Hamish Hamilton, £20, 368pp. £18 from the Independent Bookshop: 08430 600 030

What is Madness?, By Darian Leader

Emile Kraepelin was a German contemporary of Freud's and, along with Freud himself, set the agenda for modern psychology: for everything we still think about today when it comes to the mind and the brain. Unlike Freud, Kraepelin was uninterested in individual patients and in flimsy material like dreams, conversation and sexuality. He wanted to name mental illnesses, gathering symptoms together in categories which made sense for other doctors. Most significantly, he saw psychosis as an illness of the brain rather than a creative correction made by the mind.

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There isn't a family in the world without its own mad person. However, when we think of madness, we think of psychosis, and we think of its most florid manifestations: voices, delusions, paranoia, irrationality, people who want to be Napoleon, others who don't know which gender they are and those who are being addressed by, and often pursued by, the CIA. The mad are both over-certain and indecisive: they can be Stalin or Hamlet.

Great literature is bursting with the mad; all important writers have wanted to engage with extreme states of mind, and not infrequently have inhabited them themselves. A list of mad writers would be the history of literature. Literature brings madness within the ambit of ordinary life, whereas medicine has too often been phobic about it, and has not only attempted to exclude and isolate it, but "cure" it at any cost.

It hasn't been a good hundred years for the mad. Writers may have a wide range words to describe strange states of mind; they have the ability to make difficult but necessary distinctions, like that between depression, mourning and melancholia, for instance, or sadness, unhappiness, despair and desolation. But doctors have the hospitals, and they have the power. Psychiatrists, those Dr Frankensteins of the medical world, have too often locked away the mad, experimented on them, put them in comas, cut off parts of their brains, forced electricity through them, and fed them with drugs which have made them iller. I say "them" because the mad – so close to us, and indeed within our psyches, and representing our own darkness – have been segregated and often confined; for fear, perhaps, that they will contaminate the rest of us.

But as Darian Leader brilliantly shows, things are never so simple. Deciding who the mad actually are, and how mad they have to be to be considered mad, is quite a job. After a hundred years no one has come up with a diagnosis which most psychiatrists can agree on; they haven't even agreed on the right label for the illness. The same patient could easily be called hysterical, depressed, psychotic or manic, depending on which symptom they declare to which doctor in which country.

The fact that madness may remain unidentified as a somatic condition has led psychiatrists to attempt to locate a part of the brain where the madness can be found. If this part can be known, then the pharmaceutical companies could come up with a drug which treated it. Not only would the companies become richer, and the mad not only cured, but we could tell far in advance which people would be mad and which wouldn't.

Psychiatrists and brain scientists have hunted about for decades but have come up with nothing substantial when it comes to the source of illnesses like the psychoses, schizophrenia and bi-polar illness. The only result, unfortunately, has been that the public now speaks of "brain chemistry" and "genes" as if they refer to something real.

Psychology's Plato, Sigmund Freud, was a revolutionary and remains so – a danger to us all - insofar as he actually attended to his patients as individuals and saw their desire and its vicissitudes as being at the centre of their lives. As Leader states, "madness and normal life are compatible rather than opposed". It was listening to the mad, as Freud did, rather than looking at them, which was the turning-point in both psychoanalysis and psychiatry.

Leader says that "What matters is to unearth the logic in what psychotic subjects say about their experience." Although the mad are different to one another, and we are all mad in our own ways, the mad, in many ways, are the most rational of all. It may be painstaking, time-consuming and expensive work attending to the voices, delusions and paranoid constructions of the mad, but it is not impossible to unpick the threads which bind these subjects within themselves. As GK Chesterton writes, "the madman has lost everything except his reason."

Just as a cursory glance at the 20th century would inform us that attempting to separate the "healthy" from the "unhealthy" is always disastrous; so it is dangeous to separate the person from their symptom. For Leader, the creation of symptoms such as delusions are forms of self-creation and protection: the useful texts of the insane.

Removing a patient's symptom with undue haste could result in the triggering of a psychosis. Leader cites a case of Freud's, where he cures a woman of a long agoraphobia, only for her to succumb to psychosis. She then had to be hypnotised by a colleague, who reinstated the shield of her symptom.

There are dozens of talking therapies and more and more patients. Do they work? They do, if we put notions of "cure" to one side, and if we remember that it is always possible for people to become interested in themselves in new ways.

Leader reminds us that adults have been vulnerable children for a long time and therefore are difficult to change. They love their symptoms, usually more than they love their lives. People also love to suffer and to make others suffer; they also love to be punished.

As any poet would tell you, being human is very difficult, and most likely maddening; and there's no cure for that. It is also perfectly possible to be mad and to live a productive and useful life.

Hanif Kureishi's 'Collected Essays' and 'Collected Stories' are published by Faber & Faber

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