10/24/2011 10:38 am ET | Updated Dec 24, 2011

Is the Economy Clinically Insane?

We're hard-wired to have a physiological response to the actions observed in others, but are our psychological states mirrored in the outside world, as well? On a macro scale, the functioning of countries may seem far more spectacular than our own inner workings, but, scale aside, may not be all that different.

Jiddu Krishnamurti, writer and philosopher, famously spoke of the direct action our own discordant psychology has on the world. "Economic revolution without inward revolution is meaningless, for hunger is the result of the maladjustment of economic conditions produced by our psychological states -- greed, envy, ill-will and possessiveness." He goes on: "To rely on others is utterly futile; others cannot bring us peace. No leader is going to give us peace, no government, no army, no country. What will bring peace is inward transformation which will lead to outward action."

I wondered recently: If a person presented to a clinical psychologist the same characteristics evident in the daily drama of world markets, what kind of notes might they make? Certainly, there are markers of normal human psychology to be found. The inevitable habituation that occurs to both negative and positive economic news, confidence diminished and regained and so forth, as well as the bias towards optimism that generally skews markets upward over time. However, there seems to be quite a bit of dysfunction as well. Borderline personality disorder, characterized by extreme variations in mood, has clearly been present in the huge swings that the Dow has experienced recently. It's also been a bit histrionic, defined by the highly theatrical way in which those variations occur. Paranoia is high -- FOX News, anyone? -- and empathy low, at least as far as The 99 Percent are concerned.


Photo credit: Reagan Hackleman

Jonah Lehrer, author of How We Decide and Proust Was A Neuroscientist, hinted in a piece for the New York Times last year that trying to outsmart the stock market proves as futile as attempting to one-up our hard-wired human firmware: "[Neuroscientists] have become interested in bubbles, if only because the financial manias seem to take advantage of deep-seated human flaws; the market fails only because the brain fails first. It's microeconomics at its most microscopic."

Unique problems surely require unique solutions. The most prominent attempt, Occupy Wall Street, was recently written about in a great article by Douglas Rushkoff. Of the grassroots-effort-gone-global, he said: "This is not a movement with a traditional narrative arc. As the product of the decentralized networked-era culture, it is less about victory than sustainability. It is not about one-pointedness, but inclusion and groping toward consensus." Sounds like family therapy to me!

In other words, the cure for our economic psychosis will require more than medication for its symptoms. "There is no revolution, no fundamental transformation, as long as we do not understand ourselves," Krishnamurti says.

A reformer tries to patch up the present society, or create a new one, on the basis of an ideology, and his idea is the conditioned response to a pattern; and such revolution, based on an ideology, can never produce a fundamental, radical transformation in social relationships. What we are concerned with is the fundamental transformation of man in his relationship with man; and as long as that basic change does not take place in the individual, we cannot produce a new social order. That fundamental transformation does not depend on belief, on religious organizations, or on any political or economic system -- it depends on your understanding of yourself in relationship with another.

America, your bill is in the mail.