WHAT IF THERE WERE NO ACCOUNTANTS?

WHAT IF THERE WERE NO ACCOUNTANTS? Bernie Madoff, of course, answers the question for private corporations. From another great Michael Lewis article in Vanity Fair, it seems that the Greek government provides a good example of what a public organization would be like if there were no accountants. (Interwoven in the article is a wonderful story about otherworldly Greek monks and their billion dollar economic successes). I base my view that the Greek government financial accounts are equivalent to what you might get if you didn’t have any accountants on some quotes from International Monetary Fund officials in the Michael Lewis article. The article has an account of how in October 2009 the new Greek government found itself making new daily discoveries about how bad the Greek finances were. (For example: “A pension debt of a billion dollars every year somehow remained off the government’s books, where everyone pretended it did not exist, even though the government paid it.”) Lewis quotes a senior IMF official: “How in the hell is it possible for a member of the euro area to say the deficit was 3 percent of G.D.P. when it was really 15 percent? How could you possibly do something like that?”