Not too long ago I had an intriguing and frank conversation with a university president who had once served as a law school dean. He leads a university that is home to a middle-rung law school that is going through the same stresses and changes being experienced by most of the country’s institutions of legal education. We both agreed that law schools at the top of the pecking order had no real difficulties and that we hoped the institutions at the very bottom that are increasingly admitting applicants with qualifications indicating they are unlikely to become well-qualified lawyers simply disappeared. Our focus was on the numerous law schools—perhaps 80 to 100—that are subject to strong pressures from declining enrollments and reduced revenues, from information technologies that are altering and eliminating traditional “law jobs”, and from the variety of ways in which the legal profession and alternative mechanisms for delivering legal services and “law knowledge” were “morphing” into forms that altered the ways law schools need to educate to best serve the profession and society.
Among the critical points raised were the following.
- Strategy has to be localized for each law school. There is no single “national” or “global” strategy that fits each law school’s needs. A law school’s strategy has to be diverse and individualized. There is no “one size fits all.” Such things as the realistically sustainable operational scale of the law school, scope and type of law job market, population size and makeup of the area from which a law school draws its students, demographics of the existing legal employment market including patterns and rates of lawyer retirement, alumni support and quality of links with major employers in the area, the economic health of the region into which a school sends its graduates, and the extent to which a law school is in a competition with other law schools for applicants and employment are all important considerations. Along with these matters are the net cost of attending the law school and the extent to which the parent university is willing or able to subsidize the law school.
- As law schools adapt and increasingly seek to become institutions that offer education-in-law to diverse groups seeking such knowledge as well as educating future members of the legal profession to practice law effectively they need to develop new sources of applicants and identify and serve non-traditional market niches within a school’s competitive area.
- Traditionally, law schools have been net income generators for their universities. This has changed for many schools. Parent universities are subsidizing law schools in an attempt to help bridge the revenue gaps created by declining tuition income and fixed personnel costs that cannot easily or quickly be reduced but make up 85-90 percent of a law school’s budget. Among the most critical questions are, how long can subsidies exist, or even if a university has the ability to continue paying subsidies to keep their law schools going to what extent will host universities remain willing to continue those subsidies when it becomes clear that the negative market conditions are not going away?
- The ability of universities to subsidize law schools varies radically. Endowments and the needs of other programs in non-law departments that are under financial pressure come into play in determining the ability and willingness on the part of universities to provide continuing support for law schools. In this period of declining revenues in which law schools are asking their parent universities to accept a financial burden by subsidizing them while they attempt to develop and implement strategies that preserve the quality of the law school while adjusting scale and function it is imperative that the law schools develop specific and realistic financial strategies rather than simply “wishing and hoping” that things will somehow “return to normal”. 
- This means there is a need to decide on the feasibility of what have been called paths of “soft attrition” as well as “hard attrition” whereby faculty and staff costs are reduced in accord with the institutional scale now appropriate for a law school’s operation.  It means expanding alumni giving when this is possible even though such funds will never be enough to sustain the operation of a law school. It involves clear decisions about salaries, teaching loads, optimal faculty staffing levels après le deluge, tuition levels and how these considerations play out in creating competitive advantages and disadvantages. Asking a university to provide significant support to a law school over a substantial period of time without developing a clear and realistic financial strategy is simply ignorant.
- In such a resource-driven and political context it is important to ask what a law school contributes to the university in which it is housed. In an expanding resource situation where law schools were “cash cows” that contributed positive dollars to a university, the answer was obvious even if the underlying motivation to accept the law school was not qualitative. But in a context in which the “cow” has stopped providing “milk” the considerations for some universities are increasingly stark. They include whether to seek professional help to create “medicine” or curative “treatments” that regenerate the positive flow, to pray that what is going on in legal education and the profession is a temporary condition that will turn around at least to the extent that the situation becomes revenue neutral or perhaps a little positive, or decide to “bite the bullet” and “butcher” the former “cash cow” and convert its assets.