Wednesday, February 29, 2012

Why Misleading Law School Employment Stats Are, in Actuality, Fraudulent

In the comments to my "Persuading the 'Personal Responsibility' Crowd" thread a debate broke out about whether or not the law schools are committing fraud.  In my view the answer is a resounding Yes, in the context of actuality and not legality.  From a legal perspective it will depend on individual states' fraud statutes and case law, the specific facts at issue, etc.

In one of the comments to that thread, poster "Just Sayin" responded in part:

And no they aren't screwing people over by publishing false employment numbers. That's to be expected. More so we were all encouraged to go to law school by family members and the thought of being rich.
 To which I responded, Anonymously (being too lazy to log in):
In your view, should it be perfectly permissible for used car dealers to "rollback" the mileage on cars and then tell purchasers that the vehicles have much less mileage than they actually do? If a buyer purchases a vehicle with 60,000 actual miles on it but pays the price for a vehicle with 25,000 miles after relying on the odometer that showed 25,000 miles, is that the buyer's fault?
To which "Just Sayin" responded:
That analogy doesn't hold up. Sorry. When law schools say hey 95% of people with law degrees from our school gets a job. So when one buys X, there's a high possibility that you can do Y. They aren't selling you a future job, their product is a law school education. Whatever you pay, or whatever the market is saying, you will still get a law school education. Essentially, they can lie all they want about a future job, because that's not what they are selling. Its shady nonetheless, but fraud no.

Onto your analogy where a used car salesman sells you a car that they purposefully rolled back the meter. Pretty much they are selling you a crappy car, not the potential of X happening do to you buying the car. This is more equivalent to a law school promising you a great education but instead giving you crap..... actually this is true too.

Lastly, sooner or later, we have to stop lying to ourselves as to why we went to law school. We all were either talked into it by family, who said "wow you can argue well, you'll be a great lawyer some day" or by watching an endless number of law dramas. Really, no matter what the job numbers were, we weren't going to not go. We had to prove how smart we were, or to make their degrees worth something.
This brings us to the crux of the issue.  What exactly are the law schools selling?  Are the law schools at the very least guilty of fraudulent inducement?

I submit a resounding Yes in answer to the second question.  The law schools know exactly what they are doing and why they are doing it when they publish their employment stats.  They publish this information because they know that students will look at it and use it as part of their decision making process.  They also know that the information is facially false and, on-the-surface, fraudulently misleading in spite of whatever qualifications they add.  They also know that their statistics will not stick out like a sore thumb because all of the other competing law schools are publishing similar stats with similar intent.  The law schools also know that the vast majority of the general populace knows nothing about the reality of the legal job market and that most of their prospective students are naive, feel that they have few other options for earning a respectable income, and have been indoctrinated with the notion that higher education, especially the attainment of a professional degree, guarantees earning a high income.  In other words, the law schools know that their prospective customers are already very much predisposed to believing and falling for their fraudulent employment statistics.  (This is not written with the intention of being a strict a legal analysis; just a discussion about actuality.)

Addressing the first question, what exactly are the law schools selling?  I think most reasonable people would agree that a vehicle's mileage is a property of the vehicle and that rolling back the odometer is an act of fraud.  So what exactly are students purchasing when they buy a legal education?  They are not merely purchasing a generic fungible legal education, but rather a legal education specifically from School X.  They are buying School X's legal education.  Likewise, an automobile purchaser is not merely buying a generic and fungible automobile, but a specific brand of automobile.  ("I bought a Lexus, not a Kia.")

So, what property is it, exactly, that fundamentally differentiates the legal education provided by School X from that of School Y in the context of a purchasing decision?  What makes one law school a Lexus and the other a Kia?  Could it be the library?  Get real.  Could it be the "quality of the education"?  That might play a role to an extent, but the vast majority of students have little information about that.  Could it be the location and environs?  That's certainly a large factor.  However, ultimately, the dispositive factor for students who attend for vocational reasons, is, "Will my chances of obtaining a good legal job be higher at School X than at School Y?"   

Thus, the product a given law school is selling is not merely a generic and fungible legal education.  Instead, a legal education's fundamental distinguishing characteristic is how the education and its school's graduates are valued by hiring decision makers in the legal and business community for upper middle class jobs that provide a career path.  This is not merely a minor characteristic such as a tree on the lawn in front of the law school building, a famous faculty member, or a book in the library.  Rather, how a school's legal education and graduates are valued by hiring partners is the essential, defining characteristic that distinguishes the legal education at School X from that at School Y.  A law school's published employment statistics are intended to provide information about how hiring decision makers in the legal and business community regard the quality of the education and its graduates!  They are not just for show.  They are not in brochures by accident.  They are published specifically with the intention of conveying that sort of information.  It is almost exactly analogous to a vehicle's odometer reading.  Therefore, the value given to a law school's education and its graduates by hiring decision makers is an essential, crucially integral, overwhelming part of the product a law school is selling.  It is not merely the paint job or radio on a motor vehicle, nor is it a vehicle's ill-defined reputation for quality or prestige of ownership.  Rather, the proper analogy is that it's the entire powertrain, cooling system, and chassis!  Just as the fundamental purpose for purchasing an automobile is transportation from point A to point B, the fundamental purpose of purchasing a legal education for the vast majority of law school graduates is to obtain secure lifelong upper middle class employment in the legal profession.

That is the real product.  That is what the law schools are selling, and that is why, in my opinion, they are engaging in outright fraud and not merely fraudulent inducement.  (This is my personal opinion and not a specific legal analysis.  Don't attempt to violate the First Amendment and try to sue me over my opinion, bro.)

Do students rely on these employment statistics?  Would they choose not to attend if they had complete employment information?  You betcha!  The published statistics, in spite of any qualifications they might have, are believable because all of the other law schools have similar statistics and they are implicitly sanctioned by the American Bar Association.  If the real statistics were published and prominently displayed and publicized, law school attendance would drop precipitously for the exact same reason that people aren't flooding into graduate schools for PhDs in Art History, Women's Studies, Philosophy, and the like.  Who in their right mind would risk going into $80,000-$200,000 worth of student loan debt that cannot be discharged in bankruptcy for less than a Roulette Wheel's chance of obtaining a return on investment?

I don't know if the plaintiffs in the law school lawsuits can win from a legal perspective.  I do know that we should win the moral argument.  In other words, it is pretty indubitable that duped law school graduates own the moral high ground.  Our movement needs to seize, secure, and maintain this moral high ground if we are ever to accomplish anything.


Nando said...

Thanks for setting the shill known as "Just Sayin" in his place.

In the "higher education" arms race, the specific universities and law schools are selling their name brand, location, or "ties" to the community. Hell, just look at renovated student union centers, at U.S. colleges and universities. Many feature climbing walls, corporate fast food vendors, etc.

I remember when William Henderson, paid mouthpiece for the industry, told me not to make a moral argument about the law schools. He KNEW that I had the law school pigs by the balls. He was making a desperate attempt to have me give up my stronghold.

This is akin to one chess player telling the other not to attack his weak-ass king-side flank, when he has gaping holes and little protection by his pawns and pieces. Of course, when you have such an advantage, you should not concede any ground. Especially to such a vile, reprehensible enemy.

Mikoyan said...

Completely agree. And that's one of the most important aspects of the lawsuits in particular and the scamblog movement more generally: even if the legal arguments do fail, the market will still respond to the moral argument and the erosion of good will it drives. "This is a place without honor. Do not enter."

Also, Nando is really into chess this week.

Fad said...

I was in the process of deciding which school I will be attending next year, when someone on another forum I frequent casually mentioned the difficulty of obtaining jobs, across the board, for law school grads. A few Google searches later, and I realized that it is not worth the risk of what likely would have been 150k+ in debt, on top of the 35k I have for a completely useless liberal arts BA. I'll stay at the DV legal clinic I volunteer for and pick up some law books to learn more about the law. The problem absolutely is false statistics. Sure, most people want the prestige, the degree, the ego boost, whatever, but I'm pretty sure no one wants debt they can't reasonably expect to pay off. Assuming that people base their decision to attend SOLELY on presumptions about the profession and their ego is idiotic given the amount of debt incurred, and I will never understand the comments that imply the vast majority of people who attend and graduate from law school did so without any consideration given to salary expectations to pay off that massive debt, or that they should know better...How?? Law school is an investment, and the only statistics that are really out there are not real; the only people saying they aren't real are bloggers and an occasional news article about the recent lawsuit. Prospective students see a lot more of the propaganda shoved down their throats than a scam blog that takes a few google searches to find using search terms they wouldn't have thought of using because even TTT and TTTT have misleading (at best) employment statistics so why would they think something was wrong? Salary expectations come from statistics that are touted as objective, factual data, when they in fact, aren't. Long story short - I love you guys, thank you. Scam bloggers have saved me from what likely would have been decades of financial instability, and all the suffering that comes with it. I'll settle for being less fulfilled, but financially stable and happy overall. If the majority of the information out there wasn't based on propaganda and lies, there wouldn't be so many people continuing to think law school is a good investment. It takes more than a little work to discover there is a reason to think that published, reported data, by what is essentially every law school, is not entirely accurate. The truth is buried under a mountain of bullshit coming from all sides. It's tragic, really.

Anonymous said...

The only reason people pay for a school is to get a job. If you just want to learn, you're better off just learning on your own, especially in the current internet age.

Actually, even if you pay for school, they're still not going to teach you and you have to learn on your own. Just instead of actually learning on your own, you have to take someone else's spin and figure out what they're hiding from you, since they need some way to grade you so they aren't just going to "give you" the answers.

Which kind of defeats the point of "learning" from someone else. When someone tutors or coaches somebody else they don't tell you to learn the stuff on your own, they teach it to you. That does not happen in academia since the goal was never to educate, but to separate people, to classify them.

Academics though are clever and manipulative enough to know they hold less power if they outright admit how the game works and use actual numbers. So they try to hide things and lie. This is also why academics tend to hate business so much, they are a corrupt version of most regular companies.

So while these schools take your money hand over fist, they don't want you to actually question the value or even look at what you're spending.

These institutions of "learning" will never give you a break on tuition payments and the like. But you're supposed to turn around and not expect anything in return.

Anonymous said...

There's no question the stats are fraud. Let's forget all about the students for a second. I mean, let's face it, nobody gives a fuck about them anyway. If you were a lending institution, would you lend hundreds of thousands of dollars to someone with no visible means of repayment? Of course not - so if law schools want to keep the gravy train running, lenders have to continue to lend. Now you may object that the debt is non-dischargeable. However the remedy for default is kind of a last resort for reputable lenders. They are assuming default will by and large not occur, and that assumption is based to a great extent on fraudulent stats. Considering that the money the students "borrow" goes straight from the bank to the schools, I think the real pressure on the law school scam will come from the banks, once they realize that they, like their borrowers, are being duped.

Anonymous said...

Your analysis is spot on and you are doing a real service by bringing attention to this issue.

Law schools are selling a credential, they are selling a career path and the promise of a good job. Even if you factor in people who intend to pursue an academic path (which requires even more elite credentials than an ordinary student), the number of people who are in law school "for the education" is miniscule: they are there in the expectation of a certain upper-middle class (or better) existence, and that is what the law schools promise.

The statistics they present are fraudulent by any measure of equity (fairness), if not by law.

Putting aside your used car analogy, I think a better one is the auditing of financial statements of public companies: if a third party auditor were sent in to reconcile the job claims and statements of the schools with the reality, would they stamp their seal of approval on such claims? The answer is almost certainly "no". At the very least, the numbers given by the law schools are like non-GAAP financial measures that take carve-out after carve-out and then present it as a useful metric.

Blogger Templates by 2007