The Decline and Fall of Big Law

I haven’t seen very much commentary about Noam Schreiber’s New Republic article about the decline and fall of Big Law firms, but it is a very compelling read.

Schreiber recounts the story of a business model whose time has come and gone.  

Law school admissions are down. Law school graduates are having serious problems finding jobs. While some industries have recovered from the Great Recession, Bit Law does not seem to be one of them.

A job at a big law firm used to a ticket to prosperity. Partnership was like tenure. Large salaries and security accompanied prestige and status.

Schreiber describes the good old, but now bygone days:

Of all the occupational golden ages to come and go in the twentieth century—for doctors, journalists, ad-men, autoworkers—none lasted longer, felt cushier, and was all in all more golden than the reign of the law partner.

There was the generous salary, the esteem of one’s neighbors, work that was more intellectual than purely commercial. Since clients of white-shoe firms typically knocked on their doors and stayed put for decades—one lawyer told me his ex-firm had a committee to decide which clients to accept—the partner rarely had to hustle for business. He could focus his energy on the legal pursuits that excited his analytical mind….

Perhaps more importantly, the security of the legal profession lodged itself inside our cultural imagination. For generations, the law functioned as a kind of psychological safety net for the ambitious and upwardly mobile. If you wanted to be a writer or an actor or a businessman, you could rest assured that law school would be there if your plans fell through. However much you’d maxed out your credit card, however late you were on your rent, you were never more than an admissions test and six semesters away from upper-middle-class respectability.

That was then. Now the industry is shedding partners and associates. Those who remain are fighting among themselves for clients. The old collegiality  has turned fratricidal.

Schreiber looks closely at the situation at Chicago firm, Mayer Brown. He interviewed Chairman Paul Theiss and other assorted honchos. He concludes that Big Law is entering a period of “managed decline:”

If corporate America continues to be so stingy in its legal spending, Theiss could be as well-intentioned as a Peace Corps volunteer and still not have much to offer his lawyers beyond competently managed decline—charging clients the same for more work, or less for the same work; shedding bodies, or keeping the same number and paying most of them less. Theiss talked excitedly about “the drive for efficiency.” But it was hard not to see this for what it is: the further immiserization of the legal class.

I would only highlight one other comment, especially because it emphasizes a topic that I have posted about, as recently as yesterday: small talk and schmoozing.

Schreiber writes:

Lawyers at an elite firm like Mayer Brown have typically spent their lives amassing intellectual credentials. They are high-school valedictorians and graduates of elite universities, with mantles full of Latin honors. They have made law review at top law schools and clerked for federal judges. When, somewhere between the second and fifth year of their legal careers, they discover that brainpower is only incidental to their professional advancement—that the real key is an aptitude for schmoozing—it can be a rude awakening.