Quotes from The Great Transformation
The economist and political theorist Karl Polanyi argued that 19th century society failed because of “the measures which [it] adopted in order not to be… annihilated by the action of the self-regulating market.” This ‘free market’ conflicted with “the elementary requirements of an organized social life” and produced the “strains and stresses which ultimately destroyed that society” (257). Capitalist markets are destructive of life and freedom even if they are constructive in other ways.
The problem arose from organising the economy on the principles of self-interest. As Polanyi points out “Such an organization of economic life is entirely unnatural, in the strictly empirical sense of exceptional.” It tried to naturalise its oddness, by claiming that all contrary behavior was “the result of outside interference” (257).
However, while self-interest exists, it is not the only principle of human action. There are also factors going beyond the calculating little self, like co-operation, compassion, charity, generosity and so on, all of which are needed for a satisfying life. Perhaps reduction to this simplicity comes from a market which expects it and destroys satisfaction in order to persuade people to consume what is unneeded.
More to the point, these so called “free markets” are also engineered by force:
Economic history reveals that the emergence of national markets was in no way the result of the gradual and spontaneous emancipation of the economic sphere from governmental control. On the contrary, the market has been the outcome of a conscious and often violent intervention on the part of government [or business] which imposed the market organization on society for noneconomic ends. (258)
Moreover, the supposed separation of politics and economic, which has never happened, served political purposes, to produce freedom foe some “at the cost of justice and security” and liberty for most other people who were condemned by riches, and kept in powerlessness. It was not a political decision to keep them dependent on ‘their betters’ for survival and to pay them low wages, it was what the impersonal economy demanded. Yet it may be worth preserving the ideas of “moral freedom and independence of mind” for all, not just the dominant class. It is that freedom, when used from the point of view of those suppressed by the economy, that suggests the economy does not deliver what it promises. As we see today, markets do not always deliver liberty and prosperity for all, they may even deliver authoritarianism (as discussed in the next part of this blog).
The shifting of industrial civilization onto a new nonmarketing basis seems to many a task too desperate to contemplate. “They fear an institutional vacuum or, even worse, the loss of freedom. Need these perils prevail?” (258).
As Polanyi points out, this current market is already permeated by loss of freedom for most people, employment with unlivable wages, economic crashes, profiteering, inability to act because of lack of money or leisure etc. The market was curtailed for a while after WWII, but came back in the 1970s to 80s. Now we have the additions of climate change, ecological destruction and plutocracy. Not doing something may be a greater danger.
The removal of corporately controlled ‘free markets’ will not be the end of markets, trade and exchange flourished long before capitalism and wage labour, but it could be the end of treating people and land as commodities controlled by the market, able to be dismissed cheaply or destroyed for profit.
With a new economy, freedom might not be as constrained by market forces.
The current corporate free market market not only seems unnatural and suppressive of humanity, but is kept going by force. It is becoming less easy to keep going by force the more that ecologies ‘fight back’ against their destruction and produce conditions under which those markets, and market societies, likely cannot exist in a vaguely satisfactory way.
However, the danger is that people may attempt to resolve (not solve) these challenges by a resurgence of authoritarianism, which suppresses people and awareness of the real issues, while favouring the Party and the rich elites. In short, we are threatened by a fascism which will make the situation worse.
Tags: economics, neoliberalism, politics
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