Home » Free market » Neoliberalism


The ideas of the preeminent political economist Karl Polanyi have enormous purchase in the 21st century, as the liberal creed and free market ideology are being ever more forcefully asserted in society under the name of neoliberalism. Writing about 19th century liberalism, Polanyi observed all of social relations being reduced to the logic of the market (Wjuniski & Fernandez, 2010, p. 424-5). This had especially detrimental effects for the commodities of land, labor, and money which historically had not been produced for sale on the market.

The disruptive nature of marketization for these fictitious commodities threatened society as a whole, which is why Polanyi anticipated enlightened elites and labor would produce a counter movement for social protection (Wjuniski & Fernandez, 2010, p. 425; Silver & Arrighi, 2003, p. 326-327). The movement towards self regulated markets was a utopian idea that would necessarily produce a counter movement, as evidenced by the turn toward embedded liberalism in the post war era (Ruggie, 1982, p. 392).

In modern times we would expect to see a Polanyian counter-movement within Greece, as it has been hit hardest by the Eurozone crisis. Neoliberalism, the reassertion of self regulating markets, is on full display within Greece, effected by financialization, globalization, and deindustrialization in the last 30 years. Marketization under neoliberalism is different than 19th century liberalism, for one because of its globalized nature, thus we could expect the counter-movement in Greece to display this difference and enlighten us as to how Polanyi’s idea of a double-movement can be reinterpreted (Silver & Arrighi, 2003, p. 47).

Disasters and crises, such as in Greece used to be catalysts for communal solidarity, but under neoliberalism this generalized mayhem has been a catalyst for economic growth and the continued assertion of marketization (Klein, 2007, p. 50). Polanyi, for all his prescience, underemphasized unequal power relations between classes (Silver & Arrighi, 2003, p. 326). He didn’t analyze the specific actors producing counter-movement (Hyman, 2015, p. 11).

The class composition of society is markedly different in the 21st century versus when Polanyi was writing, thus the counter movement that he saw as inevitable can be assumed neither foretold nor necessarily effective in contemporary circumstances. Neoliberalism has fractured the traditional capitalist working class giving a different character to the counter-movement in Greece. Although Polanyi didn’t asses this specifically, it is clear in the early 20th century that forces from below (commodified labor) pressured elites to construct embedded liberalism (Hyman, 2015, p. 1).

But these revolts from below are neither inevitable nor necessarily progressive, what are the actors in 21st century Greece that could potentially produce a counter movement? A traditional answer would be labor unions which have historically mitigated the movement toward self regulated markets. However since the 1970’s stagnation in the wages and income of labor were met with an increase in credit to shore up aggregate demand, in countries like Greece this led to deindustrialization and credit consumption as the basis for capital accumulation (Varoufakis, 2013, p. 98-199). This produced a shift in class composition, the reduction in industrial unions led to a far more fractured labor force (Hyman, 2015, p. 12).

A new counter movement cannot rely solely on those traditional labor forces, it must combine a diverse array of social struggles including that old left as well as social and environmental movements (Featherstone, Strauss, & MacKinnon, 2015, p. 8-9). If that combination is not achieved that the precarious labor force will be disjointed and conflicted in worldview (Hyman, 2015, p. 2). In Greece we can witness the rise of the reactionary neo-fascist party Golden Dawn as evidence of this danger, they went from an insignificant paramilitary group to the 5th largest parliamentary party during the sovereign debt crisis (Rakopoulos, 2013, p. 103). Neoliberalism is far more paradoxical than 19th century liberalism, the crises it produces are used as catalysts for marketization, in Polanyian terms the reassertion of the first movement toward self regulated markets as opposed to a counter movement.

But just as under 19th century liberalism the market is not a system sufficient to organize an economy so as to guarantee human livelihood. Modern nation-states have not developed the institutions necessary to regulate and manage fictitious commodities and offer social protection (Wjuniski & Fernandez, 2010, p. 436). This is because unlike the early 20th century there is no political consensus on economic regulation, all elites are either explicitly on implicitly neoliberal (Featherstone, et al. , 2015 p. 3).

The construction of the Eurozone belies this difference while claiming to be a union delivering joint prosperity it has no democratic accountability and cannot be pressured by a traditional counter-movement from below. Previous ages of credit money, such as those that produced the international banking crisis of 2008, were accompanied by institutions that offered aid to debtors (usually religious in character) presently those international institutions, the World Bank, IMF, and ECB operate in reverse pursuing only the interest of lenders (Graeber, 2014, p. 69). This class of lenders who actually produced the crisis recreate it discursively as a sovereign debt crisis, as opposed to a banking crises, in order to promote their own interest (Featherstone, et al. , 2015 p. 6). In Greece this portrayal of the crises has allowed implementation of austerity (Varoufakis, 2013, p. 208).

Just as the World Bank used structural adjustments to liberalize the third world economies (Babb, 2005, p. 00) loans from the ECB are conditioned on further marketization and commodification in Greece. The reforms were nearly identical to those imposed in Latin America during the 90’s, sale of land and resources to foreign private investors, privatization of public utilities, free of labor markets through reduction of wages and pensions, implementation of regressive value added taxes, and disembodying the market from social practices in Greece of rest periods during with families would share meals (European Commission, 2015).

These measures have disastrous consequences for Greek society but they do not generate an effective counter-movement because the globalized benefactors have insulated themselves from all that’s crumbling around them (Klein, 2007, p. 54). There have been two dimensions to resistance within Greece the first occupying a relatively traditional counter-movement and the second offering a potential third movement or addendum to Polanyi’s conception of double-movement.

The protest tactic known as the movement of the square (Occupy being its US counter point) and the election of the leftist party SYRIZA (the coalition of the radical left) showcase example of resistance to the onslaught of bottom up redistribution and marketization via austerity. This leadership given by former academics in the SYRIZA party have done a great deal to reassemble the fractured labor constituencies (Hyman, 2015, p. 12).

Such reaction could be considered classically Polanyian had the balance of class power not shifted so considerably an to render them ineffective in achieving countermovement. The ruling party SYRIZA forming coalition government was forced to agree to the loan conditions which didn’t change the status quo and in fact accelerated the process of neoliberalization. This would appear to mean that only a viable third movement could rebuke continued marketization. One formulated toward the globalized struggles against the logic of modern capitalism.

Such a movement has been defined by its inclusion of strictly emancipatory movements of anti-rascism, anti-colonialism, women’s liberation, and would embrace diverse solidarities fusing together the global environmental indigenous and social moments in a global framework (Featherstone, et al. , 2015 p. 3). One example of this new emergent dissent is the self termed RAME activists in rural Greec involves in creating food cooperatives that re-embed markets within social relation while viewing their struggle as global and intersectional (Rakopoulos, 2013, p. 105).

These young activists, members of the precarious labor force, view their role as forging greater solidarity and changing the popular narrative about the Greek crisis within their practical work (Rakopoulos, 2013, p. 104). They differentiate themselves from right wing politics explicitly by making farmers sign agreements to employ migrant workers and refrain for doing Golden Dawn type political groups (Rakopoulos, 2013, p. 104). In doing so they reaffirm their internationalist ambition to redefine the economic order of neoliberalism by building broader solidarity networks.?

It is clear that neoliberalism has thwarted traditional countermovements by globalizing repression and insulation the benefactors of capital accumulation. Greek resistance has thus been subject to repeated defeat at the hands of neoliberal European institutions. The crisis created in society have allowed further marketization and a doubling down on neoliberalism. Resistance is now mutating into a possible third movement which incorporates changes in class power and the modern geography of capitalism. While the goals of this movement are Polanyian insofar as they hope to re-embed the market in society their methods are markedly different.

Cite This Work

To export a reference to this essay please select a referencing style below:

Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.
Reference Copied to Clipboard.