Corrupt by design

From the NYT:

In a sweeping accusation against one of the country’s largest accounting firms, an investigator released a report on Wednesday that said “improper and imprudent practices” by a once high-flying mortgage company were condoned and enabled by its auditors.

Luckily there's absolutely no need to read this report -- you've already read it hundreds of times. It happened with Enron, it happened with Fannie and Freddie, it happened with dozens of internet companies, and it will happen again.

Of course, The principle at work goes well beyond the accounting profession. We wonder why congress and the president are corrupt even though we all know how they fund their campaigns. We wonder why Moody's rated the monolines AAA until they were on the brink of collapse even though we all know who paid for the rating. And we wonder why there are so many accounting scandals even though we know who pays for the audit. These systems are not corrupt because they are filled with crooks, or because they are not sufficiently regulated -- these systems are corrupt by design.