One Yale faculty member who apparently relishes speculating about the fall of mighty Yale writes, after the last posting, to tell me that he thinks "3 or 4" of his other colleagues are likely to leave before long. Add to that the fact that many of Yale's heaviest heavyweights are in their 60s and even 70s--Ackerman, Schwartz, Ellickson, Fiss, Langbein, Priest, among others--and clearly the end is near!
Of course, it's nowhere near. Yale and Harvard are both so unimaginably rich that they can weather any storm. What has happened is that the awakening of the sleeping giant Harvard Law School under Dean Kagan's tenure and its entry into the lateral market has meant that Yale now faces real competition at the very top. Add to that Yale's chronic vulnerability--namely, its location--and the eagerness of both Columbia and NYU to hire almost any Yale faculty member at the drop of a hat, and it does mean that Yale Law School will have to work harder than a generation ago to remain on top. Yale will continue to be helped, to be sure, by the small school bias of US News, which has insured (through the per capita expenditures measure) that YLS has remained #1 in US News even in years when HLS has higher reputation scores. And until the changes in faculty quality translate into changes in clerkships and academic placement, one suspects that YLS will continue to have its pick of prospective law students for the foreseeable future.
UPDATE: As usual, Bill Henderson (Indiana) has interesting insights on the topic du jour.