As a former economist, Barnes & Thornburg partner Steve Badger described the trouble that many law schools are experiencing with fewer applicants and less revenue as “economics 101.”
Law schools are getting squeezed by changes in a legal industry with more lawyers than needed to meet the demand for services. Stories of law school graduates crushed under student loan debt and either not being able to pass the bar exam or find a J.D.-required job have deterred many undergraduates, including some of the brightest and most qualified, from even applying to law school.
For the past several years, law schools have struggled to sustain their budgets as they enroll fewer students but also have to offer more substantial scholarships.
Some law schools have succumbed to the pressure by merging or closing altogether while others are under additional strain after getting sanctioned by the American Bar Association for their admission practices.
Economics teaches that decreasing the number of law schools will reduce the competition and allow the remaining schools to become healthier. However, Badger noted, this rebalancing comes with a high human cost. Many faculty will lose their jobs and students will have to make tough decisions about where, and even whether, to continue their legal studies.
Asked what can be done to soften the blow, Badger, a member of the Indiana State Bar Association’s Professional Legal Education, Admission and Development Section (PLEADS), paused. Then he admitted that is a tough question to answer.
Indiana may have to find a solution.
In 2017, the state has seen one law school close — Indiana Tech Law School in June — and another law school, Valparaiso, announce last month that it will halt admission of first-year students in 2018 amid “severe financial challenges.” Valpo said it is considering all options, including actively looking to merge with another law school.
Badger does not want the legal profession should just sit and watch. “I think individually and collectively we ought to be doing what we can to support our law schools and their students,” he said. “They are training the future lawyers of Indiana.”
Chris LaMothe, chair of the Indiana Commission for Higher Education, said the state’s greatest strength is the public and private colleges and universities that operate within its borders. Hoosiers benefit from these institutions and have an interest in maintaining higher education’s health.
However, helping troubled colleges and universities, and their law schools, can be a challenge, because by the time a school talks publicly about its problems, the difficulties likely have been festering internally for a while. The Commission did assist Indiana Tech law students in finding a soft landing, LaMothe said, but the members have not specifically discussed the turmoil in legal education.
“I don’t see any dangers in the major (Indiana) law schools having trouble,” LaMothe said. “A lot of people want to get law degrees from schools with great reputations. Fortunately, in Indiana a couple of schools have terrific reputations.”
“Must be devastating”
At Valparaiso Law School, dean Andrea Lyon said faculty and students are upset and worried about not knowing what will happen next.
The Valparaiso University Board of Directors’ announcement about the school’s uncertain future in November came days after the ABA had found Valparaiso Law School in compliance with admission standards and removed the sanction of public censure.
Administrators are meeting individually with students and have posted a link to the frequently asked questions about the law school’s future on its website.
The law school is operating as normal and students still can work in the clinics and compete in the trial competitions, Lyon said. In fact, the school had been receiving applications from “really good” candidates and had been preparing to send out acceptance letters when the board made its decision.
“We’re doing everything that we can do,” Lyon said.
Still, Lyon said the situation is frustrating. The school cannot provide too much information about what is being considered for fear of blowing a potential deal. Active discussions are taking place but the dean declined to identify with whom.
She did say all the law students would be given the education Valparaiso promised them and would get law degrees from Valparaiso Law School.
Having graduated from Indiana University Robert H. McKinney School of Law 2015, Elizabeth Traylor, secretary and treasurer of the state bar’s PLEADS, can sympathize with the Valparaiso law students. She noted that on top of the sacrifices and hard work required to get a J.D. degree, those students are now in uncharted territory.
“I imagine they’re in really, really difficult circumstances. It must just be devastating,” said Traylor, an associate at SmithAmundsen LLC in Indianapolis.
She believes the legal profession could offer some assistance to the students during this transition period. Namely, attorneys could mentor and help them find the next step whether that would be continuing their legal studies or finding another career in the law that does not require a J.D. degree.
Traylor enrolled full time in law school after getting married and starting a family. She started classes as the downturn in the legal profession had taken hold and she was a little scared, having many people close to her point to the debt that burdens many law graduates. The concerns did not dissuade her, but she did make sure she got practical experience.
“I think it affected how I approached law school,” Traylor said. “I wanted to use the experience to learn as much as I could, to do as well as I could and also to access all the resources I had at IU McKinney.”
Moral, if not legal, obligation
The trouble afflicting law schools does not surprise David Barnhizer and, he said, should not surprise the law schools themselves.
Barnhizer, professor emeritus at Cleveland-Marshall College of Law, has written extensively about legal education. The changes now roiling law schools have been coming for a long time and faculty and administrators should have been better prepared.
Instead, he said, law schools, benefiting from the flow of student loans, just kept increasing their budgets and raising tuition.
Some law schools should close because of the oversupply of lawyers, he said.
“The high point of American law schools is gone,” Barnhizer said. “We’re not going to get back to anything resembling what we had.”
Downsizing and closures will be especially brutal for faculty members, he said. Emphasizing there are “a lot of wonderful people in legal education,” Barnhizer noted law school professors tend to have lighter teaching loads than their counterparts in the larger university, and they have tenure along with high salaries.
Once unemployed, law school faculty may have difficulty finding a job because, as Barnhizer asserted, they have few practical skills outside of academia. Some professors might be able to integrate into departments and other schools within the larger university although they might have to overcome the skepticism of other university faculty because the study of law is generally not considered a rigorous academic discipline.
Students will also suffer and, for that, Barnhizer does not think law schools should be able to walk away cleanly. Deans and administrators, he said, dipped lower into the applicant pool as applications declined and accepted “really marginal students” who had little chance of passing the bar or getting a law job.
Barnhizer characterized such actions by law schools as immoral and believes they now have a moral, if not legal, obligation to help students with their debts.
“Somebody should pay for some of it,” he said.•