Avoiding the Errors of the Extremes
Decades ago, when our family prepared to move, and I was a teen, my mom went through my belongings and discarded some items. Among those things thrown away was a Nolan Ryan rookie card. In 2020, that same card sold for $500,000 in mint condition. I imagine my card deep down in a landfill and wonder, “what could have been?” How did we get to a place where such a random item became a valuable commodity?
Karl Polanyi’s The Great Transformation: The Political and Economic Origins of Our Time details the impact of the Industrial Revolution and its sweeping changes upon Western society. Polanyi traces the historical influences resulting in the emergence of modern capitalism. This book gets classified under economics, but it is also a political and sociology study. Polanyi begins his work by identifying four critical institutions of the nineteenth century, “but the fount and matrix of the system was the self-regulating market (SRM). It was this innovation which gave rise to a specific civilization.”[1]
What kind of civilization did a market economy create? Before the Industrial Revolution, Polanyi described a traditional society built on numerous principles, including biblical perspective on life and death and the freedom and uniqueness of mankind.[2] Dr. Jason Clark notes how those traditional beliefs waned after the Industrial Revolution as “these religious foundations for identity are now disembedded from the daily life of people within capitalism by the nature and mechanisms of the SRM.”[3] In Polanyi’s estimation, the Industrial Revolution resulted in a society built on fictitious commodities compared to real commodities.[4] Real commodities refer to items produced to sell on a market versus the fictitious commodities of land, labor, and money. In the earlier society, land, labor, and money were immersed within relationships, morality, and social management.
The book divides into three sections. The first section seeks to answer why a long-standing peace ended, war began, and economies collapsed. The second section analyzes market liberalism and the societies it creates. The final section contrasts socialism and fascism, two political ideologies on the rise during Polanyi’s time of writing.
Polanyi believed that a free market society does not happen organically but rather springs from political and social constructs. In other words, a market economy results from human choice. That choice infuses modern capitalism with a tension between social protection and an unregulated market. When people become a commodity, they stand at risk. A free market promises “a stark utopia” but never materializes due to the pursuit of personal gain over the well-being of society.[5] Polanyi makes arguments and then counter-arguments that appear to contradict his previous statements. To put it bluntly, this book was a challenging read for me.
My main takeaway from Polanyi’s work centers on his implied argument for a middle-ground position and an avoidance of economic and political extremes. Polanyi’s conclusion includes warnings about the dangers of fascism. If I understand him correctly, Polanyi attributes the rise of fascism to a reaction against contrary market forces of socialism. He states about fascism and socialism that “the difference between the two is not primarily economic. It is moral and religious.”[6] How much freedom can humankind handle? How much regulation is needed for the benefit of society versus the individual? The opportunities and concerns of capitalism sound similar to the Apostle Paul in I Timothy 6, where the encouragement to the rich is “to be rich in good deeds” while avoiding the “snare” of riches.
Polanyi’s emphasis on morality within a political critique reminded me of a movie quote. Near the end of a very dark movie, Enemy at the Gates, two soviet soldiers who vied for the affection of a woman come to terms. One states to the other,
“man will always be man. There is no new man. We tried so hard to create a society that was equal, where there’d be nothing to envy your neighbor. But there’s always something to envy. A smile, a friendship, something you don’t have and want to appropriate. In this world, even a Soviet one, there will always be rich and poor. Rich in gifts, poor in gifts. Rich in love, poor in love.”
The human heart can commodify anything regardless of the economic system in place. In order to thrive, humanity needs a measure of freedom and a measure of regulation. What is the right amount for each? The complexity of Polanyi’s work offers no simple, reductionistic answers. May those who follow Jesus recognize the moral aspects of a market society. May its benefits be leveraged and its abuses mitigated, avoiding the errors of the extremes.
[1] Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (Boston: Beacon Press, 2001), 3.
[2] Ibid., 267.
[3] Jason Swan Clark, “Evangelism and Capitalism: A Reparative Account and Diagnosis of Pathogeneses in the Relationship.” Diss., George Fox University, Portland, Oregon, 2018. Faculty Publications, 130.
[4] Polanyi, The Great Transformation, xxv.
[5] Ibid., 3.
[6] Ibid., 267.
About the Author
Roy Gruber
Husband, father, pastor, student, and sojourner in Babylon9 responses to “Avoiding the Errors of the Extremes”
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Ty Roy for your thoughts. You mentioned, “In order to thrive, humanity needs a measure of freedom and a measure of regulation.” Can you explain more about your thoughts on the connection between thriving to need of measure of freedom and measure of regulation in a personal level and a body of church level?
Jonathan, as I read Polanyi, it made me think how political, economically, and spiritually, there is some freedom and some “regulation.” While different systems will differ on the amount of each, they share that tension. For example, democracy provides certain freedoms but that freedom is never absolute. Spiritually, there is freedom in Christ yet there are boundaries as well. I hope that explains what I meant a little better.
Roy: That was an insightful and thoughtful post. There is a great complexity in talking about these issues. That is part of what makes this macro-economic and political discussion so interesting. Even a SRM can be employed by a society that differs in the details than other societies. Capitalism does not have to be a cookie-cutter salvo to a poor nation trying to provide for their masses. No matter the economic system in place, the Church will be there to pick up the pieces of the poor and disenfranchised. Do you see these issues playing our in your ministry?
Yes, Troy, I do see the Church stepping up in our local context. What troubles me on a national scale is the level of passion being put into politics rather than getting personally involved in meeting the needs that are around us. It seems to me that we are looking to government more than we ever have to solve issues while, at the same time, stepping back from grassroots efforts to meet real needs. In a time of disruption, the Church has an opportunity to live out a positively different life. I pray it’s an effective day for the Church.
Roy, great post. Having read your comment to my blog, it appears to me that you understood and communicated the principles of the book well. I could not agree more with your statement at the end, there are no simple answers.
Is this a realm and topic that you find to be helpful in your work and ministry? If so, how?
Eric, great question. I wish I had a more clear answer for you. Right now, this topic overwhelms me. In recent years, we’ve seen record generosity by our church. As we give people opportunities to be generous in the effort to meet real needs, the response has been encouraging. My subjective take on why: people want to do something to make the world a better place but often to not know how to do that. I also think younger generations do not place the same value on wealth of older generations. They seem to long for a positive cause to join by serving and giving. I believe that offers the church opportunity to engage in local efforts in ways we have not seen in the past.
Roy, I thoroughly enjoyed your insight into this read.
From a theological perspective, money is complicated. I don’t think God calls us all to vows of poverty. And yet, the Scriptures are full of passages that give wisdom to the clash of the pursuit of money and what we are willing to do for it, even if it hurts our neighbor.
I think the most remarkable and underused l on the matters of money is James’ letter. He has a lot to say that speaks volumes on our capitalistic society and how it causes us to undervalue the poor.
Roy, Thank you for your reflection on why this book was difficult.
One word that causes me heartburn is “FREEDOM”. I believe that at least in North America the ethos of freedom is much different than the ethos of freedom that God would embody. If you were to compare and contrast Polanyi’s understanding of free/freedom with God’s what would you say?
Nicole, I hear you in saying: freedom is a loaded term! I believe the freedom from government and the freedom in Christ are two very distinct concepts. Also, I cringed when George W stated it was a God-given right for all people to live in democracy. I lived three years in Canada and they have a different government structure and are quite free as well. It sometimes sounds like Americans think we are the only ones in the world with freedom – not true. Spiritually, freedom provides us with the opportunity to serve God and one another. In Christ, we are set free…to follow Jesus.