Wednesday, August 4, 2010

The other side of outsourcing: India protects its own

The New York Times once again shows up tardy to the party and reports on firms outsourcing loads of entry-level legal work to India. Despite this having been a topic of discussion on scamblogs, ATL, and amongst those "in the know" for some time, the publication of a Times article triggers a flurry of new commentary. Which is, I suppose, just fine. The more we can drill prospective students on the rapid decline of this profession and the income prospects it offers, the better. What's really sad is to see my Facebook news feed alight with current students who have "just discovered" this ugly truth and are "worried" about the lack of jobs out there for them. Talk about having one's head in the sand.

Anyway, one major point that the Times overlooks, and much of the blogosphere discussion passed over, is how one-sided this outsourcing and undercutting of American lawyers is. Firms in the Anglosphere have no problem selling out tens of thousands of young lawyers and law students to save a few bucks up front, despite rampant doubts about the competence and quality of Indian doc review chop shops.

Much ire has (rightly) been directed at the ABA for cheerily signing off on legal outsourcing in its 2008 Ethics Opinion 08-451, thereby consigning thousands of future lawyers to underemployment and breadlines. This is a professional organization which is supposed to protect the interests of its members and preserve the integrity, quality, and yes, the economic viability, of the legal industry. Having shirked their duty in the worst way possible, it's only right that they be called out.

What gets less press is that, unlike the American Bar Association, which is happy to bend to the desires of a few big-money players at the top of the legal pyramid and approve outsourcing, India is one of the few countries that does not allow ANY foreign lawyers to practice law there. Faced with a proliferation of foreign lawyers setting up shop, India's attorneys banded together and put the kibosh on the whole affair. Indian lawyers can (for the moment) breathe easy and not have to worry about foreign workers stealing their client base, undercutting their fees, or otherwise leaving tens of thousands of previously-employable lawyers on the street to starve.

From The Economist:
[T]here is one determined outlier among fast-growing Asian economies: India, the only big country that is closed to foreign lawyers in any capacity. A powerful lobby—ranging from hundreds of thousands of small (often husband-and-wife) practices to a handful of leading partnerships—resists change. Foreigners who tried venturing into the Indian market are still reeling from a decision in December by the Bombay High Court which deemed illegal the “liaison offices” that some outsiders had opened. The Indian government said (rather half-heartedly) that it would appeal against this ruling. But the climate in which law-related work could be undertaken by outsiders has gone from difficult to prohibitive. Reena Sengupta, a London-based consultant, says she used to see foreign-owned legal-research operations in India where beds, not desks, greeted the visitor; such was the keenness to dispel the impression that law was being practised. Now those offices have simply closed.

Indians who need world-class legal advice lose out, says Stuart Popham, a senior partner in Clifford Chance, a London firm, who this week accompanied David Cameron, the British prime minister, on a tour of India. The effect is “to restrict supply and competition and raise prices…you have to fly clients out to meet lawyers elsewhere.” A lot of Indian-related work is done in the more liberal climate of Singapore. Mr Popham says he is frustrated by some Indians’ contention that firms like his own will inevitably take away local jobs. “Liberalisation does not take away anyone’s job…the evidence is that no country has ended up with a smaller domestic legal community after opening up.”

For the Law Society of England and Wales, getting the Indians to free up their market is high on the wish-list. “We want to invest in India’s potential to become a global legal player…this means new work coming to India,” insists Alison Hook, the society’s head of international activities.

But much of her target audience is, as yet, unpersuaded. “The Indian profession will rise up in arms if [foreigners] want to open offices here,” says Lalit Bhasin, head of the Society of Indian Law Firms.

Between the ban on foreigners doing Indian legal work, and the proliferation of Indians doing foreign legal work, it must be a pretty good time to be a lawyer over there. If only our American Bar Association and cohorts had a sense of duty to American lawyers and the legal industry itself, we might see more legal jobs for the legions of unemployable, desperate law graduates. Granted, they will be entry-level, low-paid, and not particularly intellectually challenging. However, when faced with long-term unemployability, or hourly doc review wages, any starving American lawyer will take the doc review gig. Even before 2008, hourly doc review was the bread and butter for many graduates of non-elite schools, and allowed for a somewhat sustainable, if miserable and precarious, existence. Now, even this low-rung safety net has been shipped off to India.

It's a sure bet that nothing will be done to stop the hemorrhaging of legal jobs overseas, just as nothing will be done to turn of the spigot of newly-admitted law students who rush into law schools in ever-increasing numbers, paying tuition that increases by leaps and bounds every year, without fail.

6 comments:

  1. So Biglaw is becoming Wally World of the Western corproations. Hello China and India.
    If any attorney pays thier student loans they are nuts.

    ReplyDelete
  2. In fact, the ABA pigs are approving more law schools. The ABA clearly does not give a damn about the average small-law practitioner or recent graduate. Instead, the idiots approve more law schools, which will lead to even greater oversaturation of the U.S. lawyer market.

    Just like the federal government does not impose trade tariffs to stem the flood of lost American jobs - and to provide a disincentive for U.S. corporations to offshore entire industries. Instead, these tools/handpuppets want more "free trade" with countries we cannot compete with - on a wage scale. In fact, the morons want to fast-track "free trade" agreements.

    Hell, Judas the Pig sold out for 30 pieces of silver. Not much has changed in the last two millenia.

    ReplyDelete
  3. It is a great idea that we might see more legal jobs for the legions of unemployable, desperate law graduates. Granted, they will be entry-level, low-paid, and not particularly intellectually challenging.
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  4. Today, more organizations are embracing the concept of outsourcing in order to lower costs and increase their business efficiency and productivity.

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  6. The Hindu, and most third world baby machine states, do not even contemplate right or wrong, its take and racial-tribe protections. Even states that 'allow' foreign lawyers in theory, really don't. I had a buddy wanting to practice in Korea for social reasons; after submitting the bar twice, with never receiving a reply, he got the point.
    Our Western elite cares nothing about 'keeping it in the tribe.' They'll sell us out for a lark, probably thinking they are progressive and hip for their tolerance, all the while pursuing Freidman economics.

    ReplyDelete