Jurassic Park

The current financial crisis has re-awakened an idea in me.

Extinction, and why it happens.

Now, it's generally agreed that changes in environment can cause extinction. So, then, why do organisms go in directions that make them vulnerable to extinction? I think there are two poles - one goes for maximum energy accumulation, the other hedges on not being left out of accumulating energy. Maximum efficiency says grow large, that way you're pricing yourself out of the market of most predators. Or better yet, get an energy source that nobody else can touch and that you own exclusively so you don't have to grow large.

This is all speculation, of course - but these strategies only work if the environment is stable. In instability, what were assets become liabilities. Generalists and smaller creatures survive while large creatures and extreme specialists suffer.

Now, look at the companies in the most trouble right now, and it turns out they are large, large companies. Large specialists companies are virtually dead (all of the investment banks were subsumed or liquidated), while other large companies continue to suffer and threaten to go under.

Going back to biology, what would it take to keep a diverse environment stable? More generalists, smaller organisms. In the massive habitat destruction that has taken place since industrialization, smaller organisms (mice and pests) and generalists (skunks, foxes, coyotes and so on) survive and even thrive. In a free market - a limit on consolidation (company size and market share) and diversification of production would serve the same purpose. Consolidation has put a massive hardship on company survival (auto, banking, even farming) requiring inordinate amounts of cash to pull organizations through. Effectively they are on life support, sustained as their own massive bulk threatens to crush them much like beached whales.

I'm going to espouse an unpopular opinion. Break up the largest companies. Put the brakes on consolidation. Push innovation and diversification as company assets, as desirable market properties.

Let the dinosaurs go. We don't need another Jurassic Park.