Is Recession Possible in a Networked Global Economy?

In a front-page article in today's New York Times, David Leonhardt notes that, "just as at the start of the summer, economists can't even agree whether the country is in a recession." 

On the face of it this is a stunningly absurd comment.  American industry continues to lay off thousands of employees, fuel costs are way up even as the speculative rise of oil prices has for the moment reversed itself, major financial companies are collapsing or being bought out by the federal government.  And economists can't decide if we're in a recession???   Maybe they can ask John McCain to set up a commission!

But in thinking about the idea of a recession, I wonder if perhaps this model no longer makes sense in a networked global economy fueled by financial theories and practices only made possible by the computations enabled by digital computing.  The metaphors of inflation, recession, and depression are based on an analog model of the economy, of the economy as a physical, even an organic, system.  Do these metaphors make sense for today's economy? 

Perhaps it would make more sense to think about the success or failure of today's economy in different terms, on the basis of models of networked connectivity and robustness.  The collapse of Fannie and Freddie, of Lehman Brothers or AIG--should we think of these as server crashes, as losses of connectivity, of a narrowing of broadbands of commerce and communication?  In a networked digital model, servers can crash and traffic can be re-routed.  One site may be down but other sites might continue to operate.

I'm not an economist--I'm just a media theorist who follows the news and thinks about things. So I am hardly in a position to explain what the implications would be of shifting the metaphors through which economists think about the economy.  But there is one thing I am in a position to say and one thing I want to make clear.  In suggesting that recession might no longer be possible in a networked global economy I do not mean to minimize the damage and pain caused by our current economic crisis.  Rather I mean the reverse.

Whether the economy can best be understood in analog or digital terms, it is clear that server crashes or network disruptions or other economic troubles cause real human pain.  In suggesting that the metaphors of inflation, recession, or growth might no longer be applicable to a networked digital economy I do not mean to minimize the destruction that the current formation of global capitalism has caused to our planet and its human and nonhuman inhabitants, but rather to suggest that by sticking to these outmoded analog metaphors, economists seem more like scholastic arguing about how many angels you can get on the head of a pin than they do like experts or authorities able to help us move forward through what are unarguably the worst economic times this country has seen since the Great Depression.