After the financial crisis regulators, central bankers and politicians all agreed that we needed more financial regulation. Despite their failings they wanted their powers enhanced – especially at the international level.

Indeed, even the Catholic Church got in on the act when its Justice and Peace Council released a document on the future of the financial system. Cardinal Turkson, president of the Council, then repeated the calls in that document for world government of the financial system in a recent lecture at the LSE. In his lecture, there was a sketchy and somewhat flawed analysis of the financial crisis, some baffling assertions about its effects on the distribution of wealth and the usual inaccurate analysis about the prospects for the world’s poorest people, all inter-linked with some important messages about ethics which sadly are likely to have been overlooked by most people.

In the lecture, his call for an international authority was blunt. He described the creation of a world public authority as being the only horizon compatible with the realities of our time: strong words.

Interventions like this should not be dismissed as the irrelevant meanderings of a cleric. Churches can be important in forming opinion in important places on this sort of issue. Indeed, it was an intervention by the Archbishop of Canterbury on the domestic scene that set off the chain of events that led to the government proposing charge caps on consumer credit loans.

The Cardinal seemed to ignore the fact that we already have international regulatory institutions in many forms. George Osborne has been in the vanguard of support for a banking union in the euro zone. The EU has centralised other aspects of financial regulation to the extent that our domestic regulators almost act as mere branches of the European Securities and Markets Authority. Furthermore, the Basel framework for regulating bank capital has been with us for around 25 years.

I would not argue that the people who call for more international financial regulation are doing so out of self-interest – though that might be a motive. However, perhaps the people who bestride the international stage have too much self confidence that the sort of institutions they run can resolve the world’s problems.

Indeed, international banking regulation has certainly not been an unalloyed success. Arguably, it has been a complete failure and a major contributor to the global financial crisis. We had just 20 years of the Basel Accord before we had one of the biggest banking crises in world history.

The first problem with international financial regulation is that it makes regulation more uniform. As such, if we get it wrong, we get it wrong across the whole world at the same time. Central banks talk a lot about systemic risk – the problem that if a bank fails it might bring down the whole system. As a result, we have recently being trying to find ways to ensure that banks can fail whilst the banking system is not brought crashing down with it. International financial regulation raises systemic risk by raising the likelihood that things will go wrong in several countries at once. Indeed, interestingly, one of the countries that suffered least from the crisis – Canada – took a different approach to regulation from that imposed by the international Basel Accord.

Secondly, international financial regulation is ‘one-size-fits-all’. One of the reasons for the complexity of such regulation is that financial systems are so different and there are enormous difficulties designing regulations that are appropriate for different countries. The complexity of international bank capital regulations is at least partly responsible for the increase in the complexity of the banking system and the box-ticking, anti-judgement culture that developed in banks.

In addition, international regulators are not really accountable to anybody. Achieving accountability for domestic regulators is difficult enough. But how do we ensure that the Bank for International Settlements is accountable to the people whom it is supposed to serve? Does anybody know who it is supposed to serve? Such institutions can, literally, be a law unto themselves.

Indeed, Cardinal Turkson should reflect on this. Catholic social teaching on the role of the state is very clear – the state is there to serve the people. But, how can we possibly stop a world authority from serving itself? Accountability at the level of the European Union is impossible to achieve and that institution has a parliament as well as a council ostensibly controlled by the governments of member countries. How much more difficult would it be to achieve effective accountability for a world regulatory authority?

Instead of expanding international bureaucracies accountable to no-one, there is one worthy but much smaller ambition that governments would be right to pursue. Through international co-operation, it is important that any bank operating internationally can be effectively wound up without bringing the banking system down. That is a worthy aim and one that is achievable.

However, we should accept that government-led international financial regulation has failed. We do not need more edicts from Brussels or from Basel. As for Rome, Cardinal Turkson’s comments on ethics are important and noted but, with respect, he is no expert on international financial regulation.

This article was first published by the Daily Telegraph.