Discussion with Steven Harper, Author of The Lawyer Bubble

Source: stevenjharper.com

Source: stevenjharper.com

We live in a world where law schools are determined to continue to build their classrooms and increase enrollment and where universities are adding more law schools as profit centers.  Steven Harper, law professor at Northwestern University and author of The Lawyer Bubble, says that as a result, there are more law student graduates in debt and in search of a job requiring a law degree.

Harper says that the big law firms have evolved in a very dramatic way, due to an obsession with "short-term metric"-type ranking criteria, similar to law schools.  He says this clouds judgement which compromises long-term values.

One example of law schools increasing their ranking, says Harper, is by increasing the expenditures by student.  Student loans are increasing which are funding the cycle and while students get loans easily, they have a hard time getting rid of the debt.  This makes sense for the schools because their accountability ends once they accept tuition from a student and so they don't have an economic stake in whether or not the students get a job upon graduation, Harper adds.

There's a big disconnect between the financial stake in getting the students in the door in the first place and the result of the student, according to Harper, adding that at the end of the day, federal loans are funding this and there's no recourse the federal government has.  "We're incentivizing a lot of bad behavior," he says.

There is a classic pyramid in the large firms that exists now, in that there are a handful of equity owners up top and then salaried lawyers working below them at the base of the pyramid.  All of the salaried lawyers are extremely lucrative for the partner owners and they've been "pulling up the ladder as a result on the next generation of lawyers," says Harper, which just means "it's a longer and tougher road."

Harper believes that there has been an increased level of transparency, particularly at the law schools and that it is going to work against people who think this can go on forever.  A couple of solutions Harper offers includes allowing students with severe debt to discharge that debt in bankruptcy and allowing the court to make a finding that because the debt was a substantial factor in the need to declare bankruptcy, that there be recourse the federal government would have.

Harper says that until there is the connection made between the stress inflicted on someone who can't get a job and paying lots of money for a law degree and the incentive of law schools to keep raising tuition to raise revenue, the problem will never be solved.

Steven Harper is an adjunct professor at Northwestern University and author of The Lawyer Bubble.  More information about Harper and his book can be found here.