Life Without Lawyers: Taking It on the Chin
A well-known investment banker confided recently that lawyers are partly to blame for the financial meltdown. Why, apart from wanting to deflect the responsibility to someone other than bankers?
The reasoning was that, particularly with the advent of Sarbanes-Oxley, lawyers have become such an integral part of the business process that their bias toward risk-aversion has seeped into the bones of corporate decision-making, making those decisions technically compliant but shortsighted from a policy and business standpoint. Life without lawyers, or at least life with fewer lawyers, according to this highly-respected viewpoint, would improve business and the economy.
Covington & Burling partner Philip Howard arrives at a similar conclusion for somewhat different reasons. He contends in his new book "Life Without Lawyers" that a fear of litigation has stricken many of America's industries, including both health care and education, paralyzing doctors and teachers, among others. "It's as if everyone has a little lawyer on their shoulder whispering in their ear all day long," he says. Howard argues that the economic crisis presents a needed opportunity to overhaul the legal system. With an activist president and a Congress controlled by Democrats, he sees major structural changes on the horizon.
"An essential component to making anything work that's broken is rebuilding the legal infrastructure," Howard says. It's harder to change the rules in times of prosperity, he says, but the challenging times ahead could initiate just such a reset.
A recent series of front-page New York Times articles reports that worker-compensation programs, designed to fairly and efficiently compensate workers for workplace injuries, is neither: bureaucratic gridlock and expense have resulted in a high-cost system for employers that is slow and inefficient in compensating deserving employees. Who is to blame for these problems? Lawyers. Both those working inside these programs and those on the outside who made a "fair and efficient" alternate system necessary in the first place.
Finally, if you are not already doubled over from guilt, a Talk of the Town entry by Jane Mayer in the April 13, 2009 issue of The New Yorker recounts the research of English barrister Philippe Sands into the activities of the six Bush Administration officials, including William J. Haynes II, former Pentagon general counsel, who are being sued this week in Spain for the torture of Spanish citizens at Abu Ghraib. Sands' conclusion: "I've got a particular bugbear about lawyers. If not for lawyers, none of these abuses would have ever occurred."
So there you have it. Not only are our finances in disarray but our reputations and future prospects are sinking faster than a rock.
There is no doubt that data shows that lawyers are more risk-averse, analytical, pessimistic, short-sighted and zero-sum out-to-win-oriented than their business contemporaries/clients. Those same attributes often are what makes them good lawyers--able to see and remedy highly technical compliance and other problems that others cannot and win verdicts for their clients in a zero-sum justice system. But, as with all good things, there are also downsides.
One challenge that lawyers are going to have in the new age dawning is to refashion in a major way at least the perception and probably also the reality of their impact on business and the economy. The (very) old perception of lawyers as trusted advisors has given way to something closer to that of self-interested leeches who manage to rain on everyone's parade while siphoning off a percentage of GNP.
As always, it is the balance that is key. Lawyers can genuinely assert expertise in a number of areas that business people need and lack. And lawyers should be compensated for that expertise. And certainly lawyers are obligated to take stands to protect their clients and to avoid allegations against themselves of malpractice or furthering crime. However, maintaining respect for the business process, even when it differs from how lawyers would do it, structuring your practice (and your fees) so that reaching the goals the client sets is the driving force, remaining cognizant of the lawyer's role of delivering services rather than achieving dominance-- these are changes of attitudes easier advocated than done.
How to accomplish those changes is not found in any class any of us took in law school. A careful look at each firm's practice, its values and its strategic plan--and how those influence client service and associate and leadership development on the ground, rather than just in classrooms--is a critical first step to finding the appropriate balance.
Law People Management, Inc.
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