Maybe We Need a Recession

Another day, another deal gone bust. Such is the course of the emergency bailout. And the sweet thing was that it wasn't the Republicans that derailed it, but Democrats who value their reelection more than a shot at Nancy Pelosi's sagging political tit (the real thing is too horrifying to contemplate). Nevertheless, the failure shows that people are finally beginning to distrust Washington to the point that they may welcome a recession rather than more government intervention and entanglement. This idea gives me more hope than anything.

Someone on Fox News was using the analogy of a fire today while describing the economic mess. And while I've been having the thought that inspired the tile above for a while now, the analogy of a forest fire is exactly the way to explain how to solve the lovely mess that the continued infection of the free market by base politics has created.

A healthy forest is marked by greatly varying life and cover, from stands of old growth trees to brush and edge territory. I particulary like the edge territory myself, because it also happens to be prime deer habitat (woo hoo, the season's a'comin'). But if you hadn't noticed (and if you've ever raked leaves or cleaned up after windstorms, you know this), trees tend to shed a lot of shit, dropping leaf and bough. And eventually they fall over. The result is that a lot of stuff builds up on the forest floor. One of the mechanisms that exists to clear this out is fire. A fire in an untouched area will burn until it has consumed all the junk at ground level, burned the dead trees, and cleared an area. Then life can continue. Fire can often cleanse a diseased area and benefit all.

Enter Smokey the Bear, who was at the icon of the forestry services efforts at preventing and stopping forest fires. The result? After a century of this, a fire starts and burns the shit out of everything, including the big trees. In essence, by introducing artificial mechanisms to stop fires, the shit on the floor piled up until it could no longer be contained and we have an assload of destruction.

A free market economy is the same way. Anyone who's had basic economics is familiar with the idea of the cyclical economy. This means every 7 years or so, we can expect some kind of slowdown or recession. The last one was 7 years ago. It certainly sucks for some people, as businesses fail, jobs are lost, and the deadwood is burned away.

But in their infinite wisdom to spare people this pain, to stimulate the economy, to create "affordable housing" and to buy votes, various politicians over the years have created all kinds of ways to artificially protect us from these periodic burnings, these cleansings that allow a free market to not spin out of control.

The result is a meltdown of a major segment of the market. And while we are trying to control fires, a lot of that which needs to be burnt away is burnt away. While this means people will lose money, and it will most certainly make things harder on many people, perhaps it is also a good thing.

Now the Congress will eventually get a bailout through, and Bush will sign it. Hopefully, by the time things have been fixed so that they can get the votes to pass it, they will have taken as much waste and politics out of it as possible. Also, I hope that whatever they come up with, it will address the problem. But the window for acting before the coming recession gets too bad is closing. Lets see if our leaders can figure out how to lead for once.