In addition to reading Karl Polanyi for his appealing normative stance and transdisciplinary approach, I am drawn to four other attractive features.
Non-deterministic Theory. Polanyi’s historical-holistic approach takes us about as far as any social theory can. He does not offer a deterministic theory as, for example, Marxism does, with its focus on developments within modes of production as ultimately determinative. For Polanyi, neither the economic nor the political nor the social is ultimately determinative. It is the interactions among these three spheres that is crucial. What he offers is an understanding of the underlying contradiction or tension within “market societies” (capitalism), but how this tension works itself out in a particular country depends on a variety of structural and contingent factors. His implicit notion of opportunity structures, as imaginatively elaborated by Fred Block and Margaret Somers and developed further below, is a device for systematically organizing the crucial factors that intervene between the generic contradiction (the “double movement”) and the provisional outcomes.
The double movement is a concept that Polanyi originally employed as a heuristic device for understanding a particular historical experience – the collapse of 19th century (European) civilization. But it may fruitfully serve as a general model of capitalist dynamics. Polanyi contended that the movement toward a self-regulating market system wreaks severe cultural, social and environmental damage. These destructive tendencies inevitably activate a counter-movement of societal protection. Polanyi thus identifies a central contradiction: a self-regulating market is, in practice, unrealizable owing to the destruction occasioned by the commodification of labour, land and money; yet the counter-movement’s protective actions introduce constraints that undermine the profit-based logic of a market system. The result is an eventual economic crisis, an accompanying political crisis, and the danger – realized in the 1930s – that a fascist movement would take advantage of the chaos to force through a xenophobic, expansionist and authoritarian solution. The other provisional outcomes in the mid-20th century included Stalinism and the New Deal. Polanyi hoped that a form of #democraticsocialism would provide a way to transcend the underlying tension, but the emergence of the Cold War following World War II removed this option from the historical agenda.
In the contemporary world, this tension not only persists but has been universalized in the form of neoliberal globalization. In effect, the double movement has operated since the resurgence of neoliberalism at the level of the global market economy as well as the country level that Polanyi studied. Will today’s movement-countermovement dialectic be provisionally resolved through a partial re-embedding of economy in society similar to the democratic #Keynesianaccord that, for 30 years (1945-1975), reconciled the tension? Or will the contradiction be suppressed through the rise of deadly dictatorships that resemble the earlier fascist or Stalinist regimes? Or, finally, is a breakthrough into a form of democratic socialism – a re-embedding of the economy in the full sense – at all possible? In understanding why certain provisional outcomes emerge in particular contexts and what the historical possibilities are, the notion of opportunity structures is helpful. With this concept, the analyst fills in the gap between the underlying conflict and the actual or possible resolutions.
The integration of three levels of analysis. An array of contingent factors bear on the explanation of a particular historical trajectory and estimating the limits of the possible. Some of the contingencies derive from global relations, others from structural and historical conditions at the national level, and still others from the efficacy of domestic agents of change such as political movements and ideological trends. Polanyi’s tool kit assists us in fleshing out this important part of the story.
On the first page of The Great Transformation, Polanyi informs his readers that the devastation of Western civilization resulted from the failure of four political and economic institutions. Two of them were national – the self-regulating market and the liberal state – and two were international – the gold standard and the balance of power system. More generally, we can infer from Polanyi’s method the close interrelationship of three levels of analysis.
The global opportunity structure constrains what national states can achieve by limiting the leeway a government enjoys in formulating economic and social policy. A government’s leeway depends mainly on the national economy’s role within the international division of labor, its regional and international alliances and the impact of imperialism and geo-politics. The national opportunity structure, in turn, affects whether social and political movements can actually seize the opportunities presented by the global opportunity structure. Such national constraints as cohesive and well-organized elites, mass poverty, limited state revenues, fragmented class structures, weak institutions, limited history of democracy, absence of a tradition of mobilizational politics, communal or regional cleavages, and cultural norms of quietism vary markedly among countries. The global and national opportunity structures together set limits on how effective political leaders, political parties and ideologies can be in addressing the double movement and instituting leftist alternatives – assuming leftist parties not only exist but also are well organized. The opportunity structure, in combination with the double movement provides considerable explanatory leverage.
Avoidance of the imperialism of categories. Those interested in the Global South may agree that a Polanyian framework has much to recommend it, yet still question the appropriateness of employing concepts developed in the West to the non-Western world. Post-development thinkers have warned that the imposition of universal concepts derived from the advanced capitalist societies to the analysis of problems in the South threatens to enhance Western control. It does so, according to this view, by controlling the categories used to frame issues in the former colonies. Would this critique not also apply to the use of Polanyian concepts?
I don’t think so. For one thing, the Polanyi circle that carried out comparative and historical studies in the 1950s included several anthropologists who ideas reflected their immersion in studies of societies in the South Pacific and Africa. And Polanyi’s posthumous book, Dahomey and the Slave Trade, sought to understand the place of economy in society in this historical case. Polanyi’s concepts were heavily influenced by non-Western realities.
More importantly, Polanyi’s basic contention anticipates the post-development critique. The fulcrum of his critique of economic #liberalism is what he termed the “economistic fallacy.” He claimed that its adherents viewed historical and non-Western cases through the familiar prism of market economy; consequently, they misconstrued the economy-society relationship there. Believing that “economic man” and market relations were universal in time and space, the liberals misled their acolytes around the world and, in doing so, constricted the imagining of historical alternatives to capitalism. Although there is more to the economistic fallacy than this, even these few words suggest that a Polanyian model is an emancipatory rather than a subordinating set of ideas.
Political Imagination. A final virtue, implicit in what I have already said, is the significant role of Polanyian thinking in stoking our political imagination. Polanyi’s originality is manifest in his critical stance toward both liberalism and Marxism (let alone fascism) and in his central thesis that market systems are a unique and relatively recent occurrence. The latter notion opens our minds to the possibility of alternatives to (or within) capitalism. Moreover, his thinking is forward looking as well as backward looking. In essence, he sought to understand the past in order to forge a more desirable future. Yet, in a final nuance, he warns us that the “reality of society” is that impersonal systems will inevitably limit our experience of freedom. The affluent and technological – “complex” – society we crave cannot operate without large bureaucracies (and, today, personal information stored on vast computer systems). It will take considerable ingenuity for us to safeguard “all the freedom we need.”
In sum, Polanyi is one of the 20th century’s great social thinkers, a view that is only now being widely recognized.
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