Friday, 6 January 2012

PI(I)GS Might Fly!


The Troika is upsetting big bar associations because it is demanding the liberalization of professions in countries it is bailing out. Key complainers are the American Bar Association and the CCBE. (Thanks to Peter Lederer for the H/T).

The Wall Street Journal Law Blog reported that the ABA and CCBE have written a letter to Christine Lagarde, head of the International Monetary Fund and former head of the world's largest law firm, Baker & McKenzie, asking her to pass on their concerns at the end of independence of the bar to the heads of the European Union and the European Central Bank.

The WSJ Law Blog says:
The American Bar Association and the Council of Bars and Law Societies of Europe say measures in Ireland, Greece and Portugal threaten “one of the core principles of the legal profession: regulation independent from the executive branch of the state.” 
Although only three countries are listed we know it won't be long before Italy is included once it receives its subvention from the Troika.

I've analyzed some of this before and it's clear that the Troika isn't signalling the death of the legal profession. Far from it, it is demanding proper regulation and accountability which lawyers have avoided. Colin Scott, dean of UCD Law School, cogently argues:
It is not unprecedented for government to appoint independent regulators to oversee the legal is normal for independent regulators within our system of democratic governance to be subject to a variety of mechanisms of accountability to ministers, not least to provide reassurance that the regulator will not be captured by those it is set up to regulate. Few are wholly independent in a modern state better characterised as exhibiting characteristics of interdependence. As an example, the legal profession is dependent on the state for fees across much of the criminal justice system and in respect of many civil matters too. No one argues that the taking of instructions and fees from government compromises the professional independence of lawyers.
There are two strands to the Troika's thinking on the legal profession and professions more generally. The first is proper regulation as Colin Scott refers to above. (And, in the case of Ireland, for example, the Justice minister is being responsive to concerns.) The second is that in many countries the professions are closed off from many who would like to participate. Not because they are incapable but because they don't possess the social capital that enables them to enter and practice. (Ample cites on professional closure here.)

The Troika's moves are an attempt to open up the labour market so it is accessible to all not just a few. One only has to look at how many law firms in continental Europe are dynastic family organizations.

Unfortunately, when the ABA and CCBE says
Bars and Law Societies around the world have always been open to reform: they follow very closely societal, economic and any other changes within their own countries and worldwide, evaluate the impact of these changes on the profession and take the necessary steps to adapt.
 it is very hard to believe them. I don't think the IMF will budge and nor should it.


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