What Are the Problems of Law School Tuition?

Everyone agrees that law school tuition is too high. And everyone agrees that something must be done. But to what degree is tuition too high? And just what are law schools supposed to do about it?

These are not easy questions and before we can even begin to deal with them we must ask a more basic one: what does it mean to say that tuition is too high? No price -- of anything -- is intrinsically too high or too low. Whether a price is high or low is relative. What, then, do we have in mind in judging whether law school tuition is too high?

I believe there are four general perspectives people have in mind when they say that law school tuition is too high. Which perspective we take affects our understanding of the problems and the potential solutions. The four ways we can understand claims about law school tuition are the following:

1. Long-Term Mismatch of Investment and Return. Law school is an investment, not a consumer product. One possible understanding of the claim that tuition is too high is that, for a person who invests in legal education, the likely financial return over time is insufficient. Tuition is too high in this sense if there is a mismatch between what is invested now and projected earnings in the future. On this understanding, the claim that tuition is too high is just as much a claim that anticipated earnings are too low. It is very much like saying that a stock price is too high in light of anticipated returns.

This claim can be refined in a variety of ways. For example, it can be taken as a claim about the typical (or average) law graduate. Or it can be taken as a claim about the typical graduate of a particular school (so that the claim is whether tuition at school X is too high). Other specifications are possible.

2. Short-Term Mismatch of Investment and Return. The first understanding is concerned with investment and return over the long term. There is a second possible understanding of the claim that focuses on investment and return over the short term, and it has to do with student loans.

Most law students take out loans to finance their investment and generally must begin to repay the loans soon after graduation. The second claim is that, even if law school is a good long-term investment, the payoff is deferred too far into the future. The claim, in particular, is that the short-term return is so low that the immediate repayment obligations create hardship, perhaps even jeopardizing the long-run benefit. Again, this claim can be refined as either a general claim about the typical graduate, or about particular groups of graduates.

3. Mismatch of Costs and Value. Law school tuition is cost-driven: law schools begin with a cost structure, consisting mainly of compensation, and set tuition so as to ensure that revenues (from tuition and other sources) at least cover the costs. A third way of understanding the claim about tuition builds on this pricing system and claims that the costs driving tuition levels are too high. Again, there is no such thing as costs being too high in an absolute sense, so the claim appears to be that costs are too high relative to the value delivered to students. This claim, like the others, can take more specific forms, such as that the costs of meeting accreditation standards are too high relative to the value that results from the standards, or that law schools invest too much in faculty scholarship with too little benefit flowing to students as a result of that investment.

4. Adverse Societal Impact. Law schools are public entities and there is a societal interest in the character of both law graduates and the legal services they provide. A fourth possible meaning to the claim about tuition is that the price of legal education has adverse effects on matters of public interest. For example, the claim might be that the level of tuition deters entry into the profession by persons who might want to pursue lower paying but socially important public interest work. Or, the claim might be that tuition is so high that it is ultimately passed on to clients, thus increasing the price of legal services and reducing their availability to middle- and lower-class citizens. Again, other assertions of this character are possible.

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These four possible interpretations are related, but generate very different claims about law school tuition. They also generate very different approaches to solutions. They also highlight one important point, which is rarely noted in discussions about law school tuition.

The point is that, whichever understanding of the claim you emphasize, it is a complex claim. Moreover, both the causes and solutions may involve more than just law schools. If the problem is a long-term mismatch between investment and return, then the problem results not only from law school actions but from larger-scale economic decisions and actions. If the problem is a short-term mismatch between investment and return then, again, the problem results not only from law school actions but from choices about how to finance law school education. Similar considerations apply to other understandings of the problem.

I make this point not to shift accountability away from law schools. All four understandings present strong reasons for law schools to lower the price of legal education (or at least lower the rate of increase), and law schools must take the lead in dealing with the problems of tuition. But the problems generally do not result from isolated actions or policies of law schools, and they are unlikely to be solved in an effective and sustainable fashion by law schools alone. Solutions most likely will require coordinated efforts involving governments, lenders, accreditors, state bars, and others, to eliminate the mismatches or other conditions that create too high a price for law school education.

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