Are Colleges Dinosaurs?

 By Timothy D. Naegele[1]

A friend of mine has some kids who are starting college this fall, and they just got back from an orientation session at the campus, which they loved.  Obviously the kids are talented because it is difficult to get into the school, and only the best students are chosen.  Everything was positive except for one thing: the cost.  As my friend told me: it is going to be very expensive right in the midst of a job change.  Amen to that!  The exorbitant costs associated with college educations have been rising for a long time now.[2]

America’s Middle Class is being priced out of colleges for their kids; and many parents are questioning whether college is worth it, and whether they can afford it.[3]  This is true to an even greater extent when it comes to graduate schools, such as law schools.[4]  As more and more Americans face economic problems during the balance of this decade, which will be true of their counterparts abroad as well[5], many will find that undergraduate college educations and graduate schools are luxuries that they cannot afford.  Many families will be doing whatever they can just to survive.

Lots of parents of those Americans who grew up during and after World War II never went to college.  To these parents, colleges were a gateway to great jobs and wonderful futures and the “American dream” for their children.  Today, like the issue of “home ownership” that was sold as part of that dream too, Americans are reassessing their goals and their capabilities; and their conclusions may not augur well for colleges, universities and graduate schools in the United States and abroad.  Certainly in the case of State-supported schools, where budgetary pressures are dictating that their expenditures be slashed, the twin pincers of parents who cannot afford to send their kids to these schools, and declining budgets, may break the backs of such schools.

Another old friend of mine, who covered Washington for many years as a talented and insightful political and economic reporter and editor, told me recently that colleges are effectively dinosaurs and relics of the past, like newspapers and newsweeklies in this Internet age.  The educational institutions of the future will be online—or so my friend believes—which cost a fraction of what “bricks-and-mortar” educational institutions cost today.  The kids now are computer literate like no generation of the past; and the idea of learning online is second nature to them.

Why spend money on college tuitions and campus living expenses, and professors’ salaries and the infrastructure of college campuses, when everything can be done online for a fraction of the cost?  Why have professors repeating essentially the same lectures year after year, when such lectures can be taped once and shown again and again on YouTube?  Why not eliminate “redundancy” and have the best professors teaching students online nationwide, and eliminate the costs of multiple professors?  Why allow “teaching assistants” (or “TAs”) to educate our kids, when the professors are paid to do this?  Why not eliminate colleges and graduates schools in wholesale numbers—just like libraries and book stores are closing or becoming “bookless” because everything is online?

The bottom line with respect to whether education shifts to the Internet might not be a function of conscious decisions by educators or parents: pure economics in America and globally will determine the results.  Falling governmental tax revenues will dictate drastic cuts like never before; and declining personal incomes and home values and foreclosures, and other family sacrifices, will result in changes to personal life styles that will affect the way educational programs are perceived and delivered worldwide.  It is not surprising that the Washington Post‘s parent sold Newsweek magazine for $1, and kept the Kaplan online schools that have become increasingly “cash cows” for the company.[6]

© 2011, Timothy D. Naegele

---

[1] Timothy D. Naegele was counsel to the United States Senate’s Committee on Banking, Housing, and Urban Affairs, and chief of staff to Presidential Medal of Freedom and Congressional Gold Medal recipient and former U.S. Senator Edward W. Brooke (R-Mass).  He practices law in Washington, D.C. and Los Angeles with his firm, Timothy D. Naegele & Associates, which specializes in Banking and Financial Institutions Law, Internet Law, Litigation and other matters (see www.naegele.com and http://www.naegele.com/naegele_resume.html).  He has an undergraduate degree in economics from UCLA, as well as two law degrees from the School of Law (Boalt Hall), University of California, Berkeley, and from Georgetown University.  He is a member of the District of Columbia and California bars.  He served as a Captain in the U.S. Army, assigned to the Defense Intelligence Agency at the Pentagon, where he received the Joint Service Commendation Medal.  Mr. Naegele is an Independent politically; and he is listed in Who’s Who in America, Who’s Who in American Law, and Who’s Who in Finance and Business. He has written extensively over the years (see, e.g.,www.naegele.com/whats_new.html#articles), and can be contacted directly at tdnaegele.associates@gmail.com; see also Google search:Timothy D. Naegele

[2] I served on the Board of Directors of the University of California, Santa Barbara Alumni Association, and as a Trustee of the UCSB Foundation, for a combined total of approximately ten years, overlapping the time that both of my kids and their spouses attended UCSB.  See http://www.naegele.com/naegele_resume.html

Tuition hikes were coming then, and I argued vehemently that they would price the Middle Class out of a University of California education.  I am a product of the University of California system, having attended UCSB, UCLA and Berkeley for law school; and the Middle Class has been the backbone of the university.  Needless to say, the cost hikes since I served on the UCSB boards have been even worse.

Also, the same thing has been happening with the law schools, yet law school graduates cannot find jobs today.  What they do is load themselves up with massive student loans, and then are unemployed or forced to take menial jobs, and they default on the loans.  It is “fraud” on the part of the law schools, because they keep touting the “value” of their education.  See infra n.4.

I had a “spirited discussion” about these issues with a very nice female UCSB professor, who was the “faculty adviser” to one of the boards on which I served; and I asserted that UCSB (and other UC schools) were not preparing undergrads for jobs, and that the job market for them would get even tighter.  Her response was that if students want to be prepared for jobs, they would need to go to graduate schools.  I essentially told her that was absurd because neither the students nor their parents could afford it, but this fact of life did not faze her one iota.

I expect before the end of this decade that one or more of the California State University campuses will close because of budgetary problems.  Whether it happens with one of the UC campuses remains to be seen.  This pattern will be repeated elsewhere in the United States, and in other countries.

[3] See, e.g., http://www.foxnews.com/us/2011/07/28/african-american-middle-class-eroding-as-unemployment-rate-soars/?test=latestnews (“It’s quite a sign of the times that people are questioning whether their education was worth all the time, effort and expense”)

[4] See, e.g., https://naegeleblog.wordpress.com/2011/01/03/the-american-legal-system-is-broken-can-it-be-fixed/#comment-1274 (“Is Law School A Losing Game?”) and https://naegeleblog.wordpress.com/2011/01/03/the-american-legal-system-is-broken-can-it-be-fixed/#comment-1583 (“The Law: A Less Gilded Future”) (see also the article itself, as well as the footnotes and other comments beneath it)

[5] See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”) (see also the footnotes and comments beneath the article)

[6] See, e.g., http://www.businessinsider.com/its-official-newsweek-will-be-sold-to-former-stereo-equipment-mogul-sidney-harman-who-reportedly-bid-1-in-excha-2010-8 (“Newsweek Sells For $1 To Stereo Equipment Mogul Sidney Harman”) and http://en.wikipedia.org/wiki/The_Washington_Post_Company

The American Legal System Is Broken: Can It Be Fixed?

By Timothy D. Naegele[1][2]

I have been an American lawyer for 44 years.  I am a member of the bar of the United States Supreme Court, the District of Columbia Bar, the State Bar of California, and the bars of other federal courts.  I have been a U.S. Senate lawyer and a lawyer at the Pentagon, and have represented more than 200 banks and other financial institutions.  I have purchased banks for our clients, and advised two States; and I testified as an expert on behalf of the FDIC in a failing bank case.  I have done essentially everything that I ever wanted to do in the law, except work at the White House; and I have attended meetings there.  In these and countless other ways, I have seen the American legal system “up close and personal.”[3]

I have two law degrees, from Berkeley and Georgetown, at opposite ends of this great country.[4] I can say without any hesitation, reservation or equivocation that the finest education I received was at Berkeley’s law school par excellence, Boalt Hall.  I was taught—to think analytically, and to write—by outstanding professors[5] who instilled in my fellow students and me a belief that the law is sacred, sacrosanct and pristine, “a shining city upon a hill.”  Since then whenever I have encountered what I perceived as legal injustices and incompetence, I have taken umbrage and railed against them, albeit generally in my own quiet ways.

John Lennon probably said it best: “Life is what happens to you while you’re busy making other plans.”  I never truly wanted to become a lawyer; that was not my life’s ambition.  I wanted to be a businessman instead, and buy and sell companies, but the Vietnam War intervened and changed my life forever.[6] I never dreamed of being a lawyer, like so many of my law school classmates at Berkeley did, which may explain why I view the profession—which so many Americans have come to despise—with a certain degree of detachment and healthy skepticism.  For example, I would not recommend the practice of law to anyone.  Among other things, the time demands and stress on young lawyers are a “family-killer,” which is why there is a high rate of divorces among members of the profession.

When my son wanted to attend law school, I encouraged him to get both a JD and an MBA, to “hedge his bets” and give him options.  When he was nearing graduation with both degrees in hand, I did my best to talk him out of practicing law.[7] Friends of mine, who have practiced law for many years and have been very successful at doing it, feel much the same way and have told their kids and others not to pursue a legal career.  Indeed, some of these friends and I have joked that we should give lectures to graduating college seniors and entering law school students, telling them what the practice of law is really all about.  If we told them the unvarnished truth, many might decide not to enter the profession.

Despite a healthy contempt for many lawyers, and judges—who are often egotistical, callous, mean-spirited, power-hungry, arrogant, self-righteous, condescending and incompetent—I have had wonderful friends over the years who are lawyers and even judges.  I have worked with them, and some have represented me, and I will always respect and be deeply indebted to them.  They are special people, who stand head-and-shoulders above others in the profession; and they are nice people as well—which may be what distinguishes them from the others.

Perhaps the most disturbing qualities about lawyers and judges are their arrogance and abuse of power, and their lack of empathy and innate legal and life skills to deal with vital human issues that come before them.  For example, lawyers who are prosecutors are often less interested in fairness and justice than they are in winning at all costs, and exercising their raw power and hurting others in the process—such as those who are innocent but are convicted anyway.[8]

Similarly, lawyers are trained in law schools to be advocates.  When they represent clients in divorce proceedings, the last things that estranged couples need are their respective lawyers “stirring the pot” to earn greater fees, and increasing the acrimony that already exists.  Also, male lawyers prey sexually on their distraught and vulnerable female clients, which should give rise to immediate disbarments but it does not.  The American legal system is broken today, inter alia, because it has often attracted the wrong type of people.[9]

Can our legal system be fixed, and will the American people come to trust and respect lawyers and judges again, and believe that justice not only exists but prevails in this great nation?  Maybe . . . if the profession is restructured, and if it attracts those people who believe that the law is sacred, sacrosanct and pristine—truly a shining city upon a hill—and they put such principles into practice.  The profession does not require saints, but it does need something different than “Law West of the Pecos by Judge Roy Bean.”  And it needs people who are different than it has been attracting: who are often driven, ruthless, unprincipled, money-hungry, and power-hungry.

© 2011, Timothy D. Naegele

[See also (1) https://naegeleblog.wordpress.com/2013/07/15/justice-and-the-law-do-not-mix/ (“Justice And The Law Do Not Mix”), (2) https://naegeleblog.wordpress.com/2012/03/21/the-united-states-department-of-injustice/ (“The United States Department of Injustice”), (3) https://naegeleblog.wordpress.com/2014/09/08/the-state-bar-of-california-is-lawless-and-a-travesty-and-should-be-abolished/ (“The State Bar Of California Is Lawless And A Travesty, And Should Be Abolished”)]

---

[1] Timothy D. Naegele was counsel to the United States Senate’s Committee on Banking, Housing, and Urban Affairs, and chief of staff to Presidential Medal of Freedom and Congressional Gold Medal recipient and former U.S. Senator Edward W. Brooke (R-Mass).  He practices law in Washington, D.C. and Los Angeles with his firm, Timothy D. Naegele & Associates, which specializes in Banking and Financial Institutions Law, Internet Law, Litigation and other matters (see www.naegele.com and http://www.naegele.com/naegele_resume.html).  He has an undergraduate degree in economics from UCLA, as well as two law degrees from the School of Law (Boalt Hall), University of California, Berkeley, and from Georgetown University.  He is a member of the District of Columbia and California bars.  He served as a Captain in the U.S. Army, assigned to the Defense Intelligence Agency at the Pentagon, where he received the Joint Service Commendation Medal.  Mr. Naegele is an Independent politically; and he is listed in Who’s Who in America, Who’s Who in American Law, and Who’s Who in Finance and Business. He has written extensively over the years (see, e.g., www.naegele.com/whats_new.html#articles), and can be contacted directly at tdnaegele.associates@gmail.com

[2] The issues addressed in this article are discussed further in a partially-completed book of mine entitled, “Never Become A Lawyer.”  Its chapters include but are not limited to the following subjects: law schools, law firms, divorces, bar associations, Congress, lobbying, mergers and acquisitions, litigation, law enforcement, state governments, the federal government, judges, federal courts, the U.S. Supreme Court, politics, abuse of power, justice, lawyer scams, and other careers.

The book’s last chapter starts with the words:

I began writing this book with the idea of thoroughly trashing the legal profession of which I have been a member for more than 40 years, as well as the American “system of justice”—and God knows there is plenty of support for that approach.  However, the United States has many fine lawyers, including former classmates of mine at Berkeley and friends who have tried to do their very best to help others, such as those lawyers who have helped me.  Thus, in the final analysis, I endeavored to present a somewhat objective view of the profession. . . .

I assume my assessment will remain the same, or close to it, when the book is finished and published.

[3] See, e.g., http://www.naegele.com/naegele_resume.html

[4] See https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/

[5] They included but were not limited to Edward C. Halbach Jr. (see, e.g.,  http://www.law.berkeley.edu/php-programs/faculty/facultyProfile.php?facID=44), who became dean of the law school and gave me an “A” in Conflicts of Law during my last year at Boalt, which I will remember always; Sanford H. (“Sandy”) Kadish (see, e.g., http://www.law.berkeley.edu/php-programs/faculty/facultyProfile.php?facID=61), who taught Criminal Law and became dean of the law school too; Barbara N. Armstrong, who was the first woman law professor at a major American law school (see, e.g., http://en.wikipedia.org/wiki/UC_Berkeley_School_of_Law); Richard W. Jennings (see, e.g., http://www.universityofcalifornia.edu/senate/inmemoriam/richardwjennings.htm), who taught Securities Law and came to Washington when I was a young attorney with the Senate Banking Committee, and we shared stories; and Michael (“Mike”) Heyman (see, e.g., http://www.law.berkeley.edu/php-programs/faculty/facultyProfile.php?facID=52), from whom I never took a class, but I will always remember his smiling face, and that he was a “force” for excellence at the law school and beyond (e.g., he ran the Smithsonian in Washington, D.C. for many years).  A giant in the law of Torts, William L. Prosser (see, e.g., http://en.wikipedia.org/wiki/William_Prosser), was at Boalt too; however, he left shortly before I arrived—although his spirit was still there.

[6] As a result of enrolling in Army ROTC as an undergraduate, I had a commission as an officer when I graduated from UCLA in January of 1963.  I wanted to attend a business school; however, I needed to work from January to September at two jobs, to earn enough money so I could afford any graduate school.  Even though UCLA’s business school had classes that I could begin right away, in January—whereas, law school classes only began in September—my choice became a law school.  The Vietnam War was raging; and the Army would defer me for law school, but would not let me work for the same amount of time before entering a business school, which is the graduate education that I really wanted to pursue.

Having become a lawyer, however, I have always tried to do my very best, and believe that I have done so.  Also, reading endless legal decisions at Boalt Hall and later at Georgetown, I learned the English language in ways that were unfathomable at the time, but have proved to be quintessentially-invaluable with respect to any skills that I have today as a writer.

The great American poet, Robert Frost, wrote a wonderful poem about life choices entitled, “The Road Not Taken,” which perhaps says it all:

Two roads diverged in a yellow wood,
And sorry I could not travel both
And be one traveler, long I stood
And looked down one as far as I could
To where it bent in the undergrowth;

Then took the other, as just as fair,
And having perhaps the better claim,
Because it was grassy and wanted wear;
Though as for that the passing there
Had worn them really about the same,

And both that morning equally lay
In leaves no step had trodden black.
Oh, I kept the first for another day!
Yet knowing how way leads on to way,
I doubted if I should ever come back.

I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I—
I took the one less traveled by,
And that has made all the difference.

See, e.g., http://en.wikipedia.org/wiki/The_Road_Not_Taken_(poem)

[7] I was adamant that neither of my kids would work on Capitol Hill, because of what I had witnessed there.

See https://naegeleblog.wordpress.com/2010/09/24/washington-is-sick-and-the-american-people-know-it/

[8] A federal official with reason to know told me that between 15-20 percent of the indictees in federal courts are probably innocent.  Some are seniors who have been charged with cheating the Social Security program, and they are scared to death, so they agree to plea bargains rather than fight for their innocence.

[9] This is true of many judges, who serve for life and cannot be removed if they are federal judges.

Is Financial Reform Simply Washington’s Latest Boondoggle?

By Timothy D. Naegele[1]

When I arrived in Washington, D.C. after graduating from law school in California, I spent two years at the Pentagon working as an Army officer in intelligence and budgets.  It was a great experience, and I have the utmost respect for our military, which is the best of our government.  One lesson I learned was that if Congress was breathing down the Pentagon’s neck, the easiest way to deal with the issue was to “reorganize,” which would throw them off the track—and the “bloodhounds” would lose the scent.

Then I worked on Capitol Hill as a young attorney with the Senate Banking Committee, and realized that when there was a national policy issue that was “too hot to handle,” a presidential commission would be formed, not unlike reorganizations at the Pentagon.  Months and sometimes years would pass while people studied the issues ad nauseam; and in the interim, the monkey was off the politicians’ backs.  One of my first tasks on the Hill was to staff such a presidential commission.

Fast-forward to today, and no regulatory “overhaul” is going to make a tinker’s damn in preventing future economic crises or solving the present one.  By and large, the financial regulatory agencies (e.g., the Fed, the FDIC) do a fine job, often under very difficult circumstances.  There are career professionals who will keep doing their jobs, regardless of what Barack Obama or Congress propose or enact—which is high political theater and demagoguery, and not a whole lot more.

Recent reorganizations, such as in the intelligence community, have not produced better intelligence.  Similarly, changes to the financial regulatory structure will not prevent the economic meltdown that riveted the nation in 2008, and continues to this day.  It is a tsunami, and Man’s ability to stop or affect it is marginal at best.  Reorganizing the deck chairs on the Titanic, or closing the barn door after the horse is out, will never address future problems.  The flim-flam boys of Wall Street and other financial capitals will make sure of that.

Alan Greenspan unleashed the tsunami; and the words of Giulio Tremonti, Italy’s Minister of Economy and Finance, are true and cogent to this day:

Greenspan was considered a master.  Now we must ask ourselves whether he is not, after [Osama] bin Laden, the man who hurt America the most.[2]

No financial regulatory overhaul will prevent a Fed chairman like Greenspan, or some other government official from making mistakes that produce massive suffering domestically and globally.  Perhaps if Paul Volcker had been in charge of the Fed instead of Greenspan, the economic meltdown would have been avoided.  After all, Greenspan admitted in testimony before the House that he never saw the housing crisis coming.

Like the emperor with no clothes in Hans Christian Andersen’s fable, no one was willing to call Greenspan a buffoon who was over his head—until he had unleashed economic pain, the likes of which has not been seen since the Great Depression.  It will continue to the end of this decade, in all likelihood; and there is nothing that government can do to stem it.[3]

With respect to the existing financial regulatory agencies, it must be remembered that they and their affiliated agencies (e.g., the FSLIC, RTC) dealt effectively with the savings and loan crisis of the 1980s and 1990s.  In the process, almost 800 S&Ls failed, an enormous financial crisis was averted, and the ultimate cost to the taxpayers was less than expected.

Nonetheless, in 1999, Congress repealed the Glass–Steagall Act, which had controlled financial speculation since its enactment in 1933.[4] Under Glass–Steagall, there had been a separation between commercial banking and “investment banking”—or gambling by Wall Street.  Coupled with Greenspan’s mistakes and financial deregulation, which had been championed by him, a laissez faire attitude in Washington resulted in the massive problems of today.

Can greed on Wall Street and in other financial markets be stopped?  Never.  Can the SEC do a better job?  Can the existing financial regulatory agencies tighten up here and there, and do their jobs better with enhanced powers?  Sure, but the system is not perfect just as human beings are not perfect.  Utopia is not possible; and history repeats itself over and over again.  More government regulation will not prevent economic tsunamis and meltdowns from happening.  Anyone who says so might try to sell you a bridge in Brooklyn next—or ObamaCare.[5][6]

Yet, capitulation to political demogoguery and public anger is likely.[7] With the repeal of Glass–Steagall and financial deregulation, a blurring of the lines between commercial banking and investment banking took place; and now the chickens are coming home to roost.  The baby is in the process of being thrown out with the bath water; and the demogogues in Washington are strutting in full bloom.[8] A Wall Street Journal editorial states:

While the details matter a great deal, the essence of the exercise is to transfer more control over credit allocation and the financial industry to the federal government. The industry was heavily regulated before—not that it stopped the mania and panic—but if anything close to the current bills pass, the biggest banks will become the equivalent of utilities.

The irony is that this may, or may not, reduce the risk of future financial meltdowns and taxpayer bailouts.

. . .

As in health care, Democrats are intent on ramming this reform through Congress, and Republicans ought to summon the will to resist. Absent that, the only certain result is that Washington will be the new master of the financial universe.

Amen, and then some![9]

© 2010, Timothy D. Naegele

---

[1] Timothy D. Naegele was counsel to the U.S. Senate Banking Committee, and chief of staff to Presidential Medal of Freedom and Congressional Gold Medal recipient and former U.S. Senator Edward W. Brooke (R-Mass), the first black senator since Reconstruction after the U.S. Civil War.  He practices law in Washington, D.C. and Los Angeles with his firm, Timothy D. Naegele & Associates (www.naegele.com).  He has an undergraduate degree in economics from UCLA, as well as two law degrees from the School of Law (Boalt Hall), University of California, Berkeley, and from Georgetown University.  He is a member of the District of Columbia and California bars.  He served as a Captain in the U.S. Army, assigned to the Defense Intelligence Agency at the Pentagon, where he received the Joint Service Commendation Medal.  Mr. Naegele is an Independent politically; and he is listed in Who’s Who in America, Who’s Who in American Law, and Who’s Who in Finance and Business. He has written extensively over the years.  See, e.g., www.naegele.com/whats_new.html#articles

[2] See http://www.americanbanker.com/issues/173_212/-365185-1.html

[3] See, e.g., http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html and http://www.philstockworld.com/2009/10/11/greenspan’s-legacy-more-suffering-to-come/; see also http://en.wikisource.org/wiki/The_Emperor%27s_New_Clothes

[4] See, e.g., http://en.wikipedia.org/wiki/Glass–Steagall_Act

[5] Harvard professor Niall Ferguson and Wall Street investor Ted Forstmann state in a Wall Street Journal article:

By all means let us regulate the derivatives market—beginning with a reform that makes it a real market. And let’s clamp down on excessive bank leverage. But let us not believe we can abolish both bailouts and depressions, other than by creating another layer of government regulation.

See http://www.naegele.com/documents/BacktoBasicsonFinancialReform.pdf

I agree with their conclusion.

[6] See also https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/

[7] See, e.g., http://www.naegele.com/documents/AScoldingforWallStreetHonchos.pdf; see also http://online.wsj.com/article/SB10001424052748704830404575200580858688618.html?mod=WSJ_hps_MIDDLEThirdNews

[8] Real problems with the legislation may be considerable.  See, e.g., http://online.wsj.com/article/SB10001424052748703876404575199582764862248.html

[9] See http://www.naegele.com/documents/TheNewMasterofWallStreet.pdf