March 22, 2011
Masters Forum (Legal Education): Accreditation After the Bubble Has Burst
Posted by Dave Hoffman

Bursting-bubble Let's assume that the applicant data noted by Erik, the WSJ, and countless gleeful business school admissions officers, are a real turning point. The bubble has burst.  What follows for how the ABA should conduct the accreditation process?

I'll start with a Lewisian anecdote.  I've the honor of chairing Temple's self-study committee this year, as we prepare for our sabbatical site visit next fall.  As a part of the "accreditation process," I attended an ABA workshop in the summer of 2010 for site accreditors and law school representatives.  The room, at an airport hotel in Chicago, was full - Gordon Smith was in the house! -  and the plenary session sometimes informative.  I'd also estimate that it cost the attendees an aggregate of $250,000 to attend, taken from student tuition dollars, when fully all of the benefit could have been achieved with podcasts, online presentations, and e-materials.

As the conference began, the ABA's Representative gave a speech lauding the standards, which he argued could be employed to good ends.  He comforted us by noting that no one, ever, emerges from accreditation without a demerit requiring correction.  That is, the accreditation process is set up so that a law school must engage with the ABA's corrective hand. But the highlight was the Representative's joyful boast that several new schools had been guided toward a successful accreditation, and there were an additional handful of prospective schools in the pipeline.  He neglected to mention that we were then in the middle of the worst job market for new lawyers in several generations. As I recall, his announcement was met with applause.  I felt like a guy on the Titanic, watching the band play on.

Indeed, there was something profoundly odd about the whole shebang.  (And I say that hopefully without any prejudice to Temple's re-accreditation, which I expect will go as smoothly as one could expect.)The ABA folks have convinced themselves that the Standards are welfare maximizing, and that the ABA must keep law schools honest by dictating small details of their operations (45,000 class minutes, antiquated and paternalistic attendance policies, written strategic plans and self studies, study spaces, ugly tables on websites, matches between catalogues and offered courses, etc.)  At the same time, the ABA doesn't want to engage in substantive regulation - suggesting that there are perhaps too many mediocre law schools in particular regions, asking whether it is smart to pay $50,000 to go to a new law school in California. Cynics would attribute the former characteristic to bureaucratic mission creep, the latter to antitrust concerns.

So the result is this: the ABA accreditation standards meddle into law schools operations and resist innovation in pedagogy. They therefore significantly raise the cost of educating students at existing law schools.  But the standards don't ultimately serve as an effective check on entry, meaning that students (who pay more than they should for education) are competing in a world of lower demand for their services but higher supply of graduates.  This is the worst of all possible worlds.  The legal education market would be much better off if the ABA were replaced by an accreditation agency that didn't have the same guild-driven stake in the status quo.

But we're not in that world, nor will be soon.  So what should the ABA do?  Rather than nipping schools for failing to achieve some sets of metrics, or not utilizing a particular internal operating procedure, or having classrooms with noisy air conditioners, the ABA should act more like the SEC, and require (merely) disclosure of facts deemed material to "market" actors -- alumni, prospective faculty, prospective students.  Auditing would also seem appropriate - coupled with punishment for severe violations. The ABA has a really powerful weapon at its disposal that other accrediting agencies do not - the power of licencing.  It ought to use it to clean up the data, right quick.

What information should be disclosed?  It's not obvious that the current focus on employment and salary statistics is the right approach.  That's not to say that law school should hide employment statistics - or obscure them - but rather that having the Bar mandate a particular form of disclosure is a bad idea in a world where Bar-driven employment outcomes are the most variable and therefore most important part of the USNews rankings, which desperately needs a constantly changing set of measures to stave off the wolves at the door. (Having done some research into the determinants of rankings, let me just say this to Bob Morse: your plea for data transparency was funny and profoundly ironic.)  I also worry that disclosure of salary data will have anticompetitive effects in the smaller firm part of the labor market.  I could be convinced otherwise, but it strikes me that a better set of accreditation-driven disclosures would include the following:

  1. Actual law school cost: what was the retail price paid by every member of the class (anonymous, of course, and probably displayed in a histogram with 50 or so bins).  How did the school account for scholarships (was it a real dollar cost out of endowment, or a setoff).  What percentage of students ended up paying more than their originally bargained retail price?  What was the distribution of incidental costs?
  2. Actual law school debt: how many students took on debt, how much debt, and under what terms;
  3. Bar Passage: for every member of the class, the passage statistics, no matter how many times the test was taken;
  4. Retrospective Survey: some kind of nationally-designed survey, patterned after LSSSE, that evaluates whether graduates were happy with their education and the opportunities it brought them. Time series data would be really helpful in informing applicants.  A key reporting question: "did you get your money's worth"?;
  5. Law School Budgeting:  This is a complicated topic, but the basic idea would be to provide each student a school specific version of the taxpayer receipt.  How is money spent?  This would give applicants, students, faculty, staff and alumni a good sense of the school's priorities.  At the same time, the budget could disclose the law school's relationship to the central university.

I'd largely dump the substantive & strategic Standards and focus energy on enforcing these disclosure principles.  I'd cancel site visits.  Generally, I think prospective students and consumers would be better off if schools, and States Bars, picked their own paths. But the big purpose to these reforms would be to permit innovation & to reduce costs, which I think crucial to the future of domestic legal education.

Who would be made worse off were we to substitute disclosure for regulation?  Current faculty members, prospective faculty members, and (I think) practicing lawyers, all of whom would expect to see lower rents.  Also, perhaps, we'd reduce the likelihood of law professors and administrators taking politically unpopular positions, and representing politically unpopular clients.  This strikes me as a cost that is worth bearing, though many of my friends and colleagues, who are both wise and reasonable, disagree.

AALS, Law & Economics, Law Schools/Lawyering, Masters: Legal Education | Bookmark

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