The first pair of opposites that we encounter is the distinction between matter and spirit. Marie-Louise von Franz describes Jung’s position in the following manner.
In contrast to his father who, in a crisis of doubt concerning his faith, began to accept a materialistic interpretation of psychic contents, Jung rejected a materialistic derivation of psychic phenomena, for the fundamental reason that we do not know what “matter” is, just as we also do not know what the “objective psychic” is, nor what “spirit” is. Both can be described only indirectly, by means of the traces they leave in our conscious minds, but they cannot be defined in themselves. “Matter and spirit both appear in the psychic realm,” he writes in a later paper, “as distinctive qualities of conscious contents. The ultimate nature of both is transcendental, that is, irrepresentable, since the psyche and its contents are the only reality which is given to us without a medium.” Thus one could even define the psyche as a quality of matter, or matter as the concrete aspect of the psyche. “In consequence of the inevitability of psychic phenomena, a single approach to the mystery of existence is impossible, there have to be at least two: namely, the material or physical event on the one hand and its psychic reflection on the other,” so that one is hard put to it to decide what is reflecting what. In this way Jung rejected every attempt to interpret existence materialistically or spiritually. [In the sense that everything is “spirit” and that matter is “only” concretized “spirit.”] For psychology “is not concerned with things as they are ‘in themselves,’ but only with what people think about them.“. (Marie-Louise von Franz, C.G. Jung: His Myth in Our Time, p. 57)
The word “spirit” requires a bit of elaboration. While the lexicon offers a definition, von Franz explains it as follows.
Jung then sums up the meaning of the word Geist (spirit) as being “a functional complex which originally, on the primitive level, was felt as an invisible, breath-like ‘presence.’ … When therefore something psychic happens in the individual which he feels as belonging to himself, that something is [regarded as] his own spirit. But if anything psychic happens which seems to him strange, then it is somebody else’s spirit,” which can also be regarded as a still unintegrated aspect of the unconscious. (ibid. , p. 82)
Spirit, therefore, according to Jung, is in the first instance the composer of dreams: a principle of spontaneous psychic motion which produces and orders symbolic images freely and in accordance with its own laws. (ibid.)
The dynamic which produces such inner symbolic patterns in the psyche is what Jung understands by the word “spirit.” (ibid. , p. 83)
This view led to a disagreement with Freud.
From the beginning of his work Jung took this approach to psychology, on the one hand as polarity between ego-consciousness (No. 1) and the unconscious (No. 2), and on the other hand as polarity between matter (biological basis) and spirit (that is, the form-giving ordering factor). […] In his reminiscences Jung presents a dramatic description of the first type of polarity. He relates how, in his own life, conscious and unconscious were polarized, and in this respect his convictions coincided with those of Freud. They did not coincide with Freud’s, however, in respect to the second kind of psychic polarization, namely the tension between spirit and matter, since ultimately Freud was convinced that psychic processes have their origins in matter. (ibid. , p. 80-81)
While Freud sees the fundamental human conflict as a collision of instinct with collective consciousness (the superego), Jung is of the opinion that both poles are present in nature, or in the human unconscious, that both of them have always been there and that neither is an epiphenomenon of the other. (ibid. , p. 89)
In distinction with the Freudian view, the polarity between spirit and instinct can be seen in the following way.
[T]he close association between instinct and religion in the broadest sense can be explained by this primordial association of drive with symbolic image. Religion, says Jung, “on the primitive level means the psychic regulatory system that is coordinated with the dynamism of instinct” the psychic regulatory system being the form-giving spirit. (ibid. , p. 84)
It is peculiar to the spirit, or to the symbol-forming function of the psyche, to bring the multiplicity of instinctual drives into a unified structure. Concerning animal life Konrad Lorenz speaks, for example, of a “parliament of the instincts”; in man the symbol-forming function of the unconscious would correspond to the president of such a parliament. This function is the spiritus rector of the individuation process described in the previous chapter. Man, in Jung’s view, is a natural being, full of primitive animal instincts on the one hand and on the other of a spiritual heritage consisting in the structural dispositions created by the symbol-forming function of the psyche. These structural symbolic patterns serve to hold man’s instinctive drives in check. (ibid. , p. 89)
In conclusion, we can observe that the viewpoint proposed by Jung To Live By is a Freudian position, not a Jungian position.