Martin Wolf, one of the deans of financial writing in the English-speaking world, has a sobering Financial Times column that begins: “Another ideological god has failed. The assumptions that ruled policy and politics over three decades suddenly look as outdated as revolutionary socialism.” He posits that the free-market philosophy post-Reagan has now gone the way of all flesh:

In the chaotic 1970s, few guessed that the next epoch would see the taming of inflation, the unleashing of capitalism and the death of communism. What will happen now depends on choices unmade and shocks unknown. Yet the combination of a financial collapse with a huge recession, if not something worse, will surely change the world. The legitimacy of the market will weaken. The credibility of the US will be damaged. The authority of China will rise. Globalisation itself may founder. This is a time of upheaval.

One vital difference between the 1970s and now, and between the 1930s and now, is that if free markets and globalization are discredited, there is no counterveiling theory of financial organization to supplant them. In the 1930s, there were several–Nazism, Fascism, Communism, even Japanese statism. In the 1970s, Keynesianism and Attlee-ism were ascendant, with free-marketry in the wings, waiting to supplant them. Now there is — what? Ron Paulism? Islamic fundamentalism? Chinese mercantilism isn’t a philosophy, it’s a haphazard approach to growth.

Wolf is surely right that we are going to enter a more regulatory phase, but the economic consequences of tightened regulation will themselves cause a counter-pressure to deregulate to produce more growth.

We’re not out of the free market yet, not by a long shot.