Paul Caron on Drivers of Law School Cost from GAO Report

Paul Caron, at TaxProf, has posted some executive summary parts and the link to a GAO report on drivers of law school cost as well as minority enrollment.  Regarding costs of legal education, the GAO summary says:

According to law school officials, the move to a more hands-on, resource-intensive approach to legal education and competition among schools for higher rankings appear to be the main factors driving the cost of law school, while ABA accreditation requirements appear to play a minor role. Additionally, officials at public law schools reported that recent decreases in state funding are a contributor to rising tuition at public schools.

Very interesting post over at TaxProfBlog – the screen shots include a number of powerpoint charts and graphs from the GAO report.  I agree with the GAO report and its surveyed law school officials that accreditation plays very little role in driving up law school costs, and that rankings are an important driver.  They are also an important driver in things schools spend money on that drive up costs, such as faculty student ratios, for example.

I also believe, however – but wouldn’t try to defend here – that law schools respond to the availability of federal dollars and capture that money from students, and that law school tuition rates reflect perceptions of the return on investment available to students in going to work for law firms.  At least in my discussions with fellow professors who have some idea about law school economics, the thought is that mid tier schools found that they could place more of their students into large law firms, not necessarily the very top firms, but large workhorse firms that paid well.

And in my discussions with professors, the concerns are two-fold.  First, that if the big law model is genuinely collapsing into the long term, then the returns on law school investment might well be declining to … what, exactly?  Well, for those of us here in Washington DC, it might be to something closer to what government lawyers earn.  Not to be sneezed at, heaven knows, particularly if you factor in the security and benefits, but not necessarily the returns long term that can support the rate of tuition increases at even mid tier schools like my own.

Second, if the USG becomes the lender directly, the pressure on it to intervene in the tuition “market” (I use that term very loosely indeed) and impose some cost controls is strong.  That could well be characterized, and might actually be, a regulatory mechanism for ensuring that subsidies aimed at students don’t wind up in the hands of a law school oligopoly.  Or not.  At least, that’s the substance of conversations I have with friends at a variety of schools in roughly my school’s tier.

Given the fascination of law professors with all things having to do with the ranking and dissection of the law school world, is it possible that someone has already done a genuine empirical study of the cost structures of law schools and their implied or explicit business models?

As a side note, I certainly find that I think harder than I used to about whether I am providing value to students, and I think of it as dollar value and return on long term investment.  I treat myself a lot more as an educational fiduciary than I used to.  I’m not alone in that, I suspect – I had a fascinating dinner conversation with a friend who teaches comp lit at a top five university; he told me that he thinks all the time about what he is going to convey and what it should mean, particularly as it is not professional education – it is inherently long term and about learning to think, reason, interpret, and write effectively, and in the context of the humanities and values.  He has a son about to enter college and it is on his mind same as it is on mine.  Yet it’s easier, really, for me to answer that teaching in a professional school – I don’t mean that the humanities, literature, etc., are not important, far from it, but that it’s an easier pedagogical question in a law school or medical school than in a literature department.

That means, from my point of view, thinking about law student education and what I think they need that they are not professionally able to determine for themselves.  I’m not an agent for a principal, I’m a fiduciary for an only partly competent principal.  My best advice, I suppose, is that you need a mix of plumbing classes and grad school classes; classes that teach you about the nuts and bolts, but also classes that teach you to think creatively and amply, because the field is not static, at least not in American law.  It might mean law and economics, to learn to think in a forward manner about incentives, for some students; and to learn to write and interpret difficult texts for others; and still something else for others.

Students, on the other hand, tend to think they know more than they do about what they need from law school, and at the extreme end, tend to think of themselves as the purchasers of a very expensive commodity called legal education, and I am the guy on the other side of the Starbuck’s counter purveying it to them.  Wants and needs.  There was a song about that, right?