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The
Crowd
Brian
Trumbore
President/Editor, StocksandNews.com
Awhile
back, reader George L. suggested I take a look at
a classic book "The Crowd" by Gustave LeBon. I finally
got around to reading it on a recent long flight and
so I present this 1895 work.
From
the excerpts below you'll quickly see that LeBon believes
crowds almost always act irrationally (as opposed
to the more rational individual) and the reason why
this concept is perfect for a "Wall Street History"
column is because you need only think back to crowd
behavior in the late 1990s/early 2000 at the height
of tech mania, for example, let alone the bubble mentality
that enveloped the real estate sector before it collapsed.
All rational behavior was thrown out the window by
the masses, except for those reading and taking to
heart the lessons of my "Week in Review" column during
both periods, quite frankly. So we all know history
will keep repeating itself and once the crowd comes
to its senses on one bubble, after a little break
it moves on to the next one.
[Of
course this concept also explains nationalist political
movements as well, i.e., 'revolution,' which was the
prime purpose of the author's tome in the first place.]
One
tip. Read this twice. It's a little dense at first
but sinks in with repetition.
---
"The
Crowd"
[Excerpts]
"(It)
is already clear that on whatever lines the societies
of the future are organized, they will have to count
with a new power, with the last surviving sovereign
force of modern times, the power of crowds. On the
ruins of so many ideas formerly considered beyond
discussion, and today decayed or decaying, of so many
sources of authority that successive revolutions have
destroyed, this power, which alone has arisen in their
stead, seems soon destined to absorb the others. While
all our ancient beliefs are tottering and disappearing,
while the old pillars of society are giving way one
by one, the power of the crowd is the only force that
nothing menaces, and of which the prestige is continually
on the increase. The age we are about to enter will
in truth be the ERA OF CROWDS."
---
"Today
the claims of the masses are becoming more and more
sharply defined, and amount to nothing less than a
determination to destroy utterly society as it now
exists, with a view to making it hark back to that
primitive communism which was the normal condition
of all human groups before the dawn of civilization.
Limitations of the hours of labor, the nationalization
of mines, railways, factories, and the soil, the equal
distribution of all products, the elimination of all
the upper classes for the benefit of the popular classes,
etc., such are these claims.
"Little
adapted to reasoning, crowds, on the contrary, are
quick to act. As the result of their present organization
their strength has become immense. The dogmas whose
birth we are witnessing will soon have the force of
the old dogmas; that is to say, the tyrannical and
sovereign force of being above discussion. The divine
right of the masses is about to replace the divine
right of kings."
---
"Civilizations
as yet have only been created and directed by a small
intellectual aristocracy, never by crowds. Crowds
are only powerful for destruction. Their rule is always
tantamount to a barbarian phase. A civilization involves
fixed rules, discipline, a passing from the instinctive
to the rational state, forethought for the future,
an elevated degree of culture - all of them conditions
that crowds, left to themselves, have invariably shown
themselves incapable of realizing. In consequence
of the purely destructive nature of their power, crowds
act like those microbes which hasten the dissolution
of enfeebled or dead bodies. When the structure of
a civilization is rotten, it is always the masses
that bring about its downfall. It is at such a juncture
that their chief mission is plainly visible, and that
for a while the philosophy of number seems the only
philosophy of history."
---
"It
is only by obtaining some sort of insight into the
psychology of crowds that it can be understood how
slight is the action upon them of laws and institutions,
how powerless they are to hold any opinions other
than those which are imposed upon them, and that it
is not with rules based on theories of pure equity
that they are to be led, but by seeking what produces
an impression on them, and what seduces them. For
instance, should a legislator, wishing to impose a
new tax, choose that which would be theoretically
the most just? By no means. In practice the most unjust
may be the best for the masses. Should it at the same
time be the least obvious, and apparently the least
burdensome, it will be the most easily tolerated.
It is for this reason that an indirect tax, however
exorbitant it be, will always be accepted by the crowd,
because, being paid daily in fractions of a farthing
on objects of consumption, it will not interfere with
the habits of the crowd, and will pass unperceived.
Replace it by a proportional tax on wages or income
of any other kind, to be paid in a lump sum, and were
this new imposition theoretically ten times less burdensome
than the other, it would give rise to unanimous protest.
This arises from the fact that a sum relatively high,
which will appear immense, and will in consequence
strike the imagination, has been substituted for the
unperceived fractions of a farthing. The new tax would
only appear light had it been saved farthing by farthing,
but this economic proceeding involves an amount of
foresight of which the masses are incapable."
---
"Moreover,
by the mere fact that he forms part of an organized
crowd, a man descends several rungs in the ladder
of civilization. Isolated, he may be a cultivated
individual; in a crowd, he is a barbarian - that is,
a creature acting by instinct. He possesses the spontaneity,
the violence, the ferocity, and also the enthusiasm
and heroism of primitive beings, whom he further tends
to resemble by the facility with which he allows himself
to be impressed by words and images - which would
be entirely without action on each of the isolated
individuals composing the crowd - and to be induced
to commit acts contrary to his most obvious interests
and his best-known habits. An individual in a crowd
is a grain of sand amid other grains of sand, which
the wind stirs up at will?.
"The
conclusion to be drawn from what precedes is, that
the crowd is always intellectually inferior to the
isolated individual, but that, from the point of view
of feelings and of the acts these feelings provoke,
the crowd may, according to circumstances, be better
or worse than the individual. All depends on the nature
of the suggestion to which the crowd is exposed. This
is the point that has been completely misunderstood
by writers, who have only studied crowds from the
criminal point of view. Doubtless a crowd is often
criminal, but also it is often heroic. It is crowds
rather than isolated individuals that may be induced
to run the risk of death to secure the triumph of
a creed or an idea, that may be fired with enthusiasm
for glory and honor, that are led on - almost without
bread and without arms, as in the age of the Crusades
- to deliver the tomb of Christ from the infidel,
or, as in '93, to defend the fatherland. Such heroism
is without doubt somewhat unconscious, but it is of
such heroism that history is made. Were peoples only
to be credited with the great actions performed in
cold blood, the annals of the world would register
but few of them."
---
"When
studying the fundamental characteristics of a crowd
we stated that it is guided almost exclusively by
unconscious motives. Its acts are far more under the
influence of the spinal cord than of the brain. In
this respect a crowd is closely akin to quite primitive
beings. The acts performed may be perfect so far as
their execution is concerned, but as they are not
directed by the brain, the individual conducts himself
according as the exciting causes to which he is submitted
may happen to decide. A crowd is at the mercy of all
external exciting causes, and reflects their incessant
variations. It is the slave of the impulses which
it receives. The isolated individual may be submitted
to the same exciting causes as the man in a crowd,
but as his brain shows him the inadvisability of yielding
to them, he refrains from yielding. This truth may
be psychologically expressed by saying that the isolated
individual possesses the capacity of dominating his
reflex actions, while a crowd is devoid of this capacity?.
"Any
display of premeditation by crowds is in consequence
out of the question. They may be animated in succession
by the most contrary sentiments, but they will always
be under the influence of the exciting causes of the
moment. They are like the leaves which a tempest whirls
up and scatters in every direction and then allows
to fall. When studying later on certain revolutionary
crowds we shall give some examples of the variability
of their sentiments."
---
"A
crowd may be guilty of murder, incendiarism, and every
kind of crime, but it is also capable of very lofty
acts of devotion, sacrifice, and disinterestedness,
of acts much loftier indeed than those of which the
isolated individual is capable. Appeals to sentiments
of glory, honor, and patriotism are particularly likely
to influence the individual forming part of a crowd,
and often to the extent of obtaining from him the
sacrifice of his life. History is rich in examples
analogous to those furnished by the Crusaders and
the volunteers of 1793. Collectivities alone are capable
of great disinterestedness and great devotion. How
numerous are the crowds that have heroically faced
death for beliefs, ideas, and phrases that they scarcely
understood! The crowds that go on strike do so far
more in obedience to an order than to obtain an increase
of the slender salary with which they make shift.
Personal interest is very rarely a powerful motive
force with crowds, while it is almost the exclusive
motive of the conduct of the isolated individual.
It is assuredly not self-interest that has guided
crowds in so many wars, incomprehensible as a rule
to their intelligence - wars in which they have allowed
themselves to be massacred as easily as the larks
hypnotized by the mirror of the hunter."
---
"It
cannot absolutely be said that crowds do not reason
and are not to be influenced by reasoning.
"However,
the arguments they employ and those which are capable
of influencing them are, from a logical point of view,
of such an inferior kind that it is only by way of
analogy that they can be described as reasoning.
"The
inferior reasoning of crowds is based, just as is
reasoning of a high order, on the association of ideas,
but between the ideas associated by crowds there are
only apparent bonds of analogy or succession. The
mode of reasoning of crowds resembles that of the
Esquimaux [Eskimo] who, knowing from experience that
ice, a transparent body, melts in the mouth, conclude
that glass, also a transparent body, should also melt
in the mouth; or that of the savage who imagines that
by eating the heart of a courageous foe he acquires
his bravery; or of the workman who, having been exploited
by one employer of labor, immediately concludes that
all employers exploit their men."
---
"It
is tradition that guides men, and more especially
so when they are in a crowd. The changes they can
effect in their traditions with any ease, merely bear,
as I have often repeated, upon names and outward forms.
"This
circumstance is not to be regretted. Neither a national
genius nor civilization would be possible without
traditions. In consequence man's two great concerns
since he has existed have been to create a network
of traditions which he afterwards endeavors to destroy
when their beneficial effects have worn themselves
out. Civilization is impossible without traditions,
and progress impossible without the destruction of
those traditions. The difficulty, and it is an immense
difficulty, is to find a proper equilibrium between
stability and variability. Should a people allow its
customs to become too firmly rooted, it can no longer
change, and becomes, like China, incapable of improvement.
Violent revolutions are in this case of no avail'
for what happens is that either the broken fragments
of the chain are pieced together again and the past
resumes its empire without change, or the fragments
remain apart and decadence soon succeeds anarchy.
"The
ideal for a people is in consequence to preserve the
institutions of the past, merely changing them insensibly
and little by little. This ideal is difficult to realize.
The Romans in ancient and the English in modern times
are almost alone in having realized it."
---
[LeBon
quotes from remarks he himself had made fifteen years
earlier?.]
"
'Man, like animals, has a natural tendency to imitation.
Imitation is a necessity for him, provided always
that the imitation is quite easy. It is this necessity
that makes the influence of what is called fashion
so powerful. Whether in the matter of opinions, ideas,
literary manifestations, or merely of dress, how many
persons are bold enough to run counter to the fashion?
It is by examples not by arguments that crowds are
guided. At every period there exists a small number
of individualities which react upon the remainder
and are imitated by the unconscious mass. It is needful,
however, that these individualities should not be
in too pronounced disagreement with received ideas.
Were they so, to imitate them would be too difficult
and their influence would be nil. For this very reason
men who are too superior to their epoch are generally
without influence upon it. The line of separation
is too strongly marked. For the same reason, too,
Europeans, in spite of all the advantages of their
civilization, have so insignificant an influence on
Eastern people; they differ from them to too great
an extent.
"
'The dual action of the past and of reciprocal imitation
renders, in the long run, all the men of the same
country and the same period so alike that even in
the case of individuals who would seem destined to
escape this double influence, such as philosophers,
learned men, and men of letters, thought and style
have a family air which enables the age to which they
belong to be immediately recognized. It is not necessary
to talk for long with an individual to attain a thorough
knowledge of what he reads, of his habitual occupations,
and of the surroundings amid which he lives.'
"Contagion
is so powerful that it forces upon individuals not
only certain opinions, but certain modes of feeling
as well. Contagion is the cause of the contempt in
which, at a given period, certain works are held -
the example of Tannhauser may be cited - which, a
few years later, for the same reason are admired by
those who were foremost in criticizing them.
"The
opinions and belief of crowds are specially propagated
by contagion, but never by reasoning. The conceptions
at present rife among the working classes have been
acquired at the public-house as the result of affirmation,
repetition, and contagion, and indeed the mode of
creation of the beliefs of crowds of every age has
scarcely been different."
---
"
'In an era of equality,' Tocqueville justly remarks,
'men have no faith in each other on account of their
being all alike; yet this same similitude gives them
an almost limitless confidence in the judgment of
the public, the reason being that it does not appear
probable that, all men being equally enlightened,
truth and numerical superiority should not go hand
in hand.'"
---
Wall
Street History returns next week.
Brian
Trumbore
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