The cover story in the current issue of The New Republic, about how being a corporate lawyer is even more terrible than it used to be. In the article, Noam Scheiber explains how the revenue stream coming into big law is in permanent decline, and it’s turning big law firms into Lord Of The Flies.
It’s one more datapoint vindicating my decision to become a banker rather than a lawyer.
When I was finishing college, I didn’t know what I wanted to do with my life. Like a lot of directionless Harvard students, I took the LSAT and planned to go to law school, almost as a default choice.
But when I was a senior, I realised I wasn’t sure enough that I wanted to practice law to be willing to take on north of $150,000 in debt.
In search of a more cost-effective way to delay my decision about what to do with my life, I became a corporate banker. People often talk about banking as the worst of the soulless sellout professions you can take your Harvard degree to. But for me, it was a great choice.
From 2005 to 2008, I worked for Wells Fargo in their commercial real estate lending division. I worked on construction financings in New York and Washington and unsecured loans to Real Estate Investment Trusts.
Broadly, my job involved defending the choice to make a loan against a given piece or pool of real estate, either to loan officers inside the bank or to outside investors interested in buying Wells Fargo’s debt.
What I learned in this job has been hugely formative for my later work as a policy researcher and a journalist.
I learned how to distill a wide variety of numerical and abstract information into a brief, easy-to-read memo for an audience of readers who are smart but busy. This was ideal training for writing policy briefs and op-eds.
I learned how to make oral presentations of that information and be prepared to answer questions on the fly. This is why TV and radio interviews don’t stress me out: Wells Fargo’s credit officers are much tougher than any MSNBC panelist.
I learned about zoning, rent control, property tax credits, brownfield cleanup, and many other land-use policy issues that I write about today—and I got to see how policy in these areas affected the choices of real estate developers.
And I learned that being a lawyer sucks. As a junior banker, I had to take orders from a lot of people: my boss, internal credit reviewers, clients, regulators. The only people I got to order around were the lawyers.
I worked on one deal with a complicated financial structure, and our expensive Biglaw attorney kept failing to accurately describe the structure in the loan agreement. He excused his errors by saying he’d become an attorney so he wouldn’t have to do maths. I asked him how many hundreds of dollars an hour we’d have to pay for a lawyer who could also do maths.
I was 22, and I was being a dick. But I was also right.
Even when the lawyers weren’t screwing up, they were always having to be solicitous, stay late, and turn documents around as quickly as possible. And in 2007, as the real estate markets started to cool, they started to seem desperate.
I remember one night in 2007 or 2008, two law partners visiting from San Francisco took me and another fairly recent college graduate out for dinner because free food, even of the fancy variety, wasn’t that appealing to more senior bankers. That they felt the need to schmooze me was not a good sign about the state of the industry. Their firm liquidated by the end of 2008 as real estate deal volume declined.
Of course, 2008 wasn’t a great time for banking, either. As with corporate lawyers, bankers increasingly face scepticism about whether the services they provide are even useful. But Wells Fargo was doing much better than its peers because of the bank’s unusually sane attitude toward credit, and the sort of vanilla lending I was doing there remains in much better standing than more exotic products.
In other words, I could easily have stayed in banking if I had wanted to. But by 2008, I wanted to get out. In one key way, banking is very similar to law: getting more senior would mean spending less time doing financial analysis and more time sucking up to clients, and I didn’t like sucking up to clients.
Plus, I didn’t wake up in the morning excited to underwrite the next loan. I wanted to do something else.
Since I was a banker instead of a lawyer, this was fine. I didn’t have three years’ worth of grad school debt tying me to the industry. I took a pay cut and went to work for the Tax Foundation, doing research on state and local finances.
I didn’t have an economics degree or any experience in public finance. I got the job in part on the strength of a sample policy brief I wrote about an issue I’d become interested in at Wells Fargo: how falling Mortgage Recording Tax revenues were about to cause a fiscal crisis at New York’s Metropolitan Transportation Agency.
It’s the first policy research document I ever wrote and, five years on, I think it looks pretty good. Indeed, the MTA would go on to need a fiscal rescue from the state legislature, which imposed a new payroll tax in 2009 to prop up its budget. And its content and structure were informed mostly by my experience writing deal memos at the bank.
A lot of people talk about law school as doing more than preparing you to practice law, but teaching you how to think. Some people even defend the insane idea of getting a graduate degree in journalism. For me, banking provided a way to improve my analytical and writing skills and grow up a bit while drawing a salary instead of paying tuition.
I’m glad a not a banker anymore. But I’m also glad that I was one for a time—and that I never became a lawyer.
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