We’re used to thinking of the end of the Cretaceous as the end of the dinosaurs, and it was (Note: I can hear some of you shouting at your screens “uh uh, birds are dinosaurs and birds survived, so...” but while it might be both cladistically correct and intellectually fun to scrub the word “birds” off the front of Peterson’s Guide and keep that life list of dinosaur sightings, most of us make a distinction between the small feathered creatures of today and the large terrestrial beasts of yore). However, the end of the Cretaceous didn’t just see the end of the dinosaurs. The last of the flying pterosaurs, which were unrelated to dinosaurs, also died out. So did the giant reptiles of the sea. The shelled ammonites of the oceans — similar to the chambered nautilus, but coming in many shapes and sizes — vanished. Even among the groups that are still around today, the losses were tremendous. Birds as a whole might have made it past the line, but most birds didn’t. Most (okay, here you go) avian dinosaurs died right alongside their non-avian relatives. Mammals made it — which is surely worth a cheer — but many species of mammals also died at the same time. So did most reptiles. So did most fish. The K-T boundary (on geologic charts, Cretaceous is abbreviated as ‘K’) was a nasty time. Lots, and lots, and lots of things died off that weren’t dinosaurs. Overall, about half of all genera and three-quarters of all species failed to make it from one side to the other.
There was no one characteristic that seems to have been a good predictor of surviving past that ugly line of iridium-enhanced clay in the geologic record, but there was certainly one that was a good indicator of not making it: large size. Lots of small things died at the K-T boundary, but every land animal bigger than a standard poodle was a goner.
The end of the Cretaceous is far from the only such event. The history of life is studded with events that wiped out 10%, 20%.. or 90% of all species.
One of these events came about 185 million years earlier, at the end of the Permian period. At that time, the world was dominated not by the dinosaurs, but by a group called the therapsids. This group, which included mammal-like reptiles and the ancestors of true mammals, ruled over an ecosystem as complex, interesting, and complete as anything that came after. They were a diverse group, with many features that gave them advantage over the other large animals of that period. They spread across the globe for tens of millions of years and ranged from tiny insect eaters to animals weighing over a ton. There were dog-like predators. Sheep-like plant eaters. And creatures utterly unlike anything that came after. Nearly all of them vanished in an extinction that didn’t just match that which ended the dinosaurs — it was worse. In a very brief period, “the great dying” saw the end of 83% of all genera. In the seas, 96% of all species went extinct. It was only after this extinction, on a world nearly emptied out of life, that the dinosaurs started their rise to prominence. It would be 30 million years before the world regained the diversity it lost at that time. As it happens, all mammals today are also therapsids. So the same group dominated the land both before and after the dinosaurs, with a pair of major extinction events neatly bookending the period of dinosaur rule.
In each of these extinction events, there were losses all across the spectrum, but large creatures almost uniformly vanished. It was like a series of signs from a carnival ride in reverse — only creatures shorter than this line can cross into the next period. Even during the time that humans have been around, there’s been a widespread extinction of “megafauna.” It’s likely that humans were the cause of these most recent losses, but then few of these extinction events seem to share causes. Asteroids. Volcanoes. People. No matter what puts the stress on the environment, the big stuff is the first to fall.
As far as our understanding of nature goes, that’s a good thing. Through the 18th century, there was little recognition that extinction had happened at all. Thomas Jefferson had received specimens of several North American giants from a site in Kentucky, and when he dispatched Lewis and Clark into the west, he did so with confidence that they would return with tales of living mastodons and ground sloths. That didn’t happen. As more and more ice-age giants and the bones of dinosaurs were pulled from the earth, the problem became increasingly clear — many things that had lived on the planet in the past were no longer around. Jefferson might not give up the search, but over in Europe there was one man who had put his finger on a very large problem.
By 1799, the great French anatomist, Georges Cuvier, had published two papers on elephant species, and had included in his review species known only from fossil bones. The vanished elephants were distinct enough from those still living in Africa and India that there was no doubt they were different species. They were also large enough that their absence from the landscape was noticeable. If extinction had worked the other way, if it had taken out things as small as mice but left larger creatures intact, it might have been much longer before anyone noticed that the creatures of the fossil record hadn’t gone to live elsewhere, they were simply gone. Because the gates of the extinction events so often closed in the face of large creatures, it was very clear even after only a few decades of organized fossil collection. Many, if not most, of the animals that had once lived on Earth were no longer around.
And that was a problem. Looking around the world at the time, Cuvier and others could see that the planet didn’t seem to be missing all these vanished giants. Where mammoths had cropped the grass of Europe, other animals were taking care of that in modern times. Most of what was found in the rocks represented species that were extinct, and yet the world wasn’t lacking for diversity. The fossil record revealed that different creatures had lived in the past. Nature was not a constant.
To explain the turnover of species, Cuvier embraced the geologic school of catastrophism. At the time, most catastrophists were also biblical literalists, who had a simple explanation for why so many animals were extinct. They missed the boat. That is, they were left behind during Noah’s flood. Though Cuvier initially wrote extinction off to some single past event, he was never one for pointing at Noah. In fact, later he modified his approach to accommodate a number of different catastrophes, but by then the school of gradualism had come to dominate geology — a development that was spurred in large part by work done by Cuvier himself.
So Cuvier understood that most fossil animals were extinct, and he had formed a modified catastrophism that was closer to the modern understanding than most others of his time. Still, there was one thing he didn’t accept — evolution. Part of this was simply a personal feud with Lamarck, whose theory was the primary view of evolution at the time. Unlike Lamarck, Cuvier was not an aristocrat. He was the working-class son of a retired military officer who through extreme hard work, diligence, and a frightening level of genius, had risen to be quite possibly the most respected scientist in the world. Lamarck’s theory, which even in the early 1800’s was being used to promote the sort of “natural superiority of the ruling class” that would later be associated with Social Darwinism, was bound to have left Cuvier cold.
Additionally, Cuvier was reluctant to sign on because the theories of evolution then put forward depended on the one thing Cuvier didn’t see in the fossil record — gradualism.
A hundred and forty years after Cuvier’s death in 1832, Niles Eldredge and Stephen Jay Gould published a paper that was very much in agreement with what Cuvier had seen. Evolution didn’t move by a series of unbroken changes across a broad population. Change most often happens to small, isolated populations over relatively short periods. For millions of years at a time, species survived nearly unchanged, only to be replaced by new species during periods of rapid turnover. Eldredge and Gould named this pattern “punctuated equilibrium.” The answer was not gradualism or catastrophism, it was gradualism and catastrophism that were recorded in the rocks and in the history of life.
Few equilibria are as “punctuated” as the times around the mass extinctions. The events don’t just represent a sudden downshift in life’s diversity, they also mark the start of a mad scramble to refill the void. The “great dying” at the end of the Permian marked the expansion of dinosaurs and other archosaurs. The end of the Cretaceous started us on the path to the world today. Extinctions aren’t just about dying, they’re about opportunity.
This pattern, slow and steady alternating with periods of stress and change, is present at all levels of the natural world, and both parts have their roll. A world that was nothing but one disaster after another would likely be a world all but empty, with life driven down to only the smallest and hardiest of survivors. A world of utter stability might be one of stagnation, where very similar organisms held sway for billions of year. Ironically, such a world might also be populated with nothing but the simplest forms of life, as without the periods of stress and extinction, complex life might never have gotten a foothold. We would not be here without both parts of the evolutionary cycle.
In our own lives, we may try to avoid disaster (even if it provides a little variety), but the complex systems around us rarely allow us to experience “smooth sailing” for very long. There are few places on the planet where you can live out a lifetime without experiencing political turmoil, if not outright war. Fewer still where you can end your life in the same economic system in which you were born.
For the last two centuries, as the industrial age has played out and moved into the information age, the world has experienced the erratic swings of the “business cycle.” These cycles mimic the natural world in many ways, including one that many people find peculiar — it’s the periods of disaster or near disaster that see in the most new companies. The reason for this isn’t particularly pleasant. People start new businesses in bad times simply because they’ve lost an existing job, or are unable to find employment at an existing company. Just as with species that appear during the stressful time after a mass extinction, the long term survival rate of these businesses isn’t particularly good. But it doesn’t have to be. With enough raw material, the new winners will emerge, grow, and become the giants of a future cycle.
The reason that giants go tumbling when stressful times come along is that giants are children of stability. Just as with extinctions in the natural world, times of stress can bring on business failures at all levels, but these periods are particularly tough on large companies. The reasons aren’t too hard to understand. Just as large animals require more resources to live and so are susceptible to changes in their environment, large businesses exist at the center of complex social, political, and economic webs where a failure in any strand can spell bankruptcy. You don’t form these webs in the middle of disaster.
Post-extinction event worlds are worlds for small animals. Post economic disaster worlds are worlds of opportunity for small business.
When conditions are steady over a long period, it can promote the development of very large creatures who are capable of utilizing all the resources of their environment very efficiently, in ways that are difficult for smaller organisms. Stable economies support creation of massive corporations, which are capable of exploiting every aspect of laws, trade policy, differential pricing, and global resources.
In the case of banking, the combination of deregulation and nearly two decades of steady growth created “monsters” that were dependent on an incredible array of exotic securities. Those involved may feel that they are in a “fast moving environment,” but it wasn’t speed that promoted the creation of credit-default swaps, intricately recursive investments, and world-sized stacks of collateralized debt obligations. It was stagnation. Only in a system held in perfect balance can such delicately embroidered creations appear. The merest breath of the economic wind is enough to rend such structures like damp tissue in a storm.
Of course, unlike in the natural world, many of our giants don’t die. Because we won’t let them go. To a large extent, this represents a new “evolutionary path” in business. It’s not that these banks are “too big to fail.” In both nature and economies, big is a precursor to failure. Instead these companies have extended their reach into the political sphere to such an extent that they have an alternate source of revenue. As big organisms do everywhere, they’re exploiting their resources in a way unavailable to smaller creatures. Elephants unable to reach branches may simply uproot the tree. Giant banks unable to draw enough sustenance from the economic sphere instead insert a “feeding tube” into the political sphere, and suck in the nutrition there.
It may work. It may even be a good thing. Disasters might be times of opportunity, but they are first and foremost, well, disasters. Keeping alive the current crop of giants may help to brunt the “extinction” of many businesses other than just those getting direct support.
But one thing is sure. We’re denying the resources that would otherwise go to create a new crop of small businesses, and in future business cycles that absence may well be critical.
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