Category Archives: Law School

Just in Time for Halloween

Lawprofs sue over ‘satanic’ raise. Yes, really.

The AAUP Chapter at Cleveland-Marshall College of Law has filed an unfair labor practice charge with the State of Ohio alleging that the law school retaliated against certain faculty in the award of merit raises in 2013 and 2014 because of their union activities. Faculty were placed in four merit raise bands — $5,000, $3,000, $666, and $0 — based on scholarship and scholarly influence (40%), teaching as measured by student evaluations (40%), and service (20%). The complaint alleges that eight AAUP organizers received raises of $0 or $666, despite “exemplary scholarship and teaching scores.” The complaint charges that the $666 raise in effect calls “AAUP’s organizers and AAUP Satan.” In a memo distributed to the central administration and copied to the entire faculty, one of the eight AAUP organizers alleges that:

[The $666 figure] is a universally understood symbol of the Antichrist or Devil — one of our culture’s most violent religious images. Implicitly, but unmistakably and obviously intentionally, [the Dean] used his powers to set faculty salaries as an occasion to brand his perceived opponents as the Antichrist.

The mind boggles. Although a $5000 merit band doesn’t sound bad at all in this economy.

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Good Speech for 1Ls (and Others) to Hear

Anthony Casey Addresses Entering Students at University of Chicago Law School is a fine introduction to what matters in law school.

A sample:

If you believe the op-ed pieces in newspapers and the blogs spread across the Internet, you may think you are here just to learn how to read law and to prepare to take the bar exam in three years. That view is a surefire way to waste your time here. People quite ignorant of what a good lawyer does will tell you that law school should be shorter, that law school should teach students how to pass the bar, that law students learn too much theory.

I am going to let you in on a secret. The bar exam is a memory test. You had the skills to take the bar exam when you were a freshman in high school. You certainly don’t need three years to prepare for it. That is true. But passing the bar does not make someone a good lawyer. It just makes them a lawyer. And if you think that is enough, I can direct you to a thousand websites and jokes about things that went wrong when “just lawyers” were trusted with important problems.

What differentiates good lawyers – graduates from this law school – is the ability to advise clients about what those laws and documents actually mean in the real world, how they affect human interaction, and most importantly, how those effects can be changed.

To prepare you for this – and we do prepare you for this – we will teach you to explore how rules, policy, and human behavior interact. It is precisely for this reason that law school is (more than any other area of study) so interdisciplinary. You cannot understand the rights that a lender will exercise against a bankrupt corporation without understanding finance, economics, psychology, political theory, and philosophy, to name a few.

All of that is to say that the world, or at least those who are most noisy on the Internet, misunderstand both the practice and the study of law. They will tell you that lawyers create chaos and academics don’t care about the real world. Do not be taken in by this.

Spotted via Leiter.

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This Is Fun

Law and Law School in Six Words from the Marquette University Law School Faculty Blog.

My favorites so far are:

  • “It depends” worked most days
  • For sale: law degree, no promises.
  • No better preparation for serving humanity.

It’s not as easy as it looks.

(spotted via WSJ Blog, Describing Law School in Six Words) which also has some including, “‘But I’m tenured!’ the professor replied.” and “The former dean pleaded not guilty.” –which I think tells us something about the WSJ.

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I Look Forward to Reading This Paper

Robert Condlin, ‘Practice Ready Graduates': A Millennialist Fantasy”. Abstract:

The sky is falling on legal education say the pundits, and preparing “practice ready” graduates is the best strategy for surviving the fallout. This is a millennialist version of the argument for clinical legal education that dominated discussion in the law schools in the 1960s and 1970s. The circumstances are different now, as are the people calling for reform, but the two movements are alike in one respect: both view skills instruction as legal education’s primary purpose. Everything else is a frolic and detour, and a fatal frolic and detour in hard times such as the present.

No one would dispute that the United States legal system has a labor market problem, but law schools cannot revive the labor market, or improve the employment prospects of their graduates, by providing a different type of instruction. Placing students in jobs is a function of a school’s academic reputation, not its curriculum, and the legal labor market will rebound only after the market as a whole has rebounded (and perhaps not then). The cause of the present troubles is a lack of jobs, not a lack of graduates (of any kind), and producing more “practice ready” graduates will have no effect on the supply of jobs. The proposal is a spectacular non sequitur to the present troubles.

The concept of “practice ready” also is unintelligible and would be impossible to implement if it were not. There are as many different types of practice, for example, as there are levels of readiness for it and proponents of the proposal do not say which of these various possibilities (and combinations of possibilities), they have in mind. If the expression had a clear meaning, law schools still could not implement it because proficiency at practice depends upon dispositions (i.e., habits informed by reflection), and dispositions take longer than a law school course to develop. Like a lot of blog commentary, the “practice ready” proposal is more slogan than idea. Perhaps that is why it is so popular.

Not pulling any punches here, are we? Lest you think Prof. Condlin (whom I don’t know) is an Ivory tower guy or anti-clinic, here’s his official bio:

From 1969 to 1972, Professor Condlin was an assistant attorney general for the Commonwealth of Massachusetts. He represented the Commonwealth in several major lawsuits in state and federal court, including Massachusetts v. Laird, an original action in the United States Supreme Court challenging the constitutionality of the Vietnam War, Sturgis v. Quinn, the state court precursor to the Supreme Court decision in Baird v. Bellotti, upholding a woman’s right to birth control, and Board of Appeals of Concord v. Housing Appeals Committee of the Department of Community Affairs, the first defense of an anti-snob zoning statute in the United States. He left the Attorney General’s office in 1972 to establish the Urban Legal Laboratory, a full-semester clinical program for students of Boston College Law School, run jointly with the Boston Lawyers Committee for Civil Rights. In 1974 he became a teaching fellow at Harvard Law School, where he taught and did graduate study in the field of clinical law. He left Harvard in 1976 to become associate professor of law at the University of Virginia, where he created that school’s clinical law program. He moved to Maryland in 1980. He has served as a consultant to the AALS Law Teachers Clinic and Clinical Teachers Training Conferences and to the Canadian Law Teachers Clinic and has taught at Indiana University Law School at Bloomington as a visiting professor

OK, a little ivory tower, maybe. But the paper sounds like it might be a useful corrective to certain over-enthusiasms.

Posted in Law School, Law: Practice | 3 Comments

Research Assistants Wanted

Apologies, but this announcement is for UM Law students only:

I have three open jobs for research assistants, all starting when classes begin, or as soon thereafter as is practical. These jobs are for the entire academic year, although I don’t expect you to work during exams or vacations.

Job #1: Academic Research

This job requires 10-15 hours per week. The RA’s job is to help me with my research, which is likely to be focused on privacy, and internet law more generally, but may also include some robotics or torts. It requires someone who can write clearly, is well-organized, and who is really good at finding things in libraries and on the Internet. If you happen to have some web or programming skills (some or all of HTML, WordPress, MySQL, Perl, Debian), that would be a very big plus but it is not in any way a requirement.

Job #2: Jotwell Student Editor

This job requires 7-10 hours per week, although it likely involves a bit more in the first week or two as you learn the ropes. This job involves helping me manage and edit JOTWELL, an online law journal (see jotwell.com). You are a combination of managing editor and substantive editor so the job requires excellent organizational skill plus editing skills; some talent for diplomacy in dealing with authors would also be of use. Jotwell uses WordPress to publish, but it is easy to learn, so no experience needed.

Job #3: ‘We Robot’ Conference Organizer/Researcher

I need to hire one or more law students to help manage a major conference on legal and policy issues relating to robotics, to be held at the law school on April 4 & 5, 2014. There is intellectual work to be done to set up the event, notably writing online summaries of all the accepted papers. There are also some administrative duties, although the law school staff will shoulder the bulk of those.

The job involves a smaller amount of work now, and a larger amount of work in the weeks leading up to the event. You would also be asked to attend and assist with the conference, for example, liaising with speakers, and summarizing events online, on Twitter, and other media.

++

In all three cases the hourly pay of $ 13 is set by the university, and is not as high as you deserve, but the work is sometimes interesting.

If you are interested, please e-mail the following to michael.froomkin@gmail.com with the words RESEARCH ASSISTANT (in all caps) followed by your name in the subject line:

1. A copy of your resume (c.v.),
2. A short writing sample (non-legal is preferred — in any case, please don’t send your LCOMM memo),
3. A transcript (need not be an official copy),
4. A cover note telling me
– which job or jobs you are applying for (if more than one, please state preferences if you have any)
– your phone number and email address.
– anything else about you that you would like me to know.
– if you are interested in the Robots job, whether in addition to variable duties before then you would be prepared to work up to 15-20 hours per week in March 2014 if necessary.

Saying you saw the notice here couldn’t hurt.

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Law School and Cash Crunches

In The Economic Value of a Law Degree: Correcting Misconceptions, Michael Simkovic responds to critics and commentaries. One of his (gentler) responses is directed here:

Michael Froomkin wonders if law degree holders will experience a cash crunch early in their careers when their incomes are lower and debt levels are higher. 

It is unlikely that a debt financed law degree would create a cash crunch.  Young bachelor’s degree holders also have lower incomes early in their careers.  The earnings premium associated with the law degree will typically exceed required debt service payments on law school debt, particularly in light of the availability of extended repayment, deferment, forbearance, and income based repayment plans.  Graduate degrees can readily be financed entirely with federal student loans.

The costs of delayed repayment (i.e., higher interest) are already taken into account in our present value calculation, because we discount back at the weighted average interest rate on law school debt.  We’re pretty conservative in this respect: we ignore the (likely) possibility that students will prepay their highest interest rate debts first.  Indeed, After the JD II found evidence of rapid pre-payment of law school debt.

Our results suggest that most young law degree holders most of the time likely have more positive cash flow—even after debt service payments—than they would likely have had with only a bachelor’s degree.

Because the economic value of a given level of education can generally be maximized by completing that level of education early—and thereby maximizing the number of years of subsequent work with the benefit of higher wages from the education earnings premium—delaying graduate school to try to time the market is a high-cost strategy. And timing the market three or four years in advance is difficult.

I think we are talking past each other here in two ways. First, Simkovic largely relies on aggregate data; I was talking about a specific sub-class: people with (1) high debt, (2) higher-than-average average interest rates, who find themselves (3) in low percentiles in relative earnings.

Second, I would include as problem cases many of those people who are forced to go into loan deferral. That will in the long run increase their interest expense; it means some predictions they made regarding debt service may turn out to be unduly optimistic.

It doesn’t really matter to me that the paper already took account of increased interest payment due to deferral in computing net present value because the paper’s calculation is a priori and my narrative is post hoc; we’re not talking about the same thing. The paper is asking whether a law degree tends to have a positive net present value at graduation, and finds it does even at the 25th percentile. I’m discussing the issue from the post hoc perspective of a subset of students. Thus, I am not disputing the claim that “[t]he earnings premium associated with the law degree will typically exceed required debt service payments on law school debt” (emphasis added) but rather pointing out that there may be a non-trivial number of so-called non-typical cases. This observation is not negated by Simkovic’s reply that, “most young law degree holders most of the time likely have more positive cash flow—even after debt service payments—than they would likely have had with only a bachelor’s degree” (emphasis added). On the contrary, the two claims seem to me to be entirely congruent: the JD has tended to be an economic win. But not for everyone.

Simkovic offers a chart in support of his assertion that cash flow is not much of an issue. Again, his assertion may work for the majority and may work at the median, but as this very chart shows, there’s a group – 10%? 15%? for whom things are not so great:

In terms of the over-all viability of the law school enterprise these indeed are fairly reassuring charts. But note that the left chart is for the median student. [UPDATE: Actually that chart is for the median student with debt, making it even more reassuring.] When discussing cash flow problems, I’m not primarily talking about the median student. I’m talking about the appreciable minority of people who are, assuming a normal distribution, about a standard deviation below the mean. This group likely substantially includes the 5+% with more than $100,000 still owning seven years post-graduation. They are not typical, but nor are they so rare that we should ignore their existence.

My point was, and remains, that even if we take on board the valuable insight from “The Economic Value of a Law Degree” — that most JDs have made economic sense for most recipients in recent history, and that there are credible grounds to believe this trend may continue — that doesn’t mean prospective students should not ask themselves hard questions about what their JD will be mean given their personal circumstances. For an appreciable minority — circa 10% even? — and especially those borrowing to pay full tuition at certain private T4 law schools on top of other debt, it is likely to be a bad bet.

I am tentatively persuaded that law school is a good lifetime economic bet for most students, barring a structural shift in service provision unique to lawyers. There is, to my eye, more evidence for the proposition that there is a shift than there is for the proposition that shift is unique to legal services. Thus, we might expect some sort of JD earnings premium to persist. If so, a JD at even a middle-ranked law school will be a good lifetime economic bet for most people, save for a small group disproportionately composed of those who carry the highest debt at graduation and who also enjoy (suffer) the least remunerative outcomes.

Note, however, how far we have gotten: a ‘good lifetime economic bet’ is a long way from the gravy train with giant starting salaries that too many students who matriculated only a few years ago routinely seemed to expect was practically their due. Even if the over-enthusiastic critiques of the value of a JD substantially corrected by ‘The Economic Value of a Law Degree’ may have been shown to reflect serious sampling bias, the entire debate reminds us how important it is to approach a legal career, or any career, with realistic expectations.

I invite Simkovic & McIntyre to include a 10th and a 5th percentile in their various tables if possible. It might help all this become clearer if we were working from more common ground.

[UPDATE: I should maybe also add that when I think of a 'cash flow problem' I don't just mean the sort that drive people to bankruptcy, but the sort that put them back in their parents' basements. Thus there can be people with severe cash flow problems in the sense I mean it while an economist would still find there is a positive cash flow since due to severe economies they are in fact earning more than enough to cover their debts.]

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You Can Drown In a River That Is An Average of Six Inches Deep (Part 2)

Thoughts on ‘The Economic Value of a Law Degree’. Please read Part 1 first.

C. How Much Should a Prudent Student Be Willing to Pay for a JD?

Brace yourself. The exciting bottom line at the end of all that follows is that it depends on several factors.

Simkovic & McIntyre argue that a JD is underpriced, because the substantial majority of students armed with a JD can expect increased earnings over a BA with a net present value well in excess of the cost of the degree — even at full freight.

So far, I haven’t seen a convincing critique of the core of the study, although I do think there are a number of things at the margin where the authors have been unduly optimistic. For example, they assume law grads get a JD at 25, maximizing the lifetime earning stream; they assume law students earn an average of $24,000 in summer and term-time work during the 3 years of law school, which I think is high. The first is more significant than the second, although neither suffices to do more than put a small dent in the overall findings for most JD applicants. Another issue of note is that the study compares a JD to a no-JD, ie BA-only, world. It doesn’t compare a JD to an MBA or other advanced degree. Even taking all the study’s assumptions on board, the premium for alternate degrees might be higher than a JD.

But it’s one thing to set out some numbers about the distribution of national wages in the past, another to suggest they constitute a trend that will continue in the future, and still quite a different third thing to suggest that Alice and Bob can use these data to make a rational economic choice about how much they should be willing to pay for a JD. The headline numbers in the study are probably these:

Pre-Tax Present Value of JD Premium over BA (prior to calculating cost of tuition) 3% discount rate

%ile Men (in thousand $) Women (in thousand $)
25 316 352
50 581 578
75 1151 961

source: Table 8

On the one hand, all these numbers are positive, so the prediction is that — even after one further subtracts the cost of tuition — a JD pays off for at least 75% of graduates and probably a lot more. On the other hand, some of these numbers are not that big, notably the 25th percentile number for men and women is pre-tax, so knock off another 30% or so, and more in some states. This starts to look less and less a winning proposition for anyone paying full private-school tuition and falling noticeably below that 25% mark. [Remember, that 25% is not Alice or Bob's class rank or their relative outcome in their law school class -- it's their relative salary outcome in the national JD class.]

Even if we assume a (perhaps slightly discounted?) version of the authors’ numbers accurately represents the historic earnings premium for a law degree for men and women at the 25th, 50th, and 75th percentile of the earnings spectrum for JD-holders, how can a prospective student today use this information to decide if a law degree is a good personal investment? (I should note here that the calculation is strictly economic; to the extent that the experience of law school and/or being a lawyer is perceived as fun or excruciating, as the case may be, these are external factors to the economic analysis — although they should in no way be external to the decision as to whether to pursue a JD. It is, however, fair to ask whether a law degree will be affordable even if law school or law practice is fun; or whether a law career will pay enough to make up for law school’s or law practice’s misery.)

Here is where the complexities begin. The authors give us a matrix of outcomes for representative men and women at three points on the earnings spectrum. We also know, from well-publicized anecdotes and blogs,1 if nothing else, that for some number of recent law graduates — the ones with large debt and lousy prospects — that the situation is currently dire. Indeed, it is the plight of these people, who likely number in the tens of thousands, that I think so inspires the anger of people who have been beating on Michael Simkovic and Frank McIntyre’s somewhat smug attempt at a refutation of the claim that the sky is falling.

What are the take-home lessons in ‘The Economic Value of a Law Degree’ for Alice and Bob? In other words how should Alice and Bob think about their potential earnings, and what should that mean for their willingness to shoulder law school expenses?

The paper uses aggregate figures. It doesn’t differentiate by law school. It ranks people by economic outcomes, which are only partly correlated with inputs — how well people did before law school, how prestigious a law school they go to, how well they do in whatever law school they attend. Since no potential 1L can know with great certainty how they will do in law school, nor what sort of legal (or non-legal) career they will find they desire, or be forced to settle for, much less the extent to which that success or failure will translate into income, Alice and Bob like all potential 1Ls must in effect run some simulations based on assumptions about their economic potential and their economic prospects.

The first thing Alice and Bob need to do is to think about what it is they might want to do. Yes, poeple’s ideas about careers often change radically in law school. But then oftentimes they don’t. Is their goal is primarily financial, or is it to be a crusading prosecutor or a defender of DREAMers and other immigrants? Some jobs pay a lot more than others, and if they aspire to one that isn’t highly paid, that may put limits on what they can afford to pay unless they have rich and generous relatives.

The next thing is to make a sober calculation about where one will fall in the national income distribution. This isn’t easy. It’s not a simple matter of plugging in LSATs into some formula based on a law school’s US News rank, and not only because those rankings have only limited meaning. Remember that about 1 in 5 law graduates doing legal work enjoyed even worse outcomes than the 25th percentile reported by Simkovic and McIntyre.2 At some point not too far from there — the bottom 10%?15%? — law school becomes an economic loser if you have to pay full freight, and at some point lower down (we have no real idea where but it is certainly there) it becomes economically dubious even if you get a full ride due to the opportunity costs.

If I were advising a student, I’d start with the extremes: if you are contemplating going to a top-three law school, it’s a no-brainer: you’ll have a great intellectual experience, and the odds of paying off whatever you have to pay are pretty good. Get a bit of a discount from a “top 14″ school and I think the odds are also excellent that (financially) you are getting a good deal; it’s quite likely this is also true at full freight unless you do (or interview) very badly.

Conversely, if you are going to a very-low-ranked law school — which I might define expansively to include a decent fraction of the law schools outside the USN top 144 — I’d encourage Alice and Bob to assume, unless they have a promise of a job in the family firm or they just need the degree to get a promotion in the organization where they currently work, that you will be in the bottom 25% percent of the distribution. Unless you have some reason to believe that this school has a lock on a strong regional market, beware.

That leaves many people in the middle. In order to make a rational economic calculation Alice and Bob need to make educated guesses about three things, two of which are hard to guess: 1) to what extent the Simkovic & McIntyre numbers should be discounted because of things knowable before starting school (such as starting law school later in life or carrying a lot of high-interest college debt); 2) Where they believe they are likely to fall in the post-JD income distribution, taking account of their taste for risk; 3) Whether the real rate of interest applicable to their circumstances will be more or less than 3%.

That last point is surprisingly important. Consider this back-of-the-envelope recalculation of the chart above. This one uses rounded post-tax numbers, and a 4% real (ie inflation-adjusted) interest rate instead of a 3% rate. This 4% rate more closely reflects what students who graduate with $150,000 of debt and up normally have to pay on the weighted average of their debt.

Present Value of JD Premium over BA (prior to calculating cost of tuition)
Post-Tax at 4% discount [based on combining tables 7, 8 & 9]
(Table 9/Table 7)*(Table 8)*(1-tax rate, see p. 43)

%ile Men (in thousand $) Women (in thousand $)
25 (285/348)*316 * .75 =
194
(285/348) * 352 * .75 =
216
50 (482/606)*581 * .7 =
323
(482/606) * 578 * .7 =
321
75 (897/1098)*1151 * .65 =
611
(897/1098)* 961 * .65 = 510

Now things look considerably more bleak for the students in the bottom quarter of the income distribution. Whether their JD is a good investment is acutely sensitive to how much it costs. A full-freight degree at a private law school will cost upwards of $130,000 (recall that the study assumes living expenses are the same as an alternate choice; it ignores moving costs too). All of a sudden that present value $200,000 (minus summer & term-time earnings, minus other adjustments) doesn’t look so great — and the lower the graduate falls below the 25th percentile on the income distribution, the worse it will get.

Even before that point, life can get very uncomfortable if you have a lot of undergraduate debt, especially in the early years when salaries are low but repayment is hitting as hard as ever. Economists figuring out the present discounted value of a degree ignore cash flow issues because they use a present discounted value that sums the values over a time series. They don’t ask if every year in the series is positive, but only whether the total is positive. Simkovic & McIntyre suggest that cash flow is an issue they can reasonably ignore because so few JD holders default on their student loans. They also say that,

Our estimates of interest rates faced by borrowers are probably too high —that is, the present value of the degree we calculate based on the figures in Table A1 will be too low—because we have not included tax incentives or generous loan forgiveness programs for low income borrowers. (p. 55, footnotes omitted)

Alice and Bob should, I think, be wary of these arguments. Here is where using aggregates hides a great deal of the important variation in the particular, and where the question for each Alice and Bob is the cost and the the value of their degree.3 Even if average debt is manageable for JDs as a class, some people, the ones with the most debt, will experience a serious cash flow issue in the early years after law school.

So the bottom line here is in fact quite predictable: Whether a JD is a good financial bet is a function of institutional prestige, the price of the degree net of grants and scholarships, regional variations in expected outcomes, special factors that alter value or opportunity cost (e.g. age or giving up a highly paid existing job), and law school outcome (career choice, actual honors, and class rank). All but one of these variables are, in theory, knowable in advance, and that one — law school outcome– should be estimated conservatively (see part I on the Dunning-Kruger effect).

In short, whether a JD is a good financial bet depends on all the things any sensible person would already have thought it depends on. The more debt you are taking on, the more cautiously you should weigh your options. The better the school you are going to, the lower the fees you are being charged, the more law school looks like a good bet. And you need to take a very realistic, even pessimistic, look at where you likely will fall in the class at the school of your choice. On the other hand, the suggestion that law school is a bad economic bet is — if Simkovic & McIntyre’s numbers hold up — likely not true for a substantial majority of would-be JD’s…but by no means all.

D. Policy Implications

Three policy implications flow from the above.

First, we don’t need any more bad law schools; indeed unless something changes to increase the market for legal services, from a strictly economic perspective (ignoring the possible social value of having more lawyers around to serve under-served populations’ needs) we might be better off with somewhat fewer.

Second, law school transparency is really important. Alice and Bob can only make good decisions about whether to sink a massive investment of time and money into a JD if the schools seeking their matriculation provide honest and easily comparable data about student outcomes.

Third, doing something about the undergraduate student debt crisis — such as returning to the norm of a free, or nearly free, public undergraduate education, would not only serve important goals of producing an educated and aware citizenry, but would have a knock-on effect on the JD valuation issue. The combination of high undergraduate debt with high law school debt may be particularly difficult to justify unless the student is acquiring a relatively valuable JD and/or is paying relatively little in tuition.


  1. I once wrote an article entitled, The Plural of Anecdote is Blog []
  2. You may be wondering why I said “1 in 5″ rather than “1 in 4″ which would be what you would expect for a number that is labeled the “25th percentile”. This is why: as Simkovic explained,
    for technical reasons related to regression of earnings to the median, our 75th and 25th percentile values are probably too extreme. The “75th percentile” value is likely closer to the 80th or 85th percentile for lifetime earnings, and the “25th percentile” is likely closer to the 20th or 15th percentile.

    []

  3. I am also wary of the argument that the low default rate by lawyers is as significant a finding as it sounds. Lawyers are more likely than others to understand how difficult it is to discharge student loan debt in bankruptcy. They might be concerned that defaulting on a loan might reflect on their bar membership or that the publicity might deter future clients or employers. []
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