Sunday, September 12, 2010

A New Mental Image For Law School

In my recent post "Greed and Horse Gambling" I compared 1) how some people who have a gambling problem are unable to reasonably evaluate the odds of winning and lose large sums of money based on the erroneous belief that the odds will somehow be different for them than for everyone else, with 2) how some potential law students make similar unreasonable decisions to go to law school.  I was just answering some comments in the article and I noticed that Google's Adwords advertising apparently matched the words in the article with this disturbing graphic (edited to remove company name):

Wow.  It struck home with me because before I read the caption I assumed that the person in the ad was a lawyer - probably based on the suit and tie and that he appears unhappy (has anyone else noticed that if you see an ad with a person in a suit and tie and they are unhappy, it always seems to be a lawyer?)

My second thought was that the graphic could very easily be applied to law school.  The students that are going to law school certainly don't think that they will lose everything by making a bad decision.  "Somehow" that $200K in tuition and expenses will get paid for - even though 6 in 10 students don't get the job that they want - and "somehow" they will still be able to have a great life with the millstone of huge debt hanging around their neck.  Unfortunately, in fact, gambling addiction hurts a lot more when you gamble on going to law school because the student loans are NOT dischargeable in bankruptcy!  If you lost it at the casino, you could discharge it in bankruptcy in most places - not so with student loans.

See that graphic, potential law students?  For the majority of you (60%), that's you.  Actually, because you won't be able to discharge the loans in bankruptcy, you will wish you had it as good as the guy in the picture.  Please, please be very careful when considering whether to go to law school.  It's the worst time in decades to go right now.


  1. I'm trying to figure out how I can get a job with this JD on my resume, its like the Scarlet Letter. I graduated top 5% at a top 50 school, had a full ride for 2 years, LSAT 170, but I can't get a job to save my life...I got laid off from big law a year ago and I'm still just waiting to get something, fml!!!! I wasted 3 years of my life on this p.o.s. degree that is worthless. I'm just glad I dodged the debt with the scholarships, but I really wish I would have gone to get like a masters in computer science or undergrad degree was computer science and that made law school look like a cake walk. Any idiot can get a JD, but getting a b.s. in computer science was truly an intellectual challenge. The thing that sucks about law school is you pay all this money for tuition to learn shit that takes a week out of some commercial outline...the education itself is worthless.

  2. 10:42 - First, congrats on your scholarship - thank goodness you have a little less pain. Also, congrats on getting the top 5% - that's quite an accomplishment. I sympathesize with your recent negative events and I recognize that if you got laid off a year ago, then you were at least a 2008 grad and had made the decision to go to law school in 2005 (or earlier) and thus could not have predicted the downturn.

    I'll also agree with your comments about law school's current pedagogical methods. There is typically very little emphasis on practical skills in law schools - it is something that they really should work on and students should demand more.

    Here's something that might seem strange, but I'll put it out there. Have you thought about going back to computer science? Maybe hit grad school, score the Masters and go from there?

  3. Funny thing is, I saw the downturn in 2004!! I was working for Washington Mutual in their home loan department, I was looking at the shit mortgage paper being underwritten and thought, man this is going to end soon, people cant possibly get loans this easily. I was working for loan officers with high school diplomas making 100k a month, insane! I figured, okay interest rates have to go up, this party cant last....I thought by the end of 2004 it would be over. I can't believe the boom lasted till 2007...I still can't believe so many people think this crap was so "unexpected." The only thing I didn't expect was my law degree becoming worthless.

  4. 1:26 - Thanks for the comment! Sorry about your degree. With regard to interest rates, not to excuse the housing crash, but my take is that the interest rates are adjusted to simulate or de-stimulate investment activity (preferrably investment activity in industries that will produce a long-tem increase in the GDP). The US economy has actually been pretty weak for the last decade, but the increased activity in the housing sector disguised that weakness. However, the Fed was looking at interest rates overall, which are a blunt tool that apply to all industries, and looking at the overall inflationary activity - and there really wasn't any. From a broader point of view, the economy seemed to be growing at a reasonable rate. However, that "growth" was actually being fairly narrowly confined into the housing sector - which is more of a one-time GDP boost rather than an on-going GDP boost (compare a company that builds a house to a company that runs a dairy. The house gets built and it is done. The dairy keeps producing every day.) Consequently, the fed failed to notice and take steps to prevent excess investment in the housing area because they were looking at metrics that were so broad that they averaged the excess growth into something that looked reasonable. This really makes the case that the Fed should have finer control on an industry-by-industry basis. That is, the Fed could have more effectively and stablly grown the GDP if they could have varied interest rates by sector. For example, they notice housing is going crazy, but they are trying to stimulate new business creation. Consequently, they could raise overnight rates that apply to housing loans and construction to 8% to dampen the activity while lowering rates for loans for new business creation to 2%. Unfrortunately, the Fed just sets the "overnight" rate for use with all funds. Frankly, its too "blunt" of a tool. I am generally not in favor of government regulation or intervention, but there needs to be some way of introducing sanity into the situation - as you note, the people in the situation (loan officers) can't stop it themselves.