Canyons of Light

Written by Bryson on February 25th, 2009

Bryson White

“When a tree falls, cleaving its way through the forest canopy, it opens a canyon of light and an avenue of change into the understory gloom. Light is energy, and energy brings change. The new patch of sunlight immediately stimulates great changes in the life of the forest floor.” This is creative destruction at its finest. As massive, centurion trees collapse to their death, they signify not only the end of one life, but the beginning of thousands of other lives who are able to fill the space left behind. Enormous natural disasters (wind storms, landslides, wild fires) destroy entire ecosystems, so it seems, but in reality they pave the way for new life and growth to flourish. This is how the market behaves. Massive companies dissolve and dissemble. They are too old and too slow. They die off but are replaced by young, energetic, high growth firms which seize every opportunity to efficiently utilize resources. Every death is replaced with a new life. Nature always remains in equilibrium. When one tree dies, it is naturally replaced with another. After a devastating fire, saplings begin to grow. Contrary to Keynesian belief, this is also the case with the economy. The decrease of demand in one sector implies the increase of demand in another. The aggregate remains the same. Nature takes care of itself and continually replenishes itself. What we, as economists, need to do more often is stand around and stare at our dung. Instead of trying to clean it up all the time and think that we can solve all the problems, we need to stand back and watch how the system takes care of itself. We’d be amazed to see how quickly the beetles come in and clean up the mess.

 

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