I can’t stand how free market ideologues smugly talk about the “unintended consequences” of regulation. Everything has unintended consequences — including the conscious decision not to regulate. Get over it and stop with disingenuous, superior argumentation.

This week’s Economist begins with a leader on why fixing the financial system may do more harm than good. In the course of this, they talk about how regulators “are paid less than those they oversee. They know less, they may be less able, they think like the financial herd, and they are shackled by politics.” Shackled by politics, yes: shackled by the likes of the editors of the Economist and other shrill, rigid, market ideologues, too. But as for knowing less, being less able, and thinking like the financial herd, how about this August 2005 paper by Raghuram Rajan, then Director of Research at the IMF, which was done for the Kansas City Fed? It’s called “Has Financial Development Made the World Riskier?” and it argues that financial innovation and the distribution of risk increase overall risk-taking and systemic risk. It was discussed in articles by John Plender in the Financial times in October 2005 and again in 2006. John Plender also wrote in February 2005 that “Resistance to Systemic Risk May be Eroded”. And as early as 2003, Warren Buffet argued in a famous letter to his investors, which was reprinted in Fortune, all the systemic dangers posed by exploding derivatives markets which have subsequently been borne out.

So, contrary to the Economist’s claims, the contours of the problem were already being discussed at the highest levels of policy-making, and in the financial press, well before the crisis broke. Of course, it’s not just free market ideologues who bought the PR about distribution of risk. Well-known socialists also repeated that line, for completely different, but also ideological reasons: a captivating belief in capitalism’s ability to endlessly revolutionize itself. But it was not hard to see the shape of the crisis: I, for one, as an amateur but attentive reader of the financial press, could and did see it.

So the argument that policymakers don’t have the tools or ability to foresee systemic crises is less than persuasive. From the point of view of those interested in better management of the capitalist state, one question to be honed in on is how to identify policymakers who don’t think with the herd. Partly, as Philip Tetlock has demonstrated, that’s a question of temperament: skeptical and pragmatic, as opposed to rigidly ideological. The Economist talks about the financial herd, so let’s name the herd, and the reason why senior policymakers think like the herd. The policymaking herd in question is one to which the Economist belongs: a herd of rigid free-market ideologues who will advocate to put their own in key positions of economic leadership, like the chairmanship of the Federal Reserve. And they will resist every step of the way if someone from outside the herd were to be put in one of those positions.

Corvin is an activist and writer based in Toronto. Currently he is working on the Environmental Justice Organizing Initiative to help build an organized movement on climate change rooted in a class, race, anti-colonial, and gender analysis. Read other posts by Corvin Russell.