Can’t We Just Fish?
Are self-regulated markets the real evil of the industrial revolution that have fundamentally flawed the core development of the “Western World”? I believe Karl Polanyi in his book, “The Great Transformation: The Political and Economic Origins of our Time” not only poses this ultimate question but answers it with a resounding yes. Joseph Stiglitz in his forward states that Polanyi’s book describes “the great transformation of European civilization from the preindustrial world to the era of industrialization , and the shifts in ideas, ideologies, and social and economic policies accompanying it.”[1] I believe Polanyi goes much further to denounce the results of it . . . the results of a self-regulated markets.
Polanyi’s basic claim is that when the four institutional pillars that existed in the 19th century (balance of power, the gold standard, the free-market and the liberal state) were disrupted, that the introduction self-regulated markets created, ultimately due to the collapse of the gold standard, the world and shaping of Western thought was radically changed.[2]
Joseph Stiglitz states, “It is hard, and probably wrong even to attempt to summarize a book of such complexity and subtlety in a few lines.”[3] While I totally agree, I do believe that this thread of the gold standard collapse being at the heart of the development of the self-regulated market because their was no long and external marker or determiner on the value and control of all things “goods and services”. To me this is when the shift of the “those who have” and the “those who have not” became controlled by the “those who have” at new, out of control, “self (those who have) regulated world.
Jerry Michalski, in his “5-Minute University” on “The Great Transformation” had an interesting and succinct summary. Jerry summarized Polanyi’s foundation of thought through the shift from the era of feudal serfdom to the era of the industrial revolution”.[4]
Michalski summarizes the real shifts between the eras as the time when people where pulled off the land, moved into factories, mass production began and the need for a different kind of social welfare surfaced. Michalski spoke of the shift from the “economy’ of house-holding, reciprocity and redistribution. House-holding was how the majority of people, the masses, survived living off of their land as a primarily self contained food, shelter and clothing provider. Reciprocity was the simple interaction between house-holders who could help one another out with each others basic human needs. Redistribution, according to Michalski, was the occasional act of a king who would provide for the masses at times through feasts and celebrations, regularly and irregularly held.
Michalski goes on to paint the picture that Polanyi primarily discusses in chapter six on the introduction and development of “fictitious commodities of land, labor and money.” With the industrial revolution the reality of society existing off of house-holding, reciprocity, and redistribution radically changed as suddenly land, labor, and money were fabricated into new “needs” in the world. (new needs of the “those who have”)
Technically it would be through the fabrication of these new needs that the evolution of a free market began primarily because of power issues and dynamics that were being created by the new land, labor, and money demands entering the “ecosystem.” In an over-simplified but real way the new need for labor for mass production affected how land was used, needed, and distributed; the kind of life this new kind of “laboring” provided required another means of supplying basic human needs of food shelter and clothing; and the “money” that had to be “created” for the exchange of “goods and services” necessary for life in the new world emerging became something that needed to be created. House-holding, reciprocity and redistribution where being replaced and while in the moment and amidst the change taking place there wasn’t any immediate visibility of the real hollowing out or the eminent threat of hollowing out a “meaningful life” that was taking place.
Ultimately the creation of the power dynamics that were created from such a shift is what led to a free market being created, that Polanyi claims would have to be regulated if society was not going to be corrupted by a few, exploiting many to make the world run how it will need to under the fictitious commodities that were evolving. This whole cycle reminded me of the parable where an aspiring young businessman approached a woman who was fishing on a beach on a Saturday morning. He watched her for a while and noticed how much she enjoyed fishing on the beach on Saturday morning. So he approached and developed a great conversation with her about how if she got a couple more poles in the water and could catch a few more fish she could sell some of them in the market. He went on to tell her that if she did that, what would be great is she could possibly then get a boat. If she got a boat then she could go out into deeper waters and catch more. If she could catch more she could hire others to fish from the shore and then she could really catch a lot of fish and could sell so much more that eventually she could have several boats and a whole company where she could even hire someone to run the whole operation as it went “global”. Through out the conversation, or monologue of the young businessman, the only real part of the conversation the woman fishing on the beach on the Saturday morning contributed was to ask the young businessman “why?” In the end, when she finally asked “why” would she want to turn her Saturday morning fishing outing into a global fishing enterprise and hire someone else to come in and run it, he replied, “Because then you could spend your Saturday mornings relaxing fishing on the beach.” She, in turn, replied, “While that sounds like a great and amazing idea, I think I am all set.” And she went on fishing on the beach on Saturday morning.
While that is a poor attempt of a rewrite of that story I think fundamentally this is the point Polanyi is making about what the industrial revolution has done to the world and ultimately because of a free, self-regulated market developed by “young businessman” that maybe the “elites” are doing well but the reality of the masses is poverty, exploitation and being a part of fishing enterprises when all they really want to do is fish.
I am pretty sure that if we investigated the 2008 crash of the housing market (Land), the automotive collapse (Labor) and government bailout (money) and the financial crisis created by non-fictitious collapse of these fictitious commodities, much could be learned about the wall we continue to run at in the Western world. ???
[1] Polanyi, Karl. The Great Transformation: The Political and Economic Origins of Our Time. 2nd ed. Boston, MA: Beacon Press, 2001. p. vii
[2] Ibid., p.3
[3] Ibid., p.vii
[4] Michaliski, Jerry. 5minU: The Great Transformation. https://www.youtube.com/watch?v=rSuz01zvOjE. August 8, 2013.
About the Author
Phillip Struckmeyer
12 responses to “Can’t We Just Fish?”
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Phil, great use of a third party summary. It seems that Michaelski does a good job at hitting some of the salient point of the book but ultimately, any summary of this book will not be able to hit all the major points. If it did, the summary would wind up being as long as the original!
The more I reflect on The Great Transformation, reading fellow learners’ posts, I am seeing it as a sort of acquiescence on Polanyi’s part. Like he’s saying (using way smarter words) “ok folks, it’s inevitable, we HAVE to have some measure of regulation from some kind of outside entity, government or whatever, on this present, global economic system we have here… I don’t necessarily like it, but it’s just the way it is. The days of communal care and reciprocity are essentially over. Now, let’s make sure the regulating entity doesn’t become tyrannical and run us all into extreme poverty.”
The sweet spot between a macro and micro kind of management is the fine line that we have to try to force the regulators to walk I suppose. That’s a RADICAL shift from the instinctive “free” market capitalism that I have always embraced. Markets aren’t really free after all…
Dang
j
J
I think you’re onto something, Jon. It’s that creative tension again. How do we hold both the reality and the desire?
Mary, I don’t know that we can in light of man’s natural propensity towards sin and envy. It’s a bit idealistic I think
J
As you described the four pillars that started crumbling which brought about self-regulated markets as the answer, it made me realize how quickly we jump on something in the midst of change (the old pendulum thing we see in education, government, and other large institutions) to make us feel more secure. And then it becomes “THE” thing without question. How often do I do that or the organizations I’m a part of without the necessary reflection of how it impacts me, the community, even the world as a result of that one thing?
I’m intrigued by the “Relationship Economy” concept by Jerry Michalski. How did you find him? It reminds me of the social and spiritual capital that I’ve worked with the last few years.
Finally, your story about the woman who was fishing is exactly what I was trying to convey in the Shark Tank story I put on our Facebook page – he wants the capital not to become wealthier, but to help the average farmer.
Philip,
My brain hurts trying to take it all in, but then your analogy of the woman fishing on the beach and the businessman really helps to make sense of significant criticism.
Can we be fans of free market economies and also believe in and promote contentment?
David,
It is interesting picking a part the current system, but it is a totally different conversation if we try to think of the alternative. Communism, socialism, nationalism, capitalism, democracy, I am not sure what I think is really better these days??? Why can’t we all just get along like the Acts 2 church???
Phil, but the Acts 2 Church didn’t stay utopian for long. Before you know it, there was a bitter argument over, you guessed it, PROVISIONS! “I want mine! Why don’t we get as much as them? I thought we were all in this together!!!” HA!
J
Yep. It is too bad Acts 5 and 6 follows Acts 2 :)!
Thanks Phil… Michaelski’s video review was really helpful for me. Your fishing story and the Shark Tank video Mary posted help me see just how much the solution to all of this rests in our hearts.
Love that story Phill, i actually experienced that when i started my construction company years ago in my early twenties. After attending Los Angeles Trade Tech and learning carpentry I got my contractors license. Yet i went into a field that i probably did not want to go into. My real ambition was only to learn building and to enjoy it by building for myself. Going into business was really a side note. Yet because of Capitalist principles i ended up building homes, room additions, apartments and so on and my heart was not really in it. Its similar to the lady fishing. You can take away the joy of what makes you happy to expand, utilize every rescource, be great, be rich, and to be a Capitalist. I enjoy fishing down a t the Lake where i live! I think for now i will stick to that! Blessings!
Travis,
I would love to have heard the reaction to people when you chose to focus on building the kingdom rather than building your company.
God bless you brother.
Phil,
Love the story. It speaks of current contentment with what we have rather than stressful planning over what we think will bring us happiness in the future. Wouldn’t it be great if the church modeled contentment?