THE BLOG
11/24/2014 05:19 pm ET Updated Jan 24, 2015

Budget Like a Freak: The Economic Benefits of Free Legal Aid in Civil Cases

The economists at Freakonomics recently highlighted the work of the Copenhagen Consensus Cente, which engages with import public policy issues through the lens of cost-benefit analysis.

To gain an appreciation for cost-effective social programs that can deliver desperately needed services and reduce human suffering, they should set their sights on the value of providing free legal assistance to low-and moderate-income individuals and families and the positive impact such services can have on other parts of government budgets, let alone improving lives.

Shocking numbers of low-and moderate-income Americans face their legal problems without a lawyer. By many estimates, roughly 80 percent of poor Americans and 50 percent of the middle class confront their legal problems without legal representation, often with very bad outcomes. People face eviction from apartments, foreclosure of their homes, and claims of significant consumer debt that can end up impairing earnings for years, all without the assistance of a lawyer. Even for those eligible for free legal assistance through publicly funded civil legal aid programs, far more eligible individuals and families are turned away due to limited staffing and funding than actually receive assistance.

These figures are shameful in a society that prides itself on supposedly having a civil justice system that metes out equal justice. Making matters worse, denying full funding for free legal assistance to those who need it simply doesn't make fiscal sense.

A recent story in the New York Times poses this simple question: does funding for legal aid in civil cases actually save funds in the long run? The answer is yes. Providing free legal assistance usually doesn't just pay for itself, but often produces genuine and tangible cost savings, not to mention the savings in the human costs associated with evictions and foreclosures, to name just two things lawyers can prevent. The Times story references one Massachusetts bar study that shows that for every dollar spent providing representation to families and individuals in housing court, Massachusetts would save $2.69 in costs associated with providing other services.

Looking just at evictions, lawyers can make a difference by defending tenants in housing court and preventing homelessness. Comparing the cost of providing a lawyer to prevent eviction to the cost of providing shelter to a family that becomes homeless is staggering. A legal aid office can typically provide representation to a family for no more than $3,000 a case (and many have contracts and receive grants that do this for a lot less). At the same time, the cost to the municipal government of providing a family with shelter, in a place with high housing costs like New York City, can easily well exceed $35,000 a year.

Focusing on New York City, where there are nearly 60,000 homeless, a 1990 study by the New York City Department of Social Services estimated that the costs savings associated with eviction prevention services were substantial. For every one dollar spent on such services, the city saved four dollars in the costs typically associated with homelessness.

Similarly, calculating the cost to the City of New York of providing services to homeless people in 1992, and comparing that to the cost of providing legal services to all families eligible for free legal services under such programs' guidelines, one estimate found that the City could save a net amount of nearly $67 million (in 1993 dollars), by providing counsel to all income-eligible families in New York City's housing court.

A more recent study, in 2005, posited that the prevention of even ten percent of the 25,000 evictions carried out through New York City's housing courts each year would "yield a savings to the City of roughly $75 million in direct shelter costs alone." (Other fiscal benefits of civil legal assistance are compiled by the National Center for Access to Justice here.)

Every study that has looked at the potential costs associated with the provision of counsel to indigent tenants in housing courts, at least in New York City, has estimated that considerable cost savings would follow the provision of this right because fewer families would lose their apartments, become homeless, and enter the shelter system. What's more, in a city with rent regulation like New York City, where affordable rents become unaffordable once an apartment becomes vacant, an eviction of a rent regulated tenant means a unit of affordable housing is gone forever.

Moreover, the human costs associated with homelessness are incalculable, as families face mental anguish, lose days of work and school, and are exposed to disease and stress as they attempt to navigate and survive in the shelter system. A lawyer can often make the difference between homelessness and having a family keep its home. With more free legal assistance for low-income tenants facing eviction, there would be fewer disrupted lives, fewer families exposed to the physical and mental health risks associated with homelessness, fewer lost days of work and lost employment because of the disruption of eviction, and fewer days away from school and school transfers.

Given these compelling facts, why have we failed to make more progress in establishing a right to counsel in cases in which a family's shelter is in jeopardy, let alone other areas of profound human need, like termination of food stamps and other benefits? Studies from just one city, where homelessness is high and housing costs skyrocketing, show clearly that improving free legal aid for tenants there and, no doubt, in other cities facing similar housing burdens and shelter costs, would seem to make complete sense, just from the cost-benefit analysis alone. And this doesn't even address the human suffering the provision of legal services prevents.

In a society that is supposed to believe in equal justice, when too many go without access to a lawyer, we are not living up to this ideal. Making matters worse, denying equal justice doesn't even make fiscal sense.