brief, there have been three waves of marketisation that have swept the world: the first spanning the nineteenth century, the second beginning after World War I and the third beginning in the mid-1970s. Associated with each wave is the commodification of a leading force of production, successively labour, money and nature. These are Karl Polanyi’s (1944) three fictitious commodities whose commodification, he claimed, destroys their use value. Thus, when labour is subject to unregulated exchange it loses its use value – it cannot be productive; if money is subject to unregulated exchange the value of money becomes so volatile that businesses go out of business; and if nature is turned into a commodity it destroys our means of existence – the air we breathe, the water we drink, the land upon which we grow food, the bodies we inhabit. Each wave of commodification spawns a countermovement that is built on a distinctive set of expanding rights (labour, social and human) organised on an ever-widening scale: local, national and, presumptively, global. Finally, to each countermovement there corresponds a distinctive configuration of Marxism – classical Marxism based on the projection of an economic utopia; Soviet, Western and Third World Marxism based on state regulation; and finally, sociological Marxism based on an expanding and self-regulating civil society.
The periodisation of Marxism may be tied to the periodisation of capitalism but the periods themselves are continually reconstructed as a history of the evolving present, a history that makes sense of the present as both distinct from and continuous with the past. Marx (1967) saw only one period of capitalism, Lenin (1963) saw two and Ernest Mandel (1975) saw three. We, too, see three, not based on production but rather on the market as the most salient experience of today. Here I do, indeed, break with the conventional Marxist claim that production provides the foundation of opposition to capitalism. This is no longer tenable: in part because production is the locus of the organisation of consent to capitalism, and in part because in the face of the global production of surplus labour populations, exploitation is rapidly becoming a sought-after privilege of the few. Exploitation continues to figure centrally in the dynamics of accumulation, but not in the experience of subjugated populations. In the Marxian analysis the experience of the market appears as the ‘fetishism of commodities’, a camouflage for the hidden abode of production, but it is much more than that, shaping multiple dimensions of human existence.
Reconstructing Polanyi
In making the market a fundamental prop of human existence I draw on Polanyi’s theory and history of capitalism. Written in 1944, Polanyi’s The Great Transformation examines the political and social consequences of the rise of the market from the end of the eighteenth century to the Great Depression. The market, Polanyi argues, had such devastating consequences that it generated a countermovement to protect society. The countermovement, however, could be as destructive as the market it sought to contain. Thus it included fascism and Stalinism as well as the New Deal and social democracy. Indeed, Polanyi concluded that such were its consequences that never again would humanity experiment with market fundamentalism. He was wrong – market fundamentalism struck our planet once again in the 1970s, threatening human existence and annihilating communities.
The reason for Polanyi’s false optimism lies in his failure to take the logic of capitalism seriously. While he embraces Marx’s early writings on alienation, he rejects Marx’s theory of history, whether understood as a succession of modes of production, the self-destroying dynamics of capitalist competition, or the intensification of class struggle. But in rejecting the idea of laws of history, Polanyi also jettisons the logic of capital, in particular its recurrent deployment of market fundamentalism as a strategy for overcoming its internal contradictions. This, of course, is where David Harvey (2003 and 2005) steps in regarding ‘neoliberalism’ as an ideological offensive of capital against the gains made by labour in the period after World War II.2
Recognising the contemporary wave of market fundamentalism leads to questioning Polanyi’s homogenising history of capitalism as a singular wave of marketisation giving way to a singular countermovement – what he calls the ‘great transformation’. Referring specifically to the history of England, Polanyi recounts in detail the way the Speenhamland system protected labour from commodification until the passage of the 1834 New Poor Law that banished outdoor relief. The year 1834 marked, then, the establishment of a pure market in labour that, through the nineteenth century, generated movements against commodification – from the Chartist movement of 1848 that sought to give workers the vote, to the factory movement that sought to limit the length of the working day, to the abolition of the Combination Acts that sought to advance trade unions, to demands for unemployment insurance and minimum wages. These struggles were not about exploitation, argues Polanyi, but about the protection of labour from its commodification. Society was fighting back against the market.
In Polanyi’s history, the commodification of labour was but part of a long ascendancy that continues from the end of the eighteenth century through World War I to the Great Depression. Facilitated by the commodification of money, itself ensured through the regulation of exchange rates by pegging them to the gold standard, the market expanded into the realm of international trade. Opening up an unregulated global market in trade with the fluctuating value of national currencies so destabilised individual national economies that states successively went off the gold standard and undertook protectionist policies. Protectionist regimes took the form of fascism in countries such as Italy, Germany and Austria, took the form of the New Deal in the US, took the form of Stalinism with its collectivisation and central planning in the Soviet Union and took the form of social democracy in Scandinavian countries. In Polanyi’s eye the upward swing in commodification ultimately gives way to a counter-movement that could lead to socialism based on the collective self-regulation of society but was just as likely to give way to fascism and the restriction of freedom.
Knowing that Polanyi was wrong about the future, calls into question his account of the past. Thus re-examining Polanyi’s argument reveals that there was not a singular upward trajectory in marketisation but at least three waves of marketisation (see Figure 2.1). The first takes us from Speenhamland to World War I and is primarily driven by the commodification of labour, followed by its protection, whereas the second wave takes us from World War I to the middle 1970s. The second wave originates with the commodification of money (and a renewed commodification of labour), leading to a countermovement involving the regulation of national economies. The third wave, known to many as neoliberalism, begins in 1973 with the oil crisis and initiates a third wave of marketisation featuring the recommodification of labour and money, but also the commodification of nature. We are still in the midst of the ascendancy of this third wave of marketisation. Along the way we have passed through structural adjustment administered to the failing economies of the South and shock therapy adopted by the post-Soviet regime and its satellites in East and central Europe. Successive economic failures of state-regulated economies served to energise the ascendant belief in the market. The succession of financial crises in Asia and Latin America during the 1990s, culminating in the financial crisis of 2008, served to consolidate the power of finance capital.3
What is unique about the third period, however, is the way the expansion of capitalism has given rise to environmental degradation, moving toward ecological catastrophe. Whether we are referring to climate change or the dumping of toxic waste, the privatisation of water, air and land, or the trade in human organs, the commodification of nature is at the heart of capitalism’s impending crisis. The countermovement in the third period will have to limit capitalism’s tendency to destroy the foundations of human existence, calling for the restriction and regulation of markets and a socialisation of the means of production which would be as compatible with the expansion of freedoms as with their contraction.
Figure
