{"id":8100,"date":"2014-09-26T08:36:17","date_gmt":"2014-09-26T12:36:17","guid":{"rendered":"http:\/\/journals.law.harvard.edu\/crcl\/?p=8100"},"modified":"2014-09-26T08:39:28","modified_gmt":"2014-09-26T12:39:28","slug":"saving-the-world-through-simple-mathematics","status":"publish","type":"post","link":"https:\/\/journals.law.harvard.edu\/crcl\/saving-the-world-through-simple-mathematics\/","title":{"rendered":"Saving the World Through Simple Mathematics"},"content":{"rendered":"

An article in the HL Record<\/a>\u00a0recently made Above the Law<\/a>\u00a0for its somewhat-facetiously titled piece, \u201cWant to save the World? Do Biglaw!<\/a>\u201d\u00a0 Bill Barlow, the author, essentially argues that HLS grads should go into Biglaw because Biglaw lawyers make 3-4 times as much as public interest lawyers or legal academics, and so can donate more to save starving children.<\/p>\n

This salvation-by-private-charity argument is hardly new.\u00a0 I first heard it, unsurprisingly, studying finance at Duke University: perhaps from the same people as Bill, who shares my alma mater<\/em>.\u00a0 There, some students were arguing that the most ethical option for us was to go into finance and donate some (large?) proportion of our salary to charity. \u00a0I have to admit, Robin Hood: Men in Suits is a deliciously subversive image, and my Catholic Church would certainly applaud the redistributive impulse.<\/p>\n

Still, there are difficulties, and Sima Atri\u00a0has presented<\/a> the systemic issues quite nicely, so\u00a0I won\u2019t repeat them here. Bill responded: \u201cMy respected colleague has misdirected her fury away from what is, ultimately, a mathematical question.\u00a0 Is it better to save the lives of 150 living, breathing, people, or to exert the same effort on an unquantifiable, indefinable \u2018good\u2019?\u201d But let\u2019s look at the math\u2014it\u2019s not quite so clear.<\/p>\n

It seems Bill wants us to make the choices that maximizes the money in charity\u2019s hands.\u00a0 Unfortunately, we HLS students messed that one up from the moment we accepted our admissions here and agreed to three years of nearly $55K\/year tuition.\u00a0 While I am racking up approximately $240K of debt after interest, a junior associate at Goldman (with no post-graduate education) is making <\/a>approximately $140K\/year after bonus\u2014$87K take-home even assuming NYC taxes.\u00a0 Traders make even more<\/a>. \u00a0Thus, assuming I donate 25% of my income, my three years here not only cost the poor the $60K I\u2019ll be paying back in loans, but also $65K in lost donations if I had been working instead of sitting in the library writing articles like this. At Bill\u2019s rate of 25% of $100K take-home a year from a firm, it would take nearly five years in Biglaw to pay off that deficit.<\/p>\n

And our mistake gets worse as we look forward.\u00a0 According to the American Lawyer, an average partner partner at the top-compensating law firm averages $4.8 million gross, while executives at Goldman made around $14 million according to the S&P Capital IQ database Execuucomp. Each banker is good for three lawyers when it comes to charity.\u00a0 Thus, if Bill really believed his argument, he\u2019d follow fellow alum Lloyd Blankfein\u2019s example, and get out of Biglaw and into finance as quickly as possible.<\/p>\n

This reconfirms my lesson from 1L Contracts that one should never trust law students with math (so feel free to correct my own in the comments).\u00a0 But it\u2019s deeper than that. It will come as a surprise to no one except maybe other law students that we\u2019re not all that good at making money.\u00a0 We are, however, good at talking about law.\u00a0 In fact, we\u2019ve granted ourselves a legal monopoly to represent people in court in most circumstances. \u00a0\u00a0In economics, we call that a comparative advantage: we\u2019re more efficient than pretty much anyone at legally representing others. Similarly, the finance industry has a comparative advantage over lawyers as to\u00a0donation potential: they make more money.\u00a0 Thus, economics 101 suggests then we should let the bankers maximize their donation potential, and we should stick with law.<\/p>\n

There are many reasons to go into Biglaw\u2014many selfless reasons, even.\u00a0 And certainly those who do should certainly donate\u2014hopefully a lot\u2014to charity.\u00a0 But a lawyer who could be doing pro bono <\/em>or otherwise harnessing the law\u00a0to help people\u00a0should not think the best use of his skills to try to save the world through maximizing his income. \u00a0It is, after all, a simple matter of mathematics.<\/p>\n","protected":false},"excerpt":{"rendered":"

An article in the HL Record\u00a0recently made Above the Law\u00a0for its somewhat-facetiously titled piece, \u201cWant to save the World? Do 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