If We Get Rid Of Lawyers Will We Have More Lawsuits? And A Thought About Brain Drain

lawyer-salary.jpgThere’s been a lot of chatter in the blogosphere lately about whether there should be any professional requirements connected with lawyering. The issue has been brought front-and-center by the publication of a new book by libertarian authors arguing that anyone should be able to provide legal services for a fee, regardless of whether he’s attended law school, passed the bar or obtained any sort of credential. Over the course of a couple of blog posts, I chimed in with my own two cents, essentially backing the idea.
I wasn’t planning on blogging any further about the topic but last weekend The Press of Atlantic City cited me in an editorial piece addressing the controversy. The piece also cited Chidem Kurdas, a NYU economist, worrying that deregulation of the legal profession would lead to an influx of a large amount of new lawyers and spawn a gigantic new wave of litigation. Overlawyered’s Walter Olson opposes the idea for pretty much the same reasons.
I wish to raise two arguments in reply.
The first is that I think the idea that deregulating the legal profession will lead to a huge influx of new lawyer/amateurs and a huge wave of new litigation is a bit silly — especially in the long run. Kurdas and Olson’s thinking suggests to me a mistaken belief in a stable equilibrium of lawyer salary, even in a deregulated world. The moment that anyone is free to provide legal services is the moment when the bottom drops out of lawyers’ incomes. When the supply of lawyers goes up, their prices will go down. There won’t be a long-lived influx of new lawyers ginning up all kinds of new lawsuits if they discover there isn’t as much money to be made as they had hoped. They’ll return to their prior occupations.
The second point I wish to make is that driving down lawyers’ salaries will have another beneficial effect on the economy: it will prevent the brain drain of science PhDs into intellectual property law that we are currently witnessing.
Over the past decade or so, we’ve heard a lot of commentators bemoaning the fact that a lot of the nation’s best and brightest head to Wall Street. This includes a number of “quants” — the geeky math and science PhDs who head to Wall Street because otherwise they’d have a hard time eking out a living with their astrophysics degrees.
Once on Wall St., these young men and women, some of the nation’s best and brightest, put their talents to use in devising complex stock trading algorithms. The tragedy is that, if Wall Street weren’t such a big part of this nation’s life, these young scientists would be in a lab somewhere developing ideas that add to the nation’s wealth. But, given the fact that Wall St. salaries are so hard to resist, these talented young people instead spend their careers in zero-sum games where one trader’s loss is another’s gain and there is no net gain to anyone’s wealth.
The same trend is going on in the nation’s law schools. Lots of top science and engineering PhDs are abandoning their science careers and heading to law school to become patent lawyers. As patent lawyers, they generally start out making double or more what they made before.
In my own law school “section” (the contingent of your law school class with whom you take all your first-year classes), there were roughly a half-dozen science PhDs, a couple of top-notch engineers and one Harvardmathematics PhD, who had been a tenured professor at a major research university. I can’t speak to what drew these extremely talented people to law school – whether it was the potential for earning a higher salary than they could in their first careers, or whether it was intellectual interest – but I do remember feeling sad that so many truly remarkable minds were giving up careers where they might discover the cure for some disease for a career of staking out the boundaries of patent holders’ monopolies.
Allowing anyone to become a lawyer would partially drive down the salaries that lure some of our best and brightest into becoming lawyers and divert their talents into wealth-creating enterprises. It would also lower the costs for scientists who decide, after a taste of the law, that they are more suited to the laboratory. Once a lawyer-scientist has acquired six figures of student loan indebtedness, it’s hard to go back to the lab bench. If no law school were required for lawyering, the decision would be a much easier one.