Bruised and battered: law students and the next crisis
The AmLaw Daily web site picks up on clear indicators of US concern, reports from two of the country’s most venerable dailies – the New York Times and Wall Street Journal – claiming that a higher education debt mountain is rising faster than ever and that increasingly older lawyers are unable to pay-off their loans.
Eclipsing consumer debt
The NYT points to a recent joint report from the US’s Education Department and the Consumer Financial Protection Bureau, which shows the total national outstanding student loan debt has tipped the $1 trillion mark. That pile consists of $864 billion in loans from the federal government and another $150 billion from private lenders, and it is, points out AmLaw Daily, more than the country’s entire consumer credit card debt.
At the same time, the Journal highlights recent figures from the Federal Reserve Bank showing that it is middle-aged Americans who are struggling most with mounting student debt. According to the newspaper, ‘the percentage of debt on which no payment has been made for 90 day ... was 11.9 per cent for debt held by borrowers aged 40 to 49 as of March’. The paper compares that with a rate of 8.7 per cent for borrowers of all ages.
All of which prompts the AmLaw Daily to chip in with its own dark prognostications of how this mountain of student debt will affect law schools and the legal profession. ‘For anyone who thinks this problem is bad now,’ writes Steven Harper, ‘wait until today’s twenty-somethings who went to law school and can’t get jobs reach their forties.’
The article points out that US law schools are for the most part contributing to the pain by continuing to churn out a glut of graduates -- ‘more than twice the number of lawyers as there are law jobs’.