The economics of ‘ego death’ (2020)

Psychodynamic energy sources and the cyber-psychedelic transformation of 21st century capitalism

by Federico Soldani – 24th Oct 2020

Does the ongoing massive digital transformation of the economy carry major implications for the human mind?

The now obvious cyber transformation is increasingly associated, according to the ‘CyPsy’ hypothesis on the mind formulated in these pages, with the so far underrecognized and understudied psychedelic turn in 21st century capitalism.

Of course, the most obvious implication would be about possible psychological effects on citizens / consumers turned patients of such epoch defining post-industrial shift.

However, there is another, more fundamental aspect that is usually not dealt with: which is how the digital economy, in order to optimize profits, takes advantage of the human mind as we conceive it, hence transforming the mind deeply, purposefully as well as de facto, for reasons related to its own cybernetic functioning.


‘Ego dissolution’ in cyber-psychedelic capitalism

Among the many different perspectives from which such major transformation of capitalism can be observed and analyzed, here it is taken the vantage point of the mind as conceived in psychoanalysis, primarily by Sigmund Freud.

Attention is focused on the effects of “ego dissolution” or “ego death,” a concept which is an essential part of the current rhetoric of mass hallucinogens and so-called Psychedelic Renaissance in the context of the deep transformations associated with cyber-psychedelic capitalism.


What is the psychoanalytical ego?

Characteristics of the ego, according to Katz, Goldstein and Dershowitz in Psychoanalysis, Psychiatry and Law (1967), are: [1] consciousness; [2] sense perception; [3] the perception and expression of affect; [4] thought; [5] control of motor action; [6] memory; [7] language; [8] defense mechanisms and defense activity in general; [9] control, regulation, binding of instinctual energy; [10] the integrative and harmonizing function; [11] reality testing; and [12] the capacity to inhibit or suspend the operation of any of these functions and to regress to a primitive level of functioning. “Thought processes of the ego vary from logical, realistic, problem-solving to unrealistic, nonverbal daydreaming.”


“From atoms to bits”

As the economy shifts “from atoms to bits”, as MIT Media Lab founder Nicholas Negroponte famously proclaimed in his Being Digital (1995), especially in the presently accelerated context of the 2020 coronavirus pandemic, the economy and the price system that is meant to transmit economic information efficiently become increasingly digitalized and there is even discussion of digital currencies, usually referred to as cryptocurrencies. As we move “from atoms to bits”, so-called financialization of the economy might increase its relevance as well.

Digital technologies by being invasive and pervasive capture to an unprecedented extent characteristics of our mind and behavior, personality, preferences, emotions and emotional reactions, etc. All these characteristics are captured as so-called big data and predictions are made accordingly and profits produced out of such data and predictions.

Physical movement as well as interactions with others in society, especially if direct and non mediated by digital technology, are increasingly unnecessary in a digital economy in which we rely on the knowledge of the surveillance apparatus of the digital panopticon and in which so-called “social distancing” (an oxymoron) is encouraged. Functions of our psychoanalytical ego such as control of motor action, thought, memory, language, sense perception, perception and expression of affect, integrative and harmonizing function, as well as reality testing are becoming less necessary over time.

In addition to digitalization capturing the mind for instance via big data and with the concomitant reduced need for physical mobility in the current automation revolution, during the past two decades, disciplines such as neuro-economics and neuro-marketing started digging in the consumer’s mind trying to understand behavior including unconscious characteristics captured through experiments, observational big data, and even studies using neuro-imaging.

At the same time, other characteristics of the psychoanalytical ego, such as defense mechanisms and defense activity in general, as well as control, regulation, binding of instinctual energy, and capacity to inhibit or suspend the operation of any of these [ego] functions and to regress to a primitive level of functioning become obstacles to the digital economy by inhibiting or delaying the main source of energy of the psyche which resides in the id.

Id which works automatically based on the pleasure principle and not, as the ego would do instead, on the reality principle.


Cathexis, anti-cathexis, and 21st century “black gold”

As previously highlighted in these pages, Katz, Goldstein, and Dershowitz noted in their 1967 text how “from the economic standpoint psychoanalysis supposes that the mental representatives of the instincts have a charge (cathexis) of the definite quantities of energy, and that it is the purpose of the mental apparatus to hinder any damming-up of these energies and to keep as low as possible the total amount of the excitations with which it is loaded. The course of mental processes is automatically regulated by the ‘pleasure-unpleasure principle’; and unpleasure is thus in some way related to an increase of excitation and pleasure to a decrease.  In the course of development the original pleasure principle undergoes a modification with reference to the external world, giving place to the “reality principle,” in accordance with which the mental apparatus learns to postpone the pleasure of satisfaction and to tolerate temporary feelings of unpleasure.

Energy in the psyche is generated by the libido and love of aggression released through biological means called drives.

Cathexis and anticathexis are processes that control the id’s energy. Cathexis refers to the id’s dispersal of energy. Anticathexis or countercathexis refers to the energy used by the ego to bind the primitive impulses of the id, an example being repression.

As the id does not distinguish between reality and fantasy, it may act in ways that are unrealistic or not socially acceptable.

Similar to a steam engine, the libido’s cathexis builds up until it finds alternative outlets; this can lead to sublimationreaction formation, or the construction of sometimes disabling psychopathological symptoms.

In delusions, the hypercathexis or over-charging of ideas previously dismissed as odd or eccentric produce such psychopathology.

As 21st century economy goes “from atoms to bits” and is increasingly dealing directly with the human mind via digital technologies and not anymore via society and its institutions, energy sources of the psyche become increasingly relevant as such in the post-industrial context, including the “economy” of such energy sources, as opposed to energy sources of the industrial age, which during the 20th century was eminently petroleum, oil. Oil has been traditionally referred to as “black gold.”

Is then the psychoanalytical unconscious the new “black gold” of 21st century cyber-psychedelic capitalism? And are the ego and its functions in the way between such energy sources and capitalism digital profits?


Plato, Hegel, Freud, Keynes, Huxley, Brzezinski…

Similar to Plato‘s conception of the soul encompassing appetite, reason, and temper, Freud‘s model of the mind (his second topography, 1933) included id, ego, and super-ego.

The functions of the conscious ego are those associated with culture, traditions, languages, history, and human institutions such as religious, community, local, and crucially political and legal institutions. Psychoanalytical ego functions are essentially related with filtering out the energy of the id, as well as with the very concept of civilization, which took centuries of human cultural and institutional development. Such development took very different forms worldwide.

Indeed it was Hegel, in his Elements of the Philosophy of Right (1820), who talked about the prodigious transfer of the inner into the outer, the building of reason into the real world, and this has been the task of the world during the whole course of its history. It is by working at this task that civilised man has actually given reason an embodiment in law and government and achieved consciousness of the fact.”

As written in a previous article about Huxley’s Ultimate Revolution (2019) – of note, Huxley was connected to the Bloomsbury Group – “hallucinogenic substances that profoundly alter consciousness, thought, emotions, perceptions that inform us about both internal and surrounding reality, would be … a way towards enlightenment on the deeper and lower reality of matter. They would make us aware of the more animal, instinctive, individual reality, unfiltered by all mental functions in continuous interaction with the natural, social, familial, historical and cultural external environment of which each of us is the result.”

As highlighted elsewhere in these pages, “to govern globally, that is, on multiple territories and peoples (or imperially, an empire being the government over several territories and peoples) it is easier to act on what unites us all rather than on differences.” Biology, emotions and the psychoanalytical id appear then as most appropriate and energy efficient means for the purposes of a global digital capitalism.

According to Brzezinski, in his 1969-1970 book Between Two Ages: America’s Role in the Technetronic Era, which is about globalization, especially of the digital type which he called technetronic – a book full of psychological and psychoanalytical language – “nationalism so personalized community feelings, that the nation became an extension of the ego.” Ego dissolution and death, if we follow Brzezinski’s reasoning, would lead to going beyond the nation-state as it developed during the industrial age and as a result of the American and French revolutions, hence it would lead towards globalization.


Psychoanalysis, back in fashion?

Psychoanalysis has been falling out of fashion since the 80s, which is at the time of the triumph of the phase of capitalism usually referred to as ‘neo-liberalism.’

Psychoanalysis however, founded by Sigmund Freud in Vienna, ended up being extremely influential in the Anglo-American world, as mentioned in another article, for instance in England in the Bloomsbury Group, which included the great 20th century economist John Maynard Keynes in Cambridge, England.


“Freudian theory of the love of money”

One of the major economists of the 20th century, John Maynard Keynes was a key member of the Bloomsbury Group. Keynes read all of Freud’s works and his economic ideas were influenced in turn. In The Nation and Athenaeum he referred to Freud as “one of the great disturbing, innovative geniuses of our age.” See for instance, Winslow in his paper ‘Keynes and Freud: Psychoanalysis and Keynes’s Account of the “Animal Spirits” of Capitalism’, 1986. Winslow highlighted how Keynes seems to treat the money-motives as “furtive Freudian cloaks” for other “deeper and blinder” “vulgar passions” hidden beneath the surface (see A Treatise on Money, 1930).

According to Keynes “the essential characteristic of capitalism” is “the dependence upon an intense appeal to the money-making and money-loving instincts of individuals as the main motive force of the economic machine.” Keynes emphasized the role of the irrational in economic life and talked about “the Freudian theory of the love of money.”

Freud compared the id to a horse and the ego to a rider, with the energy of the horse in the end dominating.  In The ego and the id (1923), Freud wrote: “The ego is that part of the id which has been modified by the direct influence of the external world. […] The ego represents what may be called reason and common sense, in contrast to the id, which contains the passions […] in its relation to the id it is like a person on horseback, who has to hold in check the superior strength of the horse; with this difference, that the rider tries to do so with their own strength, while the ego uses borrowed forces.”

Plato instead in the Phaedrus compared passions to winged horses, with a human charioteer “one of them is noble and of noble breed, and the other is ignoble and of ignoble breed; and the driving of them of necessity gives a great deal of trouble.”

In what I call cyber-psychedelic capitalism, such dependence of capitalism on its essential characteristic, the Keynesian “money-loving instincts” or the “Freudian theory of the love of money” in Keynes words or, we could add, Plato’s “largest part in each person’s soul” “by nature most insatiable for money”, is increasingly direct and not mediated either by factors in the external world, including community, society, institutions and “intermediate bodies”, by law or politics, or by the mediating and filtering factor in the internal world, which in psychoanalytic terms is called “ego.”


Ego-ism. Or id-ism?

Such psychoanalytical ego is increasingly presented in the predominant narrative in conjunction with egoism and the effects of mass egoism in the industrial age, for instance in terms of pollution of the environment; such egoism can indeed be seen as the id overriding the ego. The id overrides the ego, and as a result the ego is blamed when we talk of egoism. At one point an almost imperceptible shift happens, when the ego is not blamed anymore as a poor filter for the id, but as such.

Ego dissolution or death would obtain exactly the opposite of the initial intended purpose, which was to tame the id. We are blaming the ego as a poor dominator of the id, and by dissolving the ego and inviting the ego to die we let the id freer than it was before. Rather than ego-ism, in this light, the problem of the capitalist, industrial age might instead be called id-ism.

Plato talked about the concupiscent part of the soul that loves gain or money, the equivalent of the Freudian id. Plato also described this part of the soul effectively as unconscious and even talked about such component emerging during sleep in dreams with unacceptable content. Both of these issues are highlighted by Swiss psychiatrist Pavesi in his book Poco meno di un angelo (2016, Little less than an angel).

In the Republic, Plato talked about the content of dreams, when the rational component of the soul is asleep, describing what in the 20th century was called the unconscious and he even made reference to what we identify today as the Freudian “Oedipus complex”:

“Those that are awakened in sleep, when the rest of the soul – the rational, gentle, and ruling part – slumbers. Then the beastly and savage part, full of food and drink, casts off sleep and seeks to find a way to gratify itself. You know that there is nothing it won’t dare to do at such a time, free of all control by shame or reason. It doesn’t shrink from trying to have sex with mother, as it supposes, or with anyone else at will, whether another man, god, or beast. It will commit any foul murder, and there is no food it refuses to eat. In a word, it omits no act of folly or shamelessness. […] Our dreams make it clear that there is a dangerous, wild, and lawless form of desire in everyone, even in those of us who seem to be entirely moderate or measured.”


“And ought not the rational principle, which is wise, and has the care of the whole soul, to rule, and the passionate or spirited principle to be the subject and ally?


And, as we were saying, the united influence of music and gymnastic will bring them into accord, nerving and sustaining the reason with noble words and lessons, and moderating and soothing and civilizing the wildness of passion by harmony and rhythm?

Quite true, he said.

And these two, thus nurtured and educated, and having learned truly to know their own functions, will rule over the concupiscent, which in each of us is the largest part of the soul and by nature most insatiable of gain; over this they will keep guard, lest, waxing great and strong with the fulness of bodily pleasures, as they are termed, the concupiscent soul, no longer confined to her own sphere, should attempt to enslave and rule those who are not her natural-born subjects, and overturn the whole life of man?

Very true, he said.”

Plato, Republic, Book IV


(In the photo, from Wikipedia – accessed 24/10/2020 – Keynes (right) and the US representative Harry Dexter White at the inaugural meeting of the International Monetary Fund‘s Board of Governors in Savannah, Georgia in 1946)

Last Updated on October 24, 2020 by Federico Soldani

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