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Friday, February 24, 2017

Losing the Scholarly Pose

Hadfield and Susskinds[Posted by Bill Henderson]

Law professors are likely to be thrown off their game by Rules for a Flat World by Gillian Hadfield and The Future of the Professions by Richard and Daniel Susskind. The reason is that these books have tremendous scholarly rigor, yet the authors are not writing to advance an academic literature. Instead, they are speaking to us as political and social actors. They are telling us that the legal institutions that we operate within – and take for granted like the air we breath –  are either withering away due to seismic shifts in technology (the Susskinds) or are on a collision course with complexity wrought by globalization and a rapidly flattening world (Hadfield). 

A standard scholarly critique is therefore beside the point. The threshold issue is whether the authors are mostly right or mostly wrong. The answer to that question determines whether we need to engage as political and social actors with more existential questions regarding (a) which institutions we build, (b) which institutions we work very hard to preserve, and (c) which institutions we withdraw from or tear down.

Personally, I think the Susskinds and Hadfield are mostly right. The issues raised by the Susskinds and Hadfield remind me of an earlier time nearly 25 years ago when the intelligentsia on both the left and right ducked similarly hard questions – ones that I believe are now very much connected to the rise of Trumpland. To make my point, I need to tell a personal story.

NAFTA_Globe_and_FlagsMy path to the legal academy was less conventional than most. In the early 1990s, after dropping out of college, I worked as a firefighter-paramedic for a municipal fire department in suburban Cleveland. During my first four years of employment, I never took a sick day — until November of 1993 when I stayed home to watch the congressional vote on the North American Free Trade Agreement on C-Span. NAFTA passed the house on a 234-200 House vote. I truly felt sick.

I was against NAFTA because none the arguments advanced by pro-NAFTA pundits and economists convincingly explained how US production workers would be made better off by being placed into head-to-head competition with low-wage workers with weak workplace protections and no right to organize.  Further, even if NAFTA — and later, China’s Most Favored Nation (MFN) status — would result in much cheaper consumer goods, what about the social and political instability produced by declining working-class wages? This question was not meaningfully raised in the public debate largely because academic economists, consistent with economic theory, had concluded that expanded trade would produce significantly more social wealth. (Note that firefighters have a lot of downtime to do things like read and watch C-span; I was a voracious reader on these topics.)

But who cared what I thought.  I was a college dropout. So a year later, I returned to college, and by 1998, I was enrolled in law school.  Why?  Because I wanted to get into the game, and without these credentials, I doubted that anyone would take me seriously. 

AutorI had nearly forgotten about my NAFTA sick day until I heard a recent Freakanomics podcast in which Steve Dubner turned to David Autor, a labor economist at MIT, to answer the question “Did China Eat America’s Jobs?”  Remarkably, Autor acknowledged that the labor economists of the early 1990s lacked the empirical tools and modeling to adequately anticipate the full impact of the trade deals that the US was cutting.  Instead, economists at the time were relying on classical economic theory that trade among nation-states would enhance overall net wealth.

On balance, Autor believes that NAFTA did deliver modest economic benefits to the US. But the distributional consequences have been very uneven.  As manufacturing has moved from the US to places like China and Mexico, local economies with heavy reliance on factory jobs – often in rural and semi-rural locations – experienced tremendous downward pressure on wages, as the next best-employment options paid significantly less.  Quoting Autor from the podcast:

[T]he net effect [of these trade agreements] you can show analytically is going to be positive. But the redistributional consequences ... many of us would view [ ] as adverse because we would rather redistribute from rich to poor than poor to rich. And trade is kind of working in the redistributing from poor to rich direction in the United States. The scale of benefits and harms are rather incommensurate. So for individuals, you know, I have less expensive consumer items because of imports from China. But it hasn’t affected my employment or my wages. For many others – on the order of at least a million U.S. manufacturing workers – it meant the end of their jobs and in many cases the end of their industries.

Autor goes on to note that most workers in impacted local economies don't retrain themselves and migrate to higher wage portions of the country where their retooled skills are in higher demand.  Instead, they become unemployed, underemployed, or get classified as disabled and enter the Medicaid roles for the rest of their working adulthood.  When the factory jobs left, the second and third order effects of lost and lower wages fundamentally changed many local economies for the worst, making them fertile electoral grounds for Donald Trump's "Make America Great Again" message.

Gillian Hadfield has a powerful line in her book that speaks to this new reality:  "[P]eople who feel as though the rules don't care about them don't care about the rules."  For a while, we knowledge worker elites have been able to ignore this fundamental truism.  The disruptive impact of technology on the professions – specifically our expectation of a lifetime of comfortable employment – is our own personal version of NAFTA.  This is a very humbling way to become more empathetic toward others seemingly very different from us.  The silver lining here for lawyers and law professors is that our problems are just a subspecie of a more general problem affecting everyone living in the 21st century.  If we focus on solving it for others, we simultaneously solve it for ourselves. 

Posted by Bill Henderson on February 24, 2017 at 11:46 AM in Symposium | Permalink

Comments

I sometimes wonder if the 'int'l free trade agreements are bad for workers' vs 'int'l free trade agreements generally benefit the economy' dichotomy is false. If the Federal gov't limited herself to Constitutionally authorized regulation (that is to say, nearly none at all, the outrageously unConstitutional uses of the Commerce and General Welfare clauses that have been popular since the '30's notwithstanding) then the business climate in this nation would be so favorable that we could probably easily compete with lower income areas due to the improved overall cost of doing business here.

Posted by: Jeremy Klein | Feb 27, 2017 4:09:45 PM

A study in the UK showed that only 20% of government workers did jobs that required actual human intelligence. The legal profession (which already only employs about half of law school graduates) is said to be particularly vulnerable to inroads made by artificial intelligence.

However, instead of robots processing forms, we'll see a Baptists & Bootleggers type coalition of lawyers and public employees using their power in the system to keep themselves entrenched.

Posted by: Johann Amadeus Metesky | Feb 27, 2017 4:27:42 PM

It was manufacturing jobs then, now (and for a while) it is jobs in the Tech industry, programming/design going to places like India and China. they only ones (in the US) benefiting from this are the upper management, the CEO's and the like who own the stock. The workers same exact story.

Posted by: old guy | Feb 27, 2017 5:03:18 PM

NAFTA destroyed my career. I along with 60 co-workers were informed that we were all being let go and our company was relocating to Mexico in November of '93, right before it was to become law. That was when I began to become more politically aware, as I couldn't believe that my own government was no longer representing me or my interests. In the wake of NAFTA, tens of thousands of small manufacturing businesses closed their doors and millions of hard-working Americans like me found it increasingly difficult to find a job in our chosen profession.
What we lost will be difficult to recapture. What we lost was an industry where upward mobility was the norm. Someone who began in a shop delivering goods (for example) could find other positions that interested them and either learn on the job, take evening classes or (in my case) join an apprenticeship program. You could start out on the shop floor then add to your knowledge to become a machinist, Quality Control inspector, a CNC programmer, an accountant or an engineer. The more experience you gained, the more valuable you became to you employer. There was no limit to how far you could progress. You could even start your own company. NAFTA destroyed all of this in a formerly vital sector that was less vulnerable to economic downturns than the service sector which was to replace it.
We who saw our careers shipped to other countries who don't share our passion for quality or a clean environment and whose governments heavily subsidized their entries into manufacturing were stunned. What were our so-called representatives thinking about? Whatever it was, it certainly wasn't us.

Posted by: BackwardsBoy | Feb 27, 2017 5:05:25 PM

So Ross Perot with his "giant sucking sound" was right and the institutional economists were wrong?

Why are we listening to these guys, again?

Posted by: Bill Peschel | Feb 27, 2017 5:58:49 PM

An excellent post and insightful follow up comments. I think the author is right that the disruption that first faced the Blue Collar rural voters will soon find its way to white collar urban voters. Working together to find solutions for both parties, as the author suggests, seems the best course of action. An article in the Atlantic recently quoted someone as saying that the problem with a meritocracy is that it sucks out all the empathy. I think many rural blue collar and urban white collar voters now feel an us-vs-them dynamic and that is dangerous for creating clear thinking policies.

To Bill Peschel's point: Right? There seems to be a serious crisis in confidence. I think the problem is that too many claim undeserved expertise or claim abilities that expertise doesn't grant. Experts should be willing to say what they can't predict, what they can't do, and what isn't to their knowledge possible, while also affirming that of which they are sure. Education is a great example. I'm shocked as I speak with coordinators, principals, interventionist, and so called specialist, who when discussing students in private repeatedly say they don't know what to do, suggest the latest education fad or hot topic, or list off the possible reasons its not their fault. But then go into a parent meeting and assure them that they know exactly what to do and promise results. How long do they think they can do that without creating a serious distrust in them and their so called expertise?

Posted by: Stuart Enkey | Feb 28, 2017 10:20:47 AM

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