POLI 4062 Exam 2

Political regime

A set of governing rules and institutions that structure how power is exercised and policies are made within a state.

Fictitious commodities

Things treated as commodities in markets but not originally produced for sale—land, labor, and money.

Reciprocity

Exchange based on social norms where goods/services are given with the expectation they will be returned over time.

Self-regulating market

A market system that operates independently of social or political control, where supply and demand fully determine outcomes.

The Trilateral Commission

An elite international organization (founded 1973) promoting cooperation between North America, Europe, and Japan, often tied to neoliberal governance ideas.

Double movement

Polanyi’s idea that market expansion triggers a counter-movement by society to protect itself.

The Mont Pelerin Society

A network of intellectuals (founded 1947) that helped develop and spread neoliberal ideas.

The Geneva School

A neoliberal intellectual tradition emphasizing global markets and strong global governance structures.

Human capital

An individual’s skills, knowledge, and abilities that increase their productivity and economic value.

Structural dependence of the state on capital

The idea that governments rely on private investment for economic stability, limiting how much they can oppose business interests.

• Explain Polanyi's crucial statement: "market economy can exist only in a market society."

A market economy, according to Polanyi, can only exist within a market society because all elements of life must be organized around buying and selling. In a true market economy, not only goods but also land, labor, and money are treated as commodities and priced through the market. Because these elements are originally part of society and not created for sale, transforming them into commodities requires reshaping society itself. This means social relations, institutions, and daily life must follow market logic rather than moral or political principles. As a result, the economy is no longer embedded in society, but instead dominates it. Polanyi argues that this transformation is artificial and unstable because it ignores the social nature of human life. Therefore, a market economy can only function if society becomes a market society, even though this creates tensions and eventual resistance.

• Some of the well-known graffiti slogans during the global protests in the 60s were: "Il est interdit d'interdire!" ("It's forbidden to forbid!'); "Be realistic - demand the impossible!"; "All power to the imagination." What do these slogans tell us about the nature of the 60s protests? How did the protests end in the 70s?

These slogans show that the 1960s protests were not just about specific reforms, but about completely reimagining society and rejecting existing authority. Phrases like “it’s forbidden to forbid” and “demand the impossible” reflect a deep anti-authoritarian and anti-system mindset. The protests challenged not only capitalism but also the state, nationalism, and traditional institutions like family and education. They expressed a belief that a totally different way of living was possible beyond the existing political and economic system. This made the 1960s movements global and radical, rather than limited or reformist. However, these protests did not succeed in fully transforming society and instead led to instability and backlash. In the 1970s, this crisis and unrest created the conditions for elites to reassert control and helped pave the way for the rise of neoliberalism as a new dominant system.

• What is the meaning of the title of Polany's book, according to Polanyi (not according to you, a Nobel Prize winner, or Chat GPT)? And provide a textual source that supports your answer.

The Great Transformation by Polanyi critiques the western, liberalization view of market economy. He emphasizes that the capitalist civilization is built upon a rhetorical, fictious foundation. Society trying to organize itself around a self-regulating market was merely an optical illusion. In his introduction, he quotes, “the idea of a self-regulating market implied a stark utopia.” Therefore, “The Great Transformation,” refers to how the rise and fall of the self-regulating market forced society into a double movement . Consequently, as people search for stability and control, the rise of extreme political ideologies such as fascism transformed society for the worst.

• Describe briefly a set of crucial neoliberal policies that changed the global economy since the 1980s. Neoliberalizing the world, however, was more than a change in economic policies. It involved a profound sea change in ideas/ideology, and culture that generated a new way of the world —a new "everyday life" (la vie quotidienne). Explain this profound change in terms of two fundamental features of neoliberalism.

The neoliberal policies that changed the global economy since the 1980s include privatization, deregulation, low taxation, flexibe labor markets, and financial globalization. These policies were codified in the Washington Consensus of 1989 and promoted by the IMF and World Bank. The fundamental features that changed everyday life were market society on a global scale and a small but strong government. These extended market logic into all areas of life and reconfigured the state to enforce and sustain the market.