Long ago, if you wanted to become an attorney, you could go through an apprenticeship with a practicing attorney. Not many states still allow that, and I'm sure there are good reasons for requiring all aspiring lawyers to go to law school instead. But the old system did have one thing going for it: It kept the supply of lawyers from becoming completely detached from demand. As a great many people who who are trying to pay off their JDs on Starbucks pay can attest, the same is not true under the current system.

There isn't. Law is the same profession it was 150 years ago. (There are new tools, of course--electronic research, e-discovery, etc.--but you don't really learn to use them in law school anyway.) The JD requirement is just one instance of the larger capture of American society by academia.

Your point about supply and demand is astute. The JD requirement didn't replace the apprenticeship requirement, it supplemented it. Today, lawyer supply is still limited by the opportunities for new lawyers to go to trial, handle deals, etc.--nobody would hire a lawyer who has only academic or theoretical experience in those areas. But the winnowing process happens after a whole bunch of people have taken six figures in non-dischargeable debt.

In my view, there are two good reasons.

First, the legal job positions that only require a mechanistic understanding of the law have been automated. The days of needing a "country lawyer" whose practice consisted of basic family law like wills are gone, thanks to LegalZoom and similar services. The jobs that were best filled by these people have been automated away. In the jobs that remain, it's not enough just to know the law, but you must learn to think in a legal/analytical way. This is not a skill that comes easily just from reading statutes and some case law under supervision.

Second, the size and complexity of the American legal regime, including the administrative state, has made it necessary for lawyers to (a) specialize; and (b) be able to issue-spot in areas well outside their expertise, to know when to look for help. Although a mergers and acquisitions attorney might be able to apprentice a young aspiring lawyer in that area, they're unlikely to be able to transfer all the latent knowledge they have of other areas of law. As an example, I have about a decade of experience in my practice areas, and would be wholly incapable of apprenticing an aspiring lawyer in the area of, say, commercial paper to the point of being able to pass the bar exam. The first requirement (depth in a specialty area) makes most practicing attorneys ill suited to train someone to standard in the second requirement (latent breadth).

Given the high cost of lawyers, and the general understanding that you avoid going to court as much as possible, as it can easily bankrupt you before achieving any good, its hard to imagine that's actually true. The current options are to pay a huge amount, or give up entirely; I'm sure there's a market for the middle ground (inexperienced but cheap lawyers), and a reason no one can access (eg regulation)

There is no such regulation. A fresh graduate could theoretically argue a case in the Supreme Court--it just requires a pro forma application and payment of a $200 fee to be admitted to the Supreme Court bar. A JD you hire for $20/hour on Craigslist can, legally, represent you in almost any proceeding, as long as she is upfront with you about the fact of her inexperience (and is willing to shoulder the malpractice risk).

There is no market for inexperienced but cheap lawyers, at least for business litigation. If you're a plaintiff, you can get experienced lawyers to work on contingency. If you're a defendant, you have huge potential exposure if you lose the case. If you really have no money, the plaintiff will realize it can't get blood from a stone and will settle cheaply. It would be incredibly risky to roll the dice and try to fight with a lawyer who lacks experience.

Caveat there - there's room in the boiler room, at least on the bigger cases.

Not exactly the kind of work kids dream of when they apply to law school, though.

https://en.wikipedia.org/wiki/Reading_law#Modern_practice

We bitch about people going into debt, but turn around an are fine with companies being picky as hell about having a specific degree, as if that's everything about a person's ability or background. We also bitch about healthcare costs, but then act like the sky will fall if we start discussing the possibility of pharmacists, optometrists, or psychologists prescribing or offering more services. Your observation about law is equally astute.

I'm going to beat a dead horse until it rises from the grave, but this is the situation with liberal arts degrees as well: they're from a time when it was assumed that you could major in, say, philosophy, and take comp sci classes, do work in that area, and build up a career in comp sci without anyone questioning it. Now your local HR department uses that comp sci degree to screen you, as if you are your degree.

Everyone knows that these degrees are helpful but imperfect indicators, but we treat them as perfect indicators because it's easier to maintain the myth, and it benefits those who benefit from rent-seeking and overregulation.

This person has a bachelor's in economics

Man, of all people that ought to know about the "sunk cost" fallacy...

If you accept that middle-income, professional jobs are decreasing relative to lower-income and higher-income positions, then many students with a non-trivial amount of debt are in a trap. For example, say you graduate with a B.A., $120K in debt, and the only job you can get out of school pays ~40K, but low upward mobility long-term (pay-wise).

Your options are (for this hypothetical):

(1) Take the ~40K job with low upward mobility long-term.

(2) Purchase a $120K graduate degree that offers a 65% chance at a six-figure job out of school (and high upward mobility long-term) and a 30% chance of a ~$60K job (and medium upward mobility long-term) and a 5% chance of ending up in outcome (1).

Which is more rational?

Now, we could get into questions of how well this maps to reality, or what the expected value of each outcome is, or how to even compute expected value in a situation with myriad messy variables and reductionist assumptions, etc. Regardless, I think we can say that if income and upward mobility resemble a barbell distribution more than a normal distribution, then we have defeasible justification for believing the following:

(Proposition) A non-trivial number of students face decision traps which lead to a choice less akin to the sunk cost fallacy than a non-confident choice when living between 'a rock and a hard place'.

At times, people will say something about having invested so much already that their decision is pretty much pre-determined even though they're attempting to convey having made a non-confident choice after being stuck between 'a rock and a hard place'.

In fact let's look at it: what's the probability that given your inability to gain one of the lucrative jobs at this level of education you can gain one with a higher level of eduction? Well we can speculate, a higher level of education can be sought for two reasons: you're acadmically gifted and genuinely want to get more education, or you're not academically gifted and you want the magic fairy wand to wave to get into Brothers and Brothers LLP. Well let's face it, you're in group number 2, and it's the people in group 1 who are the actual successful candidates. So given that your pay off looks way off. You won't get the top jobs - you're not good enough, you won't get the medium jobs - you're overqualified, and you won't get the cheap jobs - you can't afford to work for that amount.

(2) Even assuming your argument goes through successfully, it is irrelevant to whether the person committed the sunk cost fallacy, which is the issue under discussion. Now, you could argue that subjective assessments of expected value always track the true underlying expected value (i.e. the actual expected value for any individual's objective abilities). In that case, all non-academically-gifted students who chose further education would likely be committing the sunk cost fallacy. That's not the case though, and you know that. Or you should, because it is prima facie absurd.

(3) It is relatively uncontroversial that there is a substantive disconnect between the supply of graduates and the number of jobs paying a salary justifiably commensurate with the debt-levels we are seeing. This has a couple of knock-on effects. For example, an across the board devaluing of degrees, which unjustifiably increases hiring requirements for lucrative professional jobs, further exacerbating prestige whoring, etc. This turns high school seniors deciding to attend elite private schools into even greater gamblers as the cost of an initial degree rises. Maybe they are or maybe they aren't rational to take that gamble (Are gambles by definition irrational? If so, pick a different term.). However, after having taken that gamble and come up short, they don't automatically become irrational in taking it again. Or, at least, the irrationality wouldn't necessarily have anything to do with the sunk cost fallacy.

So given that they'll just not even get back to zero net worth if they stop, the "better" option is to continue. Despite the negative dollar value standing next to it.

That's something that's just not considered here. When it comes to net worth, -$1000 has exactly the same consequences as -$99999999999 for that individual. So if you're going to be negative anyway, why not be as deep as possible ?

For society, that is a very negative outcome, but not for the individual. But the individual chooses (even in societies that like to pretend otherwise).

I'm not sure I follow your point... -$1000 could be paid off in a month. -$99999999999 probably couldn't be paid off in 100k lifetimes.

That's one thing people keep forgetting about, for example, take population figures. Species specifically refuse to multiply unbounded. And that's weird the first time you realize that DNA contains a distributed regression algorithm that estimates to what size the population of it's species can grow under the current circumstances and then blocks reproduction, or enables asexual (or otherwise really fast) reproduction. Why ? Because if you get it wrong, population numbers will fluctuate.

And that seems "what's the problem ?". Well the problem is that there is a very special number, called "zero". And if the population of any species randomly fluctuates, it might randomly hit zero. And then it's over. There's no coming back from zero. Then you will realize that the number where that happens is not actually zero but can in fact be quite large a number and you see why fluctuation is an extremely undesirable property.

So for debt you can't pay, "zero" is the magic number. Once you cross it, your mission in life changes. It's no longer to get out of debt, but rather to get in as deep as you possibly can, while refusing any and all attempts to get back out (except of course to deceive others to let you get deeper in debt). That behavior by itself is the only thing that might get you back out of debt (just look at the president)

And in economics in general you should keep in mind that while individual humans are stupid, large groups of humans are incredibly good at finding optimal Nash Equilibria. If large numbers of people "randomly" or "out of stupidity" do something, fact of the matter is that the stupidity is yours, for not seeing the whole picture. Stupidity at large scale only exists at very short timeframes, if at all. Lots of people going into debt is not stupidity.

The way to think about it isn't that to leave would be to throw away 2 years of tuition, it's to consider whether the next 2 years of tuition is worth a 4 year degree. And the answer could easily be, yes, it absolutely is worth it.

I had plenty of experiences where I realized "dude can only do exactly what I say ...".

Hard to know if it is any worse or better than in the past, but man, it was disappointing to see.

What struck me again later was finding out that 24 is the tipping point for the brain. That's about when the majority of brain matter is "gray" instead of "pink" (aka the process of myelination), which seems to be a biological rather than an environmental process. So this has likely been the case for a very long time (like 40,000 years or more).

He has no way to pay his loans, never will, and is unable to discharge them in bankruptcy.

Yeah, there is a "poor me" element to this. However bankruptcy laws exist for a reason, and denying people like him access to bankruptcy forces them into unproductive lives. That non-productivity makes all of us worse off in the long-run.

Since private government-guaranteed loans were discontinued, most private student lending dried up, so “lenders” here basically refers to the federal government.

cost of not continuing - very large chance of being screwed from that point for the rest of your life

cost of continuing - student debt, which at worst gets you into the above situation

So clearly, continuing is the better choice.

Secondly, as they say, when people have to choose between death now or death later, they choose later. No matter the strings attached.

This is only even plausibly true for people who have no family members. That's nearly nobody.

Consider a traditional Chinese or Japanese official who is ordered to commit suicide. Generally the command is obeyed. On your model, such a command would never be obeyed -- you can always just not kill yourself, in which case you'll still die, but later than you would have.

Good on you that you think like this. Try to hold on to it and enjoy it, it won't last.

If it's not too personal: Which major/minor did you choose? Which school was it? Year of graduation? Would you recommend it to others? Any downsides to the school?

Majored in computer science. There's a lot of student-friendly work nearby, especially for software people. I really couldn't stand the local culture and I'm even from a pretty conservative christian home, but I was there to get down to business so I worked as much as I could, maxed out credit hours I could take (12 - 18 credit hours all costs the same), and got out in 4 years with a solid education, no debt and enough savings to comfortably start my real adult life right away. A hard 4 years, but looking back it was clearly the right call compared to my peers. Tuition prices at other colleges have just never seemed worth it. Had I not gotten into BYU I would likely have tried to just get software jobs with no degree, or gone into a trade like welding.

Which indicates a huge part of the problem for a lot of people these days. It's a safe bet that the wages at the jobs you worked then haven't doubled in the last ten years, so someone merely wanting to replicate your path would need to work considerably more hours just to make their tuition payments.

Reliable, accredited colleges cheap enough that you can realistically work your way through them at the wages paid at the kinds of jobs typically open to inexperienced students are increasingly thin on the ground.

1) Does the student have a history of completing what they start? If not, consider a part-time trial at a community college with expectation of finishing with decent grades in courses that will transfer.

2) Will the student need remedial classes? The school gets paid but these courses do not satisfy graduation requirements. They do increase debt!

3) Does the student have a clear goal for a major? College is an expensive place to "find yourself."

4) What are the job prospects for that degree? How likely is it that the student will be high in the distribution of the graduates? Will the anticipated salary permit repayment of debt and self-support?

5) Are the time-to-graduate estimates realistic? A surprisingly low percentage of students complete a degree in 4 years. 5-6 is more common and results in more debt...

6) Has the student learned to live within budget? There are many distractions at college. Spring Break trips add cost...

https://financialaid.byu.edu/cost-of-attendance

Except for the fact that they are almost completely non-dischargeable, you mean.

When talking about putting away money for a retirement plan, other 20-somethings I work with are deer-in-headlights about the little known fact that the rest of their non-working quality of life starts right where they're at now, not ten years down the road after the university, home ownership, car, and child-rearing costs are taken care of.

In total transparency, my parents taught my sister and I nothing about interest rates, and co-signed a good amount of money between the two of us. One of us is debt free, while the other is still struggling to pay down a 6.x% variable 55k note, has another house note around 150k, and a car note around 35k. We both have technical degrees and work in technical professions, so what went wrong?