© Muffet
The present financial meltdown may only be the latest example of the incalculable harm done to civilization, and countless individual lives, by psychopaths, a subspecies of Homo sapiens. The purpose of this essay is twofold. First, I will provide a brief tour of the psychopath subspecies so that you understand who they are and how they operate. You probably already know psychopaths, and it is overwhelmingly likely that at some point in your life a psychopath that you encounter personally will try to harm you. Second, I will draw the correlative between psychopathy and the present financial meltdown and provide a suggestion of a relatively simple change that could decrease the likelihood of the sort of abuses that could lead to future meltdowns.

Part One: What is a Psychopath?


Kunlangeta is a word Yupik Eskimos apply to "a man who . . . repeatedly lies and cheats and steals things and . . . takes sexual advantage of many women -- someone who does not pay attention to reprimands and who is always being brought to the elders for punishment." In a Harvard University study conducted by anthropologist Jane M. Murphy in 1976, an Eskimo man was asked how his people might deal with a Kunlangeta, to which he replied, "Somebody would have pushed him off the ice when nobody else was looking."

In the West, the formal recognition of psychopaths goes back at least as far as Theophrastus, a student of Aristotle, whose study of the Unscrupulous Man defines the basic characteristics of psychopathy. Much later this condition came to be referred to as manie sans délire ("insanity without delirium"), a term that by the 1830s evolved into moral insanity, the key symptom of which is a "defective conscience."

By 1900 the label was changed to psychopathic personality, but it wasn't until 1941 that psychiatrist Dr. Hervey M. Cleckley of the Medical College of Georgia systematically defined the condition.

A General Description

Very roughly (we'll expand on these characteristics momentarily) a psychopath is a person without conscience, empathy or even an ability to experience the range of human emotions. Their ability to feel is confined to a narrow range of primitive proto-emotions such as anger, frustration and rage. Psychopaths will tend to be pathological liars and expert manipulators victimizing family, friends and strangers. Often they are charming, charismatic, popular and admired, if not loved, by members of both genders. They are not mentally ill, not delusional, and may often be more coldly rational and intelligent than non-psychopaths. They are likely to be promiscuous and to abandon partners without remorse. They are prone to entitlement, grandiosity and find nothing wrong with themselves. They typically blame others for the consequences of their actions and engage in moral reasoning that is glib and superficial if not absurd. They usually have little fear of consequences and enjoy risk as they need novelty, stimulation and living on the edge to compensate for their emotional vacuity.

Psychopathy Demographics

Across all eras and societies, approximately one in a hundred men is born a clinical psychopath, and one in three hundred women. About twenty percent of an average prison population, male or female, is comprised of psychopaths, but amongst the violent offenders it is about fifty percent. Psychopaths commit more than fifty percent of the serious crimes. For example, about half of serial rapists are psychopaths. About 25% of wife assaulters are psychopaths. Both male and female psychopaths commit a greater number of crimes, and their crimes tend to be more violent, abusive and predatory than those of other criminals. They also tend to recidivate earlier and much more often than other criminals. While psychopaths make up about one percent of the population, ten percent of the general population falls into a grey zone with enough psychopathic tendencies to be of significant concern to society.

Lack of Empathy and Emotional Depth

Most of us take emotional experience for granted and tend to assume that others have a similar range of emotion as we do. Most of the time this premise is correct, and this allows us to often accurately replicate the emotional state of another within our own perception. But among those to whom we apply this principal are psychopaths who often have a chameleon-like ability to replicate and counterfeit emotions in ways that allow them to manipulate our perceptions of them. We are very likely to accept as genuine their counterfeit displays of emotion, and thereby falsely attribute emotional depths to psychopaths who in actuality are entirely lacking the feelings we think we perceive. In reality they may be completely indifferent to the acute suffering of someone right in front of them, and can remain cold and unmoved by all sorts of things that what would emotionally affect most people. On the other hand, insignificant matters that most would react to with minor annoyance can greatly enrage them.

Dr. Cleckley believed that psychopaths have a profound underlying disorder in which emotional and linguistic components of thought are not properly integrated. He called this condition semantic aphasia and concluded that it greatly reduced the capacity for developing internal control, conscience and the capacity for making emotional connections with others.

Functional MRI scans of the brains of psychopaths show that their patterns of brain response to words and images of strong emotional content have a fundamental difference with non-psychopaths. Ordinarily, limbic regions of the brain process emotional content, but for psychopaths, activations occur in regions of the brain associated with comprehension and production of language suggesting that things which evoke emotion in normal people are experienced by psychopaths as linguistic categories. A psychopath might scan the inanimate, animate and emotionally charged with the same neutral, indifferent coldness -- a rusting transmission over here, a person writhing in agony over there, an overturned trash can just up ahead, etc. They may be well aware, however, of how others might react, and can smoothly feign an emotional response if so doing serves their agenda.

For example, a psychopath who killed an elderly man during the course of a burglary, casually gave the following account of his evening:
I was rummaging around when this old geezer comes down the stairs and...uh...he starts yelling and having a fucking fit...so I pop him one in the, uh, head and he still doesn't shut up. I give him a chop to the throat and he...like...staggers back and falls on the floor. He's gurgling and making sounds like a stuck pig (laughs) and he's really getting on my fucking nerves so I...uh...boot him a few times in the head. That shut him up...I'm pretty tired by now, so I grab a few beers from the fridge and turn on the TV and fall asleep. The cops woke me up (laughs).
A researcher tried to find out if a psychopathic convict recognized the feeling of fear. When asked, the psychopath responded, "When I rob a bank I notice that the teller shakes or becomes tongue-tied. One barfed all over the money." The psychopath found these responses puzzling.

The researcher pressed the psychopath to describe his own fear and asked how he would feel if the gun were pointed at him. The convict responded that he might hand over the money, get the hell out or find a way to turn the tables. "Those were responses," the researcher said. "How would you feel?"
"Feel? Why would I feel?"
Psychopaths can, however, feel primitive protoemotions like anger, frustration and rage. Occasionally, even full-blown psychopaths like Eric Harris (of Columbine infamy) will display what seem like flickers of empathy. Eric appeared to feel bad for his dog when it was sick and, along with Dylan, apologized on his basement videotapes to his parents for the trouble he anticipated they would experience after the massacre. Since psychopaths are so often masters of feigning emotional responses, however, it can be hard to discern what might be an actual moment of empathy from another simulation.

A probable psychopath that I knew in the early Eighties seemed to have a subordinate part of his personality that had elements of conscience and empathy. For example, he once warned me that he was evil and that I should have nothing to do with him. Foolishly I responded sympathetically, and rather than heeding the warning I told him I thought he was being too hard on himself. For a moment he seemed to take me behind the scenes of his inner psychopathic machinery. He said that he was just kidding when he told me that he was evil, but then told me that when he said he was kidding that it was just an example of his deceptiveness so that he could disown his own statement. Then he said no, he really was just kidding, and put on again his usual charming, smiling demeanor. Although this might seem like merely a mind game and a psychopath toying with someone, it was also a type of confession. He was intentionally going in and out of psychopathic mode to show me what he was.

That same evening, he related a specific incident in his past when he felt that his soul died. This did not seem a mind game at all; a palpable sense of suffering and bitterness was in the air as he confessed this. He also confessed many traumatic details of his life that I was later able to verify. Although it is a classic psychopathic technique to reveal some truths as part of playing someone, I don't think that was the complete explanation in this case. There also seemed to be motivations of actual confession and reaching out for help.

Months later I discovered a series of deceptions and thefts he had committed against me. In what appeared to be an act of calculated carelessness, he kept evidence of all his petty crimes against me in a place where I could easily find it, as though a part of him desired to be caught.

A Psychopathic Paradox

In my research on psychopaths I noticed an obvious paradox: psychopaths, everyone agrees, are notoriously unempathetic, but they are also, everyone agrees, superb manipulators able to accurately read other people and gauge their weak points with fine precision. None of the research I encountered seemed to comment on or explain this paradox, so I'm going to offer my own speculation. Non-psychopaths are often inaccurate in their reading of others because of their own complex emotional lives. When emotions are swirling around inside of you it is all too easy to project feelings and expectations onto others. We also tend to assume that others must have a similar range of emotions as we have. Most dogs, for example, display a range of emotions that seem very recognizable to us, so it is natural to assume that our fellow humans must have these as well. The emotional vacuity of the psychopath combined with their cold rationality may allow their psyche to register an image of our personalities as if on a clean photographic plate. They may be able to recognize our needs and vulnerabilities much more clearly since there is little emotional confusion within them to obscure that. With a focused, predator consciousness as their inner baseline, they can see all of our characteristics that deviate from that baseline in distinct relief. Even if we are complex, it may not take complex insight to manipulate us because even complex people have very stereotyped vulnerabilities and therefore can be manipulated by flattery, sexual attention, greed, intimidation and fear.

The Charm, Magnetism and Charisma of the Psychopath

"He is such a caring man. So intelligent. He can always find the right words to reach your heart. You must love him." -- Woman who befriended a rapist/murderer on death row.

Everyone who has observed psychopaths has noted their intense charm and magnetism, which will often cause them to be the most popular individuals in almost any social circle. Many of the most popular movie heroes, Clint Eastwood's Dirty Harry character comes to mind, are psychopaths. In Cleckley's classic study of psychopaths, "likeable," "charming," "intelligent," "alert," "impressive," "confidence-inspiring," and "a great success with the ladies" are some of the most common descriptions of psychopaths. Most people labor under insecurities and psychopaths are often objects of intense admiration since they possess desirable traits such as overwhelming self-confidence, decisiveness and attractiveness to the opposite sex. Even well trained mental health professionals with substantial knowledge of psychopathy are deceived and seduced into sexual relationships with known psychopaths.For example, a prison psychologist had an affair with a psychopath and planned to marry him after his release. When a psychiatrist showed the prison psychologist a copy of Without Conscience, by Robert Hare, the world's leading expert on psychopathy, it had no effect on her love and marriage plans with the psychopath.

Hare writes about,
...A con artist who became Man of the Year, president of the Chamber of Commerce and member of the Republican Executive Committee in the town where he resided for ten years. When found out, this man was unconcerned, and stated that he knew if he was ever discovered 'these trusting people would stand behind me. A good liar is a good judge of people.' He was right in many senses. The local community rushed to his support. 'I assess (his) genuineness, integrity, and devotion to duty to rank right alongside of President Abraham Lincoln,' wrote the Republican party chairman.
I have a theory of the often-astonishing appeal of psychopaths, cult leaders, super salesmen and demagogues of various sorts that uses magnetism as an analogue. Most people are highly fragmented and oppressed by what psychologists call psychic entropy -- the anxious tape loops and other distracted thoughts and fantasies that crowd their attentional space. When a person of single-minded focus and confidence appears it is analogous to placing a powerful magnet below a sheet of paper on which there is a scattering of iron filings. The magnet immediately organizes the scattered filings into a coherent pattern that reflects its magnetic field. The scattered personality feels an immense relief to be structured in this way from the outside and craves further contact and submission to the magnetic personality that can produce this effect, relieving them of their default state of psychic entropy.

Psychopaths and Pawns

"My belief is that if I say something it goes. I am the law. If you don't like it, you die." --Eric Harris

Psychopaths are predators and their predation is oriented toward members of their own species whom they view as pawns, suckers, targets and victims. They are unable to empathize with anyone and are therefore completely unfazed, if not contemptuous, by the suffering of their victims. Although they may appear charming and solicitous, covertly they are domineering, hostile and exploitative. According to Hare,
Their statements often reveal their belief that the world is made up of 'givers and takers,' predators and prey, and that it would be very foolish not to exploit the weakness of others. In addition, they can be very astute at determining what those weaknesses are and using them for their own benefit. 'I like to con people. I'm conning you now,' said...a forty-five- year-old man serving his first prison sentence for stock fraud.
Psychopaths recognize no rights of others while feeling infinite entitlement for themselves. They will, therefore, violate any boundaries to get what they want. Often they will take pleasure in dominating, exploiting and humiliating their victims.


"I hate the fucking world. I feel like God. I am higher than almost anyone in the fucking world in terms of universal intelligence." --Eric Harris (From his journal, which was entitled "The Book of God." Eric also wrote a composition for school entitled "Zeus and I" in which he compared himself to Zeus.)

Although other personality types also display grandiosity, psychopaths seem to be particularly high on themselves. Hare described a psychopath named Earl whose long list of accomplishments included stabbing a teacher with a fork in kindergarten, becoming a pimp at age 10 by procuring young girls including his 12-year-old sister, multiple counts of assault, rape, theft, fraud, attempted murder, sexually abusing his daughter, and raping his daughter's girlfriend. Earl described his self-esteem this way: "I'm always being told by others how great I am and how there's nothing I can't do -- sometimes I think they're just shitting me, but a man's got to believe in himself, right? When I check myself out, I like what I see."

Pathological Lying

"I lie a lot -- almost constant, and to everybody, just to keep my own ass out of the water. Let's see what are some big lies I have told...No, I haven't been making more bombs." --Eric Harris

Psychopaths lie with such ease and coolness that they can become addicted to it and will often lie when it serves no practical purpose. They have no anxiety about lying and are often extremely convincing and are even able to pass polygraph tests. Polygraph tests register physiological stress responses to the anxiety of lying, but since psychopaths have no anxiety about lying, the lies register no different than their baseline. Psychopaths also lie to themselves and may get deceived by complex beliefs about their own talents, powers and abilities. As Hare put it,
Lying comes so naturally to psychopaths that one of them compared it to breathing. Often they take considerable pride in their facility with lies. One female psychopath, when asked if she lied easily, laughed and replied, 'I'm the best. I'm really good at it, I think because I sometimes admit to something bad about myself. They'd think, well, if she's admitting to that she must be telling the truth about the rest.' She also said that she sometimes 'salts the mine:' with a nugget of truth. 'If they think some of what you say is true, they usually think it's all true.'
Lack of Remorse, Shame, Guilt and Empathy

A psychopath can commit the most heinous deed without experiencing a trace of remorse, guilt or empathy for victims. A lack of empathy, however, does not mean he will to do harm. Many psychopaths are nonviolent and may instead be found amongst white-collar criminals. But when a psychopath also happens to be a sexual sadist, the lack of empathy can produce a catastrophic result -- a remorseless, efficient rapist and/or killer. Ted Bundy, who may have murdered as many as a hundred women, was once asked about guilt: "Guilt? It's this mechanism we use to control people. It's an illusion. It's a kind of social control mechanism -- and it's very unhealthy. It does terrible things to our bodies. And there are much better ways to control our behavior than that rather extraordinary use of guilt." An expert on serial killers I once heard interviewed recalled an instance where he asked a serial killer what he thought about what he systematically stalked a young woman and prepared to abduct, torture, molest and kill her. He replied, "Takin' care of business." The shame, guilt and anxiety that might inhibit or trip up the average criminal may be entirely absent in psychopaths, allowing them to be cool, collected and efficient. Where we might hope to find inner conflict about an act of violence we may instead find only pleasure and considerable pride. On the block I grew up on in the Bronx a guy in his twenties would sometimes show up who carried a laminated clipping in his wallet that he showed off every chance he got. The clipping described how he had fatally stabbed someone for bumping into him at a dance.

Glib and/or Warped Moral Reasoning

If a psychopath attempts to justify a crime, the moral reasoning is likely to be an act, but if sincere it will be glib and superficial or absurdly rationalized. A rapist psychopath justified himself this way: "What's a guy gonna do? She had a nice ass. I helped myself." Joyti De-Laurey, a female psychopath who stole more than 7 million dollars from her employers to lead a lavish lifestyle, felt sure that God was on her side. She kept notebooks she called "Bibles of Daily Thoughts," which contained her letters to God. In one of them she wrote: "Dear God. Please help me. I need one more helping of what's mine and then I must cut down and cease in time all the plundering. Please ensure my job is safe and my integrity is unquestioned."

While some might comfort themselves that religiosity should be an immunization of some sort against psychopathy, the opposite seems to be the case. Religion can easily be used by a psychopath like Jim Jones as a justification for an agenda of power, greed, sexual conquest and sadistic manipulation. Since religious communities tend to assume bonds of affinity amongst members, they are the perfect hunting grounds for psychopaths.

A Need for Risk, Excitement and Novel Stimulation

Because of their emotional vacuity, psychopaths may have an extreme and overriding need for risk and life on the edge. They are often high-risk thrill-seekers, as this may be the only way they can feel anything. For example, a female psychopath said, "But what I find most exciting is walking through airports with drugs. Christ! What a high!" This need for continual stimulation, as we shall see later, is a key point of connection between psychopathy and the financial meltdown.

The Power of Now

A related quality is that psychopaths tend to live for the moment and usually don't dwell on the past or future. They tend to be clever situationalists interested in getting as much stimulation out of the day that they can. They are usually less interested in long-range planning and tend to disregard consequences for themselves and others. A psychopath in high finance, for example, will be much more interested in making a windfall profit this quarter rather than doing what is in the long-term interest of his company or clients.

Disregard of Consequences

Since psychopaths tend to live for the now, and are often unable to feel fear, they tend to have little concern about consequences for themselves and others. They are usually very poor at mentally picturing the consequences of their actions. Particularly fuzzy is any image they might have of consequences for their victims. The excitement of immediate rewards seems much more real than the vagueness of future consequences.

Don't Know Thy Self

Psychopaths usually don't find any fault with themselves. They apparently don't notice the inconsistency between their enormous sense of entitlement and their stunning disregard for the rights of others. If they acknowledge anything wrong they can always blame it on someone else or on society. For example, a young psychopath said, "I wouldn't be here if my parents had come across when I needed them. What kind of parents would let their son rot in a place like this?" Asked about his children, he replied, "I've never seen them. I think they were given up for adoption. How the hell should I know?" A refusal to accept blame can also characterize a psychopathic culture, and I certainly can't recall hearing a single mea culpa during this financial meltdown.

Psychopath as Predator, Parasite and Chameleon

Psychopaths typically lead a parasitic lifestyle. They are experts at finding people and institutions that can be drained of resources. The host could be a vulnerable person with a bank account or a Wall Street investment firm. Many researchers describe psychopaths as chameleons because of their great proficiency at blending in and disguising their true agendas and nature. As the author of Columbine, David Cullen, put it, most people think Hannibal Lechter when they think of psychopaths, but it would be more accurate if they thought of Hugh Grant. Robert Hare related a recent incident where he was taken in by a psychopath and he said that his "antenna" weren't aroused at all. One researcher described the psychopath as a "near perfect invisible human predator." Another described him as a chameleon that becomes "an image of what you haven't done for yourself."

Ann Rule's book, The Stranger Beside Me, describes how she worked across a desk from Ted Bundy at a suicide hotline and became his close friend. She had great trouble accepting that her friend and fellow counselor was one of the most notorious serial killers in history.

Psychopaths are known to be masters of tapping into the vulnerabilities of others, at first by appearing to be what victims are hoping to find, and later taking ruthless advantage of their fears and insecurities.

People frequently report that in the presence of a psychopath their hearts are racing and they are sitting at the edge of their chair. The air around them may seem to crackle with electricity, which some find thrilling and magnetic. According to a survey conducted by psychologists Reid and M. J. Meloy, one in three mental-health and criminal justice professionals report such feelings when interviewing psychopaths. In their paper based on the survey, Reid and Meloy speculate that this may be an ancient intraspecies predator-response system.

I've had some experiences that would provide a little anecdotal support to their speculation about an ancient intraspecies predator-response system. One time on a daytime train ride to Brooklyn I had the distinct feeling of close proximity to a murderer/predator. The feeling was quite unpleasant and seemed primordial and almost cellular, a feeling that seemed primitive enough not to be specifically human, but rather to be a feeling that a great many other organisms experienced. What I experienced was the very unpleasant sensation of my body as meat, as a possible food source for a predator. As I looked around the subway car, however, I couldn't locate the source.

Another time, around 1987, I had a very similar feeling, also on in the NYC subway system, but this time while waiting on the platform of the 14th Street Union Square station. I looked all around me, but the only people I could see seemed fairly harmless. A couple of seconds after my brief visual survey I saw two adolescent males, both of them relatively small and skinny, coming down the staircase. One of them was wearing an Eight Ball leather jacket. Eight Ball leather jackets, cleverly sewn together out of colored segments that depict a pool table and a large eight ball, were one of the hottest retail items in the inner city, the Air Jordans of that particular season. Having only just left a six-year stint as teacher and dean of a public high school in the South Bronx, where I was also the building security coordinator, I understood the significance of such a jacket. Five minutes after leaving my class, a student of mine, who had an imposing physical size and presence, was shot with a shotgun when he resisted giving up a different, though similarly popular, type of leather jacket. Anyone wearing an Eight Ball jacket likely took it from someone else and/or had the means to defend this high status item -- probably with a device that could easily make a series of nine-millimeter holes in a would-be jacket thief of any size.

Besides the implications of the one boy's jacket, these two adolescent males lit up as the source of my predator-alert feelings. Since Union Square was a well-populated station I didn't feel that I was in imminent danger, despite the sensation of my predator-response system, and decided to stand near these two adolescents when they reached the platform. The more dominant-seeming of the two appeared to be surveying people on the platform, many of them well-dressed professional types, and said to his partner, "So much meat on the hook and we can't do shit." I understood his statement to mean that he saw that there were many prime mugging victims around, but that the crowded station prevented them from acting.

If my feelings and suppositions were correct, this would be the second time that I had encountered a dyad -- a two person killing team. Some famous dyads include Bonnie and Clyde, Leopold and Loeb, and, far more recently, Eric Harris and Dylan Klebold. In both of the dyads I encountered, it was instantly obvious that one of the pair was dominant and acted toward the other like a puppet master. According to Columbine, dyads are much more likely to be complimentary rather than similar.

Are Psychopaths a Subspecies?

"How dare you think that I and you are part of the same species when we are so different. You are human? You are a robot. And if you pissed me off in the past you will die..." --Eric Harris

Although psychopathy, like every other psychological attribute, has an environmental component, its source may be biological. According to at least one major study of identical twins, psychopathy does seem to have a strong genetic component. It is often impossible to account for a psychopath based on his environment and upbringing. Psychopaths often occur in caring families amongst empathetic siblings. Eric Harris quoted Shakespeare in an entry he left in his day planner for Mother's Day: "Good wombs have borne bad sons."

Alan Harrington, in his book Psychopaths, states that the psychopath is "the man of the future." Other researchers, among them Dr. Marnie Rice, an Ontario-based psychologist, echo this sentiment by claiming that the condition isn't a "disorder" at all, but is more accurately considered an adaptive, evolutionary trait. From the point of view of this theory, in societies where most people are law-abiding and inhibited by conscience, a finely tuned, camouflaged predator can find a great, adaptive niche. Part of their successful evolutionary adaptation hinges on the fact that psychopaths become sexually active earlier and remain more promiscuous than their non-psychopath counterparts. Besides the frequency of their sexual transactions, their uninhibited use of coercion and exploitation, as well as their tendency to freely abandon partners and quickly take up with new ones, means that they are considerably better than average at passing on their genes. Psychopaths also seem to selectively target reproductively fertile women and are less likely to sexually target the same gender or the prepubescent.

Part Two: Psychopaths and the Financial Meltdown

Two businessmen are walking together, each carrying a briefcase. 'We're only morally bankrupt,' says one. 'Thank God,' says the other.

Are Psychopaths Uniquely Adapted to Succeed in High Finance?

Although Harrington called the psychopath the "man of the future," when it comes to the world of high finance the psychopath may be the man of the present and recent past. R. J. Smith, in his book, The Psychopath in Society, views psychopathy as an orientation encouraged and rewarded by the materialistic, competitive, marketplace values of our capitalistic society. Our tour of psychopathy emphasized those who committed violent crimes, the easily defined psychopaths who, by their open acts of transgression, are available for study. However, the cleverer, more successful psychopaths are likely to elude detection and may even achieve great success in society. It is the failed psychopaths, those who are not able to blend in and restrain their impulses, whom we hear about in newspaper headlines. Most psychopaths are not violent criminals; they may be more likely to pursue white-collar crime, where the payoff is so much higher and the odds of detection so much lower.

Psychopaths are perfectly designed for success in many fields, especially business, law and politics. They have higher IQs on average than the general population; they are charming, charismatic and manipulative; they can be decisive and take risks without anxiety, and they are ruthless, cunning and coldly rational. Psychopaths often personify many of the traits that the human resource departments of many corporations look for in job candidates: confidence, charisma, decisiveness, emotional detachment, coolness under fire and relentless drive. Take for example Bernie Madoff, who was described by a reporter who grilled him for two hours as "cool as a cucumber." He was relentless in his drive for success and was not inhibited by conscience when he took money from friends, schools or charities. His all-confident charisma and capacity for deception took in many very astute people. Madoff was a master at making it seem like he didn't particularly want your business so that prospective customers had to court him, and when he acquiesced they felt privileged to be part of an exclusive club.

A Parasitic Agenda

Psychopaths are natural parasites, and parasites always look for rich deposits of energy such as blood, sexual chi, and money. Wall Street and other spheres of high financs are like super-charged magnets for psychopaths. As Hare put it, "If I were unable to study psychopaths in prison, my next choice would very likely be a place like the Vancouver Stock Exchange." Vast deposits of energy in the form of money are available for the clever and ruthless manipulator with a head for numbers. In the process of manipulating money the ambitious psychopath may also achieve prestige, if not celebrity. Since they are emotionally vacuous, money fills up a psychopath; he can use money to fulfill all his needs and won't be tormented by guilt or a sense of emptiness.

World as Cookie Jar

Opportunities to steal money are irresistible for psychopaths. As one psychopath convicted of selling forged corporate bonds put it, "I wouldn't be in prison if there weren't so many cookie jars just begging me to put my hand in." For psychopaths, known for their grandiosity and ability to "think big," the entire global economy is a planet-sized cookie jar begging to be plundered.

Psychopathy, the Nightmare from which We are Trying to Awaken

The affinity of psychopaths for high finance is certainly not my discovery. My original working title for this essay was: "Reptiles in Brooks Brothers Suits." I abandoned that title when I discovered that Robert Hare, the world's leading expert on psychopathy, had co-authored an excellent book entitled Snakes in Suits -- When Psychopaths go to Work. I almost abandoned the whole project, wondering if I had anything new to say. After some consideration I realized that although the main hypothesis was already well established by others, I had a few new points to add and, in any case, the subject is so important, and with such vast implications for society, that I felt obliged to continue. The damage that psychopaths do to the global economy, and human civilization in general, is incalculable. As the James Joyce character Stephen Dedalus said, "History is a nightmare from which I am trying to awaken." Psychopathy may be one of the prime drivers of the nightmarish aspect of history.

Situational Psychopathy, a Confusion of Terms

To understand the depth of connection between psychopathy and the financial meltdown we need to acknowledge that not everyone who acts like a psychopath is a psychopath. As we pointed out earlier, about ten percent of the population is in a grey zone where they are not full blown psychopaths but have enough psychopathic aspects to be of concern to society. A psychopathic culture can cause people who might otherwise be restrained or even moral to act like psychopaths. The stress and culture of combat, for example, can cause some soldiers to act like psychopaths, needlessly killing civilians even when not specifically ordered to do so. As veterans, these soldiers may be tormented by profound feelings of guilt and remorse. Many male subcultures have a psychopathic attitude toward women such that it is considered virtuous and manly to ruthlessly exploit women without remorse. Street and motorcycle gangs, organized crime families and syndicates, all tend to have psychopathic cultures. The person who is most ruthless, cool under fire, and skilled in lying and manipulation will likely be deferred to or made the leader of a gang or other criminal enterprise.

Non-psychopaths who act like psychopaths are frequently called sociopaths. Sociopath is a term that many researchers dislike since it is often incorrectly used as a synonym for psychopath. A sociopath is someone who acts in an anti-social way, who commits transgressions without taking moral responsibility. Most psychopaths are sociopaths, but many sociopaths are not psychopaths. If that's not confusing enough, the DSM created a third unilluminating term, antisocial personality disorder or ASPD, which they define as "...a pervasive pattern of disregard for, and violation of, the rights of others that begins in childhood or early adolescence and continues into adulthood." Some say that ASPD is just psychobabble for "criminal."

My former writing mentor, E.L. Doctorow, once called such psychiatric terms "the industrialized form of storytelling." We do, however, have a rigorous way of defining and diagnosing psychopaths -- Hare's psychopathy checklist -- so it is the other two terms that seem to muddy the waters and create endless confusion. I propose, and will hereafter use, the terms "situational psychopathy" and "situational psychopath" because I believe these clarify the key difference. Some people, who are not psychopaths, will act like psychopaths in some situations and there are some situations that seem to bring out psychopathic behaviors in non-psychopaths. The stress of combat, as we discussed above, is the classic situation of situational pscyhopathy. Bond trading and the floor of the stock exchange are often described as combat situations, with people screaming and shouting orders amidst frantic activity and general chaos. Many areas of high finance seem to be psychopathic cultures (a culture that generates situational psychopathy) where psychopaths and situational psychopaths act similarly. Robert Hare was a consultant to the excellent documentary, The Corporation, which documents the psychopathic culture that reigns in many, but not all, corporations. As illustrative examples of how this psychopathic culture is generated we will next take a look at the movie, Wall Street, and the documentary, Enron: The Smartest Guys in the Room.

Psychopathy on Wall Street

No other artifact of popular culture captures the mythology of Wall Street so well as Oliver Stone's classic 1987 movie, Wall Street. Oliver Stone's father was a Wall Street trader and the film was meticulously researched and informed by insider information. Twenty-two years later it seems not just mythological, but also remarkably prophetic. The personification of Wall Street in the movie is a corporate raider, Gordon Gecko, a man who we are told, "...had an ethical bypass at birth," a description that sounds almost like a definition of psychopathy. The character is named after a reptile and Gecko lives in a super-charged atmosphere of reptilian proto emotions. He is continually saying things like, "we're in the kill zone, lock and load," and, "I want every orifice in his fucking body flowing red."

The main thing Gecko wants in prospective employees is killer instinct and emotional vacuity: "Give me guys who are poor, smart and hungry, and no feelings." He has complete remorseless contempt for his competitors and the thousands of victims of his hostile takeovers: "We beat them because they're sheep, and sheep get slaughtered."

Gecko seems motivated by risk and the atmosphere of combat. He tells his young protégé, Bud Fox, that it's "trench warfare out there pal. It's better than sex."

Gecko is named after a reptile, but his protégé, Bud Fox, is named after a mammal. While Gecko seems pure psychopath, Fox is obviously not a psychopath; he is a man of conscience who eventually acts nobly. The Bud Fox character personifies the situational psychopath, a person who becomes seduced by a psychopathic culture into acting in ways that violate his essential human values.

Enron: The Smartest Guys in the Room

Enron: the Smartest Guys in the Room is a brilliant 2005 documentary about the Enron scandal. Imdb.com offers the following summary:
Enron dives from the seventh largest US company to bankruptcy in less than a year in this tale told chronologically. The emphasis is on human drama, from suicide to 20,000 people sacked: the personalities of Ken Lay (with Falwellesque rectitude), Jeff Skilling (he of big ideas), Lou Pai (gone with $250 M), and Andy Fastow (the dark prince) dominate. Along the way, we watch Enron game California's deregulated electricity market, get a free pass from Arthur Andersen (which okays the dubious mark-to-market accounting), use greed to manipulate banks and brokerages (Merrill Lynch fires the analyst who questions Enron's rise), and hear from both Presidents Bush what great guys these are.
The film also provides fascinating glimpses into a psychopathic culture dominating a major corporation. It would be presumptuous for me to diagnosis any subject of the documentary as a psychopath. A diagnosis of psychopathy should be made by a professional who has significant access to the person in question and has been rigorously trained in the use of Hare's psychopathy checklist, the widely accepted tool for screening possible psychopaths. Most of the people involved in the Enron scandal were probably not psychopaths. As the director of the documentary put it,
These were not extraordinary people, extraordinarily bad people, they were everyday people and many of them off the job were extraordinarily decent people, but on the job they were killers and how did that happen? Well, in some ways, I think, the only conclusion you can come to is that the culture of Enron infected them in a way that they lost any sense of moral perspective.
It is easy to recognize many instances of at least situational psychopathy in the Enron culture. Many have pointed out how high testosterone and predatory competition dominated the culture of Enron. As one very candid former Enron employee put it, "Talking about my compensation -- If I step on somebody's throat and that doubles it, well I'll stomp on the guy's throat. That's how people were." Jeffrey Skilling said that he liked to hire "guys with spikes." In the most famous instance of situational psychopathy, a sound bite widely replayed on TV news, two Enron energy traders who knew they were being recorded, have a bit of informal conversation. The dialogue takes place when Enron was artificially creating rolling blackouts in California so as to manipulate the energy market through systematic extortion.

Here's a sample:
"Yeah, Grandma Millie, man, she's the one who couldn't figure out how to fuckin' vote on the butterfly ballot. Now she wants her fucking money back on the power you charged right up her ass."
Enron president Jeffrey Skilling, perhaps the most visible of the Enron players, displayed a number of psychopathic values and tendencies. A reporter who interviewed Skilling just before he resigned from Enron, left absolutely convinced of the improbable story that he was leaving Enron because of family reasons. As the reporter put it in his interview for Enron,

Skilling convinced me that it was for personal reasons. I left his meeting feeling sort of emotional because of the concern that he seemed to be showing about the relationship he had with his family. He appeared to be distraught and I remember saying to an investor, 'If he's not telling the truth, then it's a good thing he quit his day job because he needs to go to Hollywood.' Skilling always seemed convinced of his own innocence despite all the dramatic evidence to the contrary. His moral reasoning seemed to embody the glib superficiality and sense of entitlement so common in psychopaths. At one point Skilling looks a video camera right in the eye and with a look of poignant sincerity says: 'We're the good guys. We're on the side of angels.'

Skilling and a number of the key Enron players seemed motivated by the exhilaration of risk even when it was at the cost of self-interest. In the documentary we are told by people who knew Skilling personally that despite the fact that he "...portrayed himself as somebody who very tightly monitored risk, in reality he's a gambler, he gambled away huge sums of money before he was twenty years old by making wild bets on the market." It's also pointed out that Skilling "...was a huge risk taker. He actually talked about wanting to go on trips that were so perilous that someone could actually die." In fact, Skilling organized many such dangerous trips for himself and other Enron executives. These high-risk adventures yielded many broken bones and other serious injuries and no doubt helped to inculcate the high testosterone Enron culture with its emphasis on aggression, risk and a thrill-seeking life on the edge. While there was so much evidence of the garish palette of reptilian proto emotions, there were few displays of other sorts of feelings and a noticeable lack of empathy. At one point in the documentary, Lou Pai, who would later flee Enron with a 250-million-dollar golden parachute, said, "I'm not feeling anything."

Enron as a corporation seemed to embody the parasite strategy of going after a rich deposit of energy and finding a way to drain it. Rather than getting into the energy production business, they were mostly interested in being energy middlemen using a variety of trickster strategies to acquire wealth and power without producing anything of value to society. Fed Chairman Allan Greenspan, and other true believers in the innate intelligence of the marketplace to self-regulate, was not wary enough about parasitic tricksters who like to take huge risks with other people's money. As a result, the Enron scandal came as a huge shock, but not enough of a shock to get the SEC to uncover Bernie Madoff's Ponzi scheme, which they had been warned about repeatedly. Also, as we are all now painfully aware, there was a remarkable lack of action by any government agency or regulatory force while sub-prime mortgages were being feverishly propagated by a whole sector of the economy that was infected by a similar trickster passion for gambling with enough of other people's money to threaten the economy of our entire planet.

The Flaw in Greenspan's Model

During congressional testimony and several interviews, former Fed Chairman Allan Greenspan acknowledged that he was shocked to discover that there was an essential flaw in his model of the economy. Before Congress he acknowledged the flaw, but in densely abstracted Greenspanease. In interviews he described the flaw more conversationally (unfortunately, I cannot quote verbatim) and said that he falsely assumed that self-interest would keep people from doing certain things. In other words, Greenspan recognized that his model had a psychological flaw that made an incorrect assumption about human motivation. I believe that Greenspan would have been quicker to recognize this flaw in his understanding of motivation if he knew more about psychopathy. Psychopaths are, of course, motivated by self-interest, but there is another, more primary motivation that will often trump self-interest. As we have discussed earlier, psychopaths are emotionally vacuous, and therefore they are powerfully drawn toward risk taking in order to feel anything. Psychopaths also live in the present and are not very concerned about consequences for themselves and others. Harsher penalties may not be much of a deterrent for psychopaths and might actually contribute to the adrenaline rush they often crave when they take risks.

Repairing Greenspan's Flaw

If harsher penalties would likely be ineffective, is there any way to change the model so as to discourage psychopathic plundering?

First, we must repair the flaw in Greenspan's model. The assumption of self-interest as a psychological constant underestimates the irrationality that so often drives individual and collective psychology and behavior. Although psychopaths are more rational than average, any casino owner knows that, even for nonpsychopaths, the thrill of risk taking, combined with greed and over-confidence will often override rationality.

We must be aware of psychopaths, their techniques and their motivations, when we design financial structures. Usually I have little confidence in social engineering, and rarely make any suggestions in that direction, but I do have one for the problem of psychopaths and Wall Street. Sometimes when computer hackers are caught they are then hired by government and/or business to help defend against or catch other computer hackers. Kevin Mitnick is a notable example of a reformed hacker who now runs his own computer security company, Mitnick Security Consulting, LLC. Many have commented that the SEC tends to employ those trained in finance but who are not as clever, ruthless or determined as those they are trying to monitor. I would suggest that they be open to hiring psychopaths with MBAs and offer them multi-million dollar bonuses and recognition, celebrity recognition if possible, for catching high level scams. Since psychopaths are a force of nature we are unlikely to eliminate, we should instead harness their unique talents to serve the socially useful purpose of catching other psychopaths. Who could possibly be better qualified, better able to pierce strategies of deception, than other highly motivated psychopaths? To use Wall Street metaphorically, we need a highly motivated team of clever reptiles and foxes to catch other reptiles and foxes.

In Conclusion

Most of the problems that the human species confront, such as racism, violence, warfare, environmental pollution, and economic issues, all stem from a common source -- human psychology. It is human psychology that decides short-term profits are more important than the long-term consequences to our biosphere. All wars are a psychological product. Money is a psychological artifact. By consensus we have agreed that these symbolic counters have value, and it is our psychology that decides what we are willing to do, or not do, to get hold of these artifacts. The irrationality and ever-fluctuating emotionality of markets and economic structures are well recognized and rigorously studied in fields like Behavioral Economics and Behavioral Finance. In recent years neuropsychology and economics have merged and researchers have made fascinating discoveries by observing people with functional MRI scans while they make financial decisions. Allan Greenspan's most famous phrase is "irrational exuberance," and Robert Shiller, an American economist and Yale professor, wrote a bestselling book entitled Irrational Exuberance, which predicted the burst of the stock market bubble in the late 1990s, and warned about the emergence of a housing bubble after the dot-com bubble burst in 2000. Another of Shiller's books is entitled Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism. The book opens with the following two sentences:

To understand how economies work and how we can manage them and prosper, we must pay attention to the thought patterns that animate people's ideas and feelings, their animal spirits. We will never really understand important economic events unless we confront the fact that their causes are largely mental in nature.

Many of the thought patterns and animal spirits driving economic events are generated by psychopaths and situational pyshopaths, and to prevent another such economic catastrophe we must take this into account as we design regulations, checks and balances. We especially need an agency that, unlike the SEC, includes a core of highly motivated and talented investigators who understand the remorseless mind of the psychopath and who can stalk those who stalk us, the reptiles and foxes who will forever try to steal the world's treasure.


[i] Jane M. Murphy, PhD, Psychiatric labeling in cross-cultural perspective ( Science 191, March 12, 1976), 1019-28.

[ii] Robert D. Hare, PhD, and Paul Babiak, PhD, Without Conscience: The Disturbing World of Psychopaths Among Us (New York: Guilford Press, 1999), 87.

[iii] Hare and Babiak, Without Conscience, 94.

[iv] Robert D. Hare, PhD, and Paul Babiak, PhD, Snakes in Suits: When Psychopaths go to Work (New York: Harper Paperbacks, 2007), 18.

[v] Hare and Babiak, Snakes in Suits, 118.

[vi] Hare and Babiak, Snakes in Suits, 22.

[vii] Hare and Babiak, Snakes in Suits, 55.

[viii] Hare and Babiak, Without Conscience, 86.

[ix] David Cullen, Columbine (New York: Twelve, 2009), page#.

[x] Hare and Babiak, Snakes in Suits, 269.

Hervey Cleckley, MD, The Mask of Sanity (London: Henry Kimpton, 1941), 353-54.

[xii] Hare and Babiak, Snakes in Suits, 67.

[xiii] Hare and Babiak, Snakes in Suits, 279.

[xiv] Hare and Babiak, Without Conscience, 111-12.

[xv] Cullen, page#.

[xvi] Hare and Babiak, Without Conscience, 49.

[xvii] Cullen, page#.

[xviii] Hare and Babiak, Without Conscience, 99.

[xix] Cullen, page#.

[xx] Hare and Babiak, Without Conscience, 47.

[xxi] Stephen G. Michaud, Ted Bundy: Conversations with a Killer (Irving, TX: Authorlink, 2000), 281.

[xxii] Hare and Babiak, Without Conscience, 88.

[xxiii] Hare and Babiak, Snakes in Suits, 237-38.

[xxiv] Hare and Babiak, Without Conscience, 61.

[xxv] Hare and Babiak, Without Conscience, 21.

[xxvi] Hare and Babiak, Snakes in Suits, 39.

[xxvii] John Seabrook. Suffering souls: the search for the roots of psychopathy, New Yorker (November 10, 2008).

[xxviii] Cullen, page#.

[xxix] Medical News Today: Psychology/Psychiatry, The origins of antisocial behaviour, twin study
[xxx] Alan Harrington, Psychopaths (New York: Simon and Shuster, 1973),

[xxxi] Hare and Babiak, Without Conscience, 114.

[xxxii] Robert Joseph Smith, The Psychopath in Society (New York: Academic Press, 1978).

[xxxiii] Hare and Babiak, Without Conscience, 119.

[xxxiv] Hare and Babiak, Without Conscience, 121.

[xxxv] Howard H. Goldman, Review of General Psychiatry (Columbus, OH: McGraw-Hill), 341.

[xxxvi] Wall Street, Directed by Oliver Stone (Century City, CA: 20th Century Fox, 1987).

[xxxvii] Enron: The Smartest Guys in the Room, Directed by Alex Gibney (New York, NY: Magnolia, 2005).

[xxxviii] The Internet Movie Database, [email protected], Enron: the smartest guys in the room, plot summary.

[xxxix] Robert J. Shiller and George A. Akerlof, Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism, (Princeton, NJ: Princeton University Press, 2009), 1.

Works Referenced

Cleckley, MD, Hervey. 1941. Mask of Sanity. London: Henry Kimpton.

Cullen, David. 2009. Columbine. New York: Twelve.

Enron: The Smartest Guys in the Room, DVD. Directed by Alex Gibney. 2005, New York, NY: Magnolia, 2006.

Goldman, Howard H. 2000. Review of General Psychiatry. Columbus, OH: McGraw-Hill.

Hare, PhD, Robert D. 1999. Without Conscience: The Disturbing World of Psychopaths Among Us. New York: Guilford Press.

Hare, PhD, Robert D., and Paul Babiak, PhD. 2007. Snakes in Suits: When Psychopaths go to Work. New York: Harper Paperbacks.

Harrington, Alan. 1973. Psychopaths. New York, Simon and Shuster.

Medical News Today: Psychology/Psychiatry. The origins of antisocial behaviour, twin study. Medical News Today. (accessed July 9, 2009).

Michaud, Stephen G., and Hugh Aynesworth. 2000. Ted Bundy: Conversations with a Killer. Irving, TX: Authorlink.

Murphy, PhD, Jane M. 1976. Psychiatric labeling in cross-cultural perspective. Science 191, March 12.

Seabrook, John. 2008. Suffering souls: the search for the roots of psychopathy. New Yorker, November 10, (accessed July 13, 2009).

Shiller, Robert J., and George A. Akerlof. 2009. Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism. Princeton, NJ: Princeton University Press.

Smith, Robert Joseph. 1978. The Psychopath in Society. New York: Academic Press.

Wall Street, DVD. Directed by Oliver Stone. 1987, Century City, CA: 20th Century Fox, 2007.