The Great Transformation by Karl Polanyi is an ambitious, encompassing work to uncover what went wrong with self-regulating markets and the corresponding effects on civilization, especially during the turn of the 19th century. Polanyi was born in 1886 in Vienna and was an economic historian, social theorist, and political economist. He lived through two wars, the Great Depression, and the Industrial Revolution. Polanyi argues that the failure of self-regulating markets destroyed 19th-century civilization. Four concepts in his book that I found of particular interest were the idea that self-regulating markets require government intervention, embeddedness implications, nature and humans are sacred, and Polanyi’s attempt to review historical events to understand future decisions.
Self-Regulating Markets Require Government Intervention
Polanyi traced the early Industrial Revolution and how the leading thinkers responded to the initial disruptions by developing market liberalism. And Polanyi concludes that market liberalism is responsible for the collapse of peace that led to WWI, the Great Depression, and the rise of fascism. Market liberalism is premised on self-regulating markets. However, Polanyi’s research demonstrated that because of the harmful effects of self-regulation, governments had to step in to help control the market by imposing regulations and other interventions to help protect workers and the poor. On page 257, Polanyi writes, “the true criticism of market society is not that it was based on economics…but that its (society) economy was predicated on self-interest.” After our readings from the past two weeks on the impact of capitalism and the Protestant work ethic – and the initial attempts of asceticism – one can determine it wasn’t long before the underpinnings of greed consumed a great many that government regulations were implemented. Jason Clark’s work, Evangelicalism and Capitalism: A Reparative Account and Diagnosis of Pathogeneses in the Relationship, substantiates that the initial “religiously disciplined market life ultimately gave way to non-religious resources for understanding society, i.e., the liberal utopia detailed by Polanyi”…Additionally, Clark writes that from this, Evangelicals ceded their influence over the market. Their embeddedness is removed, leaving the new market identity to become a “new society” and community. Also, Clark states on page 163, “God is removed from this process completely, leaving as the only reality the market itself.
Light On A Hill
I touched on the concept of embeddedness in the previous paragraph. However, it is a crucial concept that Polanyi writes about and warrants further discussion. Polanyi writes that the economic system must be embedded into or subordinate to social relations. However, problems arise when society is treated as an afterthought of the market…although economists argued that economic activity must be fully disembedded from society to be effective…this was a utopian idea that would never be able to come to fruition. The critical issue is that economic activity should be subordinated to moral and political systems. The moral aspect is what I am most concerned with, as it should influence how I conduct myself in the capitalist system. Not only that, but it allows me the opportunity to influence others as I am called to be salt and light in the world. If I withdraw my light or my morals are not subordinate to my religious values, I lose my saltiness and, by default, allow unethical and immoral behaviors to abound. No one sits a light on a hill and then covers it – or do they?
Sacredness of Human Life
The fictitious idea that value could be placed on humans, land, and money was closely related to why government regulations were necessary to undergird the so-called self-regulating markets. Polanyi said all three were fabricated commodities because neither was produced for sale on the open market. On this point, Polanyi relies on two arguments. First, humans and land are sacred, so one should not attempt to place a value. Secondly, concerning land, the government must intervene to manage and oversee the production of land resources for the good of all. For Polanyi, putting a price on humans was a moral issue that had been a guiding principle of societies for centuries. While I agree with Polanyi that human life is sacred and priceless – I do not understand how he concluded that it had been a guiding principle of societies for centuries – unless he did not recognize Africans and other indigenous people as human. But I digress.
Tribe of Issachar
Lastly, I was intrigued by the idea that Polanyi wanted his work to be a lesson in how we study the past to learn from it to impact how we imagine the future in the hopes of making better decisions. It is always fascinating to me that, at times, the secular arena has a better grip on what to do than people of faith. I am reminded of the tribe of Issachar. In 1 Chronicles 12:32b, “All these men understood the signs of the times and knew the best course for Israel to take.” These men were from the tribe of Issachar and were explicitly designated by God to understand the chronos (chronological) and kairos (specific) times and guide Israel in the way it should go. I believe that this ability to understand the seasons and times we are in and to be able to speak to the Church and the culture is still available today.
 Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (Boston: Beacon Press,1944), 257.
 Ibid., xxii.
 Dr. Jason Clark, Evangelicalism and Capitalism: A Reparative Account and Diagnosis of Pathogeneses in the Relationship, (2018). Faculty Publications – Portland Seminary. 132. https://digitalcommons.georgefox.edu/gfes/134-134.
 Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (Boston: Beacon Press,1944), xxiv.
 Ibid., xxv.
 Ibid., xxv.