David Brooks (“The New York Times”) and Gillian Tett (“Financial Times”) have each produced a useful article on the relationship of individual psychology (or personality) to the wider world of government policy – although the articles do it by heading in different directions from essentially the same starting point. The Brooks article suggests that not enough attention is presently paid to the effect of individual psychology (personality) on leadership decisions – and thus on personality when choosing leaders. The Tett article, largely based on the work of Prof. Dennis Smith (a “historical sociologist”), relates individual psychology (personality) concepts to the whole populations of countries. Taken together, the articles act almost like a circle with the two directions eventually meeting each other and encompassing a lot of wisdom that is all too often overlooked when considering issues of public policy.

The motivation for the Brooks article seems to have been the US presidential election, while the motivation for the Tett article is the Euro-crisis and the effect of subsequent policies on the populations of countries such as Greece.

To some degree, the concepts covered in the Brooks and Tett articles might also be applied at the intra-country group level.

For example, the humiliation that Putin and Co. are willingly to attempt to inflict on the aspiring Russian “middle class” (for want of a better word) may result in some of the responses mentioned by Tett:
“Typically, it occurs in three steps: first there is a loss of autonomy, or control; then there is a demotion of status; and last, a partial or complete exclusion from the group. This three-step process usually triggers short-term coping mechanisms, such as flight, rebellion or disassociation. There are longer-term responses also, most notably “acceptance” – via “escape” or “conciliation”, to use the jargon – or “challenge” – via “revenge” and “resistance”. Or, more usually, individuals react with a blend of those responses.”

But Tett also wrote that Prof. Smith believes that “Ireland already has extensive cultural coping mechanisms to deal with humiliation, having lived with British dominance in decades past. This underdog habit was briefly interrupted by the credit boom, but too briefly to let the Irish forget those habits. Thus they have responded to the latest humiliation with escape (ie emigration), pragmatic conciliation (reform) and defiant compliance (laced with humour).”

Thus, the responses of the “national psychologies” of Ireland and Greece to their “humiliation” resulting from the Euro-crisis may exhibit significant differences.

The Russian “middle class” is certainly using Irish-style escape, pragmatic conciliation and defiant compliance to cope with its humiliation—- but in the longer term the coping mechanism could become more “pathological”. If this were to happen, I suspect Putin’s response would largely be determined by his personality.

Read more at: http://www.jeffschubert.com/index.php?id=115

I have up until now avoided writing much about Russian pension reform (mainly because of the very long-term nature of the calculations, which means that it is generally not a very exciting issue as well as having a high degree of uncertainty), but both recent events in Russia and a useful recent IMF Working Paper entitled “Reforming the Public Pension System in the Russian Federation” mean that it is time to tackle the issue in more depth – at least in terms of giving an overview of the situation.

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