Over the last 30 years Karl Polanyi’s The Great Transformation, first published in 1944, has become a canonical text in several inter-related social sciences – sociology, geography, anthropology, international political economy, as well as making in-roads into political science and economics. Undoubtedly, part of its appeal lies in the resonance of his theories with our times which have been marked by the deregulation of markets and their extension into new realms. Polanyi argued that the rise of market fundamentalism had devastating consequences for society, leading to protective countermovements that could be of a progressive or reactionary character. From the perspective of today’s market fundamentalism, Polanyi’s countermovement effectively frames, on the one hand, the democratic social movements of 2011, including the Arab Spring, Occupy, and Indignados, and, on the other hand, the more recent advance of illiberal democracies, often veering toward dictatorships, in Turkey, Poland, Hungary, the Philippines, Brazil, Italy, Israel and Egypt. It also frames an understanding of such popular movements behind Brexit, Trumpism, the Five Star Movement, and the Yellow Vests as a reaction to an expanding market that commodifies, denigrates and excludes. It is the obvious appeal of Polanyi’s argument that now leads commentators to evaluate his writings critically and with renewed intensity, searching for answers to crises of a global scale.

CRITIQUES OF POLANYI

The most common criticism of The Great Transformation is Polanyi’s failure to anticipate another round of market fundamentalism beginning in the 1970s that has continued virtually unabated for nearly 50 years. Attributing colonial atrocities, two world wars, and the rise of fascism to the repercussions of a market fundamentalism, Polanyi believed that humanity would never be so irrational and irresponsible as to take another plunge toward a market utopia. Yet this is precisely what happened. I call this “Polanyi’s Paradox” – a mistaken idealistic response to a materialist diagnosis. He failed to recognize the mighty economic forces driving marketization.

This calls for a twenty-first-century reconstruction of The Great Transformation very much as The Great Transformation can itself be seen as a twentieth-century reconstruction of The Communist Manifesto. Polanyi’s reconstruction of Marx and Engels’ treatise moved the centre of gravity from production to exchange, from exploitation to commodification, from struggle against capital to countermovement against the market.