New York Times Financial Advice: Be an Unpaid Intern Through Your 20s (Then Work till You’re 100)

Jason Mazzone has already addressed the main shortcomings of the latest N.Y. Times article by David Segal on law schools. I’d like to situate it as part of a neo-liberal ideology developing at the Times and other scriveners for the powerful.

If you pair the basic message of Segal’s piece (“law students and professors aren’t doing enough to raise corporate profits”) with that of Ed Glaeser’s anti-retirement musings in the same pages (“work into your 90s”), the ideology starts to emerge. Labor economist Mark Price pithily suggested it:

Law schools couldn’t possibly teach the wide range of firm specific skills that law firms need . . . . And yet you have a writer [pushing] propaganda that the big law firms are tired of paying for on the job training.

On the other hand it is at least comforting to know that law firms are not that different from firms in Manufacturing or Health Care[;] that is[,] they would prefer that somebody else pay for the skills that make them profitable.

This is a classic problem of uneven bargaining power familiar since the 1920s.* Why are wages falling while productivity is rising? Because firms realize they can fire current workers, shift their duties (unpaid) to frightened current employees, and reap the profits of having one person do the work of many. It’s another form of “shadow work” that contributes to the time bind so many Americans find themselves in. When 65% of economic gains go to the top 1% of the population, it’s not too hard to discern this dynamic.

Of course, a firm can only pile so many unbillable hours onto existing employees. So what’s the next step? Start calling beginning work an “unpaid internship.” Complain that “kids these days” don’t know a thing; they’re “zero marginal product” workers; they don’t deserve to be paid till they’re truly experienced. (At the end of a long line of traineeships, some may find themselves discarded as “too old” or “overqualified” for what is now defined as an “entry-level” position.) This is a wonderful strategy for cutting the budgets of corporate legal departments. But it only spells doom for attorneys caught up in the corporate games once reserved for blue collar labor.

The Political Roots of Rising Un- and Underemployment in the Legal Industry

Mazzone has complained that Segal doesn’t know enough about legal education. He’s also too narrowly focused on it. There is no question that, in many sectors, there are fewer positions for attorneys. Many journalists have attributed the decline to the creeping influence of “skill-biased technological change” and outsourcing: e-discovery can be done by computer or by the asymmetrically open Indian legal market. These trends do undermine some firm business models. But James K. Galbraith has already demonstrated the weaknesses of the “skill-biased technological change story” in many contexts. Moreover, the biggest driver of legal unemployment is political: the wholesale dismantling of tort, contract, and administrative remedies for corporate wrongdoing.

As I observed back in 2008, it would be shocking if an ideological movement to shut the courthouse doors to the injured failed to threaten lawyers’ livelihood. To build on that: maybe there are less jobs for finance lawyers because the Justice Department has systematically failed to prosecute egregious white-collar crime. A “tort reform” movement has made the price of violating the law a mere cost of doing business for thousands of companies. When banks can get away with robo-signing and foreclosure fraud, why should they hire attorneys to ensure that their paperwork is actually valid? Even an ostensible regulator, the OCC, isn’t bothering to launch a serious investigation in areas where deeply troubling practices have already been documented.

Corporate promotion of tort reform, deregulation, and arbitration has saved businesses many costs, including legal fees. But it has also increased the fragility of our food and drug supply chains, accelerated a financial crisis that has already cost the US trillions in lost output, and reduced opportunities for attorneys to fight to assure that business is conducted in a fair and societally beneficial way.

To ignore the political roots of the decline of both law and the rule of law in the US (and its obvious impact on attorney employment) is to fail to even begin a serious analysis of young lawyers’ problems. Segal acts as if corporate defense is the heart and soul of legal work. He never considers how legal education works to prompt legal challenges to corporate wrongdoing. No one will have a job defending corporations if there aren’t well-trained attorneys applying old law to new corporate wrongdoing. That takes creative thought, a chance to learn the policy behind law, and engagement with current industry trends. It’s not something to be drilled into people by projecting bar prep rote back into law school.

Law as a Cost

Throughout Segal’s article, another pair of assumptions creeps in. Law is presented as a cost, a series of niggling and none-too-important hoops to jump through to get down to the real business of mergers and deals. Law professors’ research is dismissed as pure self-indulgence, as we are once again treated to Justice Roberts’ witty dig at articles devoted to Kantian Bulgarian evidence law.

Segal never stops to ask: Why might a Justice like Roberts want to discredit the legal academy? Maybe it’s because, while colleagues of mine were trying to nip the housing crisis in the bud, a phalanx of deregulators on the Supreme Court came up with a politicized preemption decision that let the good times roll for America’s most predatory banks? Maybe it’s because law professors actually have the time to document how radically Roberts and his allies have diverged from precedent? Perhaps it’s because Roberts, after long years in corporate practice, sees law profs’ efforts to reinterpret old statutes and doctrines in light of new harms (a far larger part of legal scholarship than the high theory he laments) as one more nuisance for the clients who made him a rich and powerful man?

But we need not even engage with these politically sensitive questions. Rather, we might wonder: why does philosophy stand in for Segal as archetypical legal scholarship? When I first heard Justice Roberts lament the tragic dearth of practical articles, I marveled: has he ever taken a look at Sharona Hoffman’s or Nicolas Terry’s cutting edge work on digital medical records? This emerging field raises critical questions about the balance between privacy and innovation. We cannot permit our digital health infrastructure to be constructed solely according to the corporate interests of whatever vendors and providers happen to be most powerful at the time. We desperately need more work like Hoffman’s and Terry’s to guide us through the thicket of administrative and technical issues raised by electronic medical records.

I can think of figures as eminent and important-to-practitioners as Terry and Hoffman in five areas of health law and four areas of intellectual property law off the top of my head. (Ever heard of Pam Samuelson, Mr. Segal?) Yet Segal is apparently ready to write off the entirety of legal scholarship because someone, somewhere had the temerity to write about Kant.

I can understand why a writer at the New York Times might want to lash out at maladaptive institutions. Segal is daily subjected to his paper’s opinion pages, which peddle one irrelevant or stereotypical piece after another from their tenured moderates. (You learn more from Dean Baker’s critiques of them than from the articles themselves.) Thursday Styles reports on the 0.1%’s lifestyle intently, breathlessly tracking the price of Birkin bags as if it’s news the rest of us can use. The Gray Lady is becoming less the paper of record than a chronicler of the conventional wisdom and consumption of the wealthy.

What Next?

Law students, like many others today, face a grim job market almost without precedent. But I think proposals like Segal’s—making students start corporate-type work earlier and earlier—will only exacerbate the problem by providing an ever-larger pool of free labor for firms. We need a bigger picture view of an economy where professional and rentier incomes in general must deflate to match the diminished buying power of strapped lower and middle classes.

Debt is the critical financial issue of our age. Mortgage debt, student debt, credit card debt, medical debt, sovereign debt—–all are causing social upheaval. Debt often seems like a standalone menace, a black hole sucking money (and thus time and opportunity) from the indebted. But behind every mortgage statement is a servicer, distributing those funds to buyers of income streams. Debt is the shadow side of wealth, as Margaret Atwood memorably portrayed it. You don’t have to immerse yourself in the accounting equivalences of Modern Monetary Theory to figure this out.

Congress addressed two major sources of debt recently. The credit card provisions in the 2009 CARD Act and Dodd-Frank offered some weak disclosure provisions. Look at your statements, and you’ll see exactly how many years it will take you to pay off the balance if you stick to minimum payments. Basic consumer protections are in place, but there is not much substantive relief for debtors.

However, the ACA addressed medical bills much more comprehensively. I think its provisions can be a model for balancing obligations of the individual and society in other essential areas, like housing and education. In brief: for unemployed individuals (or those who are not offered affordable insurance by their employer), health insurance exchanges will offer various health plans. Thus the notorious “individual mandate:” these persons will need to get insurance or pay a fine. But the government will offer help, in two ways.

First, to help pay for the premium, advanceable tax credits will ensure that no one pays too much of their income for insurance. How much is too much? A family of four with earnings under $40,000 should not be paying more than around 6.3% of income for premiums; for those making around $85,000, the rate rises to 9.5%. (Here is a calculator with rough estimates of how much individuals and families need to pay at certain levels of income.) This is essentially an income-based payment scheme, for people making up to 4 times the federal poverty level. Moreover, “those with incomes below 250 percent of the poverty line will also receive cost-sharing assistance” on the other side of medical bills: the copays, coinsurances, and deductibles not covered by an insurance policy. The formula is complex, but the bottom line is that the federal government assists in paying these costs based on income, as well.

Income-based repayment schemes are a part of education financing now, though many have complained that they are not sensitive enough to other costs of living. Making income-based repayment more fair, and considering other legal changes in this area, are very important political issues. Housing policy should also be more open to income-based payment of mortgages, offering options ranging from “rights to rent” to direct principal modifications.

The key point here is that the owners of the income streams from student debts, mortgages, and other sources are playing a dangerous game if they think rights to payments are as sacrosanct, as, say, the AIG bonuses. They may think that they can continue to squeeze the indebted to pay 60 or 70% of their income each month for housing, insurance, and loan debts (and for the dubious right to claim as an asset something that will eventually be worth far less than what was paid for it if current debt deflation continues). But the larger economic implications are disastrous. Consider Steve Keen’s diagnosis, as related by George Monbiot. Keen believes that both the Great Depression and the current crisis “were triggered by a collapse in debt-financed demand:”

Aggregate demand in an economy like ours is composed of GDP plus the change in the level of debt. It is the sudden and extreme change in debt levels that makes demand so volatile and triggers recessions. The higher the level of private debt, relative to GDP, the more unstable the system becomes. . . . In the 1920s, private debt rose by 50%. Between 1999 and 2009, it rose by 140%. The debt-to-GDP ratio in the US is still much higher than it was when the Great Depression began.

We are in the midst of a great readjustment. For decades we’ve been told that our economic model, as persons, was to act like corporations do, accumulating assets and rights to payment. In fact, this “ownership society” was a mirage, providing great wealth to a few at the very top and precarity to the rest. There is no way to guarantee a secure future all on one’s own. Social structure, norms, and bargaining power matter.

Neither law students nor law schools can preserve their own future simply by better learning how to serve the corporate interests that would like to eliminate all profit-menacing regulation and tort claims. Economic security is an inevitably political question, which requires a coordinated political response—not one more effort to legitimize corporate wage-slashing with a simple story about “unskilled” workers. Before the Times treats us to another “what’s wrong with law schools” story, it might want to investigate the forces of deregulation and volatile financialization that kneecapped not only the legal job market, but employment prospects generally. No one needs another piece legitimizing the “young people don’t deserve to be paid” meme of the radical right, in the guise of snide snark about out-of-touch law professors.

*I’ve addressed these imbalances many times in posts on Law & Inequality. See, for instance, Power & Productivity After the Great Recession; Inequality and the Great Recession).

Image Credit: Kevin Drum.

Frank Pasquale

Frank is Professor of Law at the University of Maryland. His research agenda focuses on challenges posed to information law by rapidly changing technology, particularly in the health care, internet, and finance industries.

Frank accepts comments via email, at All comments emailed to may be posted here (in whole or in part), with or without attribution, either as "Dissents of the Day" or as parts of follow-up post(s). Please indicate in your comment whether or not you would like attribution, or would prefer your comment (if it is selected for posting) to be anonymous.

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21 Responses

  1. BH says:

    Bravo. Well said. The picture is much bigger than what is going on in law schools.

  2. Larry Rosenthal says:

    There is a great deal of merit in this important post. The fact that law schools may not be entirely responsible for the current state of affairs, however, does not mean that they bear no responsibility at all.

    Given the incentive structure in the legal academy, one should be quite surprised if students receive adequate preparation for practice. Given the statistics regarding the paucity of experience of most in the legal academy, is surely hard to quarrel with David Segal’s observation that teaching, and in particular the ability to impart marketable skills, is generally given little weight in the process of hiring and promoting law professors. It should therefore come as little surprise that the current professiorate has little interest in or ability to impart marketable skills — a point on which I have written at some length, using the legal career of John Yoo as an example:

    This state of affairs reflects a serous conflict of interest in the academy — it is in the interest of law schools and their faculties to focus resources on the pursuit of scholarly prestige,while externalizing training costs to employers. In an increasingly competitive market, however, it is becoming increasingly clear that it is in the interests of students to receive instruction that focuses more on the acquisition of marketable skills. The externalization of training costs particularly harms government and public interest law firms pursuing goals of which Professor Pasquale should approve. In an era of limited resources, these firms have even less ability than the traditional commercial law firm to assume the training costs that law schools externalize.

    I am willing to accept a great deal of Professor Pasquale’s assessment. Yet, this does ineluctably produce the conclusion that there is no need for reform in legal education.

  3. BH says:

    When has that conflict not existed? The partners who are complaining about graduates not knowing how to practice law did not know how to practice law themselves when they began. Someone taught them. Now, they are unwilling to do for the younger generation what was done for them. Okay, clients do not want to pay for young associates. They have never wanted to pay. It is interesting that they don’t want pay at a moment when many corporations are enjoying record profits. Too much is not enough.It is clear: they call the shots in our lives and maybe we all have to toe the line. But there is room for drawing attention to the people who really rule, and it’s not law professors.

  4. Milan Markovic says:

    Segal’s article is more of a critique of “elite” law schools that feed associates to large law firms like Drinker Biddle than it is of law schools in general. The fact that Segal does not recognize that there are significant differences among law schools is one of the central weaknesses of the piece.

    If large law firms and their corporate clients want practice-ready lawyers, then they could recruit from law schools that are well-known for instilling practical skills. The fact that they generally do not do so shows the extent to which BigLaw and in-house legal departments wish to associate themselves with the nation’s most prestigious institutions even though they unsurprisingly think that these institutions should be functioning differently.

    I do not read Prof. Pasquale to deny the need for reform in legal education. But the mere fact that law firms have to spend a few hours training new lawyers as to the nuts and bolts of conducting a merger should be well down on the list of concerns. Indeed, I am sympathetic to BH’s claim that it is a little rich for older partners to complain of having to train new lawyers given that many of them received extensive mentoring when they were starting to practice.

  5. Larry Rosenthal says:

    It is also perhaps “a little rich” for law professors whose scholarship is subsidized by the tuition of their students to complain that law firms have become less willing to contribute an additional subsidy by continuing to assume training costs. Apparently, to those in the legal academy, the natural order of things is to have everybody subsidizing legal scholarship.

    In any event, it is telling that BH and Professor Markovic are willing to engage only when it comes to the behavior of law firms. They make no comment on the implications of a professiorate largely unable to impart practical skills for public interest and government law firms. Those with a stake in the performance of a legal academy that does not adequately prepare its students for practice are not confined to the top one per cent. And, if Professor Markovic thinks (apparently on the basis of no actual empirical evidence) this problem is confined to elite law schools, he might review the data discussed in the article to which the Times links. The author of the Times article, it seems, actually bothered to find pertinent empirical evidence.

    Larry Rosenthal
    Chapman University School of Law

  6. BH says:

    There is nothing in what I wrote that apparently says anything about my views on the need for legal reform. My point was that whatever conflicts of interest exist between professors and practitioners existed before the current crisis. I read the post as asking us to think about what is different now, suggesting that there are larger structural issues at play that law professors did not initiate. Sure, reform away! But, you cannot separate what is happening with young lawyers from policy decisions that are not in the control of law professors.

  7. Milan Markovic says:

    Prof. Rosenthal,

    If the Segal article were directed to the inability of law schools to educate public interest lawyers, government lawyers, and solo practitioners, then I agree that it would be very convenient on my part to focus on the behavior of law firms. But the focus of the article is predominately on the perceptions of large law firms and corporations on the academy’s training of young lawyers. These businesses can, if they choose, hire only law students who taken certain “practical” courses in law school. As pointed out by a commentator on another thread, the law school that one of the young Drinker Biddle associates featured in the story attended offers a course entitled “Takeovers and Tender Offers.” This strikes me as a highly valuable course to take if one wishes to be a M&A associate. Did the associate take this class? Did Drinker Biddle urge him to do so?

    In terms of the “empirical data” that Segal refers to (primarily a study by Professor Newton that appears in the South Carolina Law Review), Segal is quite judicious in his use of the study. For example, he notes that “One 2010 study of hiring at top-tier law schools since 2000 found that the median amount of practical experience was one year, and that nearly half of faculty members had never practiced law for a single day. If medical schools took the same approach, they’d be filled with professors who had never set foot in a hospital.” However, the same study also notes that “[F]or the schools in tier four, the median years of prior practical experience was 6 years and the mean was 7 years.” For some reason, I did not see that quoted in the article.

    I do not deny that there are some important issues raised by the Segal article (including whether there should be fewer law reviews and whether extensive practice experience should be viewed with suspicion by the academy), but Segal overall gives his readers the impression that the vast majority of law schools do not teach practical skills, do not value clinicians, and are staffed predominately by folks who know nothing about the practice of law.

  8. Meehan says:

    In another discussion of this article, a professor commented that “claims that law schools do not teach practical skills are complete BS[ and w]hat really happens is that students do not TAKE the practical skills classes offered them,” despite the “value offered” by such courses. I appreciate Frank’s contrasting perspective. Segal’s article is problematic, but we have to resist shifting blame onto students. Treating law students as if they are rational actors with regard to how much practical training (or loan debt) they take on makes it easy to assign culpability individually. But, as among professors/administration/employers/students, students are the actors with the least amount of actual knowledge as to what the work world requires and what courses may help them most as practicing attorneys.

    Given this information asymmetry, awareness of “value offered” ultimately lies with the institution to impart (and/or enforce through course requirements). And as we all know, the incentive structures for students and doctrinal faculty value grades and scholarship, respectively, over acquiring or imparting training in “practical” or “marketable” skills.

    Query, though, just what we should define as valuable or practical, and whose interests this serves. The needs of the marketplace are important; we do want our students to be able to find and keep legal jobs. No one can deny that we are in the middle of structural shifts in the practice of law, and that legal education needs to be nimble and responsive in turn. However, letting the immediate needs of (the most powerful, wealthy) employers and clients set the clinical priorities of legal education carries its own set of issues, as Frank explores.

    As noted by Corey Johanningmeier in recent comments on the National Law Journal’s Law School Review forum, “Big firm lawyering is often more business than law, and its only primacy claim over small firm, government, and public interest lawyering is economic.” These are economics of dollars, not of scale—the actual number of legal jobs offered by such firms is limited. Reforming legal education to serve the current market needs of this powerful constituency is at best a moving target. At worst it is a narrowing of broad legal education to vocational corporate training for a job few law grads, from few schools, will get in the first place (and for which firms will likely always provide better and more precise training, even if they would prefer the cost savings of not doing so).

    I support the expansion of skills and clinical programs, particularly those that serve the poor and disadvantaged, provide exposure to government work, and that give grads from all “tiers” of legal education the background and confidence to manage their own practices, should they need or choose to do so. But I concur with Johanningmeier that a broad grounding in legal doctrine [and legal research and writing] may “turn out to be a more important enabler of practical adaptation, and career success in changing times, than does prior ‘clinical’ exposure to the precise realities of a moment.” Frank correctly notes that for well-trained attorneys to apply old law to new wrongs, they need creative thought, a chance to learn the policy behind law, and engagement with current industry trends–all of which law schools are well-equipped to teach.

  9. PrometheeFeu says:

    Income-based repayment is something that I have liked a lot ever since I first heard it from Milton Friedman. But I seriously doubt it is viable because of the inherent moral hazard as well as the fact that people are overconfident in their ability to earn income.

    Consider a pool of potential borrowers. They have an average income of $100,000. Now, in an IBR situation, we charge them 1% for 10 years or do a normal loan for $1,000 per year. But really, half of them plan to become teacher earning $20,000 per year while the other half plan to become Goldman Partners making $180,000 per year. Of course, the teachers will take the IBR paying $200 per year while the Goldman Partners will simply take the $1,000 per year loan. Whoever made the IBR loan will loose a lot of money. So realizing that, they raise the rate to 5% and get $1000 back from the teachers. Of course in reality, the population is much more gradated. So we would end up seeing people with a low-income expectancy paying a very high percentage of their income while people with a high income paying a very lower percentage of it. (Assuming screening was possible) Does that sound familiar? Well, that’s because that’s basically what the current loan system is.

    The second problem is overconfidence. It has been well established that people tend to overestimate their lifetime income. Let’s say the creditor wants on average $1,000 per year back. They calculate my future income according to their model and find $100,000 per year. So they offer me 1%. If we agree, all is good. But let’s say instead, I believe I will earn $200,000 per year. Well suddenly, that 1% per year sounds like $2,000 per year and I would rather go to their competitor who offers me a $1,000 per year repayment plan.

    I’m not saying there will never be any IBR. There is I am sure a market for those. But I think it will be difficult to make them work for a large percentage of borrowers.

  10. Joseph Slater says:

    Terrific post.

  11. A.J. Sutter says:

    A lot of food for thought here, but an initial reaction on the question of externalizing costs of training students: Like the associates in the story, I knew nothing about my chosen field of law practice — corporate/securities transactions — when I graduated from law school nearly 30 years ago. Clients didn’t want to pay for training back then, either — even though billing rates for 1st-years in the early 1980s were much lower than now.

    So my firm dealt with a big chunk of my (and my classmates’) hourlies the old-fashioned way: it ATE them.

    Even back then, no partner enjoyed writing off associate time, but they did it for newbies because it was a part of the natural life cycle. (Also, the Great Wall Street bump in 1st-year lawyers’ salaries was still a few years in the future at that time.) What’s changed is that both clients and today’s partners are unwilling to take the hit — so they pass it along to the hires.

  12. EP says:

    Outstanding post. Though the NYT often portrays Rupert Murdoch as a renegade media tycoon that leverages his publications as a forum for his personal political agenda, the same may be said of the Sulzberger family and the NYT. A bit of history may prove telling – the Sulzberger family tree traces its roots to a founding member of the New York Stock Exchange.

  13. PrometheeFeu says:

    @A.J. Sutter:

    “What’s changed is that both clients and today’s partners are unwilling to take the hit — so they pass it along to the hires.”

    From this post and the news, it sounds like there are a lot more law school graduates than there used to be. Could this be a simple supply and demand story? The supply of newly minted lawyers shifts right rapidly. (more new lawyers) As a result, they must compete harder for positions. One of the way they do that is by paying for their own training. Does that sound a likely explanation to you?

  14. A.J. Sutter says:

    @PrometheeFeu: Based on my experience, no, it doesn’t seem likely. For one thing, there wasn’t exactly an undersupply of people trying to get into Big Law firms like mine back in 1983. Competition was quite intense. (This wasn’t yet like the dot-com era supply curve faced by Silicon Valley firms.) For another, the explanation is based on too macro a rationality. I think it has more to do with a couple of micro-type factors:

    (i) Partners today are a more self-interested bunch than the generation who trained me (who were two generations before many current partners). Not that those older folks were necessarily angels, but they had spent their entire careers at one firm, and “for the good of the firm” was a phrase that still stirred their hearts, as I saw plenty of times.

    (ii) Financial pressures on partner performance are much more intense now than back then, and partnership today isn’t the effectively irreversible safe harbor it was back then (absent malpractice or too-obviously inappropriate sexual stuff). Consequently, a partner is more likely to catch hell if he or she writes off any associate’s billables — or at least, the partner is afraid that this will happen. OTOH, the guys who trained me were like very secure tyrannosaurs who didn’t give a sh#t, and were very generous from their own pockets. My mentor even personally paid for my wife to join me on a week-long business trip to Los Angeles, once he realized that he was asking me to jump on a plane from New York on the same weekend she was taking the MCAT. He also had to eat most of the billables from that deal (not just mine, but a passle of L.A. associates’, too) because the highly complicated intra-state securities offering we were working on raised only $200 (two hundred bucks), and he had a long relationship with the client. It was expensive for him, and his partners teased him a lot about it at the time, but it didn’t diminish his power within the firm. They don’t make ’em like that anymore, and haven’t for a few decades already.

    (iii) Possibly: The ethos of neoclassical economics is more generally diffused among lawyers now. More partners have taken an intro economics course now than back then, and the course they took was more Friedman than Keynes. Probably (i) and (ii) are more salient, though.

  15. BH says:

    The other thing that happened is that firms decided to hire many more associates to drive up their profits. I came into practice just as this was happening. The size of my “class” was huge compared to what it had been in years before. With smaller classes, partners could play the role of mentor for people who might have a reasonable shot at joining them in the partnership. Clients would have something of an incentive to put up with billings of new associates because there was a chance that those young associates would one day be their lawyers. Once that chain was broken, and firms started hiring legions of people they had no intention of making a partners, there was no longer a point in taking the time train young lawyers. There was no opportunity because the classes were so large. Young associates are no longer investments, they are there to provide billable hours for a few years and then leave to make way for the next crop. That was the reason for my earlier comment about how blithely we accept as normal and right partners’ decision not to do for young people what had been done for them by an older generation.

  16. Nancy says:

    Great post! Thank you.

  17. EP says:

    Although many of the comments to this post address the substance of Segal’s article, I think they miss the point that Frank is trying to make. Segal’s piece, and the decision to publish it and like-minded rants, is part of a larger anti-intellectual movement that most (if not all) mainstream media has enthusiastically adopted and perpetrated. The NYTimes is no exception, and is, quite simply, a propaganda engine for the robber barons of the 21st century.

  18. PrometheeFeu says:

    @A.J. Sutter:

    It does make sense that if people are more likely to jump around between firms, they are less likely to sacrifice for the firm. Also, spending resources to train someone is less attractive if there is a good chance that person will jump ship after you’ve trained them.

    Why do you think partners are less secure than before? Are law firms under greater financial pressure in general? I’m curious, why would you make a complex intra-state securities offering to raise no more than $200?

    Back in school, we used to joke that things that are obvious to people who took econ 101 are obviously wrong to people who took econ 201. I think it is true that an intro to econ course, no matter how positive it tries to be does tend to make one a bit more sympathetic to more cut-throat market-oriented solutions. (It’s always amazing how econ students almost always behave differently than other people in game theory experiments) But I am obligated to point out that Keynes didn’t disagree much with neo-classical micro and that his macro theory isn’t really liable to make anyone more generous.

  19. Frank says:

    Thanks for the many insightful comments. I’ll respond more next week, after I’ve read Prof. Rosenthal’s Yoo article.

    The question of assessing the overall quality of legal scholarship has seemed like far too “meta” an exercise for me to engage in, especially given the uniformly important materials I’ve seen presented at recent health law conferences (and my experience giving testimony or presentations for members of Congress, the FTC and HHS, and the National Academy of Sciences). But I think AALS sections might want to think about compiling an account of scholarship’s value more systematically now, given the campaign against it.

  20. mid-level biglaw cog says:

    The Roberts conspiracy theory struck me as a little bit strange. He was making the common point that most academic articles are of little or no use to judges or practicing litigators. That’s almost indisputably true and to respond by suggesting that he’s out to discredit the academy because law professors make arguments that his former clients didn’t like is simply bizarre.

    Much of the rest of this is good stuff, and the analysis of law firm economics is the refreshing sort of stuff that Segal didn’t even attempt to think about.

  21. A.J. Sutter says:

    @PrometheeFeu: Sorry for the late reply.

    Jumping from ship to ship became more common in the 1980s and ’90s. As late as 1988-89, I was at a dinner where a 50-year-old partner at a big Century City (L.A.) firm spouted forth that he was suspicious of resumes from lateral hires if they had been at more than one firm; and he questioned why any competent person shouldn’t stay at his first firm, like he had. (I was already sniffing around for my firm #3, so I kept my mouth shut.) But one reason the jumping around became more common was that firms no longer took such a personal interest in junior attorneys. So the causation/rationality isn’t so simple as your comment suggests.

    The tendency to jump around isn’t uniform, though whether there are geographical factors or simply firm cultural factors involved, I couldn’t say. The other day I was idly checking lists of attorneys at offices where I used to work. In the Silicon Valley office of a Top 5 firm that I left in year 2000, I now recognized the names of only 6 out of 80 attorneys. (The office had a comparable number of lawyers back in the dot-com days, too.) In my first firm’s Wall Street office, which I left in 1985, I recognized the names of 33 out of 247 attorneys — almost double the retention rate, and that despite a time frame 15 years longer. (There were about 200 attorneys there in 1985.) I don’t know whether this reflects a difference between the coasts, or simply that there was something especially nice about my first office (plausible to me, though maybe not to everyone).

    As for insecurity: By the early 1990s, clients, especially in finance, were showing more tendency to hold “beauty contests” instead of sticking with their traditional firms. This did begin to put financial pressure on firms. Also, I think probably the “shareholder value” movement that began in the 1980s eventually led to pressure on in-house legal departments to monitor costs more assiduously, and to pressure firms for alternative fee arrangements. But this took a while to percolate: when I was in-house in the late 1990s, we didn’t pressure our outside firms much on this point, and when I was back at a firm in the dot-com era, it was often the firms who called the shots (at least, in the Valley).

    So I’d have to say I think the main source of financial pressure on partners in the boom years of the 1990s was the greediness of their fellow partners, and the rise of thinking of running a law firm “like a business” — i.e., with a managerial, profit-maximizing mentality. Some firms were ahead of the curve on this instrumentalizing attitude. When interviewing at the Century City office of an English firm in 1987, I asked why they were seeking to hire a corporate associate at that time; the partner, sputtering with disbelief and condescension for my not seeing the obvious, informed me it was “to fill in the interstices of the pyramidal structure” in the office.

    The point of the intra-state was to come within an exemption from the Securities Act of 1933, so the idea was to reduce complexity, not to add to it. It was the client’s idea: he had trained as a lawyer before becoming a New York real estate mogul and eventual leisure-suit-clad Vegas businessman (this was ca. 1984). His scheme was to send offering circulars to California residents who’d visited his Las Vegas “indoor skydiving” attraction (apropos of jumping, BTW). All visitors had had to sign liability waivers, so he had their names and addresses. We had advised him that it would be more trouble than it was worth, but he pushed forward. Actually, the client was as charming as his then-customary attire suggests, so many of us who worked on the deal hoped at many points that it would die. We were repeatedly disappointed. But even my mentor, who was his friend, admitted that the ultimate proceeds were a kind of appropriate comeuppance for the guy’s hubris.