I've been watching from the sidelines the atmosphere of crisis overtaking American legal education in the past few years. The financial crisis hit U.S. legal employment extremely hard, vaporizing thousands of high-end jobs (many of which probably won't come back) and reducing the amount of money middle-class Americans had to spend on legal services. The U.S. does not have a sophisticated system of consumer legal insurance, so most people have to pay for legal services out of pocket. This has decimated the job prospects of the people graduating from any but the most elite law schools.
At precisely the same time, law schools — from the elite to the for-profit bottom feeders — have been drastically increasing their tuition fees in lockstep by something like 10-15% per year, meaning that many have literally doubled their tuition fees in the past 15 years or so. (I was lucky enough to go to law school back when it was a serious chunk of change, but not ludicrously, astronomically, ruinously expensive). Now, the average law student in the US can expect to incur total expenses (not just tuition) of something like $150,000 to $180,000 for a three-year law degree.
Paul Campos, the most readable critic of American legal education, explains what's driving this slow-motion train wreck:
An interesting statistic from his blog, Inside the Law School Scam:
Harvard Law School annual tuition IN 2011 DOLLARS
Campos was also recently interviewed by Megan McArdle:
Do you have a sense of how that happens? The legend at business
school–from which I graduated in 2001 with high five figure debt–was
that the universities were using their professional schools as cash cows
to subsidize the rest of the university.
But perhaps the faculty is being paid lots and lots? . . . she said, wryly.
Faculty salaries have doubled in real terms over the past 30 years.
Administrative salaries have grown by much more, and the sheer number of
administrative positions has exploded. Facilities are much nicer (this
is known as the amenities race), and at law schools faculty-to-student
ratios are much lower because of the pursuit of rankings. It's just a
crazy business model, all of which is enabled by no underwriting
standards for student loans.
Megan: Presumably because they're not bankruptable.
Yes, and because the cost is borne by graduates (who are prone to
cognitive errors, ie optimism and confirmation bias) and by taxpayers,
who are a diffuse group. The benefits, on the other hand, are reaped by a
very discrete group — law schools in particular and universities in
general. It's Poli Sci and Econ 101 respectively really.