Regulatory philosophies are converging, too. Former British Prime Minister Margaret Thatcher's famous injunction that "you cannot buck the market" was part of the regulatory mind-set in the pre-crisis Anglosphere. And former Federal Reserve Chairman Alan Greenspan resisted any attempts to rein in the "animal spirits" of the wealth creators on Wall Street. The Chinese were less ideological. They had no compunction about calling a bubble a bubble, or in intervening to deflate it. Now, only Sarah Palin reveres Thatcher's views on all issues, and Greenspan has been airbrushed out of financial history, Chinese-style.
When the G-7 morphed into the G-20 in early 2009, many were understandably worried that, with such a diverse range of participants, coming from such different traditions, it would be difficult to achieve consensus on regulatory matters in the Basel Committee and elsewhere. These concerns turned out to have been overstated. The elements of a broader consensus on the future role of financial regulation are in place, as long as Americans like Geithner can resist their constant desire to tell the rest of the world to do as they say, not as they do.
This article comes from Project Syndicate.