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CLINICAL NOTES SERIES

ON THE TRANSFERENCE AND THE COUNTER-TRANSFERENCE

Pat Radford (1970). ‘Transference,’ and ‘Counter-Transference,’ in Basic Psychoanalytic Concepts on Metapsychology, edited by Humberto Nagera (London: George Allen and Unwin Ltd), The Hampstead Clinic Library, pp. 168-206.

INTRODUCTION

The most important concept in clinical psychoanalysis is the transference. This is because the analyst cannot open the head of the patient and take a look. The workings of the unconscious are inferred through its manifestations in the transference. The transference can take on a positive or a negative form. A positive transference usually takes on a negative dimension when the analysis proceeds into greater depths. Furthermore, it is characterised by ‘ambivalence.’1 In other words it appears that the patient will experience both positive and negative feelings for the analyst (like he does for his parents). This is where an inexperienced analyst can lose his patient. Such is the case with examiners and stakeholders as well. It is therefore important to learn what Sigmund Freud has to teach us about the clinical dynamics of the transference. As Freud knew only too well, the transference is not specific to the Freudian clinic; it takes on an ‘extramural’ form as well. It is important to note that, as Jacques Lacan was fond of putting it, wherever there is a ‘subject presumed to know,’ there will be a transference in the analytic sense of the term.2 Both clinical and extra-mural transferences have a feature in common; they are asymmetrical in structure. Though 1 See Pat Radford (1970). ‘Ambivalence,’ Basic Psychoanalytic Concepts on Metapsychology (London: George Allen and Unwin Ltd), The Hampstead Clinic Library, pp. 130-138.

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Freud doesn’t use the term ‘asymmetry,’ it is obvious that his clinical descriptions of the transference have this dimension written all over them. I say this at the outset because the relationship between the participants and the stakeholders in the contemporary financial system is constantly generating transferences. Most of these relationships are also asymmetrical in terms of power dynamics, information flows, and levels of understanding. That is why what Sigmund Freud has to teach us about the relationship between the analyst and the patient in terms of both the transference and the counter-transference will help us to make sense of the affective dynamics of the financial system. The transference can be defined as the full-range of affects experienced by the patient for the analyst; the counter-transference constitutes the affects experienced by the analyst for the patient. The main challenge in transferential dynamics is that ‘inappropriate affects’ and ‘false connections’ that analysts and patients experience and make about each other when they transfer affects from their own past to the present will abruptly end the treatment and leave both the analyst and the patient feeling disappointed with the lack of progress in the treatment. These then are a few problems in mental health that will be of interest to not only clinical practitioners, but also to the monetary authorities and the legal system.3

KEEPING THE ANALYSIS GOING

Their main priority then should be to keep the analysis going without either party seeking a premature termination or acting out any of the themes that were activated in the analysis outside the space of the clinic.4 This is easy to say but extremely difficult to pull off day after day given that an analyst may have any number of patients. In other words, it is a lot easier for the patient to work-through his positive or negative transference to the analyst than for the analyst to work through a positive or a negative counter-transference to a patient. An analyst can only survive the relentless ordeal if he has himself been trained through a 2 See Jacques Lacan (1973, 1977). The Four Fundamental Concepts of Psychoanalysis, translated by Alan Sheridan, edited by Jacques-Alain Miller (London: Penguin Books), passim. 3 For papers on these themes, see H. Tristram Engelhardt, Jr. and Stuart F. Spicker (1978). Mental Health: Philosophical Perspectives (Dordecht-Holland: D. Reidel Publishing Company).4 The desire of the analyst, according to Jacques Lacan, is precisely this: to keep the analysis going. For a clinical definition of acting out that can terminate the treatment, see Charles Rycroft (1968, 1995). ‘Acting Out,’ A Critical Dictionary of Psychoanalysis (London: Penguin Books), pp. 1-2. See also Jean Laplanche and Jean-Bertrand Pontalis (1973, 1988). ‘Acting Out,’ The Language of Psychoanalysis, translated by Donald Nicholson-Smith, introduction by Daniel Lagache (London: Karnac Books), pp. 4-6.

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personal analysis with an analyst of the same clinical orientation. Though not all schools of analysis differentiate between the transference and the counter-transference, there is broad agreement amongst the different schools that analysts and patients can affect each other in ways that can be transformative if all goes well. If, however, things do not go off well, it can destroy an analyst’s confidence in his ability to practice analysis as a clinician.5 That is why these clinical notes attempt to describe and differentiate between the transference and the counter-transference. These notes should be useful not only to professional clinicians but also to any stakeholder in the financial system, including political leaders, who are subject to demands by the members of their respective companies, teams, firms, groups, and other larger social entities. The success with which these stakeholders can lead these entities without experiencing a loss of stability while doing so will be a function of their ability to overcome the internal limitations in their capacity to contain the affects that constitute the counter-transference. It is not my intention to say that all stakeholders have clinical ambitions; not at all. I use the term ‘counter-transference’ to indicate the fact that they must manage extra-mural transferences vis-à-vis their followers. That is why the ‘give-and-take’ between central bankers and psychoanalysts in recent years has proved to be useful for both parties.

SUBJECT PRESUMED TO KNOW

A leading central banker like Ben Bernanke or Mark Carney will find himself in the locus of the ‘subject presumed to know’ the secret of ‘calmness and stability’ in the ongoing attempts to stabilize the financial system in the wake of the financial crisis of 2007-08.6 Those systemically important stakeholders who are subject to exams in the stabilization process by these examiners will resist in ways that bear a resemblance to patients on the couch. But, most importantly, these stakeholders will 5 See, for instance, Dylan Evans (1996, 1997). ‘Transference,’ An Introductory Dictionary of Lacanian Psychoanalysis (London: Routledge), pp. 211-214; and Bruce Fink (2007). ‘Handling Transference and Counter-Transference,’ Fundamentals of Psychoanalytic Technique: A Lacanian Approach for Practitioners (New York: W. W. Norton and Company), pp. 126-188. 6 There is a growing literature on this theme. Books relevant to these clinical notes include but are not limited to the following. See Vince Cable (2009). The Storm: The World Economic Crisis & What it Means (London: Atlantic Books); Wolfgang Münchau (2010); The Meltdown Years: The Unfolding of the Global Economic Crisis (New York: McGraw Hill); Gary B. Gorton (2013). Misunderstanding Financial Crises: Why We Don’t See Them Coming (Oxford: Oxford University Press); and Ben S. Bernanke (2013). The Federal Reserve and the Financial Crisis: Lectures by Ben S. Bernanke (Princeton: Princeton University Press).

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transfer affects to these central bankers that are based on a false connection in their unconscious because they see; or think they see, a resemblance between early caretakers like their own parents and these stabilizers. That is why stabilizers have to equip themselves with a theory of the counter-transference in order to themselves stay stable under provocation, as Mark Carney, for instance, is reputed for being.7 Provoking the analysts within the space of the transference is not a contingent aspect of certain analyses, but is almost a constitutive feature when the patient feels that he is being hystericized in the analysis. So, needless to say, there will be a matching of wits and a hysterical tug of war between the patient and the analyst and between stakeholders and their examiners in the monetary system. The main burden of these clinical notes is to explore these parallels in the attempt to demonstrate the usefulness of the Freudian model of subjectivity, the unconscious, and the clinical dynamics of the transference and the counter-transference within the larger context of the financial system.8 I will argue that transferential affects emerge almost automatically in situations characterised by any significant form of asymmetry whether this concerns the flows of affects, information, or knowledge. In other words, these notes attempt to situate the relevance of clinical dynamics within the extra mural space of the financial system. These are the reasons why Ben Bernanke is fond of saying that nearly 98 percent of monetary policy is about managing the psychology of stakeholders; only 2 percent of the efforts of central bankers goes into the technical determination of interest rates.9 The layperson is however under the impression that 98 percent of the effort put in by central bankers is about the technical determination of interest rates on the basis of the data crunched by staff economists in central banks. That is why I routinely invoke Ben Bernanke and Mark Carney in my articles, essays, reviews, and posts on psychoanalysis.

THEORY OF THE SUBJECT

7 For the role played by stabilizers, like Mark Carney, see Robert J. Shiller (2012). ‘Policy Makers in Charge of Stabilizing the Economy,’ Finance and the Good Society (Princeton and Oxford: Princeton University Press), pp. 111-118. 8 See, for instance, Bruce Fink (1995). The Lacanian Subject: Between Language and Jouissance (Princeton: Princeton University Press). See also Bruce Fink (2011). ‘Psychoanalysis, Money and the Global Financial Crisis,’ New Formations, Vol. 72, pp. 20-32.9 For more on such themes, see the Ben Bernanke blog on monetary policy at the Brookings Institute at Washington DC.

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In Freud’s own lifetime the main areas where psychoanalytic insights were ‘applied’ was in areas like anthropology, art, literature, and religion.10 I however have good reason to believe that if the financial crisis has taught us anything it is that the time has finally arrived for central bankers and psychoanalysts to take each other seriously. Not only will these exchanges revive the fortunes of clinical and applied psychoanalysis, it will also make it possible for central bankers to address the 98 percent of their ‘remit,’ as Mark Carney is fond of putting it, with a fully-articulated theory of the subject that is available in the work of Sigmund Freud and Jacques Lacan. Customary readers of my essays will recollect that I compared Ben Bernanke’s calm manner to Sigmund Freud’s clinical persona as early as 2008 in early drafts of ‘Big Ben: On Federal Reserve Communications.’ Since Ben Bernanke and Mark Carney signal together under the aegis of ‘benchmarks’ in central banking, I am not in the least surprised by the fact that they are both preoccupied with the 98 percent of the analytic iceberg that remains under the water. What is it that corresponds then in central banking to the Freudian imperative to keep the analysis going? My answer to this question might annoy systemically important stakeholders, but I am sure that the Federal Reserve and the Bank of England will agree with me on this. The answer is to simply keep the exams going. This might appear cruel but it is what Sigmund Freud thought constitutes the mainstay of analysis; this is the central banker’s equivalent of abstinence. If the stakeholder’s demand for love within the transference is taken up seriously, the central banker will make the same mistake that the stakeholder’s parents made which rendered them either neurotic or unstable as adults. That is why the Mark Carneys of the world must hold their nerve when they are insulted and dubbed as no better than ‘neo-Nazis.’ Such a ‘compliment’ from a patient is proof that Mark Carney has succeeded in ‘hystericizing’ them.

REWIRING THE UNCONSCIOUS

In other words, what such patients or stakeholders complain of is the need to completely re-wire their unconscious in order to remain stable within or at the periphery of the financial system. This is, interestingly enough, precisely the goal of Lacanian analysis; it is to hystericize the obsessional subject in order to get him to face up to the truth of his desire. A stakeholder’s ego defences will not be shed effectively unless they are subject to hystericization by stabilizers. It says a lot about Mark Carney’s commitment to his profession that he has refused to back down under

10 For a recent Lacanian foray in ‘applied psychoanalysis,’ see Jacques-Alain Miller and Maire Jaanus (2013). We’re all Mad Here, Culture/Clinic, Vol. 1, Applied Lacanian Psychoanalysis (Minneapolis and London: University of Minnesota Press).

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threats from stakeholders who do not want their lack of stability to be exposed to either themselves or to others. The sheer proliferation of terms like ‘break,’ ‘breaking,’ and ‘break down,’ in the American media in recent years to describe the state of the nervous system of ‘systemically important stakeholders’ in the financial system is testimony to the overwhelming rigor with which the U.S. Federal Reserve and the Bank of England have gone about their task. In order to appreciate the enormity of the stabilization process however readers must, in addition to reading about these bankers in the financial press, also acquaint themselves with the theories of the transference and the counter-transference that constitutes the clinical and meta-psychological mainstay of both Freudian and Lacanian psychoanalysis.11 To dismiss Mark Carney as a ‘sadistic neo-Nazi’ is to completely miss the point. There must have been any number of hysterical patients who would have taunted their analysts with similar designations. That is the ‘occupational hazard,’ as organizational theorists or an HR expert might put it, of trying to rewire a systemically important stakeholder’s unconscious in the financial system.

SEDUCING THE STABILIZERS

The transference was first discovered in the case of Anna O, a patient of Sigmund Freud’s collaborator, Josef Breuer. The significance of this case is that it clearly revealed the ‘libidinal nature’ of the positive transference. Breuer’s patient not only experienced a hysterical pregnancy; Breuer was forced to terminate the treatment. Breuer then went on a holiday with his wife who felt neglected by the enormous effort that Breuer was putting in to cure this patient who was later revealed to be Bertha Pappenheim, a feminist. The transferential dimension in this case is the hysterical pregnancy that Bertha experienced; the counter-transferential dimension is the fact that Breuer promptly impregnated his wife when they went for a holiday following the termination of Bertha’s treatment. It turns out that neither the patient nor the analyst suspected the existence of what we nowadays term the ‘libidinal economy of the transference.’ An important question here is this: Did Breuer himself act out his desire for Bertha by impregnating his wife? Or, as an American movie maker might put it: Was Breuer thinking of Bertha in bed? The main reason that Breuer himself resisted clinical analysis (given that he started and remained a physician) was that he was not equipped with a theory of the transference. It was as 11 See, for instance, Stephanie Griffith-Jones et al (2010). Time for a Visible Hand: Lessons from the 2008 World Financial Crisis (Oxford: Oxford University Press); Colette Soler (1996). ‘Transference,’ Reading Seminars I and II: Lacan’s Return to Freud, edited by Richard Feldstein et al (Albany: SUNY Press), pp. 56-60; and Andrew J. Lewis (2000). ‘From the Work of Transference to the Transference of Work,’ analysis, No. 9, pp. 138-149.

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difficult for Breuer to work-through the counter-transference to Bertha as it must have been for her to work-through the transference. This encounter between Bertha and Breuer becomes the libidinal paradigm in the Freudian model of the subject for transferential dynamics.12 Much of the advice that Freud gives physicians who are training to become analysts relates to the importance of keeping the analysis going in a state of abstinence. Freud is keen to point out that the ‘transference love’ of the patient is based on contingent similarities between the patient and the analyst; if the analyst allows himself to be seduced by the patient the analysis is over. If however the analyst spurns the love offered by the patient, it will lead to resistance. The patient would rather, Freud is keen to note, be cured by love rather than do all the hard work involved in analysis. If the analyst gives way to the hysterical ruses of the patient then an analysis, by definition, cannot be completed. These are also the kind of affects that are unleashed in systemically important stakeholders when they are in analysis with stabilizers like Mark Carney. They alternate between cursing him and seducing him; what they really want is to get him to lay-off their unconscious. What should Mark Carney do? The analytically informed answer is that he should keep the analysis going. In other words, he should keep the exams going until he is convinced that he has done what he could to rewire the patient’s unconscious. If Carney himself gets either hystericized or seduced then the hysterical ruses of the stakeholder will make it impossible to stabilize the financial system. It will be tantamount to a form of regulatory capture. In other words, Mark Carney should hold his nerve going forward. Any number of systemically important stakeholders will be willing to seduce Mark Carney if they can get him to back-off from his relentless commitment to stability. Whether Mark Carney will survive this stint in the Bank of England depends on whether he can resist the endemic temptations of regulatory capture; a danger that Janet Yellen is only too aware of.

INTERRUPTING THE TRANSFERENCE

Every patient has a stereotypical way of going about the transference; the task of the analyst is to delineate it in ways that will be therapeutic for the patient. There is however an unresolved question here. Should the analyst interpret the transference? In other words, should he point out, like a 12 For a history of the part played by this case in the development of Freudian psychoanalysis, see Joseph Schwartz (1999). ‘Hysteria and the Origins of the Analytic Hour,’ Cassandra’s Daughter: A History of Psychoanalysis (New York: Penguin Books), pp. 40-62. See also Patrick J. Mahony (1992). ‘A Psychoanalytic Translation of Freud,’ Translating Freud, edited by Darius Gray Ornston, Jr. (New Haven: Yale University Press), pp. 24-47. Mahony calls attention, in his essay, to the number of myths that have accumulated around this particular case since it marks the beginning of psychoanalysis.

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pedagogue, that the patient is not really in love but is suffering in the affective throes of oedipal passion? Freud himself was willing to interpret the transference because, I suspect, he was teaching himself psychoanalysis in his celebrated case histories. But contemporary analysts are a lot more cautious. This is especially the case with Lacanians who would rather ‘interrupt the transference’ using the structure of the variable session rather than ‘interpret the transference’ by explaining to the patient what they are doing. For Lacan, therapeutic outcomes do not depend on the patient having a conscious understanding of what is going on.13 Lacan is not as keen as Freud was to make the unconscious conscious; Lacan thought that such an approach might be counter-productive. It is like a surgeon waking up the patient at periodic intervals in the operating theatre to explain what is going on. Such an approach will protect the patient’s rights but also ensure that she does not survive the operation. Freud was given to invoking the surgical analogy as well. Freud felt that the analyst must be as cold hearted as a surgeon who can save the patient’s life only if he does not get too distracted by the affects that he must navigate on the way. Interpreting the transference can exacerbate the resistance and lead to bouts of regression on the part of the patient. It is important to remember that analysis is based on an asymmetrical model and not on a contractual model of patient care.14

LIBIDINAL ECONOMY OF MONEY

Pat Radford sets out the types of transference in his conceptual essay before explaining the clinical significance of the transferential mechanisms involved. As previously mentioned, the transference could be positive or negative; it can also be ambivalent in orientation. This is just another way of saying it includes both transference love and transference hate. Mark Carney must be familiar with these affects by now. There is nobody that stakeholders love to hate more than Mark Carney; this takes the form of attempts on their part to redefine his remit. They might also quibble about whether stability is a Bank of England preoccupation or whether it is being forced on them because he takes the additional responsibility of ‘fighting threats to stability for the G20.’ Will the real

13 This is not only true for the patient, but also for the analyst. For essays on this theme, see Bruce Fink (2014). Against Understanding: Commentary and Critique in a Lacanian Key (London and New York: Routledge), Vol. 1 and Bruce Fink (2014). Against Understanding: Cases and Commentary in a Lacanian Key (London and New York: Routledge), Vol. 2.14 For a description of Lacanian analysis, see Bruce Fink (1997, 1999). A Clinical Introduction to Lacanian Psychoanalysis: Theory and Technique (Cambridge: Harvard University Press).

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Mark Carney please stand up? Ratford also mentions the ‘compulsion to repeat’ and the need to work-through whatever takes on a compulsive dimension in the analysis. Stakeholders might have seen a recurrent pattern to the themes involved in ‘stress tests’ conducted by the monetary authorities; they necessarily involve a form of repetition. If the stakeholder waits a while, he will see another iteration of the same themes. Those stakeholders who passed last time may not necessarily pass in the next round of exams. This is the systemic pattern of working through that is required by the monetary authorities irrespective of what the results might be on any given occasion. The main range of affects that both analysts and the monetary authorities encounter are the following: frustration, hostility, resistance, and even regression. Those following the process of ‘demonetisation’ in India, for instance, will be familiar with these negative affects. The correct response in such situations for the monetary authorities is to always hold firm. These affects are not just a consequence of the inconvenience generated by demonetisation; they are also a consequence of the fact that money resonates in the unconscious. That is why psychoanalysts know that social hypocrisy has mainly two objects in the unconscious: money and sex. In neither case is it possible for the patient to free associate without revealing some measure of hypocrisy. The main question then, in terms of the libidinal economy of the subject, is this: Which plays a greater role in constituting social hypocrisy? Is it money? Or is it sex? 15

CONCLUSION

These then are just a few suggestions on how the ‘symbolic economy of the monetary system’ is affected by the ‘libidinal economy of money.’16 That is why knowledge of psychoanalysis can be of immense value to the monetary authorities. This is the case for both the 98 percent of psychology that central bankers do and for the 2 percent of interest rates that they must determine at periodic intervals. These clinical notes on the transference and the counter-transference should, I think, not merely 15 For essays on this theme by a renowned psychoanalyst based at INSEAD, see Manfred Kets de Vries (2009). ‘Meditations on Money,’ Sex, Money, Happiness, and Death: The Quest for Authenticity (London and New York: Palgrave Macmillan), The INSEAD Business Press Series, pp. 71-106. See also the essays in John Forrester (1997). Truth Games: Lies, Money, and Psychoanalysis (Cambridge: Harvard University Press). 16 For an extremely lucid introduction to money and the monetary system, see David A. Moss (2007). ‘A Short History of Money and Monetary Policy in the United States,’ A Concise Guide to Macroeconomics: What Managers, Executives, and Students Need to Know (Boston: Harvard Business School Press), pp. 87-97. See also R. W. Hafer (2005). ‘Money,’ The Federal Reserve System: An Encyclopaedia (Westport, CT: Greenwood Press), pp. 258-262

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explain to central bankers the significance of what they are doing in terms of the libidinal economy of money; and the forms of resistance that they must overcome amongst systemically important stakeholders; but, most importantly, make an urgent case for increasing the levels of interaction between psychoanalysts and financial analysts if we are to avoid the early emergence of the next financial crisis. What the monetary authorities and the psychoanalysts can learn from each other then is the difference between the ‘symbolic economy of money’ and the ‘libidinal economy of money.’ This will increase the probability of either preventing the next financial crisis or at least mitigating it.

SHIVA KUMAR SRINIVASAN