In "The Archetypes of the Collective Unconscious" Carl Jung distinguishes the "subject level" and the "object level". Elsewhere (in "The Constructive Method") Jung holds that repression, the process of suppressing problematic mental content into the unconscious, is never able to eliminate this content which reappears as neurotic conditions. This problem, a basic of the psychoanalytic tradition, can take place in what Jung calls the "object level" – our relationship with others in our life. The object level is the level which relates to external objects in the patient's world. But Jung adds another level, the "subject level", based on the idea that every object in the patient's life represents a certain aspect of his unconscious – the subject. This is why Jung, unlike Freud and Lacan, is preoccupied with the subject itself, and not his relations with the object.
According to Jung, if we are disconnected from a repressed part of our unconscious this part will be projected on an outside object. A part of the psychoanalytical process is the transference of this projection to the therapist which enables its manifestation and resolution. When psychoanalyzing a dream, for example, we can treat symbols in the dream as manifestations of objects in our life, this is the "object level". In addition, we can interpret them as symbols that point to certain elements in us, this is the "subject level" which is according to Jung more important and therefore should be the focus of psychoanalysis. Freud and Jung were severely disputed on this point.
A central part of Jung's theory in "The Archetypes of the Collective Unconscious" is the concept of "demon". The demon according to Jung is an aspect of our psyche that is experienced as negative and therefore cannot be conceived as part of who we are. Repressing the demon only makes it more powerful and our fear on it increases.
According to Jung in "The Archetypes of the Collective Unconscious" the old "naïve" human honestly believed in the existence of god and demons which played various roles in his daily reality. He did not realize that these demons are projections of himself casted on the external world. Man and his world were, therefore, undistinguished. Modern rational man, on the other hand, is aware of the fact that gods and demons are of his own imaginative making and therefore, being rational, denies their existence and represses them into the unconscious. Jung holds that this rationalist process causes mental energy that was previously invested with the gods to be redirected inwards. The "naïve" man was projecting his darker sides to demons, allowing him to remain "clean" in his mental experience. Modern man, on the contrary, overburdens his own unconscious with negative mental energies since he loses touch with his own "demons" which are no longer manifested, only repressed.