Doctor of Leadership in Global Perspectives: Crafting Ministry in an Interconnected World

More Dispatches from the Front of the Financial Crisis

Written by: on January 31, 2013

Karl Polanyi, in the epic sweep of his work The Great Transformation: The Political and Economic Origins of Our Time, sets forth an extremely timely reading of modern world history, even though he was writing in the 1940s.  Polanyi’s central thesis is that the rise of democracy, the industrial revolution, capitalism, liberal economic policy and ultimately the creation of a capital class (who would become the ultimate arbiters of much the political system) birthed the utopian idea of a self-regulating free market.  Polanyi thus views the Western faith in the free market as the advent of the “control of markets over human society,” or at least the idea of the market.  In fact, Polanyi quickly points out that the self-regulating free market is very much a naïve misnomer, as nations, cultures, and interest groups actually force the “free market” into existence creating an essentially unstable political and economic situation that is complicated by varying issues of culture, politics, and economic instability, but in the end must be controlled for the benefits of the economic capital class.  Ultimately, this system replaced what Polanyi postulates as the core elements of traditional human economics and society: reciprocity, redistribution, and householding.  This rapid change and replacement of millennia of human social structure is ultimately what Polanyi refers to as “The Great Transformation.”  Polanyi goes onto to see this transformation as the source of the great upheavals of the 20th century, as societies, nations, and international regulatory institutions struggled to cope.

In our own time we have seen the rapid strengthening of globalization, post-industrial and postmodern society and economies, and the entrance of the majority world into the Western economic system (where they must play by the West’s rules).  Currently, much of the West faces a continuously shifting economic crisis.  As I sit writing this from Spain (currently on the frontlines of this crisis), unemployment sits at 25%, unemployment for people at 26 or under is a catastrophic 60%, a newly built billion euro airport sits unused and closed, and the streets of my city are just newly cleaned from the heaps of trash that piled up over a 13 day trash strike.  What is more, hopelessness and ambivalence are in the air. 

Is Polanyi correct in asserting that the utopia of free markets has created an impossible dystopia, tilted to those who already have?  Has our Western faith in limitless economic progress and the free market blinded us all to the reality that the system might be unwittingly rigged away from justice?  Has globalization (and the complexity of national and cultural diversity) sped up our entrance into a dystopian future? 

There is, of course, much to unpack here.  In the US, we are just awakening from the worst financial meltdown since The Great Depression.  Deregulation of financial markets under the Clinton administration, encouraged the Greenspan school of thought, promised unlimited growth.  Later the Bush administration in hoping to spur on the economy through the housing market deregulated banking loans.  This was partly motivated by a generous idea that if more lower income people could buy property it would improve their lives and economic situation.  Banks only saw the ability to generate more loans which on paper meant more assets for the bank, more commissions for the loan officers.  The market was fluid, but the bubble eventually popped, predicated on people’s greed, just as much as the capital class’s belief in the “self-regulating free market.”  The market of course did self-regulate, leaving a financial catastrophe in its wake crushing some, bankrupting states like California, but ultimately proffering the rescue of most of the capital regulatory class complicit within the Bush and Obama administrations. 

At the same time, the European Union, built very much upon the liberal democratic values of free trade, unified currency, and free flow labor faces its own struggles.  Iceland, Ireland, Spain, Italy, Greece, and Portugal all face horrific financial consequences after they faced their own great transformation into instability.  Northern Europe still does not understand why Southern Europeans take midday naps, have an excess of holidays, and operate their economies around nepotism and clannishness.  The German assumption was that if we give EU money to these nations they will operate exactly as we do.  Utopia.  Iceland is particularly instructive.  A tiny nation of 300,000, who until recently was solely a fishing economy rooted more in reciprocity, redistribution, and householding  (and a strong economy in the removal of fairies) than a modern economy became wealthy overnight with the globalization of the fishing market and the regulation of the European fishing industry. This wealth motivated risk driven fisherman to set up banks and investment firms without any real education in financial markets.  What transpired was Icelanders lending exorbidant sums of money to each other, and drawing the attention of the international markets, who then invested heavily into Iceland’s unwitting house of cards.  Finally, when people realized that there was nothing to stand on (at one point the head of Iceland’s national bank was a poet) it was too late.  This kind of flow of unregulated capital to nations and projects with no reasonable recourse was played out all over Europe, now leaving many jobless and hopeless, with everyone pointing the finger at someone else.  Never mind that everyone took advantage of the good years.

In Asia, China’s entrance into the free market has the looks of recreating the Dickensian blight of England’s Industrial Revolution.  Pollution is run amok, labor exploitation is appalling, and even though the emerging Chinese middle class is bettering their lives, China appears as an unwieldy monster on the world stage.

The options of utopian ignorance and postmodern bliss versus hopelessness and revolution are ripe within our world.  Here is where I hope to turn us back to the gospel, and where the world needs a fresh encounter with gospel.  As Western Christians we have often placed our faith in the market.  We have often found our desire in consumption.  How do we unpack this connection?  How do minister in a world where the détente of the Cold War has been replaced by faith in the free market, but in calamity across the globe? 

Quite possibly we should turn to Richard Baukham’s Bible and Mission: Christian Witness in a Postmodern World.  I believe Bauckham offers a strong answer, and most of all a critique of the attempts to redress our economic and societal upheaval through the imposition of power.  American evangelicalism’s dance with the Republican Party has only been an attempt to overlay another metanarrative over the American Christian experience, even at its purest motivations.  Conversely, liberation theology also only offered the replacement of one system with another system.  Both are essentially utopian, but failed to address the heart of the matter, the heart.  Here Bauckham suggests a subversive approach to our postmodern world.  A movement not based in metanarrative or coercion, but based in witness and expansion of the kingdom of God from below.  Ultimately, he proposes a rejection of power, and an offer of hope in the witness of communities who live out the truth.  Thus, if we are moving more and more towards a metanarrative of the free market, or a coercion of the free market into all and everything, then could the answer be a subversive witness of justice, transformed life, love, and community a.k.a. the church?  Could our New Testament set in the context of the Roman hegemony, offer a fresh narrative reading of how to live in the postmodern free market world?  Is the control of the free market, dare we say, the new Babylon? “Witness to the truth, distinguished from the will to power by its willingness to suffer for the truth, confronts, and defeats the will to power (Bauckham , 109).”

In Spain, people are desperate for something.  They are looking for answers that deal with narrative issues of the world, that deal with their feelings of helplessness in the face of the coercion, confusion, and the fantasy of the market that will make everything better.  

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