IIn 1944, groundbreaking political economist Karl Polanyi published his radical masterpiece, A major transformationIn it, he accused influential liberal economists, including David Ricardo and Thomas Malthus, of commodifying humans and the environment in the name of free markets.
Their industrial-era ideas, he argued, led to the barbarism and poverty that accompanied 19th-century globalization and unrestrained capitalism, which in turn led to a far-right and far-left backlash in the 20th century against subsequent socialist, individualist and liberal movements.
today, A major transformation Polanyi has been hailed as a masterpiece and its prescience celebrated by everyone from former World Bank chief economist and Nobel laureate Joseph Stiglitz to Finance Minister Rachel Reeves to French “rock star” economist Thomas Piketty. But because Polanyi was a Hungarian-Austrian Jewish expatriate, and because of the popularity of Keynesian economics in the post-war period, the prophetic insights of his book were rejected and ignored by mainstream British academics and economists for decades. Now, for the first time since the Second World War, A major transformation It has finally been published by a British publisher, and a new edition was released by Penguin Classics last week.
“Polanyi is the most important thinker you’ve never heard of,” said Hannah Teraie Wood, editor of Penguin magazine. “He was one of the pioneers of heterodox economists and one of the first, perhaps the founders, of environmental economists. He was always around, but just never saw the light of day.”
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Born in Vienna in 1886 to a Jewish family and educated in Budapest, he was forced to flee Hungary in 1919 by the Fascist regime and later became a prominent Christian Socialist and journalist in Vienna. With Hitler’s rise to power in Germany and the rise of Fascism in Austria in 1933, he fled again, this time with his daughter, to London, where he obtained British citizenship and earned a living as a part-time lecturer at the Workers’ Educational Association. His lecture notes are: A major change.
“He came up with most of the idea for the book while he was living in England, and it was mainly about the history of capitalism in England, but until now no British publishers had taken him on,” said Teraie Wood. He spent years trying to get a job at a British university, applying to everything from Oxford to Hull. “He had glowing letters of recommendation from luminaries on the intellectual left, but he just couldn’t get the job he should have, given his genius,” said Dr Gareth Dale, an expert on Polanyi, who wrote the foreword to the Penguin edition.
He added: “I think because he was an outsider, a foreigner with a funny name, there was xenophobia and suspicion. There was probably prejudice and anti-Semitism. And there was certainly condescension towards him. He should have taken that job.”
In 1940 he was invited to become a research fellow at Bennington College in Vermont, USA, where he moved and wrote. A major transformation He then took a job at Columbia University. “Like other brilliant Jews who fled their homelands due to the oppression and pressures of anti-Semitism and fascism, Polanyi made his way to England and then emigrated to the United States,” Dale said.
Polanyi observed that wealthy Germans who in the 1930s viewed the Nazi Party as a “battering ram” against labor unions and socialists were persuaded to ignore Hitler’s anti-Semitism because it allowed the market system to flourish, Dale said. “Just as many Americans who find Trump unpleasant today will still vote for him, many German elites said to themselves: ‘It’s perfectly fine for us to fund Hitler because his street fighters will crush the labor unions and help us make more profits.'”
Polanyi lost friends and relatives in the war, including his sister in the Holocaust. “The book is in a way about fascism, which Polanyi himself suffered deeply from,” Dale says. “And that’s why the book has new and real relevance today.”
