The AAA four centers approach was illustrated in the President’s speech by questions that each center might deal with as part of its mandate.
The centre that was to focus on public policy and thought leadership (i.e. the public interest) was illustrated with a question that is a fair bit beyond the remit of accounting “What are the effects of national debt on households in the future?”
Excuse me????? What in our background as accounting scholars and teachers that gives us a comparative advantage in answering such a question or posing public policy solutions to such a question?????
I am pretty confused by that one. Yes some of accounting academy have micro-economics training but look at what happened with micro-economic theory (i.e. agency theory in this case) was used to set macroeconomic policy. In September 2008 the then US Secretary of the Treasury said that firms had to be allowed to fail in order to deal with problems surrounding moral hazard thus justifying his decision to let another financial institution go under. Indeed on the last Friday in September he left the world with the thought that AIG needed to pay the same price that Bear Sterns and Lehman Brothers had paid. Luckily at the last minute he changed course and lead a what eventually became a highly profitable rescue of the insurance giant AIG. Most economists and bankers believe that allowing AIG to fail (the largest insurer to many of the world’s banks) would have resulted in an implosion of the world economic system that would have made the 1930’s look like a decade of prosperity.
So I am not so certain we would want those accounting folks toying with macro economic questions. Nor do I feel especially certain that psychology or sociology based researchers have any more to offer on such a question.
So while it is important for accounting academics to become engaged in larger questions in our society, it should be about institutions and issues that we have an comparative advantage in studying. Securities laws and practices, the regulation of public and private companies, the supporting of the not for profit sector, government accounting and getting it right accounting rather than the politically expedient slight of hand accounting that is so often practiced, issues about taxation and fairness of such systems, the quality of auditing and how to make it work better, and so on and on and on. These are all issues that accounting scholars have some comparative advantage in. Commenting on those issues would be talking in the public interest based on our knowledge rather than our lack of knowledge.
So lets stay away from questions that we have no basis for addressing. It would be a sad day if an accountant is widely quoted about the effects of the national debt on households in the future!