In a smart piece of reporting, Erik Eckholm takes a look at how the drop in in federal interest rates is leaving Legal Aid societies high and dry, forcing them to cut back on the lawyers and paralegals who assist the poor with civil litigation.
The rate decline, though generally welcomed as a blow against the recession, has had an unplanned and severe effect on legal aid societies, which depend heavily on revenues that are tied to the federal funds rate. As recently as 2007, the rate was more than 5 percent and legal aid agencies reaped more than $200 million for their operations.
Now, for many legal aid groups across the country, cutbacks in staffing are expected to reach 20 percent or more over the coming months, even as requests for their services have risen by 30 percent or more.
Legal aid groups have long benefited from little-known programs that draw interest earned from short-term deposits that lawyers hold in trust for clients during, for example, real estate transactions or personal injury payouts. The interest is mainly donated to legal services for the poor.
As the story points out, the government is only required to provide lawyers for criminal cases, although losing a civil case can have consequences that are just as serious. Already overworked legal aid lawyers in New York City aren't even able to help more than 1 in 7 people who request their services, and legal aid societies generally assist only half of potential clients. On a day of rememberance for one of the biggest proponents of equal justice under the law, it's an unpleasant irony that so many people lack just that not because of the courts themselves but because they cannot obtain qualified representation.
-- Tim Fernholz
