Middle Class and Psycho-Economics

The field of psycho-economics.

We combine a fundamental principle of psycho-economics with Prout's concept

of class to analyse the social struggle in Venezuela today.

Traditional economics concentrates on the material motives for doing work.

But people work hard for many reasons, including physical, mental and
spiritual reasons. People's economy of Prout is designed to meet physical
needs, but once physical needs are met people begin to discover that they
have psychic and spiritual needs as well.

Examples of the kinds of motivation that explain why people work so hard to
perform are diverse and difficult task to correlate. A Nobel scientist once
said that in order to do well in science, a person must have a burning in
their tummy. Without a burning urge, it is unlikely that a person would put
in the hard work and have the persistence to overcome all the emotional ups
and downs of scientific research.

The term 'psycho-economics' was invented by Sarkar and refers to one of the
four sub-disciplines of economics. (The other three are people's economy,
commercial economy and general economy.) Psycho-economy includes the study
of the management and utilisation of psychic and spiritual resources.
Perhaps you have not thought of a scientist's "burning in the tummy" as a
form of wealth. But consider the tremendously valuable knowledge and
technology that would be lost if a potential Nobel laureate had not been
born with a burning in his/her tummy.

Psycho-economics takes over when people's economy is functioning well and is

comfortably supplying people with the necessities of life. It is different
from traditional economics because there are no limits to growth. One
person's learning and spiritual insights do not deprive others of the same.
This is a new field of study but Sarkar predicts that in future
psycho-economics will be the glamour field of academic economics.

A fundamental concept in psycho-economics is that no person likes to feel

that their life is stagnating. Every one wants to grow, expand, explore in
at least one part if not several parts of their life at one time. Typically
in human development, we grow physically first, then around the age of 7 or
8 our minds begin to blossom and we discover the intellectual urge. Then
around 18 or so, we begin to appreciate the importance of wisdom and become
attracted to it. Even in later life when our bodies begin to decline, we
never loose that internal urge for continued psychic and spiritual growth.
It is a powerful motivator.

Since psychic and spiritual motivations are so strong in human life, how can
we utilise them for the benefit of social and economic development? A
Proutist economy would endeavour to discover each person's healthy
motivations and utilise them for the benefit of society. One idea promoted
by Sarkar is that a person's incentive income could partly be in a form that
both satisfies the person's desire and at the same time stimulates their
capacity to perform more valuable work. For example, a scientist who is
strongly motivated for research, would like to accept new equipment and new
research facilities as part of their 'income'. An engineer would accept a
trip to some of the engineering marvel's of the world as form of 'income'.
The concept already exists in nascent form in modern corporations as "income
packaging" and "fringe benefits". Prout would greatly expand this approach.

As a generalisation, we may observe that psycho-economy is of particular

importance to the middle class in any society. The physical needs of the
middle class are typically taken care of and they have sufficient education
so that psychic and spiritual expressions become powerful motivators.

We can focus on the Venezuelan middle class and their role in the social
struggles of their country. Perhaps a bold assertion that it is not possible
to place the middle class "on hold" (i.e. ignore the aspirations of the
middle class in Venezuela) while attempting to fight poverty. This can be
amplified and there is a justification of this assertion.

In order to proceed, we need some tools of social analysis. Prout has a

complete theory of social classes and social dynamics but it is beyond the
scope of this brief discussion. For this analysis, it is sufficient to
distinguish the three traditional classes, the poor, the middle class and
the upper class or elite. In addition, it is useful to distinguish three
kinds of social power that can be exercised in any social conflict; people
power, financial power and cultural power.

We can combine these concepts into a single diagram which displays the
different kinds of power exercised by the three classes.

Consider people power. In this scenario, the poor are always in the
majority, so typically people power expresses their concerns. People power
is sometimes incredibly important in social struggle. For example, the right
wing coup which briefly removed President Chavez in April 2002, was defeated
when hundreds of thousands of the poor in Caracas came down from the slums
and surrounded the presidential palace. People power also defeated President
Marcos of the Philippines in 1986. However the primacy of people power is
very rare. If it were the norm, the democracies of the world would be run in
this way, but we know this is not the case.

Financial power is the dominant force in the world today and of course that
is exercised by the wealthy elite. Hence in the diagram, this becomes the
dominant colour - colour of financial power. In Marxist analysis, social
struggle boils down to a struggle between people power and financial power.
People power overcomes financial power only on rare occasions leading to a
proletarian revolution. However Prout considers this analysis to be
inadequate because it ignores the importance of cultural power.

Cultural power is exercised predominantly by the middle class, and in Prout

analysis it is cultural power that is the deciding factor in social
struggle.

The middle class have a special relation to culture partly because of their
education. But also the poor are usually too concerned about where their
next meal is coming from to have the luxury of reflecting on culture. And
the majority of the rich are more concerned about their overseas bank
accounts and tax havens. Therefore the responsibility for preserving and
reproducing culture falls to the middle class.
According to Prout, many social struggles revolve around culture, hence the
importance of the middle class in social struggle. The dynamics of social
struggle usually progress to a point where a community becomes polarised
between those who want to embrace socio-cultural change and those who do not
want change. Venezuelan society is in just such a condition.

It is convenient to compare the two Venezuelan cultures, old and new, using
a few key words. You can certainly think of others.
- The Old Culture: Privilege & Exploitation
- The New Culture: Social Equality & Cooperation

We now return to the consideration of the three kinds of power currently at

play in Venezuela's social struggle.

Let us add a simplification. In order to accommodate the polarisation of

Venezuelan society, we draw a line through the centre of the cultural
rectangle. This signifies two almost equal but opposite cultural forces, the
one for change, the other wishing to retain the culture (traditional for the
last 30 years or more) of privilege and exploitation. This is a
simplification because it is clear that not all of the poor have embraced
the cause of change and perhaps there are also a few of the elite who can
see the need for change. But it is a useful simplification because it
contains enough truth to permit a clarity of thinking and in particular it
allows one to plan appropriate social strategies.

The strategy being pursued by the Venezuelan government at the present time
is to increase the social and cultural awareness of the poor, for example
through the establishment of the Bolivarian Circles. These are study circles
and crucibles for community planning. This is a useful and a worthy
strategy. It would be pursued by any progressive government. In terms of our
diagram, the effect is to increase the scope of the red colour (representing
the poor) in the bottom 'cultural power' rectangle and thus push the white
dividing line towards the right. But it is an insufficient strategy because
it ignores the great danger posed by the disaffected middle class on the
right side of the dividing line. The problem is that a large portion of the
Venezuelan middle class apparently do not feel that the current changes in
Venezuela offer them a future. This is a difficult and complex discussion
because much of middle class thinking is dominated by the media and the
media is almost completely controlled by the elite who are totally committed
to a culture of privilege and exploitation.

The media like to create an impression that the Venezuelan middle class is
opposed to the government of President Chavez. But clearly this is false. A
large number of the middle class do support the cultural changes in
Venezuela and for this reason it was possible for PDVSA (the Venezuelan
state-owned petroleum company) to recover rapidly from the crippling
management strikes of early 2003. However it is clear there exists a
significant portion of the middle class opposed to the new Venezuelan
agenda.

The great challenge is how to convince more and more of this disaffected
group that change in Venezuela is to their long term advantage. The idea
offered here is that an additional component could and should be added to
the government's programs - an attempt to win more of the middle class by
direct participation in its programs. This strategy appears as an additional
arrow in the diagram, situated on the divide within the middle class.
The psychological purpose of additional programs to involve the middle class
is that the middle class must also feel the benefits of the changes in
Venezuela. Better if they feel part of the exciting developments. They can
be the greatest critics of capitalism and the strongest opponents of
exploitation. They should share in the benefits of increasing prosperity.

Here are some proposals:

- Cooperatives require ethical management, sound business management and
ongoing education and training. These are skills that the middle class
possess in abundance. Hence the middle class has the skills to implement the
cooperatives component of the Chavez agenda. When people feel they are part
of a program they will support it.
- Involve middle class in social and economic planning.
- Free up middle class entrepreneurial activity so as to direct it into
cooperatives and small business.

There is a battle for the collective mind - so must get the positive message
out! Counter propaganda in private media - produce grass roots media. Here
the middle class has great potential.

"Middle-class people, with their developed intellect excited by pecuniary

troubles, take the leading part in such a mass upheaval against the reign of
terror, and finally a change in the sceptre is effected by this politically
conscious sector of society." - PR Sarkar