It is nearing the end of the fall semester, which makes for a lot of nervous people here this college town. Many of my own students are frantically attempting to compensate for slacking off most of the fall, suddenly concerned about their grades.
I still find the grading process the most difficult part of teaching. I don't like disappointing people, but that is my job when it comes to handing out some grades. I think I'm pretty easy on my students, yet many don't seem to agree.
I am hired by Front Range Community College to teach the classes and distribute these grades. But, what if I was hired and paid directly by the students? Would I be tempted to hand out A's to everyone, so that they would be happy with me and continue to employ me? Tempted......maybe "compelled" would be the better word.
This came to mind as I read today's story in the NY Times about how the ratings agencies contributed to today's financial turmoil. They were paid to rate securitized debt by the issuers of the debt. To keep the money coming in, and the customers happy, they just kept stamping AAA, even though the entire investment community was trusting them to provide valuable information. This is clearly a conflict of interest, and the agencies pretty much decided in favor of their own short-term profits over their fiduciary duty.
This is similar to the failure the accounting firms who audited the likes of Enron to do their job, pressured instead by the client to deliver the desired opinion. The ratings agencies deserve to get the same treatment that Arthur Anderson got.....pursued legally and run out of business for not doing their jobs.