Are Law Schools Part of the University?

Long ago Jim promised a series on law schools as public utilities. It's a great idea and current budget crunches make the parallel even clearer. One basic comparison is that in regulated industries, regulators are not that interested in how much a utility spends. Instead it is how much is passed along to rate payers. In higher education, the question is not how much a unit spends but how much is passed onto to taxpayers.

My own school is dealing with the budget crunch by reducing the size of the entering class (lowering the pass through) and raising tuition (to offset the loss) in order to avoid downsizing the budget itself. I hasten to add that our tuition is way, way below the average for public schools so we anticipate little reaction on the demand side of the market. The key point of the plan is that we keep the extra tuition so, as my dean puts it. " substantially all of the dollars generated are returned to the benefit of the college whose students paid those dollars." As my prior posts indicate and Rick Matasar has also said, it's not all that clear that the funds are used for the benefit of students as opposed to avoiding faculty sacrifices, but that is a different matter.

In various regulatory structures, cross subsidization refers to the idea that some revenue raising ventures earn enough to subsidize other activities. In a university, it is possible to see professional schools as those responsible for cross subsidizing those activities that are necessary to have a top university but which do not generate comparable revenues. For example, is it possible that medical schools and law schools should be the cash cows for the humanities? In a regular business we might cut loose a product line that does not carry its weight. Is the same logic applied to higher education? And from a slightly different perspective, if the rationale for public law schools their "public good" character and the positive externalities they produce, why should the students pay more?

In any case, the move to keeping what we bring in is obviously a step toward privatization. My hunch that that most faculty at public law schools would regard that as a bad idea. But then they seem to like semi-privatizing and not being part of the University when times are bad.

Is the Law Professor Gravy Train Over?

New York Times (Jan. 18, 2009): The Last Professor, by Stanley Fish:

I have argued that higher education, properly understood, is distinguished by the absence of a direct and designed relationship between its activities and measurable effects in the world. ...

It may be fun to argue its merits (as I have done), but that argument may be merely academic – in the pejorative sense of the word – if it has no support in the real world from which it rhetorically distances itself. In today’s climate, does it have a chance?

In a new book, The Last Professors: The Corporate University and the Fate of the Humanities, Frank Donoghue ... asks that question and answers “No.” ... Except in a few private wealthy universities (functioning almost as museums), the splendid and supported irrelevance of humanist inquiry for its own sake is already a thing of the past. ...

One vision, rooted in an “ethic of productivity” and efficiency, has, he tells us, already won the day; and the proof is that in the very colleges and universities where the life of the mind is routinely celebrated, the material conditions of the workplace are configured by the business model that scorns it. The best evidence for this is the shrinking number of tenured and tenure-track faculty and the corresponding rise of adjuncts, part-timers more akin to itinerant workers than to embedded professionals. ... Universities under increasing financial pressure, he explains, do not “hire the most experienced teachers, but rather the cheapest teachers.” Tenured and tenure-track teachers now make up only 35% of the pedagogical workforce and “this number is steadily falling.” ...

People sometimes believe that they were born too late or too early. After reading Donoghue’s book, I feel that I have timed it just right, for it seems that I have had a career that would not have been available to me had I entered the world 50 years later. Just lucky, I guess.

Forbes (Jan. 14, 2009): The Great College Hoax, by Kathy Kristof:

Accepted into the California Western School of Law, a private San Diego institution, [Joel] Kellum couldn't swing the $36,000 in annual tuition with financial aid and part-time work. So he did what friends and professors said was the smart move and took out $60,000 in student loans.

Kellum's law school sweetheart, Jennifer Coultas, did much the same. By the time they graduated in 1995, the couple was $194,000 in debt. They eventually married and each landed a six-figure job. Yet even with Kellum moonlighting, they had to scrounge to come up with $145,000 in loan payments. With interest accruing at up to 12% a year, that whittled away only $21,000 in principal. Their remaining bill: $173,000 and counting.

Kellum and Coultas divorced last year. Each cites their struggle with law school debt as a major source of stress on their marriage. "Two people with this much debt just shouldn't be together," Kellum says.

The two disillusioned attorneys were victims of an unfolding education hoax on the middle class that's just as insidious, and nearly as sweeping, as the housing debacle. The ingredients are strikingly similar, too: Misguided easy-money policies that are encouraging the masses to go into debt; a self-serving establishment trading in half-truths that exaggerate the value of its product; plus a Wall Street money machine dabbling in outright fraud as it foists unaffordable debt on the most vulnerable marks. ...

Not only are college numbers spun. Some are patently spurious, says Richard Sander, a law professor at UCLA. Law schools lure in minority students to improve diversity rankings without disclosing that less than half of African-Americans who enter these programs ever pass the bar. Schools goose employment statistics by temporarily hiring new grads and spotlighting kids who land top-paying jobs, while glossing over far-lower average incomes. The one certainty: The average law grad owes $100,000 in student debt. "There are a lot of aspects of selling education that are tinged with consumer fraud," Sander says. "There is a definite conspiracy to lead students down a primrose path."

AALS Committee on Research Program (Jan. 9, 2009), Citations, SSRN Downloads, U.S. News, Carnegie, Bar Passage, Careers: Competing Methods of Assessing Law Schools (podcast):

• Bill Henderson (Indiana):
  
  • 25:30: "Employment outcomes do not turn on your U.S. News ranking."
    25:55: At 50 law schools, 20% of the students are either unemployed, flunked out, or are unknown, yet the ABA and LSAC disavow the use of data to rank law schools.
• Richard Matasar (Dean, New York Law School):
  
  • 1:16:50: "We are an input-focused business, and outputs are what the students are paying for."
    1:20:40: "Law school needs to be about what people need -- not what we're good at. ... Most of us are social misfits, and we're the ones who've been designated to teach the students how to work interpersonal skills."
    1:21:20: "We should be ashamed of ourselves. We own our students' outcomes. We took them. We took their money. We live on their money to pay to come to San Diego. And if they don't have a good outcome in life, we're exploiting them. It's our responsibility to own the outcomes of our institutions. If they're not doing well ... it's gotta be fixed. Or we should shut the damn place down. And that's a moral responsibility that we bear in the academy. It's a leadership responsibility that each of us has. And damn the U.S. News if it affects our rankings. The kids are not gonna show up. Do you know that LSAT registrations are flat to down this year. That students' applications to law school are flat to down in a substantial number of law schools. That's never happened in a downturn in the economy before. They're catching on. Maybe this thing they are doing is not so valuable. Maybe the chance at being in the top 10% is not a good enough lottery shot in order to effectively spend $120,000 and see it blow up at the end of three years of law school.
• Jason Solomon (Georgia):
  
  • 1:29:20: "We're mad as heck and we can't take it anymore. ... To the panelists and others in the room: what are we going to do? Are people from AALS leadership here?"
• Bryant G. Garth (Dean, Southwestern):
  
  • 1:32:00: "This group has stonewalled completely and killed any kind of real consumer information for 20 or 30 years, and that's what made U.S. News own this particular enterprise. And it's something that maybe those that stonewalled for some long might have to take some initiative and responsibility in remedying the situation we find ourselves in."

(Cross-posted on TaxProf Blog.)

U.S. News on Track for April Release of New Law School Rankings

Robert Morse, Director of Data Research at U.S. News & World Report, announced on his blog yesterday that the U.S. News law school rankings are on track for the annual April publication:

• The law school statistical and peer assessment data collection is now complete.
  
• U.S. News will publish for the first time peer-assessment-only rankings for Ph.D. programs in English, history, psychology, sociology, political science, economics, and criminology and criminal justice, as well as new rankings for master's degree programs in library and information studies.
  
• U.S. News will publish updated law school rankings in a variety of fields, including tax.
  
• U.S. News will publish for the first time rankings of the 87 ABA-approved part-time J.D. programs (defined as a law school that has a separate admission process for part-time law students and specific part-time J.D. program curriculum offerings).

For more details, see TaxProf Blog.