For-profit law schools are likely to remain unchallenged under Trump.
After centuries of exclusion from the legal profession and the justice system, ethnoracial and socioeconomic minorities are now welcome—at a very hefty cost. This was a key lesson I learned from years studying a US for-profit law program. Whereas school proprietors counted on a feast of unconditional federal student loan dollars, students assumed the risk of famine brought by non-dischargeable debt and limited job prospects. Students of one law school even faced literal hunger as their loan checks were temporarily suspended due to their school’s repeatedly poor performance.
For-profit law schools, once unheard of under the strict accreditation monopoly of the American Bar Association (ABA), suddenly became viable after a deregulatory policy shift in the 1990s. Following the lead of large for-profit colleges like the University of Phoenix, financiers powered by fresh interest in private equity investment created new law schools and branded them with a mission to “serve the underserved,” in other words to cater to minority and working-class communities long excluded from the legal profession and access to justice. Amid renewed, marketized interest in corporate and professional “diversity,” these schools attained ABA accreditation.
Despite accusations of predatory behavior, they could argue that no one else was so actively diversifying the legal community. When more and more students—especially minority graduates—failed to obtain Bar admission or gainful employment upon completion, school principals argued they had enabled market “access” for more minority legal professionals than anyone before.
Whereas school proprietors counted on a feast of unconditional federal student loan dollars, students assumed the risk of famine brought by non-dischargeable debt and limited job prospects.
Yet the growing ranks of private for-profit schools, including those geared toward legal education, have not gone wholly unchecked: In its final years, the Obama Education Department had begun a crackdown on such predatory institutions. Large for-profit colleges Corinthian and ITT were forced to shut down after the Education Department observed fraudulent activity and applied fines to the former and barred federal student loan money from reaching the latter. However, with the election of Donald Trump, the prospect of continued efforts to rein in such exploitative educational institutions seems very much in doubt.
Prior to Trump’s election, Obama education officials had started taking notice of for-profit, professional law programs, notably the Infilaw schools in North Carolina, Florida, and Arizona. All accredited by the American Bar Association (ABA) and therefore eligible for federal student loans, these schools were already near the bottom of law school incoming indicators like grade point average and LSAT scores. Following the economic bust of 2008 and 2009 and its resulting contraction of the legal services industry, these same schools—contractually bound by offsite private-equity investors—still had to fulfill capital commitment agreements promising returns on investment in the ballpark of twenty percent. They had, in other words, to push their admissions standards even lower and recruit increasingly from communities of students previously unlikely to gain acceptance to legal education or profession. Seeing student outcomes such as Bar passage and job placement plummet under these developments, the ABA placed Infilaw’s Charlotte, North Carolina school on “probation” in October of 2016, and then the Obama Education Department removed student loan eligibility for it in December. Closure of the school appeared imminent.
Without the disbursement of their student loans, many could not afford to eat.
Normally, when a college or university must shut down, it is expected to produce a “teach out” plan to move remaining students through the program or transfer them to other schools. In the absence of such a plan, a school’s closure is supposed to give students the opportunity for complete loan discharge. However, in the inaugural haze of January 2017, the reaction among my research participants in the for-profit law school sector was as follows: Trump won; DeVos will control the Education Department; all Infilaw has to do is wait. In the meantime, students of Charlotte School of Law were justifiably in a panic. Without the disbursement of their student loans, many could not afford to eat, so a professor at the school—perhaps realizing the moral hazard he or she had participated in—put together a jarringly appropriate “food drive” for the aspiring attorneys while the school effectively delayed moving forward with either a “teach out” or a closure plan, suggesting it was indeed choosing to “wait.”
The delay tactics worked. In early May of this year, the Education Department under DeVos—following considerable lobbying by Infilaw through a consultant the Sectretary had herself just used for her cabinet appointment—disbursed the second yearly federal loan sums to Charlotte allowing third-year students to graduate and forestalling closure and student loan forgiveness by another semester.
Then, perhaps needing to qualify her privatization agenda with a commitment to diversity, Secretary DeVos delivered a controversial May commencement speech at Bethune-Cookman University, the historically black institution in Daytona Beach, Florida. There, she extolled the value of dissent: “I'm grateful for the opportunity to speak with you, and particularly with those who have disagreed with the invitation for me to be here.” DeVos was referring to the 50,000 signatories to a petition opposing her visit, the thousands of students booing her presence, and the roughly two hundred graduates who would turn their backs on her speech.
And there was an added twist: In March of this year, Bethune-Cookman had signed an “affiliation agreement” with none other than Arizona Summit Law School (ASLS), the southwest campus of the three for-profit Infilaw schools. Their deal had been in the works for some time, and it appeared ASLS had long been seeking a university to partner with. But the agreement between a historically black institution and a struggling law school with objectively poor debt-to-income numbers raised alarm among many who saw this as a logical extension of the larger Infilaw mission to treat poor and middle-income minorities simply as an “untapped” market.
The agreement between a historically black institution and a struggling law school with objectively poor debt-to-income numbers raised alarm among many.
Only weeks after the Bethune-Cookman deal, the ABA placed Arizona Summit on a probation list alongside its sister school in Charlotte. The relevant violations included poor admissions policies, low program rigor, weak academic standards, and poor academic advising and support. The last was particularly ironic given that it had featured prominently in ASLS marketing materials aimed at “underserved” minority populations. It is also noteworthy that the ABA’s decision in March was not followed by an Education Department retraction of federal loan funding, the way it had been with Charlotte back in December under the Obama Education Department.
With this added scrutiny in the law school regulatory establishment, and with the growing, feverish competition for students among recruiters at all low-ranked institutions, surely one of the for-profit law schools would be the first to finally close under market pressures. Many felt the ABA moves against Charlotte and Arizona Summit foretold a final coup de grâce for at least one of them. And yet, come April of this year, it was an altogether different, older, non-profit law school that announced its closure. Whittier Law School in Orange County, California had existed since the mid-1960s and joined Whittier College (Richard Nixon’s undergraduate alma mater) in the mid-1970s. It always sat many rungs below UCLA and Loyola in the Los Angeles market, but it had educated a different type of attorney aimed at solo and small firm practices of the kind access-to-justice reformers often cite as beneficial to the lay public.
For some of us studying legal education, the closure of Whittier was shocking not in itself but in its primacy relative to the for-profits. Reports from the field, about such things as a lucrative Board of Directors property sell-off, suggest the Whittier closure belied forces more complex than just the legal education “bubble.” The failure of a decades-old non-profit institution ahead of nouveau for-profits contains a lesson about wider political-economic realities made clearer since the Great Recession. If hitherto weak regulation was tolerated in order to “let the market decide,” the market has decided institutions with a more ambitious profit motive were more likely to receive a second and third chance.
The great anthropologist, Carol J. Greenhouse, speaking of the rise of federal legislative neoliberalism in the US during the 1990s, says that, “The bipartisan support for these measures showed that the era of the national society—which had lasted from the New Deal through the Great Society—was now over, without political force within the institutions of federal government.” As my book, Law Mart, suggests, US law schools, helping to generate student debt with the ideological weight they possess regarding upward mobility, justice and morality, and public service, offer stark evidence that the “the national society”—a countrywide sentiment of political belonging and responsibility—probably is over. The changes described above, normative and factual though they are, show how federal regulation in higher education, long ceasing to be an expression of public values about the future, is now a vessel whose variable contents are filled by successive political appointees and whose prescriptions can be waited out or lobbied against by the most financialized of institutions.
Law Mart depicts this loss of national society from the inside of a single law school institution. In the years leading up to Trump and DeVos, educators and administrators far closer to the ground had long been applying market logics to the teaching and training of college and graduate students. “You are your own brand.” “Invest in your human capital.” “Learn skills for the global marketplace.” All of these could be heard on US campuses struggling to stay “relevant.” Meanwhile, the relevance of broader values learned through liberal arts and sciences was deemed suspect—even as they were exported abroad through global ventures like Yale-NUS in Singapore. This is Greenhouse’s point; humanities and social sciences did not become less relevant to society; society became a subset of global economics.
Using the ethnographic narrative form, Law Mart presents a deep case study of the need for regulatory as opposed to market discipline over legal, and by extension higher education. The Obama Administration’s eleventh hour “crackdown” on for-profit law schools represents the ultimate policy realization of this regulatory intervention. But, the willingness of a subsequent administration to undo such a crackdown—re-embracing market fundamentalism at the highest level—adds yet another layer of urgency to the themes described in the story. In fast changing social fields, such works are made more relevant by the day. But, when those changes pertain to the production or reproduction of legal expertise—the primary backstop to abuses and misuses of social justice—in-depth accounts such as this are not just relevant to our understanding of the issues, they are essential to it.