PRE-PUBLICATION DRAFT

The definitive version of this article is available in Economy and Society

43:4

Introduction: A post-Polanyian political economy for our times

Christopher Holmes

Abstract

2014 is the 70th anniversary of the publication of Karl Polanyi’s The Great
Transformation and the 50th anniversary of its author’s passing. This special issue
celebrates these markers by bringing together a collection of critical engagements
with Polanyi’s work which, whilst sympathetic to his intellectual aims, ward
against any straightforward application to contemporary issues. In so doing, it
suggests that part of the value of Polanyi’s work lies not in its ability to be recited,
repeated and re-applied in its original form, but rather in its openness and its
susceptibility to alteration and transmutation. In this introductory article, I
consider the return to intellectual ‘voices from the past’ in the post-2008 landscape.
I suggest that the distinctiveness of Polanyi’s voice comes from his attempt to
problematise, challenge and re-imagine the very notion of ‘economy’ itself, a theme
which underpins all of his most important ideas, and one which reverberates across
contributions to this special issue. I suggest that, beyond his immediate critique of
free-market ideas, the desire to de-centre the notion of an autonomous economic
sphere – and to challenge abstract modes of thought that address such a notion,
regardless of their political sensibilities – is his most valuable legacy, and one which
might encourage us to seek out new innovations and engagements in future
Polanyian scholarship.

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 Our social thinking, focused as it is on the economic sphere, is for that very reason ill
equipped to deal with the economic requirements of this age of adjustment (Polanyi
1977: xlvi)

Introduction

In times of uncertainty and change, people search for authoritative bases for
explaining events and for guidance as to how to proceed. It is therefore
unsurprising that, given the sense of crisis that has framed thought on the global
economy since 2008, we have seen a renewed emphasis on voices from the past.
Giants of the political economy canon, previously restricted to the fringe of
academic discussion, have come to walk openly in mainstream political economic
debate. In the wake of the sub-prime mortgage crisis, Keynesian indictments of
unfettered financial markets and endorsements of regulatory and fiscal
intervention became commonly accepted, if not universally enacted, policy
wisdom – it was, as Robert Skidelsky put it, ‘the return of the master’ (2009). In
various guises, Marx’s work also had something of a renaissance (Elliott 2012).
As the sub-prime mortgage crisis morphed into a more generalised liquidity
crisis, moving on to provoke sovereign debt crises in Europe, it became
increasingly difficult to think in terms of individual crises, each with particular
exogenous causes. Recognition became widespread that individual morality
tales about greedy bankers, admonishment of spendthrift nations, or accounts of
mistaken risk modelling techniques and faulty economic reasoning, might all be
‘missing the wood for the trees’. The polyvalence of the financial crisis as a
whole forced people to consider higher planes of abstraction: perhaps it was
finance in general, laissez-faire ideology or the centrality of markets themselves
that needed to be bought into question.

But what has been just as striking is how the openness and radicalism of this
debate shrank away over the proceeding years. Marx’s theory of the declining
rate of profits was re-written as ‘therapy for bankers’ (Barker 2012), with the
core of his message – the injustice of private property and class struggle – being
replaced by a set of ideas that might inform better economic policy so as to ‘make

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capitalism work better’. Keynes’ more demanding prescriptions on limiting
capital mobility – designed specifically to challenge the authority of financial
market freedom – were shelved in favour of limited and crisis-specific stimulus
measures designed to support it (Pettifor 2013; see also contributions to Tily
2010). An open discussion about alternative visions of how we might go about
reconstructing economic relations differently was superseded by a much more
technical debate about how we might go about restoring the previous order to a
pristine state (Watson, this issue). And what Keynesian interventions there were
soon gave way to discourses of economic austerity across Europe and beyond,
which sought to pull back the frontiers of the state, rather than to extend them so
as to exert more control over financial markets (Blyth 2013).

In this context, there are good reasons for turning back to the work of Karl
Polanyi. His magnum opus, The Great Transformation (1944), offers us a unique,
historical and conceptually rich account of socio-economic crisis, explaining it in
terms of the social pressures wrought by the attempt to construct societies on
the back of utopian economic ideas. His famous ‘double movement’ thesis has
been subject to a bewildering array of interpretations and deployed toward
myriad analytical ends (see Dale 2010), but in its rawest state – as a description
of attempts to instantiate the self-regulating market idea upon increasing
spheres of life, and the forms of social resistance that that process engendered -
it is surely at its most relevant in the post-2008 landscape. In particular, his
account of the politics of nineteenth century haute finance and of the gold
standard between the World Wars provides a great deal of critical insight which
we might bring to bear on current attempts to set up, repair and sustain financial
markets and their role in structuring society and polity.

As Kari Polanyi-Levitt, has recently argued (2013), her father’s wide-ranging

mode of enquiry into matters of finance pushes us far beyond limited debates
over the relative merits of austerity and stimulus policies, instead
problematising the relationships between finance and democracy, and between
market and society, as a whole. Moreover, Polanyi’s thesis on global finance was
itself ensconced within a much broader critique of the costs of commodification

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upon people, communities and the environment, which might give us pause as
we witness the extension of market mechanisms into traditionally non-
marketised domains such as public services (Crouch 2011) and environmental
protection (Lohmann 2010). One reason that Polanyi’s work is attractive today
is precisely because it refuses to consider financial crises as distinctive and
separate from broader economic and social trends. As Nancy Fraser discusses in
her opening contribution to this special issue, Polanyi eschews ‘critical
separatism’, connecting crisis potentialities in financial, ecological and social
spheres of human engagement. This de-centring of ‘the financial’ – and indeed of
‘the economic’ – within our understanding of crisis in general is a valuable move
for today because it provides a critical language through which we can articulate
a challenge to the common separation between financial, productive and
reproductive aspects of the economic existence (which, as Fraser argues, offers
up scope for a novel Polanyian brand of feminist thought). Fraser’s piece thus
demonstrates how the very expansiveness of Polanyi’s approach to ‘great
economic transformations’ matches the profundity of questions of political
economy that need to be asked today.

But none of this potential is un-problematic. Rather, our own era of

transformation comes at the point of an ‘introspective turn’ in the Polanyian
literature. Rather than seeking to apply Polanyi's thought verbatim, or to work
towards establishing the ‘definitive Polanyian position’, some of the most
interesting avowedly Polanyian research starts from the observation of
problematic aspects of his work, including for example an uncritical attitude
towards non-market forms of economic integration and a latent determinism
evident in his depiction of economic history (see Sievers 1949 and Hejeebu and
McCloskey 1999 for respectively sympathetic and unsympathetic critiques). If
we are to wrest the most value from Polanyi’s challenges to the market society
ideal, and to develop its contemporary relevance to the fullest extent, it is vital
that we engage with these problems, which is exactly what the contributions to
this special issue do. Each approaches Polanyi’s thought critically, exploring the
tensions and contradictions in his analytical scheme, before using those
explorations as a catalyst for innovation and engagement on a wide variety of

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issues. Fraser’s contribution is a case in point. Recognising a residual
communitarianism in Polanyi’s work she argues that Polanyi’s single-minded
focus on the perils of self-regulating markets came at the expense of a
consideration of the harms perpetrated in the name of the social, however
conceived. What about the patterns of social domination, exclusion and
hierarchy that markets sometimes act to break down (see also Robotham 2009)?
Fraser responds by innovating, suggesting a notion of ‘triple movement’ so as to
capture emancipation from domination in the same analytical scheme as
Polanyi’s opposition between market and society.

All of this leaves us with a question. The remarkable diversity of uses to which
Polanyi’s ideas have been put, the equally remarkable diversity of
interpretations of those ideas, and the increasing awareness of problematic
aspects of his work begs us to ask, if there is not a definitive Polanyian position
to be unearthed and applied, then what is it to be ‘a Polanyian’, or to work from a
Polanyian position? If Polanyi is to provide us with inspiration today, despite
problematic aspects, then we must consider our response to this question
carefully. In what follows, I suggest a response which focuses on the extent to
which Polanyi’s work encourages us to problematise, challenge and re-imagine
the very notion of ‘economy’ itself, a theme which underpins all of his most
important ideas, and one which reverberates across contributions to this special
issue.

To begin, I explore the contemporary relevance of Polanyi’s desire to challenge

materialist and market-centric accounts of the economy and how these might
contrast with Keynesian and Marxist responses to financial crises since 2008. I
move on to examine Polanyi’s notion of the provisioning of livelihood, discussing
how it challenges other conceptions of what the economy is. I argue that this
challenge reflected a broader suspicion that Polanyi held towards abstract and
universalist modes of thought, which is evident in various ways across his work.
However, along with Dale and other contributors, I note that this line of thought
was hampered by an attachment to a Marxist teleology which reproduced
aspects of the very abstract modes of thought that he was attempting to escape

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from. In the final section, I suggest that we might move on from these problems
and harness the fullest potential of Polanyi’s work by considering it in the light of
other traditions of thought to Marxism, which might in turn offer up the potential
for more innovative empirical engagement today. In sum, this article concludes
that, by approaching Polanyi’s work critically, we can develop a uniquely ‘post-
Polanyian’ voice in the post-2008 political economic landscape which might
serve to re-animate the openness and radicalism of debate that took place in the
immediate aftermath of the sub-prime crisis in 2008.

Contextualising ‘the economy’

The notion of the ‘real’ economy – set against a presumably ‘less real’ financial
economy – is a routine basis for challenging the power of the financial sector.
Distinctions between investment and speculation and between assets and
derivatives function normatively because they suggest that finance is only a good
thing when it explicitly relates to non-financial activity – the real stuff of actual
assets and productivity. The broader cultural trope of ‘Main Street vs. Wall
Street’ also separates out the world of global finance and denounces it on the
basis of a lack of connection to the day-to-day reality of small businesses turning
out actual, useful goods. Such appeals to economic reality have also shaped
critiques of specific forms of financial activity since 2008. Valuations of sub-
prime mortgage loans were considered problematic in that they did not reflect
the real value of the collateral. It was argued that credit rating agencies issued
ratings on public and private debt that were incorrect, reflecting the subjective
interests of the agencies and their clients, rather than the objective nature of the
debt itself (Sinclair 2010: 91). The euro currency enabled peripheral European
economies to borrow at rates that did not reflect the underlying reality of their
economies. Distinguishing fictional finance from economic reality in these ways
is a rhetorical device used to enable blame to be assigned. Reality is right and
fictional is wrong, and so peddlers of financial fictions are to be admonished and
disciplined. Whether they be over-exuberant investors, nefarious rating

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agencies or utopian dreamers of harmonising eurozone economies, all must
undergo a ‘reality check’.

Whilst, politically, Polanyi was certainly concerned about the dominating effect
of finance upon everyday life, a Polanyian position might ward against this
argumentative strategy on the basis that, by definition, such moves reify ‘the
economy’ as something in and of itself. Although such distinctions may serve
polemical ends, by giving the debate ontological grounds, it also implies the
possibility of a set of authentically ‘correct’ rules and policies for financial
management which would reflect the pre-existing reality of distinctively
economic relations. This in turn implies that financial problems are economic
problems and so they demand economic solutions. But what if financial
problems were discussed first and foremost as social problems, or ethical
problems, as questions of power, inequality, or justice? Distinguishing
‘bad/fictional finance’ from ‘good/real economy’ in general might actually close
down the possibility of more open questions about the economy as a whole and
its place in society. Social, political and ethical questions over the purpose of the
economy vis-à -vis human experience and human lives become occluded.

In his contribution, Saiag speaks to the theme of reality and fiction in Polanyi’s
work by elaborating and contesting his approach to money. Saiag shows how
Polanyi rejected the ‘neutral veil’ description of money, which is predicated on a
dichotomy between the monetary sphere and some underlying ‘real’ economic
sphere, where money is merely a signifier to some underlying signified. This
dichotomy is implicitly upheld in the populist oppositions of real and financial
economies, whereas, for Polanyi, money has various characters at various times,
conditioned by particular social contexts, none of which are more or less real
than others. He went to great pains to illustrate – sometimes successfully,
sometimes less so – that money has been institutionalised in different ways
throughout history, sometimes within the context of market development, but at
other times through thoroughly un-marketlike practices including marriage,
punishment and a variety of other mechanisms of social obligation (Polanyi
1968). Similarly, Polanyi’s analysis of the gold standard did not centre on its

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internal contradictions, or on an account of the power of transnational financial
agents tout court. Rather, gold was, in his analysis, a simultaneously practical
and symbolic object, unifying poor and rich, local and global in both concrete
political economic orders and webs of cultural meanings. It was the reification of
the gold standard as the ‘faith of the age’ (Polanyi 1944: 26) that made it pivotal
to the politics of the period. In my own contribution, I argue that these ideas
remain highly relevant today, offering us a unique and critical voice on
contemporary monetary issues such as the current eurozone crisis and the
politics that has emerged from it.

But the overcoming of a distinction between financial and real economies is only
one stage in Polanyi’s attempt to contextualise economic action, for underneath
that intellectual bifurcation lay another: between economy and society. Like
Keynes and Marx, Polanyi viewed the economy in terms of its ability (or lack
thereof) to serve social ends, but unlike either, Polanyi was not willing to
elaborate any distinctively ‘economic’ theory at all. Rather, his anthropological
persuasion led him to the famous conclusion that ‘[Man][sic.] does not act so as
to safeguard his individual interest in the possession of material goods; he acts
so as to safeguard his social standing, his social claims, his social assets. He
values material goods only in so far as they serve this end’ (1944: 48). To think
otherwise – to think of the world as intelligible in terms of economic principles
first – was to miss the socially embedded nature of economic interaction.

But what are these social ends? How do we go about describing economic
behaviour in a social fashion? On pre- and non-modern economies, this was a
straightforward matter for Polanyi. As he remarked in the edited collection
Livelihood of Man:
…human beings will labor for a large variety of reasons so long as they form part of a
definite social group. Monks traded for religious reasons, and monasteries became the
largest trading establishments in Europe. The Kula trade of the Trobriand Islanders, one
of the most intricate barter arrangements known to man, is mainly an esthetic pursuit.
Feudal economy depended largely on custom or tradition. With the Kwakiutl, the chief
aim of industry seems to be to satisfy a point of honor. Under mercantile despotism,
industry was often planned so as to serve power and glory. Accordingly, we tend to

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 think of monks, Western Melanesians, villeins, the Kwakiutl, or seventeenth-century
statesmen as ruled by religion, esthetics, custom, honor, or power politics, respectively
(1977: 11).
Given this, it is disappointing that Polanyi – ceding ground to the marginalist
vision of human motivation that he so despised – was often content to consider
economic behaviour in market society in terms of simple material gain.
Betraying an imputation of false consciousness, genuinely social motivations had
been lost to Mammon in market society. As a consequence, whilst Polanyi
desired to embed our understanding of the economy within the social, he
neglected to undertake precisely that task for capitalist society (Lie 1991; Zelizer
1988) as, for example, Max Weber or Thorstein Veblen had. As such, any
sensitivity to the particular motives for particular types of market economic
action at particular times and places, conditioned by particular social settings, is
lost.

In his contribution, Matthew Watson recognises something of these limitations

in Polanyi’s reading of the history of economic ideas. As he discusses, Polanyi
tended to ‘flat-line the whole of the history of economic ideas around Ricardian
themes’ – i.e. around an abstract conception of ‘the economy’ as synonymous
with ‘the market’. By exploring the historiography of Polanyi’s conception of
economy – through Polanyi’s reading of Karl Marx and both Polanyi’s and Marx’s
reading of Adam Smith – Watson shows that this was a polemically effective, but
hasty generalisation, and one that closed off the possibility for drawing upon the
subtleties in pre-Ricardian political economic thought. Exemplifying the aims of
the special issue as a whole, Watson sees this not as a reason to abandon
Polanyi’s thesis, but rather as a cue for innovative engagement, this time with the
thought of Smith. He argues that Smith’s notion of moral sympathy provides us
with precisely the basis that Polanyi demanded, but did not actually supply, for
re-imagining economic life in social and ethical terms.

This potential for re-imagination which Polanyi’s thought opens up contrasts

markedly with Keynesian and Marxist economic worldviews as they are
traditionally understood. For Keynes, the economy was nothing but a large

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machine which, if well managed, would serve only to churn out material
satisfaction for members within it. Ideas were only relevant insofar as they
enabled us to coax the economy to perform this task better. If they did this, then
they were ‘right’ enough. For Marx, ideas were epiphenomenal to the real,
material business of production – a product of our material economic conditions
and interests, rather than a determinant of them. And as Havel notes, this easy
materialism is a mode of thought which remains with us today:
The majority of our political parties act with a narrow materialistic focus when, in their
programs, they present the economy and finance first; only then … do we find culture as
something pasted on or as a libation for a couple of madmen. Whether they are on the
right or left, most of them – consciously or unconsciously – accept and spread the
Marxist thesis of the economic base and the spiritual superstructure (2011: ix).
Polanyi’s emphasis on the social embeddedness of economic action reverses this
materialism. It suggests that the language we use to describe the economy, its
purpose and ourselves within it is not neutral, or to be measured by its
correspondence to the underlying reality of the economy. Rather, the material
base of the economy is a reflection of the sociological and political ideas that we
choose to understand it by (Thomasberger 2013). On one hand, this functions as
a useful analytical tool to analyse existing economic behaviours in terms of their
social content. But on the other, it has a polemical purpose, offering up a basis
for thinking through the purpose of the economy beyond economism and
market-centrism. Developing a sense of what it might mean to re-embed our
understanding of economy within society will be crucial to developing a
distinctively Polanyian voice in the post-2008 landscape.

Livelihood and rationalisation

Although Polanyi failed to open up the possibilities of embeddedness within

market society, he did so incidentally through the development of the notion of
‘economistic fallacy’, which is precisely an invitation to re-imagine the basis of
economic relations outside of market-norms, as expressed in the methodological
assumptions of individualism and acquisitiveness. With the early marginalists in
his sights, Polanyi wrote that ‘the error was in equating the human economy in

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general with its market form’ (1977: 6). This gives rise to the formal meaning of
economic (i.e. derived from utility-maximising/economising behaviour) being
confused with the substantive meaning (i.e. referring to economic interaction in
general). In contrast, Polanyi identifies the substantive economy as the
institutionalised interaction between humans and their natural surroundings in
satisfaction of their material wants (1977: 32) – in other words, the way people
go about securing their livelihood.

On its own terms, this move has a lot of potential in terms of characterising
economic interests in new ways. In a global economy marked by vast numbers
of economically ‘precarious’ peoples (Standing 2011) – a precarity which has
since 2008 spread greatly in affluent economies – the key interest is not the
maximisation of wealth, but the achievement of economic security for self, family
and community. What implications might it have for the way we understand the
economy to put this vision of human rationality at its centre? But equally, we
should be wary of replacing one abstract vision of rationality with another.
Instead, we can think of this as an empirical question: how do people go about
securing their livelihood, and how does that effort relate to the discursive
structures of ‘the economy’ traditionally understood?

In his contribution, Chris Hann explores this question. Hann’s analysis of the
Hungarian village of Tá zlá r presents us with a history of the economic motives of
villagers through the prism of wider changes in the socio-economic organisation
of rural Hungary. Significantly, the detail that Hann provides prevents us from
falling into the generalisations that Polanyi was prone to. Instead of seeing
people as fully subjectified by market norms, as implied by Polanyi’s failure to
explore embeddedness in market society, we get a picture of individuals,
households and communities responding to change and adapting their behaviour
in ways that cannot simply be read off from the dominant ideological and
practical regimes of governance surrounding them. Like Watson and other
contributors, Hann thus recognises the limitations of Polanyi’s anti-marketism,
but shows how, through empirical work, we might find a way to fulfil the
potential of a Polanyi’s sensitivity to the ideas that shape our understanding of

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economic interaction whilst retaining the essence of his critique of market
society. But given an evisceration of Polanyi’s simplistic and polemic notion of
economic behaviour in market society, what is left that is Polanyian here?
Rather than searching for the basis for a revolutionary return to the social and a
‘world entirely free of the economistic’ (Hann, this issue), Hann instead implies a
more moderate, sensitive and ultimately more illuminating analytical manifesto:
‘The challenge is the same in all human economies: how to institutionalise or
(re-)embed the “formal” or economistic in an encompassing holistic or
“substantive” societal framework’ (ibid.). In other words, how do people
accommodate the economic structures of the world around them in the
provisioning of their own livelihood?

Such empirical analysis still serves critical purposes but the object of critique is
different to Polanyi’s emphasis on laissez-faire ideology. As for the rural English
population that Polanyi wrote of in The Great Transformation, the important
point for the Hungarian villagers was not their degree of marketisation per se,
but the effect that sweeping changes in the socio-economic landscape around
them – whatever their ideological hue – had upon the provisioning of livelihood
in everyday life. By this account, the focus in each case is not economism in itself,
but rationalisation, i.e. the way in which individuals and communities are
subjected to, or at least affected by, external logics, towards higher ends of
efficiency or reason, however construed. Rationalisation may have been
synonymous with marketisation in The Great Transformation, but Hann’s
research demonstrates that the former is the category, the latter a species within
it.

This more general theme of rationalisation – the subsumption of the autonomous

individual and community within abstract, universalising modes of thought –
crops up throughout Polanyi’s work. Of course, the economistic vision of
humans as driven, by their natural, animalistic predispositions to exhibit market-
conforming behaviour is the most obvious example to emerge from The Great
Transformation, but he develops similar themes elsewhere. For example, in his
essay on ‘The Essence of Fascism’, part of a co-edited volume entitled Christianity

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and the Social Revolution published in 1935, Polanyi berated fascist
appropriations of Nietzschean and Hegelian thought on the basis that they lost
sight of the irreducibly autonomous agency of the individual that was so
important to the original thought of Nietzsche and Hegel, in the process
generating bastardisations of their worldviews:
'[Ludwig] Klages is Nietzsche without the Superman. [Othmar] Spann is Hegel shorn of
his dialectic. Both omissions are so vital that they suggest a caricature rather than a
portrait. ... Nietzsche rid of anarchist-individualism; Hegel deprived of revolutionary
dynamics; the one reduced to an exalted Animalism, the other to a static Totalitarianism'
(1935).
By this reading, fascism, communism and laissez-faire ideology were all
problematic visions in that they all generated infinitely applicable ordering
principles from systems of thought alone. None had, by this account, humility
towards human agency: no concession to the potential for individual autonomy,
for resistance and change – the ‘odd term’, as Foucault put it (2005: 88) – and no
notion of cultural or social specificity. Each vision extended to infinity both
temporally, through the fulfilment of some essence of human nature, and
spatially, through the globalist narratives that they shared.

Polanyi’s attempt to escape the spatial aspects of these absolutist and

universalist modes of thought leaps from the pages of his work. Emphasis upon
the value of community, nourished in part by a fascination with Robert Owen’s
philosophy and politics, is common throughout. In The Great Transformation, the
metaphor of disembedding is at its most powerful when it describes the physical
uprooting and relocation of labourers from their particular communities in the
name of market rationalisation of the English countryside, for example. And
whilst Polanyi was often nebulous in describing his own hopes for the future, it
was evident enough that it should depend not on abstract principles of order, but
on particular relationships between particular people in particular communities:
Human relationships are the reality of society. In spite of the division of labour they must
be immediate, i.e. personal. The means of production must be controlled by the
community. Then human society will be real, for it will be humane: a relationship of
persons (1935).

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But if Polanyi’s normative tilt towards the personal and the particular and away
from the abstract and universal was clear in his approach to space, he failed to
extend this way of thinking out temporally. Yes, the moral worth of the
autonomous individual sat at the heart of Polanyi’s political philosophy at all
times, but his account of the relationship between the individual and the society
within which he or she sits was often wrapped up in a Marxist narrative of total
emancipation from market society, which betrayed a form of determinism.
Rationalisation from above via market ideology was a situation that was to be
escaped through some sort of fundamental transition towards socialism (Lacher
1999), thus liberating the morally autonomous individual so as to reflect their
genuinely social inner essence and achieve ‘freedom in a complex society’ (1944:
263; see also Cangiani 2013; Holmes 2012).

In this issue, Gareth Dale unpacks some of the intellectual formation that led
Polanyi to this teleological way of thinking. Drawing on unpublished and little-
read writings, he shows that Polanyi identified, but struggled, with the
temporality of Marxist thought, recognising its limitations, but failing to escape
from them. Dale characterises Polanyi’s critique as follows:
The determinism of Marxism … begets something akin to Sartrean bad faith – the
abjuring of responsibility through denial of the freedom to choose. In its repudiation of
moral freedom, the belief in the inevitability of socialism, Polanyi concludes, is morally
and politically corrosive (Dale, this issue).
But Dale moves on to observe that, despite exposure to strains of Marxism –
particularly the work of Gyö rgy Luká cs – which sought explicitly to transcend the
deterministic and teleological tropes of orthodox Marxist thought, Polanyi did
not incorporate them into his own work. Instead, he drew himself towards the
far more reductionist and deterministic ‘revision’ proposed by Eduard
Bernstein’s and to the ‘functional theory’ of G.D.H. Cole and Otto Bauer. In result,
as Dale discusses, the transition to the better society acquires an air of
inevitability in Polanyi’s narrative, an inevitability that he appeared to be
explicitly attempting to denounce in earlier work.

Post-Polanyian approaches

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Of course a scholar can only speak in the vernacular that is familiar to them. And
so whilst Marxism was very much the familiar vernacular for Polanyi, one
wonders whether his escape from determinism might have been easier had he
inhabited a different intellectual milieu. I and others have tried to think through
Polanyi’s ideas in relation to those of later post-modern and post-structural
authors (Holmes 2012, Inayatullah and Blaney 1999; Ö zveren 2007), for whom
questions of teleology or determinism were not important. Foucault’s lectures
on biopolitics (2008) speak to immediately comparable themes, for example. In
the lectures, Foucault charts the history of the free market idea during the
eighteenth and nineteenth centuries, relating it – in much more detail than
Polanyi went into in The Great Transformation – to emergent liberal rationalities
of governance, a discussion which extends into the post-World War Two period
(e.g. 2008: 116). Drawing on these affinities, the development of a genuinely
‘post-Polanyian’ position might offer us the chance to complete Polanyi’s partial
escape from determinism and to liberate his ideas from the intellectual trappings
of Marxist theorising in general.

Beyond these possibilities, if we accept that Polanyi’s critique of economism

reflects a broader suspicion of the tendency to reason in terms of universal and
abstract ideas, then we might think about Polanyi’s relationship to different
traditions again. Weber’s rationalisation thesis offers an obvious antecedent, but
there are others of even closer fit. For example, shortly after the publication of
The Great Transformation, the conservative philosopher Michael Oakeshott
penned his celebrated essay ‘Rationalism in politics’ (1947[1962]), which railed
against the search for abstract, objective and incontrovertible truths as the basis
for political thought and action. Oakeshott’s concern to defend the virtue of
traditional knowledge against the imposition of the abstract idea bears
immediate similarities to Polanyi’s defence of the livelihood of communities
against the abstract imposition of economism. Where, for Polanyi economism
sought to disembed the economic from the social, for Oakeshott rationalism in
general sought to disembed the ethical from the social: ‘Moral ideas are a
sediment; they have significance only so long as they are suspended in a religious

15
or social tradition, so long as they belong to a religious or a social life’
(1947[1962]: 41). Where, for Polanyi, economism denied the variety of springs
of human motivation, grinding people into its economistic mold, for Oakeshott,
any politics founded on the application of universal ideas gave root to a ‘politics
of uniformity’ (Oakeshott 1947[1991]: 10). In 1949, Isaiah Berlin also berated
ideologies of every colour for their desire to find ‘fundamental principles’ or
‘truths’ (Berlin 1969: 30), which need only be rigorously applied so as to resolve
political and social problems, noting how such an approach paid insufficient
attention to ‘the infinite variety of persons’ (Berlin 1969: 39).

The fact that Oakeshott and Berlin were expressing these complementary ideas
at around the same time as Polanyi published The Great Transformation may not
be a trivial observation. It suggests that we might think about Polanyi’s place in
the history of ideas beyond his immediate affiliations and consider how the
politics of the period in general shaped the thought of scholars in diverse
traditions. But seeing the economistic fallacy as one example of a broader set of
critiques of universalist reasoning might also force us to look beyond its
immediate polemical strength and instead to interrogate the notion in a more
critical and theoretically rigorous manner. Analytical philosophy, for example,
has been home to characteristically forensic debates over the virtues of ethical
thought predicated on universalist ideas – ‘generalism’ – as set against those
predicated on ‘moral particularism’ (see Dancy 2004; Raz 2006; Timmons 2013).
This is a critical point that we must consider when approaching Polanyi’s work.
As Fraser discusses in this issue, Polanyi’s emphasis on the virtue of particular
social bonds – the community, Owen’s collectives, the immediate relations
between individuals etc. – may skip over the virtues that come precisely from
those bonds being broken in the name of abstract ideas such as that of the free
market. As she puts it: ‘what commodification erodes is not always worth
defending … marketisation can actually foster emancipation by weakening
traditional supports for domination’ (this issue). Interrogating Polanyi’s notion
of economistic fallacy in an analytical manner might at least work to clarify
precisely what is at stake in such debates.

16
Searching for new engagements such as these might allow us to deepen our
appreciation of Polanyi’s work and also to broaden it out as well. If Polanyi’s
imputation of economism is a species within a broader genus, then we might be
more creative in identifying the abstract logics that frame economic
understanding today. Scepticism towards the simplistic economistic vision of
human as homo oeconomicus has perhaps never been more profound than it is
now, and as discussed at the outset of this piece, the financial crisis has provoked
some scepticism towards ‘the market’ as the best solution to all economic
problems. In these limited ways, Polanyi’s critique of Ricardian economism has
been learned. But Ricardian economism and market-centrism does not function
as a political rationality unmediated. Rather, it is mixed up with other abstract
ideas. On one hand, the benefits of the market have often been sold in terms of
their ability to serve the ends of human freedom, as exemplified in Robert
Nozick’s work (1968). Considering markets and market ideology without
considering their explicitly ethical and moral content is, again, to fall into the
very trap of economism and materialism that, at its best, Polanyi’s work
encourages us to avoid. On the other hand, and especially since 1989, explicit
ideological defences of the market have given way to more subtle, de-politicising
modes of pro-market thought (Hay 2007: 98). Grand narratives of political
economy still exist but they are now also articulated through different discursive
practices. For example, growing demands for accountability and transparency
across all domains of governance, both private and public, appear to be non-
problematic: who would demand a lack of accountability and opacity in
governance? But such values contain an implicit preference for particular styles
of verification rooted in market norms of contractual engagement, rather than,
say, those of trust (Power 1999). Similarly, the neo-liberal notion of the market
as the site and fount of individual freedom may not be trumpeted in the same
way as it was during the Cold War, but such rationalities might instead now be
wrapped up within more subtle idioms of economic governance. A good example
is the current vogue for policy geared towards producing ‘resilience’ amongst
populations (see Brassett et al. 2013). Resilience might seem a good idea in this
era of financial, economic and ecological crisis, but as has been shown (Walker
and Cooper 2011), such ideas smuggle in a form of economism through an

17
emphasis on the primacy of the individual and the assumption that society is
merely market, i.e. an arena of risks posed to the individual which they must
become resilient to.

I include these brief examples merely in order to demonstrate that, if a post-

Polanyian approach is to be relevant, it must go beyond a critique of simple
economism and instead address the complex and subtle constructions of
governmental reason that have emerged since Polanyi’s time. There are already
plenty of resources in Polanyi’s work that might provide the basis for doing just
that, but, as this special issue demonstrates that the greatest payoff will result
from critical and innovative applications, rather than from recitation of Polanyi’s
ideas in their original form.

Concluding remarks

Polanyi’s intellectual legacy is rich and varied and this special issue by no means
covers it in its entirety. It instead seeks to address the intellectual core of
Polanyi’s approach critically so as to work towards what it might mean to adopt
a distinctively Polanyian position today. Polanyi’s most radical intellectual
moves – the challenge to materialist understandings of economic interaction, the
primacy of the social and ethical and the rephrasing of ‘economy’ as livelihood –
must certainly form elements of such a position. However, his legacy is
problematic. A residual attachment to Marxist teleology made him prone to
precisely the types of generalisation and abstraction that he sought to challenge
in both Marxist and liberal economic thought. His resultant desire to denounce
market society in its entirety meant that its subtleties were left untheorised,
limiting the potential for empirical application. These are limitations that must
be overcome. To this end, as I have argued, there is much to be gained by
reconsidering his conceptual scheme from different theoretical perspectives.
The radical moves listed above have a theoretical basis which shares affinities
with a broad spectrum of intellectual positions – affinities which might be

18
exploited so as to produce novel approaches. And such reconsideration might
provoke greater understanding of the nuances of contemporary economic ideas
in general, including the variety of ways in which economism might be
articulated and the way in which economism interacts with other types of
discourse. Although these tasks move us far beyond a simple indictment of
laissez-faire ideology, they remain quintessentially Polanyian in that they are
concerned to understand the role of economic ideas in constituting economic
practice, and in so doing to open up the space for re-thinking what the economy
is and how it might best serve human ends.

19
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