Sitting among colleagues of mine, I heard the topic of conversation change from regular work chatter to matters of the economy. The question arose, “Are we in a ‘Depression’?”

This question got me thinking last week, and even more this weekend as yet another newspaper went down for the count and talk of a “global new deal” emerged from British PM, Gordon Brown. What I started wondering was, “What is really going on?” Is this a recession, a depression, or is something more profound taking place here?

On my radio show yesterday, I concluded that what we are witnessing was an event driven more by technology than we realize, and by institutions and policies that are based or structured on the models of the industrial age and not the digital age.

Digital age strategies are based on individualization – meeting the specific needs of a person, as opposed to one cookie-cutter solution designed for everyone. They also are based on demassification as opposed to massification. In other words, the digital age ethos is that smaller, more agile entities will thrive, while larger and more bureaucratic ones will wither and eventually fade away.

So, what does this mean in context with the current economic crisis?

For starters, command and control economies are passe. However, we seemingly have not learned the lessons the failures communism and European-styled socialism brought to light. Namely, we still rely on large scale institutions to hold almost monopolistic like control, both in the public sector and the private sector, over our economic welfare. Then we act surprised when a bubble pops and the small number of large organizations the government encouraged and at times directed to make bad decisions go under. Everyone is stuck in the same pot, a collapse ensues and then everyone is scrambling around trying to do the same thing: save the system that caused the very problems in the first place.

If the digital age has shown us anything, its that going backwards to the future just will not work. The kind of “New Deal” era set of policies on a national scale (and especially on an international scale) will simply not do the job. What we need to face is that a reorder of power needs to take place. We need get smaller, more personalized and more technologically driven in our approach to solving the problems government has created today and the problems we will face going forward.