Jeremy Adelman offers a critique in the Boston Review of the recent recovery of Polanyi, his classic The Great Transformation, and its ultimately moralizing message to re-embed the economy in society in the search of what Adelman calls the “near-impossible: a non-liberal middle ground.” That critique rests on an evaluation of Polanyi’s obsession with liberal failures, his “naive” socialism and romantic attachment to the communal structures of pre-capitalist England, and ultimately his practical politics, the ways he “decamped” to “pastoral” Vermont while his wife stayed in bombed-out England or how his indicts liberal economics while his own sister is murdered at the hands of the Nazis. Adelman suggests that the blindspot of Polanyi’s attempt to navigate between liberalism and Marxism on the raft of humanist solidarity was “reactionary nationalism” — specifically, the ways such nationalism enabled and enables fascist authoritarianism and its genocidal violence. As in Hayek’s (of all people’s!) critiques of socialism, any recognition of community must lead to tyranny.
Polanyi’s zeal to incriminate liberalism blinded him. Everything that was bad about the world could be traced to one single source. Lethal, industrial-scale racism? The fault of liberals. Internationalism? A connivance of old plutocrats. The result was a tangled understanding of nationalism, which he saw as a way to restore a sense of fraternal community in the face of the globalist shredder.
I think Adelman gives Polanyi too little credit in grasping, in big-picture terms, fundamental truths about the ironic contradictions of liberalism, both political and economic. Adelman damns Polanyi for the inconsistency of his account while ignoring that this inconsistency lies at the heart of its subject matter! He misses the nuances of Polanyi’s accounts of markets, which figure not as the unambiguous evil that critics (of neoliberal capitalism and of Polanyi) make them out to be, but as a particular and widespread form of economic organization: one among many. In his best moments, Polanyi rejects the very binaries Adelman accuses him of buying into: “ethical community or economic interdependence, morals or markets.”
Instead I’ve always read Polanyi as a companion to Marcel Mauss, as striving, often incompletely, towards a realistic (that is, empirical) and ethically motivated account of economic organization that rests, precisely, on the organization of interdependence. (This is why he turned to history and anthropology, not because of his academic marginalization, but to do what we continue to do: find inspiration in difference.) Adelman calls Polanyi, somewhat dismissively, “a socialist without a party.” But this accurately captures the stakes of Polanyi’s striving for forms of collective life whose terms would not be fixed in advance. Solidarity remains as good a word as any.
I don’t mean to be a Polanyian partisan. There are many inaccuracies in his work, especially his historical work. (I think Polanyi is a good intellectual historian, but most readers tend to conflate his intellectual history with his description of historical events.) But Adelman’s critique turns Polanyi into a kind of apologist for nationalism and ultimately for Nazism. As Steve Klein writes in response to Adelman, this is just irresponsible:
In Adelman’s telling, Polanyi, who was born into an assimilated Jewish family but converted to Christianity, suffered from a sort of intellectual Stockholm Syndrome: Excluded from European society, he romanticized his murderous oppressors. He longed for the communal belonging that was denied to him as a Jew. And so Polanyi, Adelman declares, wanted to “merge into the national Volk.” This desire explains his “blind spot for reactionary nationalism,” which “would only grow with time” as he looked to the passions of nationalist belonging “as a way to restore a sense of fraternal community.” Polanyi’s rejection of liberalism was thus a rejection of his own Judaism. He attacked market liberalism and excused reactionary nationalism because of his unfulfillable desire to belong in a Europe defined by ethnic unity and anti-Semitism.
Instead, Klein writes, and I agree, Polanyi’s “central point was always that, if we want to avoid an authoritarian reaction to the ravages of the market, we need to develop a democratic alternative to pro-market liberalism.” Polanyi does not give us a complete picture of the illiberalisms at the heart of that liberalism, neglecting race and gender, imperialism and colonialism. But he nonetheless gives us a prescient lens with which to make those illiberalism continuously visible to ourselves. Go re-read the last chapters of The Great Transformation and tell me Polanyi is ignoring fascism.
Importantly, he does so without resorting to received frames of reference: individualism, “globalism,” etc. Here’s Klein again:
Polanyi fully agrees with Adelman about the remarkable potential of markets. […] The problem with markets, for him, is that they are so good at producing efficiencies that they tend to override all other considerations. To unlock their full potential, markets require the subordination of all individual, social, and political institutions to their dictates. Polanyi expresses this as the tension between habitation and improvement: We cannot live off the land while we improve the land. […] Societies create moral expectations around fairness, rewards for effort, and stability that markets, by their nature, cannot meet. What is efficient from a market perspective can be profoundly harmful from a human perspective […]
Adelman’s line of attack reveals more about our contemporary moment than it does about Polanyi. It speaks to a growing rift between liberalism and the left. Liberals want globalization with a human face, while leftists echo Polanyi in fundamentally questioning the undemocratic political infrastructure of our current market era. Adelman’s read of Polanyi reinforces the liberal view that globalization is a done deal and left anti-globalization rests on a romantic fantasy, one that cannot but appease the racism and nationalism of the “losers” of the market. Just as, if you squint hard enough, you can persuade yourself that Polanyi is a sort of self-hating, pseudo-nationalist reactionary, despite his professed socialism, so too, if you work at it, can you merge Sanders and Trump, Mélenchon and Le Pen into one anti-globalization, anti-liberal morass.
In my reading of Polanyi I am with Patrick Iber, who wrote about the contemporary rediscovery of Polanyi back in February: “Polanyi’s errors matter far less than his singular contribution.” Indeed, due to that contribution, “Polanyi may be a better prophet for our time than he was an analyst of his own.”
Polanyi’s continued relevance lies also in his commitment to solving the problems of market society by rejecting fascism and instead working to expand freedom under socialism, which he describes as "the tendency … to transcend the self-regulating market by consciously subordinating it to a democratic society."
