The New York Times on ABA Accreditation of Law Schools

David Segal’s recent New York Times article on ABA accreditation of law schools makes the important point that the ABA uses the accreditation process to reduce competition for its members by artificially reducing the number of law schools, and thereby eliminating potential competitors for its members. This interacts with laws that require consumers to rely on lawyers even for relatively simple tasks that in many other countries are performed by paralegals and the like. The end result makes even basic legal services extremely expensive, especially for the poor and the lower middle class:

[A new law school] needs the seal of approval of the American Bar Association, the government-anointed regulator of law schools.

That means complying with a long list of standards that shape the composition of the faculty, the library and dozens of other particulars. The basic blueprint was established by elite institutions more than a century ago, and according to critics, it all but prohibits the law-school equivalent of the Honda Civic — a low-cost model that delivers.

Instead, virtually every one of the country’s 200 A.B.A.-accredited schools, from the lowliest to the most prestigious, has to build a Cadillac, or at least come close. Duncan’s library costs $750,000 a year to maintain — a bargain when compared with competitors….

The lack of affordable law school options, scholars say, helps explain why so many Americans don’t hire lawyers.

“People like to say there are too many lawyers,” says Prof. Andrew Morriss of the University of Alabama School of Law. “There are too many lawyers who charge $300 an hour. There aren’t too many lawyers who will handle a divorce at a reasonable rate, or handle a bankruptcy at a reasonable rate. But there is no way to be that lawyer and service $150,000 worth of debt.”

This helps explain a paradox: the United States churns out roughly 45,000 lawyers a year, but survey after survey finds enormous unmet need for legal services, particularly in low- and middle-income communities…..

It’s not just that many lawyers are prohibitively expensive. It is that when it comes to legal expertise, there are not a lot of cheaper alternatives — not in the United States, anyway. Britain, on the other hand, has a long menu of options, including a tier of professionals called legal executives, who are licensed after getting the equivalent of a community college degree. Counsel is also

available from nonlawyers at a variety of nonprofits. And you can buy a simple divorce over the Internet for a set fee, or pay for customized legal advice, online or by phone.

“In the U.S., people and businesses have only one place to go for all their legal help — lawyers who graduated from an A.B.A.-approved law school and who follow mostly A.B.A. rules about how they run their practice,” says Gillian Hadfield, a professor at the Gould School of Law of the University of Southern California. “Everyone else who offers legal advice is engaged in the unauthorized practice of law….”

Consider business schools, [Emory law professor] George Shepherd says.

If your dream is to work at Goldman Sachs, “you can go to Harvard Business School and spend a couple hundred thousand dollars, in tuition and forgone earnings,” he says. “If you just want to move up the management ranks at Macy’s, you can take part-time evening classes and spend $10,000 for a degree. The part-time school may not be accredited, but this gets to the difference — state law says you can become an attorney only if you attend an accredited law school. There’s no law that says you need to attend an accredited business school in order to practice business.”

Professor Shepherd says aspiring lawyers should have the same choices as aspiring executives and managers….

A result is an expensive quandary for potential clients, says Professor Morriss of the University of Alabama. “Maybe you need a plumber,” he says. “But you have to hire a brain surgeon.”

These are not new arguments. Critics of the ABA accreditation system have making the same points for years. Milton Friedman did so as far back as the 1950s. I myself did called for the abolition of the ABA’s legal role in the process in this 2006 post:

To my mind, the problem goes beyond the shortcomings of specific ABA standards. The real mistake is allowing an organization with a blatant conflict of interest to take over the accreditation role in the first place. As an interest group representing lawyers, the ABA has an obvious stake in limiting entry into the profession so as to decrease the competition faced by its members. One way of doing so is by restricting the number of accredited law schools, at least in the vast majority of states that require all or most aspiring lawyers to attend an ABA-accredited school in order to take the bar exam. We would not allow an organization run by Chrysler, GM, and Ford to set regulatory standards determining who has the right to sell cars in the United States. Requiring ABA accreditation for law schools is the exact equivalent in our industry.

Although the New York Times article breaks little new ground, it has great value in bringing this issue to a wider audience.

I do have one possible quibble with the article. Segal implies (though he does not say so directly) that all or most existing law schools support the ABA accreditation system. This is far from universally true. In my experience, many administrators and faculty at relatively highly ranked schools (say the top sixty or seventy) either oppose the system outright, or at least would not object to liberalization of the rules. These schools don’t benefit much from excluding marginal new competitors, and the ABA accreditation process saddles them with unwanted expenses and administrative burdens. Harvard and Yale (or, for that matter, George Washington or George Mason) are not likely to lose students and faculty to startup law schools, even if the latter have lower tuition. By contrast, low-ranked schools (e.g. – the bottom 30-40%) tend to support ABA accreditation because they are the ones most likely to be threatened by new competition. Being a member of the ABA-sponsored cartel is often their most valuable economic asset, and they are loath to give it up.

I’m not suggesting that the higher-ranked schools are completely blameless. If more of their faculty and administrators were to speak out against the status quo, we might see greater pressure for change. Hopefully, Segal’s article will help generate a broader debate on the issue.