“Some Books Refuse To Go Away” “Beberapa Buku Enggan Pergi”
What is this book about?
I began reading the book, “The Great Transformation: The Political and Economic Origins of Our Time,” by Karl Polanyi on my flight to Washington DC last month, knowing I would need ample time to mentally digest and process the content. Consequently, articulating my post this week proved difficult. The challenge was trying to relate the text between Karl Polanyi’s book and Dr. Jason Clark’s text, “Evangelicalism and Capitalism: A Reparative Account and Diagnosis of Pathogeneses in the Relationship.”[1]
The Great Transformation: The Political and Economic Origins of Our Time, by Karl Polanyi is a seminal work in economic history and social theory.[2] Published in 1944 the book analyzes the profound economic and social challenges brought about by the Industrial Revolution which Polanyi refers to as the “great transformation.”[3]
The central thesis of “The Great Transformation” by Polanyi is that the rise of market economies during the industrial revolution led to significant social upheaval and dislocation. He argues that the idea of a self-regulating market is inherently flawed and socially destructive. Polanyi asserts that the economic system needs regulation and social protection to prevent market forces from undermining social stability and community well-being. This balance between economic progress and social stability is critical for a healthy society.
According to the book, nineteenth-century civilization rested on four institutions: The first was the balance-of-power system which for a century prevented the occurrence of any long and devastating war between the Great Powers. The second was the international gold standard which symbolized a unique organization of world economy. The third was the self-regulating market which produced an unheard-of material welfare. The fourth was the liberal state.[4]
In chapter 3, Polanyi contrast the concepts of “habitation” and “improvement” to highlight the tension between maintaining social stability and pursuing economic progress.[5]
- Habitation refers to the traditional way of life where communities are stable and social relations are preserved. It emphasized the well-being and security of the population, ensuring that people have a place to live and can sustain their livelihoods.
- Improvement, on the other hand, represents the drive for economic growth and the development, often at the expense of social structures. This pursuit can lead to social dislocation and upheaval as traditional ways of life are disputed in favor of market-driven progress.
Polanyi argues that the unchecked pursuit of economic improvement can undermine the social fabric leading to negative consequences for the community the advocates for a balance between these two forces to ensure both economic development and social stability.
Upon reading Dr. Clark’s dissertation “For Polanyi, the defining feature of capitalism is the emergence of the self-regulating market (SRM), where, for the first time in history, the market was disembedded from social relationships, such as those of religion.”[6] and “The SRM marks the first time that the market became an institution itself, based around the fictions that lacked relational reciprocity, specifically labour, land, and money.”[7], I was curious as to how “The Great Transformation” relates to me today?
I realized that the ideas Polanyi explored in his book are relevant today, the balance between habitation (preserving social stability and community well-being) and improvement (pursuing economic growth and technological advancement has become a tight rope walk in modern society). Polanyi’s insight into the potential social upheaval caused by unchecked market forces reminded me that economic progress should not come at the expense of social stability. Today, I see this tension in debates over housing affordability, job security and environmental sustainability policies focused solely on economic growth leading to gentrification wage stagnation and environmental degradation echoing Polanyi’s warning.
The challenge remains to ensure that progress benefits everyone and does not erode the social fabric of communities. Balancing these forces is as critical now as it was in Polanyi’s time. Here are some examples of how his idea in “The Great Transformation” relate to today’s global atmosphere:
- Polanyi argues that self-regulating markets increase income inequality. Market driven growth benefits the wealthy while the working class faces stagnant wages and job insecurity.
- Polanyi warned against treating land and labor as commodities, today this has led to environmental damage and climate change the exploitation of natural resources for profit has caused ecological harm sparking a global movement for sustainability and environmental protection.
- Polanyi’s double movement — the drive for market expansion and the pushback for social protection — shows up in debates over labor standards fair trade and workers’ rights in the globalized economy.
- Polanyi’s call for social protection ties into today’s healthcare Social Security and welfare debates. Governments and organizations seize these policies as crucial to counteract the harms of market driven economies.
- The price of populism and nationalism today ties back to Polanyi’s idea of social dislocation caused by market forces people’s frustration economic policies that prioritize market efficiency over social well-being has sparked a surgeon of these movements.
My takeaway
Polanyi’s book brings a wealth of history and information about market economies during the industrial revolution and self-regulating market (SRM), also recognized as “some books refuse to go away”[8] but there exists the absence of benefit to my life.
Conclusion
I agree with Polanyi, that’s the society needs a balance between habitation and improvement for progress. He adds that social stability and human welfare should not be sacrificed for economic growth. He emphasizes the importance of regulation and social protection to defend communities from the harm of unregulated markets in essence he advocates for economic growth that supports social cohesion and well-being.
[1] Clark, Jason Paul, “Evangelicalism and Capitalism: A Reparative Account and Diagnosis of Pathogeneses in the Relationship” (2018). Faculty Publications – Portland Seminary. 132. https://digitalcommons.georgefox.edu/gfes/132
[2] Polanyi, Karl. Great Transformation: The Political and Economic Origins of Our Time, Beacon Press, 2001. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/georgefox/detail.action?docID=3117969.
Created from georgefox on 2024-10-21 05:07:34.
[3] Polanyi, 3.
[4] Polanyi, 3.
[5] Polanyi, 35.
[6] Clark, 124.
[7] Clark, 127.
[8] Polanyi, xviii.
About the Author
Shela Sullivan
Born and raised on the vibrant Penang Island in Malaysia, I cherish the Malaysian greeting, “Mari Makan!!” which reflects the warmth of shared meals. Since 1996, I have called Oregon my home enjoying the raindrops and the serenity of its beaches. The ocean connects me to nature and energizes me. I am a Wife - Mentor - Traveling Pastor - Sourcing Manager Construction. Favorite Bible Verse: "Delight yourself in the Lord, and He will give you the desires of your heart." ~ Psalm 37:4~ I reside with my husband, David and our fur-baby Rolo. We share passions for travelling, culture, diverse cuisines, home improvements, classic cars and humor.10 responses to ““Some Books Refuse To Go Away” “Beberapa Buku Enggan Pergi””
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Well done Shela. I appreciate your overview and takeaways. How do you see these theories playing out in your work and in your NPO?
Thank you, Ryan for your questions. Here is my attempt:
Polanyi’s theories appear in today’s corporate environment (my work) through these manifestations. His content with economic policies focused on market efficiency over social well-being aligns with Polanyi’s idea of social dislocation, fueling populist and nationalist movements. The “double movement” of market expansion versus social protection is evident in debates over fair labor practices, ethical sourcing, and workers’ rights where corporations must balance profitability with ethical responsibilities. Additionally, the trend of wealthy shareholders and executives benefiting most from market driven growth, while the working class faces stagnant wages and job insecurity, reflex Polanyi’s concerns about widening income inequality.
As for my NPO, I believe the Gen-Z will relate to companies that prioritize profit over sustainable practices contribute to environmental degradation. Polanyi’s warning against commodifying land and labor is evident in today’s climate change crisis and the global push for sustainability. The “double movement” of market expansion versus social protection is evident in debates over fair labor practices, ethical sourcing, and workers’ rights where corporations must balance profitability with ethical responsibilities.
Hi Shela, I, too, have asked myself, “What does this mean for my life?” I believe awareness is essential. The thoughts presented by Polanyi felt like pulling back the curtain on some long-held, unquestioned beliefs concerning economics that were ingrained into my way of thinking during my undergrad. I am curious to know what differences you have observed between economic ideals in Malaysia versus the United States. Is the self-regulated market a concern in Malaysia?
Hi Elysse, Good question!
Economic ideals in Malaysia and the United States differ significantly due to their unique historical cultural and political contexts.
I had to look this up to answer the question accurately. Based on what I know from OECD (Organisation for Economic Co-operation and Development), https://www.oecd.org/en.html — Malaysia has sustained over 4 decades of rapid inclusive growth, reducing its independence on agriculture and commodity exports to become a more diversified, modern and open economy. The Malaysian government emphasizes the need for greater inclusivity and gradual fiscal consolidation. In contrast, the United States has a more market-driven economy with a strong emphasis on individualism and free market principles.
Regarding self-regulated markets, Malaysia does have concerns about the potential negative impacts of unregulated markets. The Securities Commission Malaysia (SC) promotes shared accountability and principles-based regulations to mitigate misconduct and ensure market integrity. This indicates that while self-regulation is encouraged there is also a recognition of the need for regulatory oversight to protect investors and maintain market stability.
Hi Shela, thanks for your post. I’m curious if you have seen this play out in Malaysia differently than in the United States? Do you see land and labor as fictitious commodities in the same way?
Thank you for reading my post, Christy.
That’s an interesting question! I did some research to answer your question — based on what I know from OECD (Organisation for Economic Co-operation and Development). While both Malaysia and the United States face challenges related to treating land and labor as fictitious commodities, the context and impact can differ significantly. In the United States, the commodification of land and labor has been a central feature of its capitalist economy for centuries. This has led to significant income inequality, environmental degradation, and social dislocation, as Polanyi’s theories suggest. The focus on market-driven growth often prioritizes profit over social and environmental well-being, leading to issues like labor exploitation and unsustainable land use.
In Malaysia, the situation is somewhat different. While the country has embraced market driven growth and experienced rapid economic development, there is also a strong emphasis on social protection and inclusiveness. The Malaysian government has implemented policies to ensure that economic growth benefits a broader segment of the population, including efforts to reduce poverty and improve social welfare. However, challenges related to land and labor commodification still exist, particularly in sectors like agriculture and manufacturing. Overall, while both countries grapple with the consequences of treating land and labor as commodities, the approaches and the outcomes can vary based on their unique economic, social and political contexts.
Sorry for being long-winded!
Shela,
I am wondering how you might find the balance of the lessons learned here and the fact that you are a Christian working in a non-Christian, for-profit company? Do you feel the tension of regulations and also of the capitalistic draw within you current role?
Thank you for the question, Adam. This is an interesting coffee table dialog, for sure.
Finding that balance is indeed a delicate act. Polanyi’s lessons emphasize the importance of social welfare and regulations to protect against the market’s excesses. This can seem at odds with the profit-driven goals of the for-profit company I am working for. As a business professional, profit is necessary to support working class families and for the economy.
As a Christian, I draw my strengths from my faith to navigate this tension. I focus on upholding ethical standards and advocating for social and environmental responsibility within my role. For example, as a Sourcing Manager, I advocate for diverse businesses (small business, women owned /veteran owned /disabled minority owned/ Native American owned and the LGBTQ+ community) when awarding construction projects. Most of my construction projects are up to $15million, and I find a way to award a piece of the pie to diverse business by the way sub-contracting. I believe God has given me this space and the position to advocate for fair labor practices, sustainable business operations and supporting initiatives that benefit the underrepresented business communities. It is about integrating my values into my work life and being a force for good in my corporate environment. Yes, feeling that tension is natural and even necessary (reminds me of who I am and listening to the Holy Spirit prompting me to do the right thing). It can serve as a reminder to stay grounded in my beliefs while navigating the complexities of a capitalist system.
I was the Supplier Diversity Program Manager for 2.5 years at my for-profit company. By designing a program to serve diverse businesses, I increased the overall diversity spend from 6% (2019) to 14% by the end of 2022. It was one of the best feelings using my position in corporate America to support diverse businesses.
Does this resonate with you?
Hi Shela, I appreciated your answers to Christy and Elysse’s questions. Similarly, how do society and community affect Malaysia’s perspective on economy compared to the US individualistic drive?
Hi Kari, thank you for your question. I will try not to repeat myself with the same responses to Christy and Elysee.
Malaysia’s economic perspective is influenced by societal and community values, emphasizing collective well-being and social harmony. Policies like the New Economic Policy (NEP) aim to reduce economic disparities and promote social equity among different ethnic groups, although inclusivity remains an ongoing challenge.
In contrast, the United States values individual achievement and self-reliance, leading to a focus on personal success and innovation. This approach can drive significant economic growth, but often results in greater income inequality and less emphasis on social welfare.
The core difference lies in the balance between collective well-being and individual success. Malaysia prioritizes social stability and equality, while the U.S. emphasizes individual achievement and economic freedom.
Does this help clarify the differences for you?
https://www.bernama.com/en/news.php?id=2354545