Karl Polanyi quotes
Karl Polanyi was a Hungarian economic historian, anthropologist, and social theorist, famous for his critique of classical economics. His influential book, "The Great Transformation," examined the social and political origins of market economies. He argued that markets are embedded in social relations and must be understood within their cultural and historical contexts. Here are 24 of his quotes:
The true nature of the international system under which we were living was not realized until it failed. Hardly anyone understood the political function of the international monetary system; the awful suddenness of the transformation thus took the world completely by surprise. And yet the gold standard was the only remaining pillar of the traditional world economy; when it broke, the effect was bound to be instantaneous. To liberal economists the gold standard was a purely economic institution; they refused even to consider it as a part of a social mechanism.
Karl Polanyi
Enclosures have appropriately been called a revolution of the rich against the poor. The lords and nobles were upsetting the social order, breaking down ancient law and custom, sometimes by means of violence, often by pressure and intimidation. They were literally robbing the poor of their share in the common, tearing down the houses which, by the hitherto unbreakable force of custom, the poor had long regarded as theirs and their heirs'.
Karl Polanyi
Another feature of the reversal of the Speenhamland method was less obvious to most nineteenth-century writers, namely, that the wage system had to be made universal in the interest also of the wage-earners themselves, even though this meant depriving them of their legal claim to subsistence. The "right to live" had proved a death trap to them.
Karl Polanyi
The mechanism of the market was asserting itself and clamoring for its completion: human labor had to be made a commodity. Reactionary paternalism had in vain tried to resist this necessity. Out of the horrors of Speenhamland men rushed blindly for the shelter of a utopian market economy.
Karl Polanyi
Ultimately, therefore, it is the relation of a class to society as a whole which maps out its part in the drama; and its success is determined by the breadth and variety of the interests, other than its own, which it is able to serve. Indeed, no policy of narrow class interest can safeguard even that interest well-a rule which allows of but few exceptions. Unless the alternative to the social setup is a plunge into utter destruction, no crudely selfish class can maintain itself in the lead.
Karl Polanyi
Actually, the labor market was allowed to retain its main function only on condition that wages and conditions of work, standards and regulations should be such as would safeguard the human character of the alleged commodity, labor. To argue that social legislation, factory laws, unemployment insurance, and, above all, trade unions have not interfered with the mobility of labor and the flexibility of wages, as is sometimes done, is to imply that those institutions have entirely failed in their purpose, which was exactly that of interfering with the laws of supply and demand in respect to human labor, and removing it from the orbit of the market.
Karl Polanyi
Pauperism, political economy, and the discovery of society were closely interwoven. Pauperism fixed attention on the incomprehensible fact that poverty seemed to go with plenty. Yet this was only the first of the baffling paradoxes with which industrial society was to confront modern man. He had entered his new abode through the door of economics, and this adventitious circumstance invested the age with its materialist aura. To Ricardo and Malthus nothing seemed more real than material goods. The laws of the market meant for them the limit of human possibilities. Godwin believed in unlimited possibilities and hence had to deny the laws of the market. That human possibilities were limited, not by the laws of the market, but by those of society itself was a recognition reserved to Owen who alone discerned behind the veil of market economy the emergent reality: society. However, his vision was lost again for a century.
Karl Polanyi
How far the state was induced to interfere depended on the constitution of the political sphere and on the degree of economic distress. As long as the vote was restricted and only the few exerted political influence, interventionism was a much less urgent problem than it became after universal suffrage made the state the organ of the ruling million-the identical million who, in the economic realm, had often to carry in bitterness the burden of the ruled. And as long as employment was plentiful, incomes were secure, production was continuous, living standards were dependable, and prices were stable, interventionist pressure was naturally less than it became when protracted slumps made industry a wreckage of unused tools and frustrated effort.
Karl Polanyi
The history of mankind and the place of the economy in it, is not, as the evolutionists would have it, an account of unconscious growth and organic continuity. Such an approach would necessarily obscure some aspects of economic development vital to men in the present phase of transition. For the dogma of organic continuity must, in the last resort, weaken man's power of shaping his own history.
Karl Polanyi
It was characteristic of the economic system of the nineteenth century that it was institutionally distinct from the rest of society. In a market economy, the production and distribution of material goods is carried on through a self-regulating system of markets, governed by laws of its own, the so-called laws of supply and demand, motivated in the last resort by two simple incentives, fear of hunger and hope of gain. This institutional arrangement is thus separate from the noneconomic institutions of society: its kinship organization and its political and religious systems. Neither the blood tie, nor legal compulsion, nor religious obligation, nor fealty, nor magic created the sociologically defined situations that insured the participation of individuals in the system. They were, rather, the creation of institutions like private property in the means of production and the wage system operating on purely economic incentives.
Karl Polanyi
Anthropologically, money should be defined as a semantic system, broadly similar to language; writing, or weights and measures. These systems differ mainly in the purposes served and the signs employed. Language and writing serve the purpose of the communication of ideas, weights and measures that of quantitative physical relationship. As to signs, language uses oral sounds; writing employs ideograms or visual characters; weights and measures, on the other hand, use physical objects as the basis of symbols.
Money resembles, but also differs from, each of these. It serves several ends, which are traditionally described as means of payment; standard of value or money of account; store of wealth; and medium of exchange.
Karl Polanyi