Brian Leiter's Law School Reports

The rise of female law deans

It's striking that the Deans of the very top law schools (there are 18 for those keeping count, not 14 as the dumb-dumbs indoctrinated by USNews.com believe) are now almost 50% female:   Yale (Gerken), Stanford (Magill), Columbia (Lester), Virginia (Goluboff), Duke (incoming, Abrams), Northwestern (incoming, Yuracko), UCLA (Mnookin).  Just on the cusp of the top 18 schools, you find three more female Deans (Richardson at Irvine, Staudt at Wash U/St. Louis, O'Rourke at BU).

Paul Krugman explains how the war against taxes became a war against education (Michael Simkovic)

In today's New York Times, Professor Krugman writes about the war on education. Krugman's generally smart post overlooks an important part of the story.  Many wealthy Democratic Donors also want low taxes and are therefore also hostile toward teachers unions and increases in public funding for education.  Republicans are not the only ones's responsible for the current state of K-12 education, in which high preforming college graduates are fleeing teaching for better opportunities.  Krugman writes:

 

"State and local governments . . . are basically school districts with police departments. Education accounts for more than half the state and local work force; protective services like police and fire departments account for much of the rest.

 

. . . [W]hen hard-line conservatives take over a state. . . they almost invariably push through big tax cuts. Usually these tax cuts are sold with the promise that lower taxes will provide a huge boost to the state economy. . . . This promise is, however, never — and I mean never — fulfilled; the right’s continuing belief in the magical payoff from tax cuts represents the triumph of ideology over overwhelming negative evidence.

 

What tax cuts do, instead, is sharply reduce revenue, wreaking havoc with state finances. For a great majority of states are required by law to balance their budgets. This means that when tax receipts plunge, the conservatives running many states can’t do what Trump and his allies in Congress are doing at the federal level — simply let the budget deficit balloon. Instead, they have to cut spending.

 

And given the centrality of education to state and local budgets, that puts schoolteachers in the cross hairs. 

 

How, after all, can governments save money on education? They can reduce the number of teachers, but that means larger class sizes, which will outrage parents. They can and have cut programs for students with special needs, but cruelty aside, that can only save a bit of money at the margin. The same is true of cost-saving measures like neglecting school maintenance and scrimping on school supplies to the point that many teachers end up supplementing inadequate school budgets out of their own pockets.

 

So what conservative state governments have mainly done is squeeze teachers themselves.

 

Now, teaching kids was never a way to get rich. However, being a schoolteacher used to put you solidly in the middle class, with a decent income and benefits. In much of the country, however, that is no longer true.

 

At the national level, earnings of public-school teachers have fallen behind inflation since the mid-1990s, and have fallen even more behind the earnings of comparable workers. At this point, teachers earn 23 percent less than other college graduates. But this national average is a bit deceptive: Teacher pay is actually up in some big states like New York and California, but it’s way down in a number of right-leaning states.

 

Meanwhile, teachers’ benefits are also getting worse. In particular, teachers are having to pay a rising share of their health insurance premiums, a severe burden when their real earnings are declining at the same time.

 

So we’re left with a nation in which teachers, the people we count on to prepare our children for the future, are starting to feel like members of the working poor, unable to make ends meet unless they take second jobs. And they can’t take it anymore.

 

. . . [E]xtreme right-wing ideologues . . . really believed that they could usher in a low-tax, small-government, libertarian utopia.

 

Predictably, they couldn’t. For a while they were able to evade some of the consequences of their failure by pushing the costs off onto public sector employees, especially schoolteachers. But that strategy has reached its limits. Now what?

 

Well, some Republicans have actually proved willing to learn from experience, reverse tax cuts and restore education funding. But all too many are . . . lashing out, in increasingly unhinged ways, at the victims of their policies."

 

Longtime Northwestern faculty member Kimberly Yuracko named Dean

She succeeds Dan Rodriguez.  I will post a link to the university's announcement as soon as it appears.

UPDATE:  Northwestern's announcement.

Corporate Practice Commentator's top 10 corporate and securities law articles of 2017 announced

Here is the announcement, I've inserted institutional affiliations of the scholars whose work was recognized:

 The Corporate Practice Commentator is pleased to announce the results of its twenty-fourth annual poll to select the ten best corporate and securities articles.  Teachers in corporate and securities law were asked to select the best corporate and securities articles from a list of articles published and indexed in legal journals during 2017.  More than 565 articles were on this year’s list.  Because of the vagaries of publication, indexing, and mailing, some articles published in 2017 have a 2016 date, and not all articles containing a 2017 date were published and indexed in time to be included in this year’s list.

The articles, listed in alphabetical order of the initial author, are:

Choi, Stephen J. (NYU), Jill Fisch (Penn), Marcel Kahan (NYU), and Edward Rock (NYU). Does Majority Voting Improve Board Accountability? 83 U. Chi. L. Rev. 1119-1180 (2016).

 

Cox, James D. (Duke), Fabrizio Ferri (Columbia Busness), Colleen Honigsberg (Stanford), and Randall S. Thomas (Vanderbilt). Quieting the Shareholders' Voice: Empirical Evidence of Pervasive Bundling in Proxy Solicitations. 89 S. Cal. L. Rev. 1175-1238 (2016).

 

Gelpern, Anna (Georgetown) and Erik F. Gerding (Colorado). Inside Safe Assets. 33 Yale J. on Reg. 363-421 (2016).

 

Goshen, Zohar (Columbia) and Richard Squire (Fordham). Principal Costs: A New Theory for Corporate Law and Governance. 117 Colum. L. Rev. 767-829 (2017).

 

Hwang, Cathy (Utah). Unbundled Bargains: Multi-agreement Dealmaking in Complex Mergers and Acquisitions. 164 U. Pa. L. Rev. 1403-1451 (2016).

 

Judge, Kathryn (Columbia). Information Gaps and Shadow Banking. 103 Va. L. Rev. 411-480 (2017).

 

Morley, John (Yale). The Common Law Corporation: The Power of the Trust in Anglo-American Business History. 116 Colum. L. Rev. 2145-2197 (2016).

 

Pollman, Elizabeth (Loyola/Los Angeles) and Jordan M. Barry (San Diego). Regulatory Entrepreneurship. 90 S. Cal. L. Rev. 383-448 (2017).

 

Subramanian, Guhan (Harvard). Deal Process Design in Management Buyouts. 130 Harv. L. Rev. 590-658 (2016).

 

Rauterberg, Gabriel (Michigan) and Eric Talley (Columbia). Contracting Out of the Fiduciary Duty of Loyalty: An Empirical Analysis of Corporate Opportunity Waivers. 117 Colum. L. Rev. 1075-1151 (2017).

Two law professors elected to the American Academy of Arts & Sciences

They are:  Risa Goluboff (Dean at UVA) and Mark Lemley (Stanford).

In Memoriam: Lynn Stout (1957-2018)

I'm sorry to report that Professor Stout, a leading figure in corporate law at Cornell (and who taught previously for many years at UCLA), has died of cancer.  I will add a link to the Cornell memorial notice when it appears.

UPDATE:  The Cornell memorial notice is here.

Privatization scheme highlights rifts in Democratic party between donors and educators (Michael Simkovic)

Democrats in Colorado recently voted overwhelmingly to reject public school privatization and deregulation efforts (charter schools).  Chalkbeat reports:

"Delegates at the Colorado Democratic state assembly Saturday sent a clear message to the state chapter of Democrats for Education Reform: You don’t have a place in our party.

After booing down the head of the education reform organization, who described herself as a lifelong Democrat, delegates voted overwhelmingly Saturday to call for the organization to no longer use “Democrats” in its name. While it’s unclear how that would be enforced, the vote means a rejection of DFER is now part of the Colorado Democratic Party platform. . . . 

The platform amendment reads:

“We oppose making Colorado’s public schools private or run by private corporations or becoming segregated again through lobbying and campaigning efforts of the organization called Democrats for Education Reform and demand that they immediately stop using the party’s name Democrat in their name.”

Vanessa Quintana, a political activist . . . said that before she finally graduated from high school, she had been through two school closures and a major school restructuring and dropped out of school twice. Three of her siblings never graduated, and she blames the instability of repeated school changes.

“When DFER claims they empower and uplift the voices of communities, DFER really means they silence the voices of displaced students like myself by uprooting community through school closure,” she told the delegates. “When Manual shut down my freshman year, it told me education reformers didn’t find me worthy of a school.”

Just two people spoke up for Democrats for Education Reform. . . .

In an interview, Quintana said she sees education reform policies as promoting inequality, and she wants to change a status quo in which reformers are well represented in the party establishment. She feels especially strongly about ending school closure and sees school choice as a way to avoid improving every school.

“Families wouldn’t need a choice if every neighborhood had a quality school,” she said. “There should be no need to choice into a new neighborhood.”

She believes the reform agenda is not compatible with the education platform of the party, which reads, in part, “our state public education laws and policies should provide every student with an equal opportunity to reach their potential.”

This move highlights a major rift within the Democratic Party on education policy. Charter school advocacy, expansion and evaluation has been heavily funded by foundations affiliated with technology companies--most famously the Bill & Melinda Gates Foundation--billionaire philanthropists traditionally viewed as Democratic-leaning such as the Broads, as well as conservative and libertarian billionaire philanthropists such as the Kochs and Waltons. By contrast, teachers’ unions have fought for higher wages, stable employment, smaller class sizes, and better textbooks and equipment for students in public schools, as well as nationwide efforts to ameliorate poverty, which teachers say undermines students’ ability to focus on their studies.

There is a serious empirical dispute over the quality of charter schools. The foundations say that charters, often staffed by young, inexperienced, and low-paid teachers with frequent turnover are the future of education.  But peer reviewed empirical studies have not consistently found evidence that charter schools improve student performance, compared to public schools, after properly controlling for student characteristics and expenditures per student. Although some studies get positive results (see here and here ), these studies may have suffered from methodological problems that caused them to underestimate differences in student characteristics or to focus only on the best charter schools rather than a representative sample.  Many studies find that charter schools perform worse than public schools. (See here, here, here, here).  Experiments with K-12 privatization in Sweden produced similarly unimpressive results decades ago.

Given these studies, Democratic leaders may wish to proceed with caution before further alienating one of the party’s most reliable constituencies, even if doing so risks upsetting major donors. Teacher's Unions have been particularly critical of Arne Duncan, President Obama's Secretary of Education.  Mr. Duncan has reciprocated by not supporting teachers in some of the worst funded states in the country when teachers went on strike after facing further pay cuts (in inflation adjusted terms) and massively underfunded pensions. A study by McKinsey found that high-performing college graduates are avoiding or fleeing teaching because of low pay and poor working conditions. (See also here and here for data on teacher's pay by geography).  Teachers earn 30 percent less on average than other educated workers, and relative pay has declined since the 1990s.

Many Democrats reasonably worry that "school choice" might function to defund teacher's unions (and therefore reduce the power of the Democratic party), undermine public education (but see here), to channel public money toward education technology that may be more expensive than its pedagogical value, to justify lower expenditures and lower taxes than are needed to improve the quality of K-12 education, and to facilitate racial segregation (see also here) without offsetting improvements in student learning.  

Technocrats may contend that the argument over charter schools is simply one about evidence of student outcomes. But the evidence for the educational advantages of charter schools has been and remains weak.  And there is strong evidence of a decades-long attack on public education and unions, ostensibly aimed at reducing the political power of progressives.  Democratic political leaders may increasingly consider political implications when they decide whether to support further charter-ization, or to limit it (as Massachusetts did last year).

To be sure, some studies suggest that "injecting best practices" from the highest performing charter schools into public schools can improve student performance without the need to move toward charter schools. These "best practices" ("increased time, better human capital, more student-level differentiation, frequent use of data to alter the scope and sequence of classroom instruction, and a culture of high expectations") may entail higher instructional spending per student.  And these practices seem to work in traditional public schools as well as charter schools.

Edward Kleinbard in the Los Angeles Times: Tax policy is a bore, until they take your Social Security and Medicare away (Michael Simkovic)

Edward Kleinbard (USC; former head of the Joint Committee on Taxation) writes in the Los Angeles Time

"[B]udget deficits — how much spending exceeds revenues — are extremely large and growing at a disturbing rate. The nonpartisan Congressional Budget Office estimates that the 2019 deficit will be just shy of $1 trillion. That is a roughly 50% jump in the deficit from its 2017 level — extraordinary, considering we're in good economic times.

 

Tax cuts do not pay for themselves — not the Trump tax cuts, nor in any other case in modern U.S. practice. So we face only two possible courses of action: Either we tax ourselves more, or we dismantle the social safety net (in particular, Social Security, Medicare and Medicaid) that protects Americans from destitution or disability. Which is the right direction for our country to pursue?

 

One political movement has its answer at the ready: Slash the safety net.

 

Five fellows at the conservative Hoover Institution recently laid bare in a Washington Post opinion piece how the Tax Cut and Jobs Act of 2017 was just the first step in a two-step dance. The full tango goes like this: Note that our deficits are unsustainable. Blame "entitlement spending" (code for Social Security and Medicare) rather than tax cuts. Demand cuts to social spending on the pretext that some imaginary iron laws of reduced tax collections and deficit concerns require it.

 

This agenda aims to asphyxiate the working class through the dismantling of the social insurance programs on which most Americans rely. But the tax tourniquet is a political creation, not an economic necessity. When compared with wealthy peer economies, the United States today already is the lowest-taxed country as a percentage of GDP. The tax cuts going into effect this year will reduce federal tax collections still further, to levels substantially below the 50-year average of federal tax revenues as a percentage of GDP.

 

There is no law of economics that says record-low tax revenues are the prerequisite to a thriving economy. What we actually need, like it or not, are more tax revenues to fulfill our promises to support our fellow citizens. To do so does not require any radical ideas or bankrupting the middle class. We can raise several trillion dollars of new revenue over the next decade with some straightforward moves. . . . 

 

Tax policy is a bore, until they come to take your Social Security and Medicare away. Yes, our federal budget deficit trajectory is unsustainable, but the reason is not profligate or unexpected social spending. Tax Day is as good as any other to reflect soberly on the price our country will pay for systematically undertaxing itself."

 

It should be noted that Larry Summers and other critics of the 2017 tax reforms predicted these large deficits.

New study finds that Texas lawyers generally remain satisfied with careers even after the recession (Michael Simkovic)

A new survey study by Milan Markovic and Gabriel Plicket finds that Texas lawyers generally remain fairly satisfied after the 2008 recession.  However, satisfaction varies by income, practice setting and status.

"In this article we used data from a large cross-sectional sample of Texas lawyers to examine lawyers’ career dissatisfaction in the post-recession period. Our results show that most practicing lawyers regard their careers as satisfying and that factors such as income, practice setting, class rank, and remaining law school debt affect career dissatisfaction whereas attorneys’ demographic characteristics, practice areas, and firms’ size do not. The economic recession may have impacted the legal profession, but the overall incidence of dissatisfaction remains low, and many of the factors that impacted lawyers’ assessments of their careers prior to the recession continue to be salient."

The study is interesting as a purely descriptive analysis, and consistent with studies using After the JD data such as Ronit Dinovitzer, Bryant G. Garth & Joyce S. Sterling, Buyers’ Remorse; An Empirical Assessment of the Desirability of a Lawyer Career, 63 J. Legal Educ. 211 (2013).

One of the more interesting findings is that satisfaction seems to increase with experience, although this raises questions about attrition from the sample (i.e., who leaves the practice of law?).

I think more caution is generally advisable when interpreting cross-sectional data about satisfaction and would have preferred less causal language.  I think a longitudinal study with fixed effects would have supported stronger inferences about what drives lawyer satisfaction.

For example, the study notes that law firm partners are more satisfied than law firm associates and suggests that this is because partners have more autonomy.  That's plausible, but it's also possible that law firm partners are on average more satisfied than associates because the associates who are the least satisfied leave the law firm, while those that are the most satisfied are better suited to law firm work and therefore are more likely to be offered an opportunity to join the partnership.  With a cross-sectional analysis, it's hard to know which (or how much of each) of these factors could be driving differences in satisfaction.

There are other questions about the methodology, such as choice of controls.  For example, is it appropriate to control for both income and practice area and then conclude that people in criminal law are no less satisfied than lawyers in business law?  Practice area my strongly influence income and corporate lawyers could be more satisfied than public defenders precisely because they have higher incomes.  This could be over-controlling. Indeed, even baseline level of happiness and personality could influence income.  Similarly, there are questions about controlling for class rank and current income and total debt levels, since those who ranked higher in the class may be more likely to have lower debts initially and to earn more subsequently.

The study finds that public sector work is associated with higher satisfaction, all else being equal.  Why is that?  Is it because total compensation (income + benefits) could be higher per hour of work in the public sector?  Is it because the work is inherently more rewarding or because of greater job security and less stress?  Is it because someone in the private sector whose income is the same as someone in the public sector is much lower in the hierarchy than a similar income peer in the private sector because incomes are so much higher in the private than public sector?

Another key question is, compared to what? If lawyers are generally satisfied, but other highly paid professions are even more satisfying, how should we interpret that result?  If lawyers are generally unsatisfied but other highly paid professions are even less satisfying, what does that imply?  Are these differences causal or because of selection of different personality types into different professions?

It will be interesting to see what Markovic and co-authors come up with next to address these challenging questions.

Zephyr Teachout (Fordham): Congress let Facebook CEO off the hook too easily (Michael Simkovic)

In the Guardian, Fordham's Zephyr Teachout argues that members of Congress let the CEO of Facebook off easily and essentially treated his hearing as an opportunity to curry favor with him.  Teachout writes:

"It was designed to fail. It was a show designed to get Zuckerberg off the hook after only a few hours in Washington DC. It was a show that gave the pretense of a hearing without a real hearing. It was designed to deflect and confuse.

Each senator was given less than five minutes for questions. That meant that there was no room for follow-ups, no chance for big discoveries and many frustratingly half-developed ideas. Compare that to Bill Gates’ hearing on Microsoft, where he faced lawyers and staff for several days . . . By design, you can’t do a hearing of this magnitude in just a couple of hours.

The worst moments of the hearing for us, as citizens, were when senators asked if Zuckerberg would support legislation that would regulate Facebook. . . . By asking him if he would support legislation, the senators elevated him to a kind of co-equal philosopher king . . . 

Teachout goes on to argue that Facebook's wealth, power, disregard for individual privacy, ability to manipulate public perceptions and refusal to take responsibility for accuracy of the content it presents makes it a "danger to democracy."

"Facebook is a known behemoth corporate monopoly. It has exposed at least 87 million people’s data, enabled foreign propaganda and perpetuated discrimination. We shouldn’t be begging for Facebook’s endorsement of laws, or for Mark Zuckerberg’s promises of self-regulation. We should treat him as a danger to democracy and demand our senators get a real hearing. . . . 

Zuckerberg strikes me as reliably self-serving. That doesn’t make him that interesting as the CEO of a corporate monopoly; it makes him a run-of-the-mill robber baron. . . [Senators should not] treat[] him as a good-hearted actor with limited resources, instead of someone who is making monopoly margins and billions in profits."

In fairness to Mr. Zuckerberg, traditional media organizations also often exhibit a disregard for privacy, manipulate public perceptions and refuse to take responsibility for the [in]accuracy of the information they publish and the harm it causes. Too many journalists and and editors invest the bare minimum in fact checking (often nothing), and prioritize entertainment value and "virality" over economic or political significance.  The established press too often write preconceived stories full of selective quotes or facts while disregarding contradictory information, refuse to print corrections, elevate the status of those willing to supply "helpful" quotes, and retaliate against those who point out their errors. 

This irresponsible behavior is made possible by defamation laws that make it virtually impossible for the press to incur liability unless it can be proved that they knowingly and intentionally lied with the specific goal of destroying an individual's reputation--which is virtually impossible.

Facebook may have contributed to the unexpected outcome of the last election, but so did other media organizations.  Mainstream media organizations gave one candidate billions of dollars of free publicity (hundreds of millions more than his rivals) mainly because his provocative statements--delivered with the practiced timing of a "reality" TV star--were entertaining and boosted their readership, and therefore their revenues.

This is what happens when competitive market pressures encourage media organizations to see their role as packaging advertising rather than as supplying accurate information.    Facebook may play the same game, only with better technology.

This does not mean that Facebook should get a free pass.  But we should not use Facebook as a scapegoat to avoid talking about problems with the media landscape that are systemic and that would persist even if Facebook disappeared tomorrow.

 

UPDATE: This article was corrected on 4/15/2018 to note that media organizations provided billions worth of free coverage, not just tens of millions.