Of Auto Plants and Law Schools

Published February 8, 2011

An acquaintance sent to me and others on his email list a short video that showed a brand new auto assembly plant that Ford has built in a rural area of Brazil. The plant is a technological marvel of automation and flexibility, and apparently can churn out large numbers of cars using relatively few, non-unionized and modestly paid workers. And what happens to these cars – are they sold in Brazil? No, the company built a new port facility adjacent to the plant so the cars can be exported to other countries with richer economies.

That, of course, is the sociological problem of making large amounts of product that not everyone can afford. Who will buy the product when the home market cannot absorb it? In China, people are doing work that could be done faster and more efficiently by machine, but to do so would leave even larger numbers of unemployed and underemployed than exist there now. Many workers are thus paid a low wage to make products that they in general cannot afford, but that instead are exported to wealthier countries.

Is there a lesson here for another industry that churns out a large volume of product in its home market that, increasingly, cannot be absorbed because potential customers cannot or will not pay for it? The industry is American law schools, the product is new JDs, and the developing crisis was amply documented in a recent New York Times article, “Is Law School a Losing Game?”

Consider these facts from the article:

  • “Tuition at even mediocre law schools can cost up to $43,000 a year. So much money flows into law schools that law professors are among the highest paid in academia.”
  • “Job openings for lawyers have plunged, but law schools are not dialing back enrollment. About 43,000 J.D.’s were handed out in 2009, 11 percent more than a decade earlier, and the number of law schools keeps rising – nine new ones in the last 10 years, and five more seeking approval to open in the future.”
  • “Many law school professors privately are appalled by what they describe as a huge and continuing transfer of wealth, from students short on cash to richly salaried academics.”

The article concludes: “Today, American law schools are like factories that no force has the power to slow down – not even the timeless dictates of supply and demand.” Think of the “buyer’s strike” represented by the ACC Value Challenge and the companies that are refusing to pay the exorbitant lawyer salaries of 2007. We increasingly have excess, unaffordable lawyers. The “factories” continue to churn them out. Where can we export them?

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Audience type: Large Law Firms, Small Law Firms, Sole Practitioners