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Tough Times for Big Law

Grads turn down offers of $80,000 not to work for a year.

If things are tough at the law firm Cravath, Swaine & Moore, things are tough all over. Founded in 1819, Cravath is not really white shoe—too much rough-and-tumble—so much as it is black ink. Only the lean and mean machine that is Wachtell Lipton has higher per-partner profits than Cravath, which counts IBM and CBS among its loyal clientele.

When I witnessed the job-search drama as a student at Yale Law School, just about the most desirable placement was a spot at Cravath. It didn't seem to matter that even summer associates at Cravath were expected to close Time Warner deals way past midnight. Nor did anyone seem to care that a new hire could regularly expect to have his viewing of Saturday Night Live disrupted by an emergency call from the office. Prestige whores will give it up for their choice currency, and Cravath carries that elite cachet.

Or at least it did. The class of associates that just joined Cravath was asked to defer their arrival for a year in exchange for a sweet deal: They would receive $80,000 to not work, plus they would get benefits and student-loan payments. This offer was optional.

Those who will be joining the firm next year are slightly, but only by a smidge, less lucky: They get $65,000 to put off employment for a year, with the same perquisites, and acceptance is mandatory. While other law firms are making similar overtures to their would-be and even current associates—top-notch names like Latham & Watkins and Skadden Arps among them—when trouble hits Cravath, economic swine flu has penetrated places that ought to be inoculated.

I'll leave it to law bloggers and legal economists to ponder what it is about Cravath's management that led it to this troubled place. But here's something weirder: I've been told that none of the graduates of Yale Law School who were headed for Cravath accepted their offer of $80,000 to surf and sunbathe, or go forth and save the world. Since no one at either institution is willing to discuss this—and I don't blame them, because I would be embarrassed too—I don't know this for certain. But here's what I'm sure of: Not everybody took Cravath up on this peachy keen opportunity to do anything for a year with pay and benefits. And that by itself is disturbing enough.

If even one person said no to $80,000 for bubkes, I'd question the sanity and intelligence of that sole holdout. Cravath recruits the best and the brightest kids from the most highly ranked law schools—and given $80,000 and a dream, all many of them could do was report to work on Monday.

This is cause for worry. I know it's bad enough news when there is bad news in the Motor City and all of Michigan, and it breaks my heart that there's never a good day if your livelihood is dependent on the fate of General Motors (coincidentally, another Cravath client). But New York City is not Detroit, Big Law is not the auto industry, and I dare say that even in this economy, life is still pretty swell at the top of Ivy shoots. The perception that institutions as venerable as Cravath might not be standing in a year's time seems reasonable in an era when even Lehman Brothers, which survived the Civil War but not the Bush administration, came humpty-dumptying down not so long ago.

Or maybe Cravath's fate isn't the real issue. Recently, Supreme Court Justice Antonin Scalia said: "I worry that we are devoting too many of our very best minds to this enterprise." Excuse me? These top-notch law grads, brilliant and bright as the Rockefeller Center Christmas tree when all the lights are turned on, may actually be idiots who lack imagination underneath it all. Maybe they just don't have enough vision to know what to do with $80,000 worth of free time.

Not that sleeping and loafing around Park Slope for 12 months is so bad, by the way. It's probably hard to plan a year off if your wits have been dulled by the Uniform Commercial Code and the Rule Against Perpetuities. Perhaps freedom so great is wasted on youth so stuck. These recent graduates were offered a generous gift in a time of great misfortune, and their response was to look at it askance.

That's not what I would do now, in my 40s, but maybe I would have made the same mistake when I was 20-something. As a wise man once said: I was so much older then; I'm younger than that now.

Miss Wurtzel, a lawyer in New York, is the author of "Prozac Nation" (Houghton Mifflin, 1994).