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>More lawyers could afford to charge reasonable market rates, and not work for large firms, if it weren't for the ABA mandating that you have to attend a law sc

by learc83 15y ago

>More lawyers could afford to charge reasonable market rates, and not work for large firms, if it weren't for the ABA mandating that you have to attend a law school (that results in huge piles of debt) or clerk for years (four in California) in order to join the bar. That's exactly the problem, regulatory capture of government protected guilds. It's exactly the same with Doctors and the AMA, or electricians, hell in some places even interior decorators. If you've ever had to hire a commercial electrician, it's absolutely terrible. Once they pull a permit and start working, it's extremely difficult to replace them, and they know it. Recently the general contractors in Georgia convinced the state to raise the net worth requirement for contractors. They are already required to have massive insurance coverage, so the only reason was to protect the incumbent contractors from new competition. Anywhere you end up with government sanctioned guilds ran by industry or ex-industry people, you're just asking for regulatory capture and the resulting protectionism.

nickik 15y ago
Absolutly agree with this. There is a nice episode of the Econtalk podcast that talks about the "guilds"-Problem. Here is the Abstract: "Clifford Winston of the Brookings Institution talks with EconTalk host Russ Roberts about the market for lawyers and the role of lawyers in the political process. Drawing on a new co-authored book, First Thing We Do, Let's Deregulate All the Lawyers, Winston argues that restrictions on the supply of lawyers and increases in demand via government regulation artificially boost lawyers' salaries. Deregulation of the supply (by eliminating licensing) would lower price and encourage innovation. " --> http://www.econtalk.org/archives/2011/09/winston_on_lawy.html http://www.econtalk.org/archives/2011/09/winston_on_lawy.htm...
rodyancy 15y ago
Without a regulatory body it would be too easy for an unqualified person to pose as an electrician, doctor, dentist or lawyer. Do you really want someone with no experience or training wiring your house, pulling your teeth, operating on your knee, or defending you at trial?
- thinkcomp 15y ago
  If I want to represent myself or my company at trial, I should have that right.
  - ShabbyDoo 15y ago
    You do already, I think (speaking of The US).
  - nknight 15y ago
    You have the right to represent yourself, but not another person or entity, which is what you would be doing if you attempted to represent your limited liability entity in court. It doesn't matter if you're the sole shareholder or not, you and the company are not one and the same.
    - thinkcomp 15y ago
      Except that such logic seems to vanish in small claims court (where I can represent my corporation), and before the USPTO Trademark Trial and Appeals Board (where I can represent my corporation)...which means that it's really not very logical at all.
      - nknight 15y ago
        The details of small claims courts vary wildly from state to state, but more importantly, they're not courts of general jurisdiction. They have severe restrictions on what they can and can't do, and the losing party is often entitled to a de novo trial in a court of general jurisdiction. The USPTO appeals board you mentioned is not a court at all. It is an administrative body whose holdings are again subject to review in US District Court.
      - rprasad 15y ago
        Small claims courts are not much different from arbitration. There are no consequences to not showing up or participating, as losing simply means that you can move the matter to a new (i.e., independent) case in a real courtroom with a real judge. I cannot defend the USPTO; much of what they do is indefensible.
andylei 15y ago
> regulatory capture of government protected guilds this just doesn't align with evidence. if it were true, there would be too few lawyers, not too many lawyers. i'm not saying the effect you describe never happens, but when it does, there is not enough supply, driving prices up (this is probably the case in medicine, where there are not enough doctors, driving prices up)
- learc83 15y ago
  It's not just about the number of lawyers, but also the cost to become one. In the US, unlike many other countries, practicing law requires a graduate degree from an accredited school. This dramatically adds to the cost of a legal education, and drives up the price for everyone. This is the direct result of "regulatory capture of government protected guilds."
  - repsilat 15y ago
    The supply of lawyers doesn't quite follow the simple market relationship either. The study and practice of law are still associated with some prestige, and the high cost of legal services leads many to believe that they'll quickly pay back their inflated student debt. There definitely is regulatory capture going on. Small, more affordable schools are in a real bind over having to meet stringent and arbitrary accreditation criteria, but that doesn't affect the number of lawyers because students are willing to pay anything to become a lawyer anyway.
  - andylei 15y ago
    > the cost to become one the cost of law school is a fixed (and by the time you become a lawyer, sunk) cost, and therefore has no bearing on supply decisions. moreover, how does the cost of law school jack up prices in a world where there is an excess of lawyers? if you're a lawyer, do you charge the amount that covers your loans, or the amount that nets you the most profit? the very fact that there are excess lawyers is evidence that regulation of who gets to become a lawyer is not increasing prices. now i'm not saying that lawyers are efficiently priced, merely that regulatory capture is not the reason for this.
mfaustman 15y ago
So you do not need to go to law school to be a lawyer. Anyone can take the BAR and be a lawyer. Again, as Antone points out, this all comes down to a perception of quality. Many people (and I am not saying you) would not hire a lawyer who did not go to law school.
- prodigal_erik 15y ago
  If I'm reading http://en.wikipedia.org/wiki/Admission_to_the_bar_in_the_United_States#Admission_without_law_school http://en.wikipedia.org/wiki/Admission_to_the_bar_in_the_Uni... correctly, there are only four US states which don't make law school a requirement, and two more which don't require a granted degree.
  - mfaustman 15y ago
    Did not check on this until now. Meant to say, "in California" considering the heavy conversation surrounding startup lawyers and the location of the author. Good catch! Anyone can take the BAR in California and yet legal prices here are some of the highest in the country.

by learc83 15y ago

nickik 15y ago

Absolutly agree with this. There is a nice episode of the Econtalk podcast that talks about the "guilds"-Problem. Here is the Abstract: "Clifford Winston of the Brookings Institution talks with EconTalk host Russ Roberts about the market for lawyers and the role of lawyers in the political process. Drawing on a new co-authored book, First Thing We Do, Let's Deregulate All the Lawyers, Winston argues that restrictions on the supply of lawyers and increases in demand via government regulation artificially boost lawyers' salaries. Deregulation of the supply (by eliminating licensing) would lower price and encourage innovation. " --> http://www.econtalk.org/archives/2011/09/winston_on_lawy.html http://www.econtalk.org/archives/2011/09/winston_on_lawy.htm...

rodyancy 15y ago

Without a regulatory body it would be too easy for an unqualified person to pose as an electrician, doctor, dentist or lawyer. Do you really want someone with no experience or training wiring your house, pulling your teeth, operating on your knee, or defending you at trial?

thinkcomp 15y ago
If I want to represent myself or my company at trial, I should have that right.
- ShabbyDoo 15y ago
  You do already, I think (speaking of The US).
- nknight 15y ago
  You have the right to represent yourself, but not another person or entity, which is what you would be doing if you attempted to represent your limited liability entity in court. It doesn't matter if you're the sole shareholder or not, you and the company are not one and the same.
  - thinkcomp 15y ago
    Except that such logic seems to vanish in small claims court (where I can represent my corporation), and before the USPTO Trademark Trial and Appeals Board (where I can represent my corporation)...which means that it's really not very logical at all.
    - nknight 15y ago
      The details of small claims courts vary wildly from state to state, but more importantly, they're not courts of general jurisdiction. They have severe restrictions on what they can and can't do, and the losing party is often entitled to a de novo trial in a court of general jurisdiction. The USPTO appeals board you mentioned is not a court at all. It is an administrative body whose holdings are again subject to review in US District Court.
    - rprasad 15y ago
      Small claims courts are not much different from arbitration. There are no consequences to not showing up or participating, as losing simply means that you can move the matter to a new (i.e., independent) case in a real courtroom with a real judge. I cannot defend the USPTO; much of what they do is indefensible.

andylei 15y ago

> regulatory capture of government protected guilds this just doesn't align with evidence. if it were true, there would be too few lawyers, not too many lawyers. i'm not saying the effect you describe never happens, but when it does, there is not enough supply, driving prices up (this is probably the case in medicine, where there are not enough doctors, driving prices up)

learc83 15y ago
It's not just about the number of lawyers, but also the cost to become one. In the US, unlike many other countries, practicing law requires a graduate degree from an accredited school. This dramatically adds to the cost of a legal education, and drives up the price for everyone. This is the direct result of "regulatory capture of government protected guilds."
- repsilat 15y ago
  The supply of lawyers doesn't quite follow the simple market relationship either. The study and practice of law are still associated with some prestige, and the high cost of legal services leads many to believe that they'll quickly pay back their inflated student debt. There definitely is regulatory capture going on. Small, more affordable schools are in a real bind over having to meet stringent and arbitrary accreditation criteria, but that doesn't affect the number of lawyers because students are willing to pay anything to become a lawyer anyway.
- andylei 15y ago
  > the cost to become one the cost of law school is a fixed (and by the time you become a lawyer, sunk) cost, and therefore has no bearing on supply decisions. moreover, how does the cost of law school jack up prices in a world where there is an excess of lawyers? if you're a lawyer, do you charge the amount that covers your loans, or the amount that nets you the most profit? the very fact that there are excess lawyers is evidence that regulation of who gets to become a lawyer is not increasing prices. now i'm not saying that lawyers are efficiently priced, merely that regulatory capture is not the reason for this.

mfaustman 15y ago

So you do not need to go to law school to be a lawyer. Anyone can take the BAR and be a lawyer. Again, as Antone points out, this all comes down to a perception of quality. Many people (and I am not saying you) would not hire a lawyer who did not go to law school.

prodigal_erik 15y ago
If I'm reading http://en.wikipedia.org/wiki/Admission_to_the_bar_in_the_United_States#Admission_without_law_school http://en.wikipedia.org/wiki/Admission_to_the_bar_in_the_Uni... correctly, there are only four US states which don't make law school a requirement, and two more which don't require a granted degree.
- mfaustman 15y ago
  Did not check on this until now. Meant to say, "in California" considering the heavy conversation surrounding startup lawyers and the location of the author. Good catch! Anyone can take the BAR in California and yet legal prices here are some of the highest in the country.