Hear, hear! Vic Fleischer’s defense of Seton Hall law faculty is spot on (even if his view on carried interest isn’t!)

Vic Fleischer gets it right about tenure (even though I disagree with his views on VC’s carried interest.)

The recent downturn in the general economy is impacting legal hiring and too many recent law graduates got caught in the downdraft. The loans they thought they could afford have, for the time being, become unaffordable. They are suffering as are many millions of home owners, car owners and consumers.

I have argued here and elsewhere about the importance of providing debt relief and job programs for these highly trained graduates. Sadly the leading players in the “law school death watch” crowd refuse to endorse such efforts. Clearly they have another agenda altogether. This includes supporting law suits against law schools for specious allegations of fraud. (Lawyers suing law schools – sounds almost as desperate as screen writers writing about Hollywood.)

The calls by the “law school death watch” folks for shutting down law schools, firing faculty (including personal attacks on individual faculty who voice support for law schools’ academic role), increasing teaching loads and other short sighted efforts fail to recognize, as Yale’s Owen Fiss recently did with such eloquence, the unique value of our academic institutions, particularly the important role that law schools play in a law-bound society such as ours.

These calls also fail to account for the natural volatility of a capitalist economy. In other words, the very reason I think Fleischer is wrong about the “capital” as opposed to “labor” nature of carried interest points to the inherent cyclicality of our economy.*

Law schools and legal hiring have never been immune from these cycles, even in the heyday of the Kingsfield era. But as I explained in a recent paper here, we try to protect the law school from some of that cyclicality in order to maintain the law school’s integrity with respect to the surrounding society. Faculty accept lower salaries and the other perks of taking on the risks of the private marketplace in return for their commitment to pursue knowledge and train future lawyers. The entire society gains thereby.

And while the recent downturn has been more painful and long lasting than many in the recent past, it is only a shortsighted institution – apparently including venerable Seton Hall University – which throws away blithely its invested intellectual capital.

The Unseen Costs of Cutting Law School Faculty.

*As opposed to Professor Fleischer, I think it is credible to argue that carried interest represents risk taking that is distinct from wage labor, but that is more properly explored elsewhere (for example, by tax scholars Doug Kahn and Jeff Kahn here.) Of course, the thuggish and short sighted attacks he suffered for his work are beyond the pale.