Friday, August 22, 2014
For Profit Law Schools: Campos on Florida Coastal School of Law and what it says about high cost nonprofit law schools
If you have not already heard about the huge ongoing gnashing of teeth regarding the legitimacy, or lack thereof, of for-profit law schools (nevermind the questioning of law schools themselves), you should take a look at Paul Campos' August 13th article in The Atlantic entitled "The Law School Scam". Campos has a follow-up post to the article -- commenting on Florida Coastal School of Law's rather transparent PR counter-offensive lead by a person named "Mia" -- on his own blog. The point relevant to this blog though regards the extent to which the profit motive necessarily, invariably or inevitably corrupts altruism in the managment of nominally nonprofit endeavors. One might surmise that in the absence of so much government subsidized profit -- even still today -- gushing from law schools, we might have far fewer law schools perpetuating the ever increasing bubble. I almost feel as though I am passing along some really juicy explosive gossip, except that the facts are verifiable even if his conclusions are arguable.
The Atlantic article begins with a discussion of an infamous incident in which a Dean candidate was asked to get the hell off campus right in the middle of his vision talk for too insightfully addressing the conflict between profit making and charity as it relates to the impact on law school admissions:
Florida Coastal is a for-profit law school, and in his presentation to its faculty, Frakt [the Dean candidate] had catalogued disturbing trends in the world of for-profit legal education. This world is one in which schools accredited by the American Bar Association admit large numbers of severely underqualified students; these students in turn take out hundreds of millions of dollars in loans annually, much of which they will never be able to repay. Eventually, federal taxpayers will be stuck with the tab, even as the schools themselves continue to reap enormous profits. There are only a small number of for-profit law schools nationwide. But a close look at them reveals that the perverse financial incentives under which they operate are merely extreme versions of those that afflict contemporary American higher education in general. And these broader systemic dysfunctions have potentially devastating consequences for a vast number of young people—and for higher education as a whole. Florida Coastal is one of three law schools owned by the InfiLaw System, a corporate entity created in 2004 by Sterling Partners, a Chicago-based private-equity firm. InfiLaw purchased Florida Coastal in 2004, and then established Arizona Summit Law School (originally known as Phoenix School of Law) in 2005 and Charlotte School of Law in 2006.
For the deeper questions provoked by the article, you just need to read the article. I'm probably way too biased to even present the highlights. But here is one salient point regarding mainstream [i.e., nonprofit] law schools that cannot be ignored:
What, after all, is the difference between the InfiLaw schools and Michigan’s Thomas M. Cooley, or Boston’s New England Law, or Chicago’s John Marshall, or San Diego’s Thomas Jefferson? All of these law schools feature student bodies with poor academic qualifications and terrible job prospects relative to their average debt. In recent years, as law-school applications have collapsed, all of these schools have, just like the InfiLaw schools, cut their already low admissions standards. And, like Florida Coastal, Arizona Summit, and Charlotte, all of these schools now have a very high percentage of students who, given their LSAT scores, are unlikely to ever pass the bar. Ultimately, what difference does it make that none of these schools produce profit in the technical (and taxable) sense, because they are organized as nonprofits? The only real difference between for-profit and nonprofit schools is that while for-profits are run for the benefit of their owners, nonprofits are run for the benefit of the most-powerful stakeholders within those institutions.
After describing the almost religious cult-like assumptions underlying American's blind subsidization of anything labled "higher education," including law school, Campos concludes, "these assumptions enabled InfiLaw’s lucrative foray into the world of for-profit education. But they have just as surely shaped the behavior of nonprofit colleges and universities." he might have added, "all at the expense of most students whose promissory notes finance colleges and universities."