Psychoeconomics: globalization, markets, crisis

And this is not just values and behavior, this is culture in the broadest sense of the word – culture of production and trade, material and spiritual culture.

But if this is so, then the psychoeconomic processes that were observed in the US in relation to the occurrence of the psychoeconomic crisis should be reflected in the statistical data on the development of the world economy, both of individual countries and of the world as a whole, if it is on the path of copying the culture of the leading country.

This is true. Debt is increasing in most of the world’s countries that copy the economic relations of the US. The growth of debt for most countries in relation to the entire GDP and the psychoeconomic principles that derive from it are of the same type.

The similarity of the trend of many of the economic processes in the US, with world psychoeconomic processes merely suggests that they have a common determinant. We daresay that it is generally related to the psychotype of the economically active population and the agents of economic activity. Informed by the passions of the social motivators with hysteroid traits, they think about maximizing their profits with a tactical plan, that is, obtaining income here and now, with little foresight into strategic consequences.

Thus, extremely high prices for housing caused homeowner debt to grow, and the demand for housing dwindled for many years. Extreme prices for supplied goods led to the debt of governments and corporations and this began to disrupt the world economic order…The same people who made decisions on a massive scale about the growth of prices of delivered goods, raw materials, and services, they “hiked up” prices so that to purchase such goods became unprofitable or unjustifiably expensive… And this leads to the growth of debt of countries, corporations, households, to their destruction, to the fall in the profit of those corporations that purchase more through international trade than they sell. Thus, Japan, distinguished by the diligence and high level of professionalism of its workers, suddenly became a large international debtor at the beginning of the second decade of the twenty-first century.

Many of the charts that reflect various economic processes, but which have a psychological constituent, seem to agree.

This also affects the growth of debt. The economic bases of Reaganomics – the growth of debt while curtailing the cost of credit – began to show up in all countries that copied the culture of the leading country of economic development.

Thus, globalization led to synchronization of many economic and psychoeconomic processes and phenomena, to the leveling in the price of raw materials, goods and services throughout the world. This found not only a factual, but also a legal implementation. The requirements of the WTO are the same for its members and boil down to establishing world prices for raw materials worldwide. But this leads to strengthening the influence on the effectiveness of national economies of those factors that can’t be measured, weighed or made an object of negotiation. One of these most important factors is professionalism, the psychophysiological mechanisms of people in behaving and triggering nervous impulses. People’s psychophysiological, psychological, and intellectual patterns exert a significant influence on the growth of workforce productivity and on the social division of labor.

But on the whole, globalization creates the conditions for leveling of prices for basic goods and services, for forming a uniform culture, both material and spiritual. From the rules of the financial market to the latest fashion trends.

With relatively uniform prices for raw materials and services, the quality of the workforce, its main value, becomes an increasingly decisive factor in the higher rates of development. Countries where historically there were the advantages in the quality of the workforce make breakthroughs in economic development more and more frequently. But this quality oscillates, the psychotypes change cyclically. This cyclicity serves as one of the primary causes of the cyclicity in the change of the role and significance of countries in the world economic development. And these cycles are related to cycles of solar activity.

The tendency of synchronization of psychoeconomic phenomena to a crucial degree depends on the growth of the social division of labor.

Thus, globalization has not so far led to uniform changes of the psychotypes of the population of various countries. But here such a unified psychotype began to form in the agents of economic activity who are preoccupied with financial operations.

By virtue of this, in the future, depending on the specified factors, countries will co-exist whose elite is mainly oriented toward the culture of the elite of the country or group of countries that are the leaders of financial operations. This is the economic basis for the increase in these countries in the number of people who are supporters of the compradore bourgeoisie. And here the population of some countries will follow their own path and unify around the national bourgeoisie.

Hence, in these countries the battle between the part of the elite that is oriented toward the compradore bourgeoisie and that part that is oriented toward the national bourgeoisie will grow. And we know from history that the beginning of the fight within the elite leads to the growth of a social struggle, to protest actions of the populace. And in the conditions of globalization, such a struggle will increase the growth of the social division of labor.

3.2. Globalization as a factor in synchronization of protest moods: the key to understanding the present in the past

Historical events related to the mass relocation of people that are strong, distinguished, aspiring to wealth and status but without a way to obtain this at a given point in the country they were born in (due to a limited amount of land, inheritance rights that were passed primarily to the first sons, etc.) have arisen with remarkable periodicity, with the appearance of each new generation prior to creating an economic mechanism for transferring the activity of these people into the economic stream.

That is, before the advent of capitalism. Globalization makes its own adjustments to these processes.

History teaches us that periodically, when discontented but strong and goal-oriented personalities accumulate at the bottom of the social structure of society, they are gotten rid of or advance through social mobility into the upper layers of society. If this does not occur, there are wars, revolutions, rebellions, or changes in power…

Situations have occurred periodically in Europe where some people concentrated at the bottom of the social ladder were ready to do a great deal to increase their status and attain wealth or property through their own efforts and abilities. In practically all European countries in the Middle Ages there was a law whereby land and property would be inherited by the oldest son, while the middle and youngest sons were forced to serve the king or enter a monastery or a religious military order like the Knights Templar, the Hospitallers, etc. With time, the number of ambitious knights, simple people without property, became dangerously large for the secular authorities. Among these people were many who were not inferior to the elite in terms of their own abilities and ambitions, and in fact may have been superior once the third-generation elites came into power. But this is a death sentence, so to speak, for the third-generation elite in a specific country, and the example that raises the question about accepted laws and governance in other countries. What could be done? Either weaken and even fight against the imperious orders, whose members had nothing to lose, even as their militancy grew, or else find a way to appease them. The ingenuity of thought and policy on the part of the ruling class in history was quite sophisticated in this respect.

The Crusades were one of the godsends for periodically meeting the need for property, land, and status of the strong, aggressive, militaristic members of the group with increased belligerence. This satisfaction came not at the expense of the lands of the ruling elite, but rather at the expense of the lands of the representatives of other religions, who could be killed during these conquests. Naturally, these processes were related to the growth of emotionality of the members of the order, with an increase in the hysteroidicity of its members amd with the change in the psychotypes of the population, which was also related to solar activity.

We do not have adequate information about solar activity in the Middle Ages, but we do know that the interval between solar peaks is 11-12 years on average. In any case, we know that succession of psychotypes proceeded over the last two centuries at 11– to 12-year intervals. There is every reason to assume that the Crusades occurred in connection to these cycles.

Because there were no systematic solar observations in the Middle Ages, it is difficult to precisely identify which years were peaks of solar activity, which in turn would allow us to tie the beginning of the Crusades to these peaks. To resolve this problem we will refer to the works of A. Chizhevskii and suppose that the epidemic of self-flagellation in Europe in 1260-1261 corresponded to a solar peak. Self-flagellation by men and women who were almost naked could be nothing other than a psychopathic reaction. It comes to life precisely in a period of increased solar activity. Although the epidemic of self-flagellation started in Italy, it spread quickly throughout Europe. In Chizhevskii’s opinion, this was both a religious and sexual epidemic. It then appears that the previous (seventh) and following (eighth) Crusades were separated by roughly 10-12 years from these events.

If from the existing date we take stretches of time with a lag of 11-12 years, then they fall at the beginning of every Crusade (plus or minus 2-3 years). The later the beginning of a Crusade from 1260, the greater should be the error of our calculation. This coincidence allows us to confirm that the beginning of the Crusades was linked with peaks of solar activity.

The length of each Crusade coincides with the time of activity of people with hysteroid traits. This is presented in the form of a table.

However, the Crusades ran out of steam. They failed. The knights had no desire to continue. To go on more crusades meant to go in search of their own demise. This was recognized by the knights who were potential participants in the Crusades. What was to be done? Either seek out new ways to rid the society of powerful, armed individuals who could potentially seize power and replace the current elite and even get hold of the property of the church, or destroy them. So it was not accidental that after the eighth Crusade, with the passage of time, a new generation of knights with their ambitions and with new leaders who had forgotten or driven from consciousness the lessons of previous defeats, began to be eliminated. In 1307, members of the Order of Templars were seized by order of King Philip IV “the Fair” of France simultaneously throughout the land. They were confined in fortresses, and then killed. The last execution occurred on March 18, 1314. We may state that from the beginning of the Crusades until that date, three 72-year cycles passed. One can insist that this is an accidental coincidence and we may confine ourselves to asserting that the time interval between Crusades was evenly divisible by the number of intervals between solar peaks and coincided with the period of change of generations. It is both possible and necessary to discuss the continuous wars in Europe itself. For us the dependency is important – when the possibility of channeling the activity of people in a protest mood was depleted – their annihilation began, the Crusades began within Europe, wars became more frequent, as did persecutions and killing of non-believers, which at the same time helped to annihilate the protesting part of the population and intimidate those left alive.

After the unsuccessful Crusades it was simply not possible to compel the potentially protesting people, capable of a great deal, to continue. To continually kill those knights who were unwilling was also not so simple (although executions in the Middle Ages functioned to eliminate those who were not submissive, and prevent the emergence of a systemic, armed, organized and efficient opposition).

In this situation, there naturally arose campaigns within Europe itself. These were the Crusades in Finland and Russia (1232-1240), to Smyrna ( (1343 – 1348), against the Ottoman Turks (1396), and campaigns during the Bohemian Wars (1420-1434)… But soon those involved in these Crusades realized their futility. Wealth was no longer acquired in these wars, while the participants were routed. Therefore these campaigns actively began to be replaced by commercial and military expeditions to distant lands. In this case the energy of strong and active individuals was aimed not only at satisfying their needs, but in a majority of cases also met the requirements of the elite in the distribution of their influence on other countries.

Still, the Crusades remained a unique historical method of deliverance from a potent opposition at the point of economic rise in Europe. The psychological mechanism of their origin was also related to systems of comparison. Thus, wealth increased for family members who had inherited private property and land. The growth of such inequality resulting from an accumulation of causes gave birth to the desire to not fall behind in this process. Desire and motivation emerged. This was dangerous for the elite, especially those of the third generation. And what should be done with such people if they are strong, distinguished, ambitious, prepared to die to achieve greater status, to obtain property, to rule, and who no longer wish to go to their death in a Crusade?

The massive expeditions for wealth to India, China, and especially America were psychoeconomically typical. This course of events was understood by the smarter representatives of the elite in this period. They supported such expeditions. Those seeking adventure, wealth, and success followed Columbus to rich America. Columbus brought this news to Europe at a time when it needed deliverance from people who were able to destroy the rulers in more than one realm. It is no accident that historians so exaggerate the fact of Columbus’ appearance in Europe with the news of the discovery of America. America had been discovered long before Columbus, but the news of Columbus’ success was transmitted at the right moment to the right people, so that a massive epidemic of expeditions for gold and wealth was organized.

With the building of caravels, active colonization of other peoples began, bases in Africa became feasible, and thus slave trade began. The discovery of America in 1492 and of a sea route to India around Africa by Vasco da Gama in 1498, given previous successes in maritime trade, created the economic and sociopsychological mechanism for satisfying the need of strong, active and capable individuals who were inclined to take risks and increase their social and other status.

Eighty years passed between the execution of the Knights Templar and the economic mechanism that directed the energy of bold, venturesome, and strong individuals to seize new lands and become rich outside of the countries where they lived. How then at this time did the rulers of Europe control the slowly growing opposition, with the strong and active individuals of each new generation? This involved a whole series of measures, which were found in different countries for each new generation. Otherwise the elite or even the country itself might cease to exist. In this situation the elite organized themselves with greater rapidity and enthusiasm than the protests of the masses. Considering the growth of protests by the subjects, the third-generation elite greatly desired to submit to the strong elites of other countries, for it was better to be a vassal to someone stronger but preserve your wealth, than to risk losing everything and simply be hanged. Either hang your opponents with the help of the elite of other countries, or be hanged.

With the increase in the population size despite the limitation of land in the Middle Ages, an historically tested mechanism was worked out for preventing protests by strong, capable, warlike individuals. It included:

– Periodic organization of campaigns (approximately one Crusade per generation, but not less than one expedition in three generations) by such people for long distances to seize land, property, and valuables. Loyalty was thus assured of these people to the rulers of the countries where they were born and lived, along with loyalty to the church.

– Directing the aggressiveness of these people against neighboring countries, within Europe and to the extent possible, beyond the bounds of Europe. This heated up the wars within Europe, but ground down the aggressiveness of such people through their self-destruction or through satisfying their need for power or wealth by capturing these from neighboring states.

– The destruction of the paramilitary groups that no longer submitted to secular authorities and could no longer live off wars with neighboring countries. Members of these groups looked with lust upon the wealth of the kings and aristocrats of the country where they were situated, and at neighboring states. Therefore not only the execution of the Knights Templar, but also wars with its members became socially and psychologically accepted. This unified the elite of different states in the struggle with potential adversaries of their sovereignty. Thus, Poland smashed and subordinated the Teutonic Knights during the Thirteen-year War (1454-1466). The process, begun by the French King Philip the Fair at the end of the thirteenth century, was completed. Thirty years of war! Victory was only achieved with the change in the generations of the warring sides.

– Suppression of dissent by mass executions, and through the work of the Inquisition. The year 1022 saw the first mass execution of heretics in Orleans, and in 1165, the Cathar heresy was suppressed. Bogomil Vasilii was burned at the stake in 1111. In 1233, an inquisition was created to fight heresy in Languedoc. That is, together with the organization of the Crusades, the rebellious activity of potential enemies of the existing elite in certain countries was suppressed. But the struggle against heresy began with particular barbarity after the depletion of ability of the Crusades to lower the level of social unrest and before the shift of the activity of the strongest and most active individuals to conquering America, to trade with distant countries, with possibility of economic and social advance of the strong and capable under capitalism. Jan Hus was burned at the stake in 1415, and Joan of Arc was immolated in 1431. Witchcraft trials occurred in 1442. The Spanish Inquisition began active persecutions in 1481.

– Rapid unification of countries and consolidation of the elites into a single, more powerful state against protest-inclined people began. Hence in France the period of feudal disunity came to an end under the rule of Louis XI (1461-1483). During the Burgundian Wars, Burgundy united with France. Spain was unified (1469) bloodlessly, through matrimonial alliances. In this period the Habsburg dynasty led the unification of Austria, Germany, Bohemia, and Hungary (1438, Albrecht V). The elite quickly found ways to unify themselves in the face of the danger of revolts and its overthrow..

During a period of development of capitalism and relative democracy, satisfaction of the ambitions of the strong and venturesome began to occur more thanks to the natural rivalry between people. Strong and capable people naturally occupied the highest economic and social positions in the society. The social structure came into congruence with the social-psychological one.

History teaches us that if the government and the elite cannot attain a social order that would bring the social and sociopsychological structure of the society into harmony (stronger, smarter, more capable individuals occupy higher places in the social hierarchy), they are swept away and replaced by others. There’s no other choice.

Either mass executions and mass repression with obligatory excommunication of the strongest, most ambitious of their immediate social environment were needed, or else the social environment will react to those signs of power that provide evidence of who the actual leader is. This is an innate system of reactions and reflexes. It is analogous to similar reflexes in a herd of animals that acknowledge the right to leadership of the strongest. This reflex cannot be reformed. It is either necessary to step forth and hand over part of the power to the stronger and more capable, the more assertive, or else be dethroned.

After the privatization of the 1990s, in the absence of an effective mechanism of accumulation that naturally would reconcile, in a period of capitalism, the social and sociopsychological structure of the society with the replenishment of the elite by around at least 1% per year, measures are desperately needed for creating social elevators, for creating the means of elevating stronger and more capable individuals through their natural escalation on the social ladder.

Importantly, in history such means were connected to the separation of strong, active individuals capable of warlike actions from the milieu they inhabited – sending them to war in other countries (while preserving the values of that culture that they offered) engaging them in active, creative, commercial or military activity at long distances, etc. Thus, now such measures might be those at governmental scale such as conquering the North, constructing roads, massive involvement in developing water resources or facilities of utmost government importance, service in the army ( and giving those who served a land allotment or cottage in a place where the government deems necessary), participation in construction works far from one’s hometown, etc. The facilities built can and must be secured for the best of those who participated in the construction works. It is just those people who administer property, especially that created by their own labor, who are most active in social, sociopsychological and military affairs. History attests to this. Having a large number of people in the society’s structure who are situated at levels that are lower than their sociopsychological features, their strength of personality, and their aptitudes, is potentially explosive.

But the number of such people grows cumulatively, gradually, unnoticeably. At first the explosive nature of such a situation may simply not be seen. But then the measures performed by the government to maintain order start to falter. It seems like only yesterday they were effective, but today they lead to contrary, negative results. The number of emotionally negatively inclined people in the society has crossed the critical line and these protests begin to be seen tangibly.

In a period when resonators are dominant, such protest moods are diffused, and people’s energy is directed toward self-affirmation in business. In a period of transfer of leadership to postresonators, these moods begin to accumulate little by little, cumulatively, unnoticeably. In a period of transfer of social initiative to post-postresonators, the accumulation of social emotions begins to coincide with their active external manifestation – with strikes, walkouts or armed uprisings.

When the rate of GNP growth is declining, in periods of downward mobility of not only the large number of unemployed, but also strong, capable and distinguished individuals who are able to unite in protest, it is no longer possible to restrain the society within accepted social boundaries and norms without targeted work with such people.

In this regard, the experience of the Middle Ages is instructive. Why? At that time, competition between specific individuals had not yet led to a natural attainment of balance between the social and social-psychological structures of the society, as this began to happen in capitalist society at the moment of its origin. But today the competition between individual people no longer allows the strong and capable to occupy higher places in the social structure. Still such competition remains and will remain for a long time, if not forever, an important factor in the struggle between individual corporations, groups of people, social strata, and between indivduals where it is effective and can differentiate them according to their abilities.

The causes for the decline in the role and significance of competition between individuals given their economic and social mobility in a period of globalization are multifactorial. Some of them are:

– The financial sector was “victorious” over the manufacturing sector. Profit margins in the financial sphere are much higher than in the manufacturing arena. It is almost impossible to find an area of production where it is possible to take out a loan for development with hope of returning it. However strong, smart or active the individual is, the probability of setting up successful new manufacturing in the current environment is minimal. One may try to speculate in the financial markets. But when they fall, even this possibility dies.

– For organizing new, more effective production, more and more financial resources are needed. The volume and level of minimal capital for starting one’s own business become even greater when there is an increase in the economic disparity between people. Therefore, with each year it becomes more difficult to start a business.

– The middle class is being ruined, and this was the traditional source of managers, leaders, and effective owners of big business. But only the strong, capable and smart are able to compete successfully with each other for the country.