Cornell Journal of Law & Public Policy: Predatory Student Loan Lenders, Middle Class Hope for Upward Mobility, the Legal Industry and the Inevitable Bubble

As some potential law students continue to await LSAT scores, law school admissions or are wondering whether or not going to law school will give them that one chance at a better life, it would benefit you to read the following:

Being led to the slaughter

A law journal article: 20 Cornell Journal of Law & Public Policy 67 (2010)
Options for Student Loan Borrowers: A Derivatives-Based Proposal to Protect Students and Control Debt Fueled Inflation in the Higher Education Market, Michael C. Macchiarola; Arun Abraham

O.k. so this article is 72 pages, obviously I won’t delve into the entire piece but I am placing some introductory quotes in which the author is direct with failing legal industry and how the student loan industry are basically predators. He specifically discusses law schools and new lawyers are a bad investment. the author is a ‘distinguished lecturer.’ The author is a law professor and is honest enough to basically state that going to law school isn’t worth it. Do you 0Ls get it? one of your potential professors is telling you that LAW SCHOOL IS A BAD INVESTMENT!

Here are the Table of Contents for a very brief overview:
INTRODUCTION                                                                                                                                                                                                                                                    I. THE RUNAWAY COSTS OF AMERICAN LEGAL EDUCATION
By the Numbers
The Causes: A Combustible Mix of Accreditation,Rankings, Peculiar Incentives and Federal Encouragement
A Brief History of the Law School and Its Accreditation
The Rankings Game
The Peculiar Incentives of the Law School Faculty
The Federal Government and the Student Loan Market
The Scope of Government Involvement
Crisis in the Market and the Emergence of SAFRA
Income-Based Repayment and More of the Same
“For-Profit” Schools and a Way Forward

THE DISAPPOINTING REVENUE PICTURE FOR LAW SCHOOL GRADUATES
INFORMATION ASYMMETRIES AND ENTERPRISE LIABILITY
Informational Asymmetries Abound
Applying Lessons from Enterprise Liability Theory

Now for some introductory quotes:
Runaway tuitions and the burdensome student debt required for most Americans to obtain a post-secondary degree are under scrutiny like never before.4 Evidence is beginning to mount that, for too many students, debt-financed education represents a stifling encumbrance instead of the great investment that society’s collective commonsense has long advanced.5 Such a finding is unsurprising in light of the fact that, for too long, the value of education has been reflexively embraced without adequate examination of its cost. (p. 69-70)

As most bloggers have been stating, the cost is not worth the proposed benefit with all of the practical variables: economy, shrinking industry, inflation, lower salaries, loan payments and their capitalized interest as well as the time and psychological warfare this field demands.

The cost of attending law school, for example, has increased at two to three times the rate of inflation over the last three decades.11 The promise of accessible loans has made loan eligible middle- and lower-income students an easy mark for unabashed, aggressive student-loan marketing.12 “The end result,” in fact, “has been an unprecedented, debt-fueled wealth transfer from students of modest means to the increasingly prosperous higher education industry and opportunistic student loan lenders.” (p. 71-72)

Now deemed “McLaw” this along with LPOs and general outsourcing has set the middle class population in a cycle of perpetual financial slavery. Upward mobility is not founded in usurious personal debt. Do not think of the titles. Do not think of prestige. Think of your life and happiness and with any common sense you will decide not to attend law school.

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3 Comments »

  1. sharon Said:

    I had to post because as I read the article – the google ad that popped up said “what is fafsa?” you may qualify for student loans. LOL!!

    This is almost as bad as the time I looked at a Youtube video of a tornado in a town in Kansas and ads for affordable real estate in the town -showing pre-tornado pictures- came up.

    Please keep posting on this. I don’t quite understand how anyone thought going $200,000 in debt for education was a good idea, but many people did that. I hope that some relief is in sight, but I think it will take a lot of political pressure.

  2. Pierre Said:

    This is indirectly related to this post, but I just watched CNBC’s “Price of Admissiion” which warns of the coming crises in student loans. It came to me as I was watching this that the leftists that run our universities are actually the best damn capitalists that have ever walked the face of the earth. I was also reminded of Shakespere. you know, his line that “I think the lady doth protest too much.” Well, for all of their ranting about the evils of capitalism, they’ve surely feathered their nests nicely. You have to wonder about people who spew such venom toward the capitalistic approach. Are they just trying to distract attention from the cozy perks they’s gotton from it???

    • A Law School Victim Said:

      Interesting point. What I don’t understand is how government can keep attempting band-aid on top of band-aid over a festering problem. Previous programs and the New Deal were implemented to get the immediate economy back on track; America can’t keep using the same idea expecting a different result long term=INSANITY!


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