You get what you pay for.

I wish Nancy Pelosi would outsource her jugs.

terrible idea. At least keep *some* jobs in this country. Sure, let's outsource everything and watch out once 1st world economic powerhouse become a third world country as wages decrease to match those in the 3rd world countries with which our workers are now competing.

The numbers don't lie. Let us talk numbers. A know nothing associate with no skills is paid $160K per year. Assuming he/she bills 2,000 hours at $350.00 per hr., your gross revenue per associate is $700,000.00. Deduct the $160K of salary plus another $160K in secretary salary, pro-rata office space rental, health benefits, 401K, misc. perks, and the net profit per associate is $380,000.00.
Now we all know clients resent paying know nothing associates more than $250/hr. Now, if you hire a foreign outsourced attorney, bill them at $250 per hour and get 2,000 billables, that is a net revenue of $500,000.00. You pay that foreign based attorney the equivalent of $50,000 USD and your net profit per attorney is $450,000.00 or $70,000 more than paying a know nothing associate. There are no other overhead costs with hiring a foreign based attorney (i.e., office rent, secretary, health benefits, profit sharing) and best of all, the firm would be insulated from defending baseless wrongful termination and sexual harrassment lawsuits. The numbers don't lie. I think it is clear how we need to change our business model.

Here's. the. description. FROM. the. e-letter.

Dear Lord.

"After the jump, some we post a couple of the questions the task force is asking."

Completely ungrammatical.

What's the over/under on the comment clusterf*ck on this one?

Mid-workday race-baiting tied to attorney jobs; I'm calling this one at 253.

Outsourcing: great idea or the greatest idea? Oh, okay, I'll just put you down for "great" then. November 12, 2009, 3:54 PM -- Above the Law readers say that outsourcing is great.

Outsourcing is bullshit. They never should have allowed it in the first place, especially since they keep licensing more and more law schools. They need to either dry up some of the supply of lawyers or do something about increasing the amount of work available (i.e. getting rid of the availability of outsourcing work). If neither of these things are done, the costs of law schools will become more and more unjustifiable. Even closing the outsourcing window for firms wouldn't totally justify the cost of legal education, but it would help a little.

The one thing that survey fails to mention is the requirement for export licenses. There was a Federal Register notice by the U.S. PTO last year that warned applicants of that issue.

First to say "First"!

10 - You don't need to worry too much about the ABA "licensing" new schools, because it is yanking the accreditation of other schools like UC Davis.

I don't see a problem with outsourcing. If the Chinese can build steel and toys just as well as the nose-pickers in Pittsburgh or Scranton only cheaper, why wouldn't American consumers like getting their legal services from cheap Indian attorneys?

Walmart saved me over $500 last year on tube socks, imagine how much it will save me on next LBO due diligence review!

That's right, PE, anyone can be replaced. Though if you're as decrepit and aged as you'd have us believe, you'll be long gone before the marvel of outsourcing renders you and your ilk expendable.

So I'll stop short of calling you short-sighted.

Once we start outsourcing, the floodgates will open, and we'll have a gusher. Kind of like this beaver is a gusher©:

http://www.cbsnews.com/video/watch/?id=5628730n

(LADIAN hereby copyrights this text, and expressly forbids ShaFeef from making any comment about Kash that relies on this text.)

Let's outsource ATL to Manila. Think of all the costs we will save by hosting it beside some malaria-infested sewage canal!

Actually we will save more money by shutting ATL down completely. Something to consider...

First:

The ABA itself should be outsourced--but great idea let's take a poll of its body.

And they really need a poll to ascertain
our thoughts?

Too little too late 98765432..................................

Outsourcing is the gorilla in the room for the healthcare debate. Most medical care could be handled by cheap foreign-trained professionals. Imagine all the money we would save if they flooded the market and drove out the BMW/country club docs.

As long as we had a robust tort system, the costs would be almost immediate to the consumer and the economy freeing up lots of R&D money to find real cures rather than fund medical bill churning schemes.

Partner Emeritus,

No secretary gets $160,000, partners use them more than associates do, and almost no associate gets a dedicated secretary. Your numbers are way off. Yes, off-site attorneys (whether foreign or domestic) are cheaper, but associates are necessary if firms are to continue. Someone has to make partner, and that someone probably should have some biglaw experience.

I can't believe I'm responding to flame. I need more sleep.

Outsourcing is the logical consequence of fucking clients over for years. By paying rediculous starting salaries to associates, plus rediculous salaries to partners, law firms in America have finally broken the back of corporate America. In a competitive world, you can't have grossly inefficient businesses in the equation if you want to make money for shareholders. BigLaw has to die, as does many of the MidLaw firms. Lawyers simply aren't worth what they're being paid.

We need one big malpractice case where a firm has outsourced the work to India and they screwed up. That will fix the problem.

I'm for outsourcing so long as we can bill the client for the work as if an American BigLaw associate did the work, yet only pay the offshore lawyer his $7/day.

PE,

I will take that 50k and work from home right here in the USA.

21.

They're especially not worth what they're being paid if they spell it "rediculous."

If firms want to outsource paralegal-type-work then I don't have any problem with it. What I do have a problem with is outsourcing work that someone would have to be a licensed attorney in order to do in the United States. If it's acceptable to have an unlicensed foreigner practicing law than what possible justification is there for prohibiting unlicensed Americans from practicing law? If we've concluded that our licensing laws don't actually serve any purpose then perhaps we should abolish them altogether. Otherwise, they should be applied consistently regardless where somebody lays their head at night.

Kash,

My love for you could never be outsourced.

ShaFeef

Here are my thoughts:

FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA! FUCK THE ABA!

2 thoughts

1) if they can pass the NYS bar, then they can outsource them anywhere.

2) why not outsource to upstate instead of offshore?

at this point, there are so many unemployed attorneys who actually speak english and will work for thier supper. why undermine the entire system, which has already lead to an oversaturated field with not enough demand, to accomodate indians?

Is IT in India overflowing or has there been a drop in production of sneakers in China? this is terrible!!! unemployement in whereever-the-hell is at an all time high!!!

quick - lets throw americans under the bus!

Some progressive thinkers/ talkers (Thom Hartmann in particular) talk about how the AMA restricting the number of students that can enter medical school, thereby restricting the number of doctors, artificially keeps medical costs high. If there were more doctors, they would compete for the jobs, thereby lowering medical costs. That would force medical schools to lower their tuition, and doctors wouldn't be forced to take high paying jobs and be able to work as doctors in areas of the country where medical professionals are sparse (Appalachia, for example).

However, we see in the Legal profession that perhaps that doesn't hold true. The ABA does not directly limit the number of law students, and continually approves new law schools. When's the last time you've heard of a new medical school? Despite the glut of attorneys out there, not to mention the number of unemployed attorneys, legal costs are barely being forced down by clients (and not by competition among law firms) and law school tuition CERTAINLY isn't going down.

Now, the ABA is allowing outsourcing of our jobs? Well, for one, if my job was outsourced, I would simply leave the United States, return to my country of birth, and they can have my law school debt. They can outsource my job when someone in India racks up $100K in student loans.

Does anyone seriously believe that what will be or is being outsourced is the actual practice of law? That's simply not going to happen. Shitwork can get outsourced precisely because it doesn't actually require a JD to do. A trained monkey, possibly even JaKe, can do doc review. Depositions? Trial work? Negotiation? Brief writing? Not a chance.

I'm fucking horny and i NEED me some PUNANI.

PE,

So the clients are going to pay the same rate for foreign attorneys?

Why wouldn't they treat them like contract attorneys and demand to just pay cost, since as you stated the firm wouldn't have to pay all of the perks.

If anything the outsourcing would lower PPP since the clients would demand huge discounts which would cut into the bottom line.

This comment is addressed to post no. 34.

Re-read my post. There is a $100.00 per hour discount factored into the foreign based attorney's billing rate.

35,

So why wouldn't clients treat the foreign attorneys like contract attorneys (paying cost alone) again?

Oh, because you say they won't...

Shut up, 13! You're such an idiot jerk face! UC Davis is the best law school in the world. Everyone knows that!

Gaaawd you suck!!! Jeeez!!!!

If Indians can produce the same quality of work at a cheaper price, we should outsource the work.

The cost of legal fees is transferred to consumers when they purchase a product or a service. If we do not outsource the work, we are in effect robbing consumers in order to prop up work (doc review) that we can no longer produce at a comparative advantage.

For example, a Coca-Cola costs the consumer $2.50. Let's assume that there is $0.15 in legal fees built into the cost. If we can reduce that cost from $0.15 to $0.06 by outsourcing mindless legal work (doc review, etc) to India, consumers will have $0.09 more in disposable income to spend on other products.

The Coke example is a small one, but there are legal fees built into every good or service consumers purchase. If we can take $160,000/year associate salaries for doc review out of the equation, the excess disposable income for consumers will force other sectors of the economy to grow. When other sectors grow, there will be more meaningful legal work for all.

-Economist Secure

I laugh at the American attorneys on this forum expressing indignation about outsourcing. You talk of the need to "soak up the supply of lawyers" and advocate shutting down law schools while your lunch is being stolen right out from under your nose by immigrant attorneys in the United States. 10-20% of the biglaw attorneys in the major metropolitan markets are noncitizens. What is the overcapacity of lawyers in this country?

Is it really that difficult for you to get your acts together to stop issuing work visas to foreign lawyers and put an end to the illegal immigration as well?

I wonder if foreign attorneys fuck their secretaries in the ass.

38: The flaw with your argument is that companies often don't reduce the cost of their products / services when the cost of creating / providing them go down. For example, airlines instituted all sorts of fuel surcharge fees when the cost of oil spiked a couple of years ago. Even though the price has since plummeted, those fees never went away. If anything, a company like Coke is constantly looking to charge more per unit, not less. For example, those new super small cans, more than portion control, are a way for Coke to charge a lot more for each mL of Coke that you're getting from them.

31 - You're looking at it incorrectly. While it's true that the ABA's continued approval of new law schools (and the resulting glut of new lawyers) haven't pushed down BigLaw rates (at least not much), you shouldn't expect them to. There aren't any more or less attorneys going into BigLaw because of the new schools - at best, when UC-Irvine or Charleston or UMass opens a new school, they displace people from other schools who would have gone into BigLaw as entry-level attorneys. Their students cannot graduate and immediately start competing with Wachtell for work, even if they charge 1/10 the price.

What you have seen is a reduction in fees where graduates of these newly minted schools can immediately compete. In everything from DUI defense to divorce to wills and trusts, there has been a reduction in cost, largely attributable to the flood of lawyers onto the market.

The same would arguably be true of medicine if more medical schools opened. I wouldn't expect to get a discount on brain surgery because I wouldn't allow someone who hadn't done their residency at a reputable hospital to perform brain surgery on me. However, if all I needed was someone to listen to my chest and tell me whether or not I had a sinus infection, yeah, I'd expect those costs to come down.

You know what else Indians can do? Whatever it is that you do, 38. The only reason I say Indians is because their main language in higher education is English, so there's a much, much larger pool of potential employees to do Western legal work. I think Malaysia also has higher education predominantly in English, but I'm not sure.

My problem isn't with the quality of their work. My problem is the ABA allowing this to happen while simultaneously allowing law students to go into stupendous debt. How about this announcement: Starting in 2012, we're allowing outsourcing. Make your decision to enter law school accordingly. Current law students, you're screwed. Sorry.

38 - While that's true, it begs the question as to what role our law schools and licensing systems play in the legal process.

If Americans who don't go to law school can produce the same quality work at a cheaper price than Americans who do (which presumably they can since they have far lower out-of-pocket and opportunity costs), why are we requiring that American lawyers go to law school?

Whatever the system is, it should under no circumstances be less advantageous to Americans than it is to foreigners. If law school doesn't matter, eliminate it as a requirement to practice law. If it does matter, don't allow foreigners to engage in the unlicensed practice of law.

In the long run, there's no reason to saddle American companies with the extra cost associated with the higher legal fees if it doesn't matter.

43: I'm shocked that I actually agree with you for once -- might be a very bad sign... But yes, the ABA is supposed to represent the interests of AMERICAN lawyers -- that's why it's called the American Bar Association, a bar association for lawyers in the United States. It would be a bit odd, to say the least, for the ABA to take a pro-outsourcing position, especially with so many domestic lawyers burned with massive law school debt and unable to find work in this economy.

Yes, biglaw needs to change its billing structure, which has gone out of control and results in ridiculous overcharging (first year associates being billed out at exorbitant rates for doing paralegal plus-type work). But, that doesn't mean the answer is to outsource legal work and further screw over U.S. lawyers who can't find jobs.

The ABA regards itself as the gatekeeper for legal practice in the United States and it's presiding over a major supply-demand problem -- too much supply, too little demand. Either cut back the supply (no more new law schools, tough accreditation standards), or increase the demand (more difficult, but perhaps pushing for billing reforms that will make hiring biglaw firms more practical / affordable for more clients).

Unlike many attorneys, I will willing to admit when I am wrong. I bought into the whole NAFTA, free-trade policies of the Reagan-Clinton-Bush eras. While I still believe in freetrade and low tarrifs in principle (that is, assuming everyone operates in a competitive market with little or no barriers to entry), it was pure economic suicide to sell out our manufacturing base and skilled labor force to foreign countries so that consumers could buy cheap plastic chinese products on credit that need to be replaced every 2 years. To make matters worse, our government actually increases the cost of the domestic supply of labor by continued labor regulations and handouts to unions.

Instead of secure jobs with secure income streams to purchase good quality, durable American products we restructured our country to revolve around disposable products made and serviced by disposable people.

Now that no one has any jobs or money we can enslave people with backbreaking debt, dependence on government services and global taxes!

Yah for the republocrats and democins! And thank you Mr. Rockafeller and the rest of the Trilateral Commission!

Commenter #41,

You are incorrect. If Coke does not outsource its legal work to reduce costs, Pepsi will, and when Pepsi is charging less for their products, they will take market share from Coke.

The Coke and Pepsi example is not the best because there is a significant amount of brand loyalty to those products. Many consumers are indifferent to the cost of Coke and Pepsi.

The model may not hold perfectly true for Coke and Pepsi, but in our economy most goods and services do have a high price elasticity of demand (responsiveness of the quantity demanded of a good to a change in price).

Oh, and your airline example does not hold because the airlines kept those fees because they were not turning a profit AND because demand for their service does not change very much with a change in price.

If one company decides to outsource their doc review to India and can transfer that savings to a consumer, they will take market share from a firm that does not outsource doc review.

-Economist Secure

Mercantilism works every time it's tried. Try it, America.

47: My point is that companies usually pocket such savings for themselves rather than pass them onto the consumer, even if it's to gain market share.

Furthermore, I can't think of many consumer goods where the minuscule cost of legal fees spread across each unit (for example, your $0.15 cent Coke price reduction on a $2.50 bottle) would result in a large enough change to influence consumers into changing their buying preferences. As you've stated, Americans are largely loyal to brand names (Coke, Pepsi, etc.) on anything that's not a Walmart product. And, those Walmart products are so cheaply offered already that another five to ten cents per unit is not going to make a difference.

I agree in that abstract, in a very theoretical economic sense, that what you're arguing makes sense. I just don't see it working out that way in practicality due to brand loyalty, low costs of consumer goods that would be affected, the low cost of legal fees spread across the millions of units of product produced by companies, etc.

Ello? Yes my nem is Raju Chanal colling in behaf of Watch-tell Liptan...i will be doing paper riting and paper reading phor your margars and accusations dil.

I think we are forgetting one important issue here that may be behind the ABA's decision. For many years, America and other countries forced countries, like Japan, to free up legal barriers so that Western firms could get a piece of the pie. The same thing is slowly happening in India. Part of this is WTO and other trade agreement obligations.

People for get that "free trade" is not only the free movement of goods. Free, or at least fewer restrictions, on the provisions of services has been a large part of WTO obligations. Canada had to loosen provisions on American providing legal service in Canada in order to meet its NAFTA obligations. That was also one of the drivers behind allowing foreign qualified lawyers to take the NY bar.

The next step was to allow legal services to be provided by non-US qualified lawyers. The same issue hit other countries and they had to adjust. Some EU countries had an extremely tough time with this. The issue is bigger than simply whether the ABA thinks it is good policy.

Personally, I am skeptical of the whole thing and I think the ABA has been a toothless and useless organization for quite some time. However, just like with the issue of accrediting new law schools, the ABA may very well have its hands tied.

Nationalism, protectionism, and wars OR globalism, lower wages, less jobs, less freedom.

Take you pick.

We can either fight to see who will be top dog or all run around chasing our tails in piles of sh!t.

46. I too am slowly coming around to the idea that NAFTA was a terrible idea, despite the fact that I was a big supporter at the time.

One problem that you did not address is that everybody kind of knew that it would hurt our manufacturing base. But the countervailing benefit was supposed to be the larger market for American goods.

We (NAFTA supporters) underestimated the ability of the corporations that benefit from NAFTA to keep the vast majority of the profits without reinvesting that money back into their companies in the form of higher wages to their middle class workers. We knew NAFTA was going to hurt blue collar workers, but we thought it would help middle class white collar workers much more than it has. Instead, NAFTA has been great for the captains of industry, but not for many more Americans beyond that.

And really, it hasn't been all that good for American consumers either. You know, if we could buy discounted generic Canadian drugs, that would be one thing ...
--Elie

The ABA supporting outsourcing is like the AARP supporting ObamaCare. The membership pays dues to the organization so the organization has funds to screw over the membership.

At least old people have the excuse of being senile and distracted by bingo. Lawyers are just idiots.

52 - We could institute a policy of fairly extreme mercantilism before it started any wars.

Don't be melodramatic.

54: Exactly, I was actually going to make that analogy in an earlier post. The ABA, like the AARP, isn't acting in the interests of its membership, but that of other special interests who are using it to further their agenda.

I don't see how outsourcing to India can be considered free trade. India has only approved US/UK firms to relocate their legal sweat shops to their shores and retain ownership without allowing these firms access to their domestic legal business.

Commenter 49,

Even if companies do not pass those benefits to consumers, they will pass it in another way (dividends, employee compensation, stock price).

I will agree that outsourcing doc review will not bring forth the next economic boom. It will, however, have some positive effect on the economy.

-Economist Secure

57,

51 here. Free trade also means the provisions of services. The regulations to open India's legal market further are moving through Indian bureaucracy. It will happen eventually.

Elie: I'm usually hard on you, but I'm trying to be serious here. Did anyone really argue, or even think that companies would "reinvest that money back into their companies in the form of higher wages to their middle class workers?" Even white collar workers? I thought the argument was that prices would likely (hopefully) drop more than wages... Not that wages would increase. That's just patently illogical.

55:

Merchantilism cannot work without colonies to exploit or occupying armies necessary to force foreign citizenry to purchase our products (neither idea is particularly in vogue at the moment).

Additionally, there is no more gold, no more oil, or other valuable commodities to be had. We are reaching an era of peak production of most natural resources and valuable commodities.

With no more apples to pick from the tree, all we can do is fight over the pie.

Perhaps if we formally occupied Iraq (instead of fighting counterinsurgery) and actually confiscated its oil and corresponding revenue we might be able to get somewhere. Likewise, if we full out invaded Afhganistan and appropriated the transsiberian oil pipeline we might getbe able to re-establish global hegemony.

But alas, like Diocletian was forced to do with the remains of the Roman Empire, we are forced to devalue our currency, nationalize our industries, and enslave our citizens.

I love how history repeats itself.

55:

Merchantilism cannot work without colonies to exploit or occupying armies necessary to force foreign citizenry to purchase our products (neither idea is particularly in vogue at the moment).

Additionally, there is no more gold, no more oil, or other valuable commodities to be had. We are reaching an era of peak production of most natural resources and valuable commodities.

With no more apples to pick from the tree, all we can do is fight over the pie.

Perhaps if we formally occupied Iraq (instead of fighting counterinsurgery) and actually confiscated its oil and corresponding revenue we might be able to get somewhere. Likewise, if we full out invaded Afhganistan and appropriated the transsiberian oil pipeline we might getbe able to re-establish global hegemony.

But alas, like Diocletian was forced to do with the remains of the Roman Empire, we are forced to devalue our currency, nationalize our industries, and enslave our citizens.

I love how history repeats itself.

I think outsourcing on a major scale by law firms is a bad business idea. Law firms are built on the premise that legal work is unique and requires highly skilled labor to perform it. And partners will always tell you that they have the highest skilled labor around at a price the market will bear.

However, if you commoditize legal work to the point that its just some crappy product made halfway around the world, you will devalue the product to the point that nobody thinks you're worth your rate anymore (including partners). Once you start competing on price, you have nowhere to go but down. Typical shortsighted baby boomer greed.

61/62 - Admittedly, I should have wrote neomercantilism. I thought that was just understood today, nonetheless if think that cannot work, ask Japan. Then ask China.

51. I agree.

“The Indian legal market is important, not so much for today, but for the future,” said David Jacobs, the head of Chicago-based Baker & McKenzie LLP’s India practice. Foreign acquisitions by Indian companies more than tripled to $13.9 billion in 2008 from $4.5 billion in 2005, and India “will be restored as one of the dominant global economies in our lifetimes,” he said

I dropped my membership in the ABA about 20 years ago. The ABA is nothing more than a political mouthpiece for liberal causes. Fuck the ABA.

The ABA's stated mission:

"To serve equally our members, our profession and the public by defending liberty and delivering justice as the national representative of the legal profession."

They would have to be retarded not to change that after making this decision. The two simply cannot be reconciled.

ABA = dumbasses

18 is correct. We should outsource those lefty wing-nuts at the ABA. I get a laugh out of their "Human Rights" practice group newsletter every time I receive one. Did you know there is a "human right" to transportation? Luckily, my firm no longer forces me to be a member and my membership can lapse.

BTW, what are the odds that UC Davis will be reaccredited in the future? Anybody have an idea if that is likely?

69 - Of course it's likely! Gaaawd! UC Davis is totally the best ever! Gaaawd!

The left wing ABA selling out its own. That's why you never trust a liberal.

For decades, lawyers have supported the open market policies that have eviscerated the United States' manufacturing base and its reservoir of homegrown technical expertise. These policies depressed prices of basic goods and created a short-term economic boom. The professional classes prospered from this.

It is now time for laywers, too, to feel the discipline of the market. It is time to pay the piper. The workers that were sacrificed (and the country as a whole) will benefit from more affordable access to legal services.

#72

At least those blue collar manufacuring workers didn't have to drop $150k on an undergrad, law degree and bar study to even qualify for their job.

If they chose to be lazy uneducated blue collar slobs that's their problem.

You're getting what you deserve, 72. Bring on the immigrants and the Indians.

You're getting what you deserve, 73. Bring on the immigrants and the Indians.

#73 here. I am a plaintiffs' attorney who runs my own shop. My job isn't getting outsourced anywhere.

72 - We supported those policies on the promise that the ABA would protect our interests. You might say that we reasonably relied on that promise to our detriment. I think there's a Rest. 2d section that might provide us some relief...

enjoy it while it lasts 73, because those days are ending soon.

We'll see, 76. The excess labor supply arising from outsourcing and an unrelenting influx of foreign attorneys exerts downward pressure on legal fees (which would be a good thing for non-lawyer clients). Meanwhile, the entrenchment of open market policies will exert downward pressure on potential clients' purchasing power, as their wages continue to slide toward levels of poorer nations.

If you don't feel it yet (and I do not doubt you when you say you do not), your children and grandchildren surely will.

The Korean bar exam is very hard. Only 1000 new lawyers are permitted to pass it each year, against about 50,000 who sit for the exam — a 2% pass rate. In years past, the quota was less than 300. The exam (and the law) is written in language designed to separate the wheat from the chaff: To obscure rather than to illuminate, to control rather than to empower — thereby eliminating those candidates who have not been soaked in Korean obscurantism. Anyone who passes it is a very smart individual by any definition, more so by this country’s definition of “smart”.

But it’s more of a test of rote memorization of a number of things, including rules of law, but also including history, literature, and political thought. I’ll bet money Dokdo is on the test! In other words, the Korean bar examination measures not just legal knowledge, but also how “Korean” one is, and how successful one has already been in the Korean educational system. Seoul National University students pass this test at rates much higher than others. The foreigner who passes this exam will be quite exceptional — more exceptional than me. However, this test doesn’t have much to do with how good a lawyer one will be. Just like the bar exam in the States!

Recently a handful of would-be lawyers made news because they were disqualified in the face-to-face interview portion — the first ones ever! Much was made of the fact that the interviews required “political correctness” in the responses: One failed applicant was allegedly disqualified for responding that the United States was Korea’s “main enemy” (good!). But Korean-language reports had the majority of the failed applicants getting DQ’ed for simple boneheadedness. My favorite was the guy who was rejected because his answer to an issue-spotting question involving a hypothetical criminal battery on his person was “I’d punch that guy right back!” The examiners were disappointed that there was no philosophy behind the response — no libertarian self-help argument, just hot-headedness — and no recognition of what they were trying to do with that question. This is a sign of good things to come: Foreign lawyers who have worked with young Korean lawyers most frequently complain about issue-spotting skills (as in, “They don’t have any“).

........................................J
........................................J
........................................J
........................................J
........................................J
........................................J
........................................J
........................................J
...................J...................J
.....................J..............J
..........................J.....J

True free trade requires no barriers to exit or entry to any market for any goods or services. True free trade requires that all countries drop all controls on the movement of persons and goods. It requires the abolition of government licensing requirements. It requires the abolition of laws prohibiting the manufacture and possession of substances.

Without reciprocity, free trade hollows out the society willing to open its markets and outsource.

82:

Your comment is interesting. Could you be a little more specific about what you mean in saying that free trade "hollows out" a society? What do you mean by hollowing out?

The more lawyers Biglaw lays off or doesn't hire, the more competition they will have from lawyers starting their own firms and charging less. Free market, baby.

The more lawyers Biglaw lays off or doesn't hire, the more competition they will have from lawyers starting their own firms and charging less. Free market, baby.

Elie, in Formal Op. 08-451, the ABA did not "change[] its rules to allow the outsourcing of American legal work." Rather, as I explained in "ABA Formal Op. 08-451 Good News for US-based Independent Contract Lawyers and Hiring Attorneys" (which you can find at http://legalresearchandwritingpro.com/blog/2008/08/28/aba-formal-op-08-451-good-news-for-us-based-independent-contract-lawyers/), the ABA’s position on outsourcing in Op. 08-451 is consistent with the favorable position it took in Ops. 88-356 and 00-420. Furthermore, large American firms have been outsourcing work overseas for years. Do you really think that they'd do that if the ABA's earlier opinions had disapproved of outsourcing?

I agree with #2: you get what you pay for. That's the conclusion I reached in Independent US Contract Lawyer Takes On Foreign LPO (http://legalresearchandwritingpro.com/blog/2009/10/30/independent-us-contract-lawyer-takes-on-foreign-lpo/). Any commenters who are out for LOP blood should like it (make sure to read the comments to that post for the full effect).

Oops, here's the correct link to the first post referenced in the previous comment: http://legalresearchandwritingpro.com/blog/2008/08/28/aba-formal-op-08-451-good-news-for-us-based-independent-contract-lawyers/

to #79...I work on a a contingency fee. I don't charge by the hour. As long as insured comapnies continue to screw up, I will have a job.

I am not a fan of outsourcing. That being said, outsourcing is a good thing when it allows more people to afford a bit of "justice." One of the big problems with outsourcing legal work is that the law is a people business. We interact with our clients; they gain trust in us; and they see that we are indeed working on their case. Clients want to know they are winning or being protected more than they want to know you save them 15% on their car insurance (joke). When their legal work is happening overseas, the client gets none of that, except the discount. Is there value in it, sure. If we took the time to explain completely the nature of legal services to each client I believe most would opt for American representation. If the client knows you understand their case completely and that you take an interest in their welfare, they would likely forego the cost reduction.

What we need to work on is BigLaw costs, or making more lawyers with exceptional ability cost available. I am a proponent of smaller firms with lower overhead and great lawyers. The salary of a good lawyer doesn't change, the overhead does. If we look at salary vs. cost, we can see that an attorney who bills $250 an hour and can bill 2000 hours they have grossed $500k. If we are big spenders and take out 50% overhead, we still make out at $250k. And $250 an hour is lower than what BigLaw bills out first years. You could bill higher and see bigger numbers (you just have to know the "sweet spot"). I won't even go into the quality of life you get back.

Just a thought to get you to think outside the jail cell you are enjoying at that big law firm.

How long will corporations, even rich wall street ones, pay legal bills large enough to support every associates starting 160, or even 120 or 90. Document review, research, drafting can all be done overseas at a fraction of the cost. The result is going to be reviewed by more senior lawyers regardless of where it is done. And when the top ten law school grads have trouble getting jobs, where are the lower end people going to go? The bubble is going to burst and never come back. We all sat around and thought it was great when prices lowered and the only jobs lost were manufacturing, but now the chickens are coming home to roost. Free trade is great for the world, not so good for the people (U.S.) on top.

How long will corporations, even rich wall street ones, pay legal bills large enough to support every associates starting 160, or even 120 or 90. Document review, research, drafting can all be done overseas at a fraction of the cost. The result is going to be reviewed by more senior lawyers regardless of where it is done. And when the top ten law school grads have trouble getting jobs, where are the lower end people going to go? The bubble is going to burst and never come back. We all sat around and thought it was great when prices lowered and the only jobs lost were manufacturing, but now the chickens are coming home to roost. Free trade is great for the world, not so good for the people (U.S.) on top.

73, I don't know what lazy hick town you are from, but if you think blue collar workers are lazy, you need to go out and meet some more people.

The ABA is in the pockets of big firms.

Big firms only care about short term profitability.

In the short term, outsourcing means more money for big firms. Therefore, the ABA will be pro-outsourcing, regardless of how it hurts the quality of work and regardless of how it hurts the profession as a whole.

These guys feel like they've earned their check and they want it now. They don't care about the future or the profession.

Legal jobs should not be outsourced. Period.

I'm a T2 MBA (for you lawyers that means H or S) who sometimes reads ATL because I find the comments more entertaining than Dealbreaker. I have worked in management consulting and in investment banking. In both those industries, jobs in the US have risen dramatically in the last 10 years (even taking into account the recent downturn) while 10s of thousands of jobs in the same industries have been outsourced to India, and other countries. The reason is that in these industries, professionals at all levels need to constantly interact with domestic clients -- having low cost support oversees just makes us more productive. It appears that is not the case in "biglaw" where associates do work that can easily be outsourced, with no higher value added work to be done to replace that work. This is the root of the problem. Trying to keep low level associate legal work in the US at high cost is just going to delay the inevitable.

93 sums it up pretty nicely.

95, don't kid yourself. Nobody below the level of maybe vice president at an IB provides any significant value to a corporate client. But I-bankers get paid differently than lawyers do. That's why they can ramp up the junior level ranks when the bank starts doing better much more quickly than law firm counterparts.

Legal work is global. Who cares what the ABA thinks. If US firms don't become globally competitive with process work, I'm sure the UK firms won't have a problem taking the work from them.

97 - that is just a an accurate comment. Legal work, while practiced globally, is not conducted in a simple format. If it were, foreign lawyers would not have to get an LLM to practice in the US.

American lawyers working overseas are by and large used only on business dealings that fall under the US laws. That's why they need US lawyers, not because they embrace our education as US lawyers.

The historic structure model for major law firms is history. That is the real bottom line in all of this. Simply put, the market dictates that firms move to a model with more fixed cost "staff lawyers" whille companies simultaneously outsource more legal work to alternatives to major firms (e.g., offshore outsourcing, efficient super-boutiques like in labor and employment work) The model of paying waves of newly minted law school students extravagant money are done with. Associates will still be part of the economic model for law firms, but to a much less extent.

The historic structure model for major law firms is history. That is the real bottom line in all of this. Simply put, the market dictates that firms move to a model with more fixed cost "staff lawyers" whille companies simultaneously outsource more legal work to alternatives to major firms (e.g., offshore outsourcing, efficient super-boutiques like in labor and employment work) The model of paying waves of newly minted law school students extravagant money are done with. Associates will still be part of the economic model for law firms, but to a much less extent.

Any American educated and trained attorney who is in favor of offshore outsourcing is a flat-out f--king dunce whose opinion should not matter one bit.

98

The word "process" used in 97 is an lpo term to denote rote legal work done by freshly minted attorneys whose law school background provides little relevant training for practice. In this context, requiring an ABA law degree to perform such tasks is merely an artificial barrier to entering the marketplace.

101

I believe any type of union just adds an artificial cost to my purchase

Thanks for the perspective 89

This USED to be a great profession.

I assume that any commenter above who writes in favor of offshore outsourcing is one of the following: (1) employed in the legal outsourcing business, (2) works as the GC for a large corporation, or (3) is a non-lawyer. There would be no other sensible explanation (even on theoretical grounds) for any US lawyer to be in favor of outsourcing. Your own job could and probably will be next.

Advertising by the LPOs and outsourcing proponents is fradulent, misleading and totally bogus. Most of the LPOs who call and email my firm constantly quote us rates of about $28 - $32 per hour for document review. They say our clients will save 90% on document review because firms charge about $300 per hour for doc review. Bull$hit! We get terrific contract attorneys (and some not so terrific) but generally terrific contract attorneys, who are licensed, for about $42 per hour. When clients hear that, they see there is no need to outsource. Now I'm not saying that working as a contract attorney is the preferred career choice for all law school grad, but I sure as heck am going to give a licensed US attorney a job before I ship it out overseas to save a couple of bucks. Why are LPOs so afraid of licensed US contract attorneys?

Advertising by the LPOs and outsourcing proponents is fradulent, misleading and totally bogus. Most of the LPOs who call and email my firm constantly quote us rates of about $28 - $32 per hour for document review. They say our clients will save 90% on document review because firms charge about $300 per hour for doc review. Bull$hit! We get terrific contract attorneys (and some not so terrific) but generally terrific contract attorneys, who are licensed, for about $42 per hour. When clients hear that, they see there is no need to outsource. Now I'm not saying that working as a contract attorney is the preferred career choice for all law school grad, but I sure as heck am going to give a licensed US attorney a job before I ship it out overseas to save a couple of bucks. Why are LPOs so afraid of licensed US contract attorneys?

Advertising by the LPOs and outsourcing proponents is fradulent, misleading and totally bogus. Most of the LPOs who call and email my firm constantly quote us rates of about $28 - $32 per hour for document review. They say our clients will save 90% on document review because firms charge about $300 per hour for doc review. Bull$hit! We get terrific contract attorneys (and some not so terrific) but generally terrific contract attorneys, who are licensed, for about $42 per hour. When clients hear that, they see there is no need to outsource. Now I'm not saying that working as a contract attorney is the preferred career choice for all law school grad, but I sure as heck am going to give a licensed US attorney a job before I ship it out overseas to save a couple of bucks. Why are LPOs so afraid of licensed US contract attorneys?

My firm's clients would drop us like a lead booger if we told them we were outsourcing doc review.

109

Contract US legal work is essential to the vision of around the clock/globe doc processing. You need cheap labor in the US time zone (think midwest), as well as Asia and India, to achieve this vision.

106
Or a small firm/solo practice that cannot afford to maintain a standing legal army.

Why would you tell them? And why would they care, who do you think handles your banking, credit cards, IT work now?

What about ONshore outsourcing instead? (Hiring foreign attorneys to work here in the US.). This is already happening through the JD and LLM feeder system and also "informally." So far it accounts for a MUCH greater proportion of outsourced US legal jobs.

114

Still cheaper to pay in rupees than dollars

If outsourcing increases access to legal services (by lowering fees), it will have done a good turn for the country. Only the privileged few in America can afford lawyers at current rates.

116 you are full of crap. Who in America does not have access to lawyers? Some shitass who refuses to pay rent maybe, but anyone with half a case and five lawyers knocking down their doors to help them.

Who exactly does not have access to a lawyer if they need one? Give me an f'n break.

This comment is addressed to the Post at 32.
Have you heard of the India Partnership Agreement? This is expected to be fully implemented by early next year. There are currently US licensed attorneys on the ground in India starting up offices for some of the largest US Law Firms that will be partnering with Indian Law Firms to reduce further legal costs. So much for outsourcing work not considered to be the practice or law....

When I was in Dubai I was told that many of the x-british colonies have English-law legal systems, which are different than US. Thats why there are more english firms in Dubai than American.
As someone who practices law without a license on a daily basis (or did), I say--
Replace all the non-partner track associates with paralegals! That'll save you money! And lower billing rates! What a brilliant idea (and It'll never happen because its too logical).
--Pretty Damn Senior Corporate Paralegal

But who will partners throw things at when they find a typo?

117: um, are you joking?

Oh, my, after you lawyers cheapened and globalized American labor for decades, now you get your just desserts.

The legal profession needs to be knocked down a peg or two.

Being knocked economically down a peg or two beats the heck out of being shot; which is what most lawyers deserve; lead in the head from some citizen they screwed.