Why Bailouts are Not Working...

..and why a War just may

Why are we going through a recession, and maybe even a Depression (ala the Great Depression, not the Prozac variety)?

Quite simply, the very existence of a major recession means we are not buying as much as we used to, so we don't have to make as many things as we used to, and so we are planning, building, selling, buying, consuming and wasting less than we used to last year, or the year before, and so forth.

And why are we not buying as much as we used to?

That depends on who you ask, what they do, who are their friends, what they read in kindergarten, and so forth. Because there can be several different reasons for why we are not buying, there are several different prescriptions, and several different black-holes to fill with the green-back stuff -taxing the future (aka tax rebate), bankers' bonuses, deep-discount gas-guzzlers, over-priced mac-mansions, green stuff in place of the greenhouse stuff, and so forth. So on we go, filling these holes merrily along, writing about it, thinking about it, and talking about it round and round in big round buildings.

Yet it does not seem to work. Even though we keep wasting other people's money, increasingly there seems to be less things that are really need, less things that can be sold, less things that need to be built, and less things to spend all that money on. How come???

In short, the answer seems to be that we have way too much of what appeared like good things: people and knowledge. Yeah, too much knowledge and too many people!

Used to be there were these real dumb hunter-gatherers who barely used to get around doing much hunting or gathering to eat even one mammoth steak a month -let alone getting any beer or watching any TV. Then some smart Alex's figured out this fire thing, then the wheel thing, then moving that wheel thing with that fire thing, and before you know: TV, internet, cars, light bulbs, shampoos, spam, champagne, politics, religion, and a whole bunch of people to make, sell, and talk about all that stuff.

Things were going pretty well. We needed more people to make more stuff, yet more people to think up yet more stuff, and that meant more people to buy more of that stuff. It all sorta made sense.

Except that we forgot of a few small little details. Everything we make, we make them so people can use them in useful ways in their life. Yet we couldn't extend the hours in the day, the days that people live (beyond a limit), or to evolve people into more diversified and/or advanced beings that had needs any more fundamentally different from those mammoth-hunting apes -i.e. food, den, fake-skin (aka clothing), and a fermented mammoth-steak induced urge to explain to another ape about who put all those blinking lights over their heads at night. And that meant that there always remained this fundamental limit to what we could make -they needed to be things useful to these apes during the waking hours in their lifetime.

Also, as we got smarter (i.e. created more knowledge) we started figuring out how things work, and why -to an extent at least. So we got really good at making the same things over and over to make many different copies and variants of many kinds of stuff -at times with nothing but yet another set of stuff (machines). Which meant that as soon as we could think of one more thing our fellow apes may need during the waking hours in their lifetime, wallah! we could make enough of them to have one each for every ape and then some.

Not only that, we also got smarter at how to spread our smartness about -i.e. how to teach our fellow ape what we just learnt. Forget the spear-meister teaching his clan juniors how to spear a mammoth over an entire boring season. Now we can write, read, copy, store, fetch and distribute knowledge at the speed of light, with the stroke of a key -to half the world and counting.

What all this means is that while there is a limit on what we would need (things useful to these apes during the waking hours in their lifetime), there is no limit to what we can make, with how little effort we can make them, and how many people can make the same things. Result: inflexible demand meets ever-increasing supply. That means once the output of all our knowledge applied by all who have them crosses the limit of what we can possibly need, we are on the slippery slope to needing lesser and lesser of all that new stuff we can keep churning out. And that means recession, depression, and the race to the abyss. And if anything, pouring more money to help produce more things only makes things worse by increasing people's ability to create more things faster without raising the fundamental limit to demand. That's why the bailouts are not working.

So how can we get out of this?

Well, if the problem is excess of knowledge mixed up with excess of people, we can solve it by reducing either one. As it turns out, because we got so good at writing, reading, storing, and fetching knowledge -over distance and time- it is not fundamentally possible to destroy knowledge once it is created. That leaves the option of reducing people. How do we do that?

As it turns out, our primordial ape comes to the rescue. Our cousins, chimps and baboons, are not just cute little furballs living in a big happy family as we used to think. They can sometimes get downright nasty, fight each other, kill in organized groups, and play such other unnecessary havoc (stuff we call war) that their numbers in Africa are downright lousy low compared to what they could be if they simply left each other alone and tapped into all the food sources and grazing grounds they could have -even with their arguably limited brains.

So if our lesser fellow apes keep their numbers low by creating such unnecessary havoc with nothing but their bare claws and teeth, we with our knowledge of all kinds of weapons, machines, and subatomic particles, can surely do better. In fact, when we get down to it, we really do much better at War. After all we wiped out 70 million people in the second world war alone -100K with just one bomb!

Maybe that's what we need then -a War to end all recessions (or at least this one). After all, it has worked before -with the Second World War, Spanish American War, and so forth.

Who do we fight, and why? Who cares? The chimps don't.