Trump’s Triumph– A Polanyi Moment By Manolo Monereo

This is a translation of an article by Manolo Monereo. The Spanish original can be found here:

Again they have been wrong. This time massively. It is yet another sign of the inability of liberals and social-liberals to understand what is happening in contemporary society. Once again they have come together to decry populism and the extreme right, while appealing to the unity of all citizens against a social revolt that is growing and multiplying. At such times as these there is nothing worse than a respectable progressivism which is incapable of connecting capitalist globalization to neoliberal policies and the loss of power and living standards of the social majority.

They have been repeating it for months: it is the backward sectors amongst the rural and urban poor that oppose progress, restrain the future and ignore the irrefutable laws of the market economy and free trade. Yet here once again they have to face the obvious, that globalization creates winners and losers, that in Euro-American West, the social majority is losing social and  labour rights, that inequalities are increasing wildly, that the future of young people seems blocked and that democracy has been captured by a capitalist plutocracy. Furthermore the liberal left, dominant within social-democracy, is now viewed as part of the problem, as is seen with the PSOE of today and Pedro Sanchez.

Now we get to sit through their soul-searching, their repetition of old mantras and their denigration of Donald Trump. Yet for many of us, the American election results have hardly come as a surprise. First, because Hillary Clinton represented the worst of American politics, i.e. subordination to economic powers and military interventionism on a global scale. Second, as far from radical authors such as Rodrik, Stiglitz and even Krugman have been saying, what is in crisis is capitalist globalization as a whole. That is why many of us have been talking about a “Polanyi moment”, that is, the reaction of society and the State to the growing dominance of a “self-regulating” market led by transnational capitalist oligarchies.

Many people will not know who Karl Polanyi was. He was born in 1886 and died in 1964. Recently, the publisher Virus has reprinted The Great Transformation, his key text, using Julia Varela and Fernando Álvarez-Uríathe’s much admired translation. Polanyi developed intellectually within the great Austro-Hungarian culture of his age, amongst all its splendour and decadence. Founder of economic anthropology, his studies focused on the relations between the economy, society and the State. The core thesis of his book – I hope to be forgiven for schematism – is that what was new about capitalism, what he called the “liberal utopia”, was its tendency towards the total commodification of social relations. Here the self-regulating market was both the means and the end goal of subordinating society and the state to the logic of capitalist accumulation. The key that made this feasible was the turning into commodities (or pseudo commodities) of three things that in reality were not commodities: labour power, nature and money.

The “Polanyi hypothesis” is that there is a double movement within the history of capitalism, what we would call an anthropological-social cycle, characterized by the implementation of radical pro-market policies and society’s reaction to them due, above all, to the enormous social sufferings they inflict. There is a phase A of execution and then a phase B: a response or countermovement. Capitalist globalization is living through this type of cycle. There was the early stage of triumphant globalization, progressive liberalization, and a cosmopolitan class coalition who championed it. Since the crisis of 2007 we have been experiencing a phase B, that is to say, a plebeian, national-popular insurrection – once again, I am sorry for being schematic – against a globalization now perceived as predatory, alienating and increasingly incompatible with social rights and human dignity.

The “Polanyi hypothesis” always understood that socialism as a historical movement was, in many ways, society’s response to the self-regulating capitalist market, but also understood that fascism was another possible response of that same society. Underlying these responses was something we see every day: the demand of society, that is of concrete men and women, for protection against the powerful, against the oligarchy, and against a market that submits us to its ruthless logic. The welfare state was an attempt to find a balance through synthesizing state-regulated capitalism with the social aspirations for full employment, security, and social and union rights. That era ended with neoliberal globalization, whose consequences we have been left to endure for almost thirty years.

In short, what we see in crisis is capitalist globalization and, as always, this has at least two possible outcomes: towards oligarchical authoritarianism or toward social democratization. In between, there is nothing, only the lamentations of old left-wing unions and the neo-liberal consensus that can no longer deal with society, much less transform it. This next stage has only just begun.