According to conservatives, we always see that outcomes yield to the intendencies of aristocratic authority. Existence on demand from the bottom up, they say, is delusional. What immediately occupies space over time is not democracy but oligarchy. While, for example, we see a tendency to regulate elite behavior with bureaucratic authority that meets the demands of non-elites (attempting to approximate democracy by representative means on command, by rule of law), the power elite have the last call, naturally yielding to an aristocratic identity.
Political-economic analysts refer to avoiding regulatory risk as “regulatory arbitrage.” By the time regulators respond to innovative ways of avoiding legal liability, industry and markets are well on their way to the next adaptation. What we see is the operation of “emergent property” in which systems become more complex. Authors like David Kay Johnston describe in detail much of the complexity that yields to income inequality, for example, but there is always enough space available to render those particular observations obsolete. What endures is the philosophy of risk in operation.
Risk identity is not the typical tool of risk analyses. More the realm of philosophy, identity is not technically objective. There is not an exact ratio to work with. Look at any particular analysis, however, and notice there is an existential hypothesis related to the ratio of risk-to-reward.
(While existential hypotheses can be analytically reduced to “assumptions,” for the medical practitioner, for example, the risk of loss is fully assumed in priority. The practitioner knows that all the probable risks cannot be accounted for. Despite all the best practices, yielding to the intendency, there is still a natural tendency that yields to a risk ontology whether the practitioner is aware of it or not.)
Conservatives reduce the risk-reward ratio to the “makers” and “takers” identity. The working hypothesis is that the “takers” will take more than they deserve if the “makers” don’t. Without making capital, derived from the reward the takers don’t take, there are shortages. Since there is a tendency to fight over limited supply, we naturally tend to the formation of a capital supply, yielding to an aristocratic identity.
Risk is regulated by means of perceived identity. The tendency to pillage and plunder is regulated by the capital, arbitraged by argument in the futures.
Winning the argument values the identity. According to conservatives, losing that identity causes crises, and resolving crises (naturally recurrent, stochastically determined like the econometrician says it is) always confirms our natural-risk identity.