely to happen any time soon, if ever, given the moral hazard problem and the refusal of most lawyers to discount their servics in order to be preferred providers.

Posted by: David Giacalone | Sep 19, 2005 5:19:55 PM

But the insurance solution is happening, and it is meeting many legal needs of middle-income americans. Consider:
- Automobile liability insurance
- Homeowner's/renters insurance, which often covers many liabilities
- "Pre-paid legal" insurance schemes, which cover many minor things, like demand letters and wills.

Posted by: Paul Gowder | Sep 19, 2005 5:33:07 PM

Paul, I think you are greatly underestimating the amount of unmet legal needs of the average American. For example, the ABA's 1996 Comprehensive Legal Needs Study found:

1. Most people facing situations that have a legal dimension do not turn to the
civil justice system for help.
• Each year about half of all Iow- and moderate-income households
in the United States face a serious situation that raises a civil legal
issue.
• But neither Iow-income nor moderate-income households bring the
overwhelming proportion of such situations to any part of the justice
system.
• Most often the reasons people give for staying away from the
justice system are doubts that it would help, concern about cost, a
sense the problem was not serious enough, or a desire to handle
matters on their own.
2. Even counting the efforts many people make to handle problems on their
own or to get help from outside the legal system, substantial proportions of
Low- and moderate-income households still may need legal help.
Meanwhile, over the last twenty years, legal services to individuals and
households have declined as a proportion of all legal services provided by
the civil justice system.



Posted by: David Giacalone | Sep 20, 2005 12:12:52 AM

David: I don't deny that there's a shortage of legal services to low income americans. As for moderate income Americans, well, I note that the ABA report does not provide differentiated data, because it asserts that the legal needs of the two groups are the same. That's as may be, but the solutions to the two are different, because, again, poor people can't afford legal services at all, while middle-income people might be able to afford a little.

Moreover, even leaving aside the issues relating to the nauseating lack of funding for low-income legal services, and the narrow group of people who are eligible for those services (which the ABA report correctly points out), I still wonder whether increasing the supply of lawyers will help. The simple fact is that lawyers are not -- as noted in the economics article I linked earlier -- productive. Lawyers are fundamentally rent-seekers, and increasing the proportion of rent-seekers in society might well cause as many problems as it solves, including for the poor and middle-income folks. I hate to sound like a conservative here, but lawyers are expensive to support: we tend to cause prices, insurance rates, etc. to increase.

Now, there's certainly a baseline of lawyers that are necessary -- social justice lawyers certainly make a productive contribution to society. But again, we seem to have more aspiring social justice lawyers than we're willing to pay for, so I fail to see how increasing the masses churning out of law school will be of any use.

Posted by: Paul Gowder | Sep 20, 2005 10:17:47 AM

"Jeff: that solution would make the split between the law school "tiers" even more pronounced, as job seekers from higher-ranked law schools would be perceived as even better because they'd have a year more education."

I dunno, I think the split is pretty pronounced already. My guess is that almost none of the students from the schools that would likely adopt a 2-year approach -- those in the 4th tier -- are actually competing with people from the first two tiers for jobs. If they're not competing anyway, then what wrong with making them less competitive with tier 1 students?

Also, I'm not sure that making the law schools more equal is a good thing. Law schools from the bottom tier serve very different societal needs from those in the top tier. Tier-4 law schools produce mostly small firm/solo practioners. Top tier schools produce corporate lawyers. The needs of the two different types of lawyers are very different. You can already see this difference in terms of what type of law each set of schools teach: top schools teach mostly theory-based law, while bottom schools prep their students for the bar in that state. Why not let each specicific school make its own decision as to what type of approach it wants to take regarding the 2 vs. 3 year track?

One other consideration: it strikes me that most law schools cannot really compete with each other based on quality. USNEWS rankings aren't changing, and schools have probably already tapped out the possibilities for gaming their admissions numbers to rise in USNEWS. Of course, USNEWS is not a good measure of school quality, but, by being so widely read, it is THE measure of perceived quality. So if law schools can't compete on quality, why not at least let them compete on price (i.e., 2 years v. 3)?

Posted by: Jeff V. | Sep 20, 2005 10:23:20 AM

I'm interested in Laura's suggestion today about revamping the first year. Have any schools tried a more experimental approach like the kind Laura suggests? And how would electives factor in? A lot of schools allow one elective in the spring of first year, but theoretically everything could be an elective. Would it end up that everyone still took the core courses, out of concern for the bar exam, tradition, or well-roundedness?

Posted by: Matt Bodie | Sep 20, 2005 11:47:36 AM

Jeff: I'm uncomfortable solidifying the class differential encoded into the law school tier system all the more. It suggests a comparison to community colleges. Has anyone done any research on community college populations and outcomes? My intuitive sense is that they serve two purposes: preparing students for transfer to "real" 4-year colleges and ghettoizing the lower socioeconomic classes into an "educational" program that for the most part leads only to lower-middle class careers. On the other hand, those who attend 4-year colleges have enough market credibility to have some chance of upward mobility.

When we connect your comments to David's, we get a rather worrisome picture from a class aspect. If the lowest tier of schools shortens the programs, thus churning out even more graduates, downward salary pressure will be exerted on those graduates from two directions: oversupply and perceived relative lower quality due to the length of schooling. For society in general which (allegedly) needs more lawyers to have more access to legal services, that might be good, but do we really need to make it all but impossible to generate upward mobility for the people who are attending those lower-tier law schools -- who, after all, are likely to come from lower socioeconomic classes in the first place?

Posted by: Paul Gowder | Sep 20, 2005 11:56:22 AM

Matt,

To answer your question briefly, the only school that I am aware of that has a different first-year law curriculum is Yale, which only requires one semester (the first one) of required courses: Con. Law, Torts, Contracts and Civ. Pro. A professional responsibility mini-class and legal writing are included in that first semester. After that,, it's all electives--you just have to take Criminal Law before you graduate, and must fulfill two writing requirements.

Interestingly, most students still take the core courses, like property, evidence, federal courts, tax, bus. org., etc. But the minimal requirements really allow students to explore their interests from the beginning, and get a good mix.

I'm not sure why most other law schools are so rigid about the first-year curriculum (and often the second), but I think it should be re-thought.


Posted by: Laura I Appleman | Sep 20, 2005 2:21:35 PM

Paul, I think the comparison with community colleges is interesting, but ultimately problematic, for two reasons.

First, the law school admissions process to me seems to have sufficient mechanisms in place to overcome potential class biases that are anti-meritocratic. Perhaps the largest such mechanism is a consequence of USNEWS; since USNEWS is so influential, and its student GPA component doesn't take into account the quality of the undergraduate institution attended by an applicant, the USNEWS rankings have the effect of allowing intelligent students (as measured by the LSAT, at least) to attend good law schools almost regardless of where they went to college. Indeed, I think USNEWS' effect is so strong in this regard that it creates certain alternative problems that are more important than a class-based difficulty of admissions: 1) applicants from great UG schools with mediocre GPA's are punished, and 2) applicants with science or technical majors that have harder grading curves are punished.

The second mechanism that I alluded to is affirmative action. While you may argue that affirmative action uses a factor (race) that is at best a rough proxy of class, I think you will probably concede that affirmative action does have at least some redistributive effects.

Also, your point that argues that a system such as the one that I/David/others have promted would decrease salary pressure on lower-tier lawerys begs the question: is the point of law school to maintain the high salary of lawyers in some way that redistributes wealth among classes, or should legal education train enough lawyers so that most Americans have access to legal services? I think that, if redistribution is what you want, building that into the legal education system at the expense of restricting middle class access to the benefits, advantages, and rights of the American legal system is misguided. In other words, if you want redistribution of wealth, attempting to achieve that through the method that you have outlined seems misguided and probably even counterproductive.

Posted by: Jeff V. | Sep 20, 2005 8:10:09 PM

Jeff: the USNEWS thing is interesting. I kind of like the idea of the hatefuly USNEWS rankings as a force for upward mobility. That's worth some serious thought. Of course the same can be said for AA.

In terms of decreasing salary pressure, your point is well taken if and only if the current unmet legal services need is caused by an undersupply of lawyers. As noted above, I dispute that premise, mainly based on my anecdotal evidence that public interest legal employers get far more applications than they can possibly hire for even given the pittance they normally pay. That suggests that at least the class of lawyers that applies for those jobs isn't pricing itself out of the market, so much as that society in general is failing to meet even the basic fixed costs of providing legal services to all.

I still fail to see why a robust insurance industry can't cover much of the middle-class legal need. Contrary to David's assertions, there are plenty of lawyers who are willing to lower their rates to become insurance providers -- they are in fact presently insurance providers, via e.g. automobile insurance companies.

Also contrary to David's assertions, the moral hazard problem (which is an embarassingly judgmental name for an economic phenomenon, but the economists are a little funny in the head anyway) would be structually odd for much of the legal need. After all, half of all civil litigation, plus all private criminal litigation, is defensive. How can one have a moral hazard problem when much of the use of the insured services is compelled by the actions of a hostile third party? It's not like doctors where hypocondriacs could (in theory) overuse the services. Moreover, the system has protections against moral hazard on the defense side, particularly rule 11 and fee-shifting. It would be a foolish moral-hazard-actor indeed who took advantage of an insurance company lawyer to overlitigate a lost case and then get socked with major sanctions. This means the moral hazard, if it's anywhere, will be on the plaintiff side -- but not if the ethical prohibitions against participating in frivolous suits (as well as rule 11 etc.) were incorporated into insurance company contracts, so that plaintiffs would not have the opportunity to moral-hazardly overuse their insurance lawyer services for frivolous litigation... in fact, the whole notion of moral hazard with lawyers seems to be implausible, since unlike doctors, one generally knows when one is being screwed and needs the legal system.

Posted by: Paul Gowder | Sep 21, 2005 2:05:11 PM

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