A less-than-utopian vision
On April 15, 2000, I was standing on the corner of 20th and I Streets in Washington DC. Like many other college students that weekend, I had come out to see what the fuss was all about.
All around me, there were thousands of protesters on the street, demonstrating against the International Monetary Fund and the World Bank. As I watched, police officers in riot gear moved through the crowd and blocked off the street. My friends standing on the opposite corner were part of a mass-arrest, simply because they were standing there.
Part of the backdrop of these law enforcement measures was that this was the year after the infamous “Battle of Seattle” protests against the World Trade Organization of 1999, which had turned violent. They weren’t taking any chances in the nation’s capital.
The IMF and World Bank headquarters are located in Washington DC and inside their well-appointed, heavily protected walls, were globalists, industrialists, economists and other members of the system of haute finance. On the streets was a strange combination of socialists, anarchists, students groups, church groups, trade union members, and some who had just come for the show.
This scene lays out the essential complexity and confusion around issues of economic theory and the social, political and spiritual results of it. This is the point that Fred Block makes in his excellent introduction to “The Great Transformation” by Karl Polanyi. He writes, “Because of the very richness of this book, it is futile to try to summarize it; the best that can be done here is to elaborate some of the main strands of Polanyi’s argument.”[1]
As I read chapters of this book, I felt as if I had taken a walk through 150 years of Western history, gotten baptized in economic theory, and returned again to that street corner in Washington DC, where the amount of stimuli, passion and debate was both edifying and dizzying.
One of the key ideas that Polanyi brings up is that, “For a century, the dynamics of modern society was governed by a double movement: the market expanded continuously but this movement was met by a countermovement… for the protection of society.”[2] To put it another way, as the free-market moved and expanded, seeking greater influence in the lives of people and the plans of governments, there was always a “countermovement”, or a reaction. This reaction, for Polanyi has to do with the self-preservation of people, society, morals and a decent way of life.
He writes, “under the guild system, as under every other economic system in previous history, the motives and circumstances of productive activities were embedded in the general organization of society.”[3] This “embeddedness” is a key idea for Polanyi because it means that the market and economy are meant to serve and benefit people, rather than, allowing it to become “dis-embedded”, or free from social, political and moral concerns.
Polanyi describes “fictitious commodities”, of land, labor and money, which previous to the growth of the “free market” were not commodities at all. They were social realities, which were interconnected. What Polanyi is doing in his historical overview and critique of free market capitalism, is showing the insidious ways that the “laissez-faire” economy commoditizes people, which he believes is wrong.
There is an underlying moral argument to what Polanyi is doing, and it may stem from his life-long commitment as a Socialist. As Dominic Erdozain has argued in his book, “Marx was both a materialist and a moralist… his materialism emerged from his moralism.”[4] Throughout his writing, Polanyi exhibits a moral concern (especially for those who will be affected adversely by macro-economic policy), which colors and informs his historical, sociological and economic thinking.
Indeed, in his review of the book, Economist Greg Clark uses this as a cudgel. He writes, “The Great Transformation has attained the status of a classic in branches of sociology, political science, and anthropology. Stacks of it await undergraduate initiates each year in college bookstores. … Yet in economics the work is unknown — or, when discussed, derided. Thus the cruel irony of the term “social sciences.”[5]
Clark is using as critique, the way that Polanyi includes and allows a moral vision to enter into his pursuit of “the dismal science”, as economics has been called. However, it is Joseph Stiglitz, a 2001 Nobel prize winning economist who writes in the foreword to this book that, “Economic science and economic history have come to recognize the validity of Polanyi’s key contentions.”[6]
Clearly, even within the field, disagreements will continue over the assertions that Polanyi makes in this book. He is essentially undermining a kind of liberal economic orthodoxy, “the Washington Consensus”, which holds that free markets, operating free of regulation or constraint, will eventually right themselves and offer the broadest benefits to the most people. Polanyi stands against this assertion and belief.
One thing that I really appreciate about his view, is the way that he is so anti-deterministic. He doesn’t let utopian thinking, or solutions that are “too tidy” to sway him. He writes, “Our thesis is that the idea of a self-adjusting market implied a stark Utopia. Such an institution could not exist for any length of time without annihilating the human and natural substance of society…”[7]
The reason that I resonate with his argument, is that it takes seriously the human condition, and our tendencies not to act our best. In cold, economic theory, there is certainly a world where everything works “perfectly”. But in the day to day lived reality that people experience, “things fall apart”.
As a college student witnessing those protests all those years ago, I was still swept up in utopian schemes and dreams. This is the usual way with youth and inexperience. But, what is surprising in Polanyi’s book, is the way that he turns the table on this idea. He suggests, in the end, that it is the consensus around the benefits and perfection of unfettered free-market capitalism that is actually unhelpfully idealistic.
In the end, I believe that Christians, as people of hope, even “ideal” hope, are also called to engage the world as we find it. To step into the messiness of life, for the sake of those that God loves. I seek to lead institutions that hold these two parts together, hope and action.
[1] Karl Polanyi, The Great Transformation (Boston: Beacon Press, 2001), xxiii.
[2] Karl Polanyi, The Great Transformation (Boston: Beacon Press, 2001), 136.
[3] Karl Polanyi, The Great Transformation (Boston: Beacon Press, 2001), 73.
[4] Dominic Erdozain, The Soul of Doubt (New York: Oxford University Press, 2016), 223.
[5] Gregory Clark, review of The Great Transformation, by Karl Polanyi, The New York Sun, June 4, 2008, 11, http://www.nysun.com/arts/reconsiderations-the-great-transformation-by-karl/79250/ (accessed February 1, 2018).
[6] Karl Polanyi, The Great Transformation (Boston: Beacon Press, 2001), xiii.
[7] Karl Polanyi, The Great Transformation (Boston: Beacon Press, 2001), 3.
About the Author
Dave Watermulder
12 responses to “A less-than-utopian vision”
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Hey Dave, great post. Interesting how economic purists would like to keep the idea of morals out of their field. But as Polanyi taught us, people and land don’t fit neatly into spreadsheets. You end with the bold statement, “I seek to lead institutions that hold these two parts together, hope and action.” How does the church you currently lead hold those two together? How does your project seek to do the same?
Thanks, Jenn– I think this is always an essential function of churches, to hold both of these together. In our congregation, we have a kind of unofficial motto: “come and see, go and do”. We want to be a church is interested in both. So, for my research, I want to help churches like mine, that have this kind of commitment, to think about and work out what that will mean in particular.
Hi Dave,
A captivating start to your Blog. Well done. I felt like we were there with you on those streets.
I also liked your “less than utopian” thoughts. I am a straight edge “tidy” guy, but unfortunately economics and social theory are moving targets that get messy in reality, with rough edges abounding.
So, you really helped me when you called us Christians to HOPE and ACTION. That to me was key! God puts the sand paper in our human hands to help smooth out some of the rough spots with economics and sociology, don’t you think?
Thank you, Jay– yup, I think that’s right…
Dave, your story at the beginning of your blog provides a great image for the rest of your post. You captured the gist of Polanyi, I think, drawing out the main points of Polanyi’s work. I also share your appreciation of Polanyi’s sobriety.
Thanks, Chris!
Dave! What??! You mean socialists can have morals?? 😉
One of the more interesting historical facts about Canadian history is that the father of universal health care was Tommy Douglas, a Baptist pastor from Saskatchewan. He said, “Social justice is like taking a bath. You have to do it every day or pretty soon you start to stink.”
http://www.canadashistory.ca/Explore/Politics-Law/History-Idol-Tommy-Douglas
I really appreciated your perspective in this post; thanks for your contribution. I am enjoying how our readings are pushing boundaries of what we assume and what is the common narrative in our polarized online culture and traditional Christian communities.
Thanks, Mark– totally agree. I think that is probably part of the idea/plan here– to push us out of easy “Christian answers” or expectations, so that we see the bigger picture while we work.
Dave,
As you close your post you wrote “In cold, economic theory, there is certainly a world where everything works “perfectly”. But in the day to day lived reality that people experience, “things fall apart”. What a great summary of the dangers of an unfettered free market. I feel you hit the nail on the head, of course there is probably to much to lose for any real changes to happen in our economic world but there is always hope. What is the hardest part for you to reconcile with as a pastor in the consumerism in the church?
Jason
Hey Jason,
Great response to my post– thank you!! I think one of the biggest parts that is hard about consumerism in my context, is that it is just the water in which we swim as fish. It is largely unseen and insidious, almost an expected thing, rather than something people choose for themselves. We have to consistently resist that kind of coopting by market forces. It’s hard to do!
Hi Dave! Before I even read Jason’s response I wanted to speak to the same quote: “The reason that I resonate with his argument, is that it takes seriously the human condition, and our tendencies not to act our best. In cold, economic theory, there is certainly a world where everything works “perfectly”. ” I’m fearful that the pendulum is swinging in this country to cold economic theory – not so much assuming everything works perfectly – but not caring if it doesn’t! How we can live in a society that doesn’t take the human condition into consideration? It’s scary and dehumanizing. Do economics connect to your research in any way?
Thanks, Jean–
Yea, I think this reminds me of what I was writing with Jenn about. My particular work and research doesn’t connect with economics explicitly. However, I think as I study and think and grow in this, it turns out that I need to understand economics and systems in a better way. In my own life, I haven’t interacted much with economic ideas or theories, however, most people in my church live in that world as natives. So, I’m thankful to be learning about this.