Polanyi’s discovery of society and the digital phase of the industrial revolution

Abstract

Polanyi’s (1957 [1944]) The Great Transformation stands as a towering analysis of the industrial revolution and a powerful social warning against social and natural damage driven by the pursuit of maximal economic value. Polanyi envisioned that the ‘discovery of society’, due to its radical neglect during the industrial revolution, led to this new social knowledge resulting in the end of laissez-faire and the self-regulating market. Yet, the most recent phase of the industrial revolution, the digital phase, suggests that many of the same failures to manage industrial revolutions are occurring again. In particular, looking at the emerging digital economy through the prism of Polanyi’s social theory, this article argues that the changes driven by the digital economy, specifically in terms of the reshaping of attention and sociality and the increasing potential for ‘normal catastrophes’, suggests that Polanyi’s lesson of the destructive power of the self-regulating market is again being neglected.

Polanyi’s (1957 [1944]) The Great Transformation is a towering contribution to understanding the specificity of capitalism. In contrast to Marx, Polanyi did not reject markets in themselves; rather, what Polanyi rejected was the market system (Heilbroner, 1999; Polanyi, 1957). Markets as an adjunct to societal goals could play an important function; it was society as an adjunct to the market that primarily concerned Polanyi. As such, his account did not simply accept or reject social technologies, such as markets, in themselves, but rather, sought to evaluate them in their specific use within an overarching society.

Instantiating well this principle of evaluating social and material technologies not in themselves, but rather the systemic use of the technology, Polanyi’s application of this principle extended to the point of not even rejecting enclosures in principle, but rather focusing his point of critique on the pace with which they were carried out and the economic logic in which they were embedded in after the Glorious Revolution of 1688, which did not provide adequate protections to those who were displaced by enclosures (Polanyi, 1957, pp. 34–36). In this context of a renewed industrial revolution, this time digital in nature, the urgency of finding a path between blanket acceptance of all the technological innovations of contemporary capitalism and the ‘counter-enlightenment’ thread that rejects the potential fruits of economic development raises again the importance of Polanyi’s work in particularly exigent terms. ¹

In this vein, Polanyi’s critique of the contemporary economy is not of technological development or economic improvement (see Polanyi, 1957, pp. 34, 38), but how the new institutional mechanism of the self-regulating market generates an institutional pattern and systemic motivations to actions that cause economic improvements to proceed at a pace and through a competitive dynamic that causes catastrophic social dislocations (Polanyi, 1957, p. 40). Polanyi’s analysis of the industrial revolution in particular highlighted how industrial revolutions within the institutional context of a self-regulating market cause massive damage to society and nature (Polanyi, 1957, pp. 72–73). Polanyi though believed that the industrial revolution led to the ‘discovery of society’ (Polanyi, 1957, p. 129) and that the ‘counter-movement’ of social protection would prevent the horrors of the industrial revolution from occurring again.

The history of the industrial revolution in England in the nineteenth century does in a significant sense support Polanyi’s claim that the ‘discovery of society’ had been realised and that the errors of allowing the self-regulating market to primarily determine the trajectory of material life would not be allowed again. Over the course of the nineteenth century, there was growing state regulation to protect against excessive hours, child labour and dangerous working conditions (Mathias, 1983, pp. 182–183). The principle of laissez-faire and absolute freedom of the contract, which led to collective weakening of already disadvantaged groups – which then could legitimate the further intensifications of inequality as mutually beneficial, ‘voluntary exchanges’ – has declined in a major way since the early nineteenth century (see Atiyah, 1979). Even analyses of the ‘new liberalism’, which sought to undermine post-war ‘embedded liberalism’ (Ruggie, 1982), which is also known as ‘neo-liberalism’, emphasise that neo-liberalism is not a return to a night watchman laissez-faire state, but rather a much more active state that constantly fosters and supports the extension of the logic of competitive markets (Brown, 2015; Foucault, 2008).

This article proposes two theoretical innovations that while perhaps departing from the letter of Polanyi’s analysis, are still closely aligned with the principles of Polanyi’s theory. The primary intention of these theoretical re-articulations of Polanyi’s analysis of the institutional mechanism of the market society and the industrial revolution is to suggest that the primary lesson that Polanyi identified from the nineteenth-century industrial revolution continues to be neglected. Firstly, following Cipolla (1973, p. 19) this article – while allowing for the specificity of the first industrial revolution in the nineteenth century – views the 19th-century industrial revolution as one among several industrial revolutions, each of which generate different opportunities to improve human functioning (Sen, 1985), while also creating different threats to social and material life. ² It is then argued that specific exceptions to laissez-faire by the state to remedy the worst excesses of a prior industrial revolution is no evidence of state regulation that is fit for purpose for the current industrial revolution. ³

Second, the concept of the economy as a self-regulating system is re-articulated so that it is still consistent with exceptions to laissez-faire through state intervention. As argued below, the core of the notion of the self-regulating market is not that the state never intervenes in the market. Rather, core to the idea is (i) that the economy has become a system in which, within this domain, pursuit of individual gain is socially legitimated as the primary motivation of action ⁴ and (ii) that the cumulative results of actions in pursuit of economic goals within economic organisations have a primary impact on the distribution and pace of change of material goods in social life. ⁵ Unquestionably, the market has limits as well as supports, and it is also the case that which aspects of social life are considered within the market domain is powerfully shaped by social framing (see Callon, 1998). Nevertheless, while acting within economic institutions regulated by the market economy, it is activity oriented to economic gain that primarily regulates the outcomes of actions. Limits to the previous excesses or various social and political structures that support the functioning of the market system (see Granovetter, 2005) do not defeat this analysis of the market system, but rather put boundaries to the system and provide essential supports for the continued functioning of the system. ⁶ Building on these theoretical re-articulations, I argue that the contemporary digital revolution fits with Polanyi’s analysis regarding how the self-regulating market and the pace of change engendered by the self-regulating market in the context of an industrial revolution can cause massive social disruption that is only adequately perceived after the damage has begun to be wreaked.

This article proceeds in three parts. First, Polanyi’s critique of the market system and the damage caused by the treatment of the substance of social and material life as commodities is briefly outlined. Second, the potential objection that the scope of state action renders Polanyi’s critique of laissez-faire irrelevant is addressed by showing that specific exceptions to laissez-faire do not preclude the potential for the logic of the market system to cause massive disruption to society and nature, especially when entering a new realm of terra incognita associated with each new industrial revolution. Third, the article argues that there is significant evidence to suggest that we are again in a ‘Polanyian moment’ in which the discovery of society is not being adequately integrated into the management of the digital industrial revolution. This point is shown through discussions of the reshaping of sociality and attention in the digital economy and the growing interdependence and fragility of emerging digital networks.

Polanyi on the competitive market system and social harm

Polanyi utilises the distinction between a society having markets and a society having a self-regulating market to emphasise the fundamental break in the relation between the economic and social that occurred in the nineteenth century, and which occurred in its most extreme form in the most industrially advanced nation, England. Prior to the early modern period, there were local markets and there was long-distance trade, but there were no internal markets. For Polanyi, both local markets and long-distance trade are ‘institutions of different function and origin’ than that of an internal or national market (Polanyi, 1957, p. 60), such that local markets were based on the principle of geographical proximity and trade was in principle complementary, rather than competitive, in which town and country exchanged different goods.

Alongside the development of the national market, it was the development of the fiction in the nineteenth century that labour, land and money were like any other commodities that led to the development of the self-regulating market in the nineteenth century. For the first time in history, labour and land were treated like any other commodity; supply and demand alone regulated the rate of remuneration that these ‘factors of production’ would receive. ⁷

But for Polanyi, land, labour and money were not produced to be sold and hence could only be ‘fictitious commodities’. Polanyi highlights well the disastrous social and human effects of the process of the self-regulating market, in which the basic elements of industry, land, labour and money, are treated as if they are commodities like any other, being produced merely for sale. ⁸ Polanyi begins this necessary intellectual task of the reintegration of participants in the self-regulating market into the overall life of society by stating that ‘Labor is only another name for a human activity which goes with life itself, which in turn is not produced for sale but for entirely different reasons, nor can that activity be detached from the rest of life’ (Polanyi, 1957, p. 72). Labour is merely another name for humanity and land is just another for nature (Polanyi, 1957, pp. 130–131). To act in wanton disregard of this fact would:

Result in the demolition of society. For the alleged commodity ‘labor power’ cannot be shoved about, used indiscriminately, or even left unused, without affecting also the human individual who happens to be the bearer of this peculiar commodity. In disposing of a man’s labor power the system would, incidentally, dispose of the physical, psychological, and moral entity ‘man’ attached to that tag. Robbed of the protective covering of cultural institutions, human beings would perish from the effects of social exposure; they would die as the victims of acute social dislocation through vice, perversion, crime, and starvation. (Polanyi, 1957, p. 73)

Likewise if nature qua land as a factor of production was treated merely as a commodity without protection or regulation ‘[n]ature would be reduced to its elements, neighbourhoods, and landscapes defiled, rivers polluted, military safety jeopardised, the power to produce food and raw materials destroyed’ (Polanyi, 1957, p. 73).

Polanyi detailed the way in which only if humanity was stripped of all social protection and social motivations, being forced to work merely to avoid hunger and to pursue gain, would the self-regulating market function on its only tenable principle, that of unrestrained competition. But ‘the scourge of unemployment, the shifting of industries and occupations and…the moral and psychological torture accompanying them’ (Polanyi, 1957, p. 215) led to the necessity of social protection and the growth of state intervention over the course of the nineteenth century.

While there are many valuable elements in Polanyi’s account of the rupture that occurred in the relation between economy and society in modern liberal societies, it is Polanyi’s ability to consistently and incisively re-integrate the impacts on humanity at its most fundamental level of social and economic processes, which others have not been able to do so, that is most striking. ⁹ As Polanyi shows, the cumulative human consequences of unrestrained economic improvement qua exchange value of individual actors and organisations often continues to be opaque. The following section updates this discussion to show how the deleterious impacts of the self-regulating market can remain even as many exceptions to laissez-faire have developed since the origins of the industrial revolution.

Polanyi’s analysis of the competitive market system without Laissez-faire

Core to Polanyi’s analysis of what made the competitive market system so damaging and which enforced social dislocation in a way in which previous economic regimes had not done was the abolishment of the ‘right to live’ in the Poor Law Amendment of 1834. This abolition forced the creation of a competitive labour market in which human beings were only distributed their basic needs as if they were simply another factor of production (Polanyi, 1957, p. 78). Likewise, Polanyi envisioned the removing of all supports to labour as necessary to the continued functioning of the institutional mechanism of the market system (see Polanyi, 1957, p. 187). As such, insofar as the state began to put limits on competition and to provide for basic needs, then Polanyi could interpret this counter-movement as the corresponding abolition of the treatment of human labour as a factor of production, and hence the disconnection of the dysfunctional triplet of economic change, forced disruption of labour activities, and social damage.

Yet, in this vein, this type of analysis embodies a key error that Polanyi presciently identified in other nineteenth-century thinkers – excessive naturalism, in which humans are treated primarily from a biological perspective (Polanyi, 1957, pp. 103–109). ¹⁰ Human beings do not intend only to live, but also to live well (as Aristotle argued and Sen (1993) has more recently innovatively further developed); hence threats to bare life are not the only means of forcing changes on labour activity and hence social dislocation. As such, competition without boundaries is not necessary to create a system in which competition is its central principle and in which agents experience constant, systemic pressure to compete. ¹¹ The key for the coercive element of economic development is not that individuals lose everything – including food and shelter – if they do not compete. Rather it is that enough of their social functionings (Sen, 1985, 1993) are threatened if they do not compete within the economic domain, that they experience significant systemic pressure to adapt to competitive pressures.

In light of Sen’s discussion of the aim of achieving social functionings and how average increases in wealth can cause increases in the costs of functioning ( Curran, 2017; Sen, 1985), the necessity of agents participating in a competitive labour market continues despite significant limits to the absolute losses that can be imposed in material terms on individuals. As such, the shift from a laissez-faire state to a state that actively supports economic competition in different spheres (Brown, 2015; Foucault, 2008) does not defeat the primary insight of Polanyi. That is, when competitive markets generate systemic orientations to gain and they are the primary allocative mechanism of the material position of individuals and of the environment then significant changes in the economy can force significant changes on individuals as economic agents and on productive materials (i.e. ultimately the products of ‘land’) to adapt to these changes. These changes can in turn massively disrupt how human beings and nature support, and are reshaped by, the larger reproduction of social and environmental life.

Consequently, Polanyi’s framework illuminates how insofar as the economy is subordinated to the logic of the self-regulating market, economic change, especially in the context of industrial revolutions – in which technological change increases the power of economic change to cause social and material disruption – can cause massive social damage. This damage can be through the necessities of adapting to new economic imperatives or to those people who are left out of the new economic formations. ¹²

Dislocation and the digital economy

As the previous section argued, it is not enough to place limits on laissez-faire in specific cases based on the catastrophic effects of previous industrial revolutions to defeat the logic of the self-regulating market. This is a point that Polanyi himself allowed for when he declared that if laissez-faire at any time became opposed to the self-regulating market, then the continued reproduction of the self-regulating market would always take precedence over laissez-faire (Polanyi, 1957, p. 148). The key for this Polanyian critique is the ability of the systemic logic of gain via the market system to generate cumulative tendencies that re-arrange economic ‘factors of production’ – which also happen to be core constituents of society and nature – in damaging ways. As Polanyi illuminates, human beings’ and nature’s satisfaction of market imperatives qua labour and land also have the potential to powerfully disrupt the other roles that human beings and nature play. While all advanced economies that experienced the industrial revolution in the nineteenth century have rectified some specific worst cases of its impacts (see Daunton, 1995; Hechter, 1981, p. 416; Mathias, 1983), the digital industrial revolution creates a new set of challenges. This tendency to only regulate social and material disasters emerging from the last revolution (Curran, 2018) does not address the more general potential of economic development to damage human life. This power is particularly intensified during industrial revolutions because the pace of change creates greater dislocation and allows more damage to be done before counter-acting forces can be wielded. This article asks: Are there potentialities in the current digital industrial revolution that suggest that we are again in a moment where Polanyi’s discovery of society against the self-regulating market is not being adequately integrated into the management of the intersection of the economy, society and nature? This section explores this question through an analysis of how two key changes associated with the digital economy have the potential to create massive social dislocation, which is only being managed, if at all, in an ex post fragmentary way. The first of these will be the discussion of the reshaping of sociality and attention in the digital economy. The second is how the increasing interconnectedness of social and material life through digital networks is increasing systemic digital risk.

Sociality and attention in the digital economy

In discussing the negative impacts of the industrial revolution in the nineteenth century in the context of innovation driven by the market system, Polanyi makes an important point. For a long period of time the industrial revolution was a period of destruction without awareness of destruction. As Polanyi points out, this was not simply a wilful blindness, but rather that in many ways the dominant classes lacked the appropriate tools to measure the damages that were being caused. As he states:

the trading classes had no organ to sense the dangers involved in the exploitation of the physical strength of the worker, the destruction of family life, the devastation of neighborhoods, the denudation of forests, the pollution of rivers, the deterioration of craft standards, the disruption of folkways, and the general degradation of existence including housing and arts, as well as the innumerable forms of private and public life that do not affect profits. (Polanyi, 1957, p. 133)

The ideology of many representatives of Silicon Valley – to move so quickly that one is breaking things, as Mark Zuckerberg declares ‘Unless you are breaking stuff…you are not moving fast enough’ (Zuckerberg in Anthony, 2017) exemplifies well the continued relevance of Polanyi’s insight. Though what Polanyi’s analysis of competitive markets and disruption brings out, which is rarely acknowledged in Silicon Valley ideologies, ¹³ is that the means of disruption is generally a dynamic of destruction driven by profit and economic valuation. ¹⁴ The reductionism of the self-regulating market to metrics of profit and expanded valuation of companies ¹⁵ results in the economic benefits of innovation being much more clearly perceptible and salient than the multitude of different social and material side effects that result from this dynamic of innovation.

Specifically in terms of the digital economy and the reshaping of attention, there is increasing concern that the treatment of attention as a commodity is a fiction that is causing massive damage. As Smythe (1977) emphasised earlier, for media companies that primarily make their money from advertising, the users of the media are not the consumers – rather they are the product. While ‘attention merchants’ since the middle of the nineteenth century have sought to capitalise off the acquisition of attention, the digital economy has significantly intensified this tendency (see Wu, 2016; Zuboff, 2019). While the content of television was largely and constantly reshaped to more efficaciously capture attention, this was a specific domain of life – entertainment. While the ‘culture industry’s’ impacts over the course of the twentieth century have been significant (Adorno & Horkheimer, 1979 [1944]), as digital media have become tools essential to so many different functionings in life, it can be argued that the constant reorganisation of digital media to capture attention is leading to a commodification of attention on an unprecedented scale (Stiegler, 2015; Zuboff, 2019).

As Crary (2013, p. 68) has argued, the digital revolution and the pace of digital life – which is increasingly becoming imbricated with all of life outside of sleep for young people, is increasingly closing off the layers of unadministered life that went along with the intensification of productivity associated with the rise of the industrial revolution and later changes associated with Fordism and Taylorism. ¹⁶ A study by Microsoft indicated that between 2000, when the mobile revolution began, and 2015, the attention span of the average human being declined 33%, from 12s to 8s (Watson, 2015; see also Curran, 2018). More recently, a study has shown that 91% of smartphone users never leave home without their phone and that the constant ‘on-demand access’ ubiquity of smartphones has led to a situation in which for heavy users, the mere presence of their smartphone diminishes their performance on other cognitive tasks (Ward et al., 2017, p. 146). Likewise, recent research has indicated that a significant spike in youth depression alongside the growing utilisation of smartphones as a primary conduit to socialisation may be associated with the fear of always ‘missing out’ on a constantly developing set of social dynamics on digital networks (Twenge, 2017).

The growing impact of the digital revolution on social relations and the nature of attention has sparked debate in contemporary theorising about the Internet. Fuchs (2012, 2017) has primarily interpreted the rise of the Internet, and in particular social media, as a massive extension of commodification and as a source of exploited surplus value. Taking even developments that were originally considered positive, such as the rise of consumer activity as production (‘prosumption’) on the Internet, Fuchs argues that prosumption does not represent a more participatory Internet, but rather ‘the total commodification of human creativity’ (Fuchs, 2017, p. 243).

Feenberg (2017, p. 91) on the other hand argues that Fuchs has been overly reductionist, reducing one of the functions of the Internet (profit-making) to its nature or fundamental meaning (commodification). Feenberg (2017, pp. 91–92) then proceeds to argue that despite extensive data mining, ‘online communication remains essentially what they were even after their commodification’ and that ‘in fact the commodification is quite restricted’. As such, Feenberg (2017, pp. 91–92) argues that while profit extraction occurs, a ‘real subsumption’ does not, and that as such social media is much more like the telephone than the factory.

In attempting to tease out the relevance of this debate for this article, both Fuchs and Feenberg attempt to interpret the Internet in terms of nineteenth categories and dilemmas, which highlights the importance of Wark’s (2019) dictum of the risks of seeing the new through the old categories of nineteenth-century capitalism. Feenberg (2017) importantly highlights that simply because an activity is a source of profit does not entail that it is subject to total commodification; rather, the key issue is the extent to which the activity is subsumed under its economic function. Yet, the inference that because the commodification does not transform communication in the way that labour and land was previously transformed, then the commodification is ‘quite restricted’, does not adequately grasp the novel risks that emerge with each industrial revolution in a market system society. The basic protocols, categories and templates of social media have massive impacts on forms of attention and on social life (Bucher, 2018; Wu, 2016). Insofar as ‘sociality and connectivity are resources that fuel the development of new business models’, then these protocols and categories activate relational impulses in ways that serve economic ends, rather than social ends (Bucher, 2018, p. 6; see also Wark, 2019, p. 3). As such, some scholars have argued we should describe ‘social media’ as rather a ‘social industry’, due to its ability to govern social life through algorithm and protocol, and thus produce and programme social life (Seymour, 2020, p. 23).

Insofar, as digital companies can treat society as ‘a large-scale public laboratory’ (Seymour, 2020, p. 49) to maximise the economic value of information extracted from these interactions, and to ever constantly intervene in an A/B testing manner to enhance the value of the data extracted, then we can conclude that our sociality and our attention is increasingly treated as a ‘fictitious commodity’ in contemporary digital capitalism. In this way, a renewed Polanyian analysis highlights how new technologies enable novel, deeper and more fine-grained forms of intervention on social and natural life funnelled through the prism of the maximisation of economic gain. Insofar as the power to prioritise economic gain seeps deeper into the very sinews of our social and natural life in previously unforeseen ways, then the greater the risks that other fundamental social and natural functions will be damaged. Therefore, a continually renewed ‘double movement’ is needed in which the mechanisms of social protection continually update themselves to address the novel challenges posed by industrial revolutions in the context of a market system. ¹⁷

Stepping back to reflect on methodological questions regarding how to analyse the novel risks of industrialisation and techno-economic development, Beck (1992) argues that addressing the social dangers of these risks requires the development of an empirically oriented, projective social theory. In this vein, Polanyi’s dictum that in the midst of novel social change driven by economic change we may often lack the means of adequately measuring changes is especially relevant. Distracted driving, conversations, and students, people checking out from meetings, family gatherings, and dinner dates to check apps on smartphones that are specifically designed to keep people clicking (Burrell & Fourcade, 2021; Leslie, 2016) ¹⁸ sounds like a nuisance more than a social catastrophe – and the claim here is not necessarily that it is. But, if Stiegler (2015) is correct that our media functions as our collective social memory, then in the history of human society, at no point has the way that social memory is accessed and stored been more shaped by commercial systemic orientations rather than other orientations – including lifeworld ones, than it is at the present (see Habermas, 1987). ¹⁹ Yet, extremely little has been done to regulate and mitigate the revolutionary nature of these changes and the potentially extreme, though as of yet, largely unperceived, changes.

The digital economy and the tightly coupled society

Charles Perrow (1984) argues that contemporary society increasingly faces what he calls ‘normal accidents’. According to Perrow (1984), the employment of technology in ways that increase tight coupling and complexity tend to increase the likelihood and negative impacts of accidents. Tight coupling is a product of systems in which the impacts of failure of one part cannot easily be isolated from other parts and for Perrow, under these conditions, ‘routine sins of organizations have very nonroutine consequences’, which may often lead to catastrophes (Perrow, 1984, pp. 10–11). For Perrow, the creation of systems in which failures, that may be trivial in themselves, but which can interact with other routine failures to produce much larger accidents, are system accidents (Polanyi, 1957, p. 7). That is, the shift from relatively independent parts to highly interdependent parts create interactive complexity that can lead to the failure of the entire system and hence massive knock-on effects (Perrow, 1984, pp. 10–11).

There has been greater attention to the importance of systemic risk in the lead-up to and in particular in the aftermath of the financial crisis (Haldane, 2009; Haldane & May, 2011; May et al., 2008). In this vein Andrew Haldane (2009, p. 4) argued that in the lead-up to the crisis, ‘financial innovation, in the form of structured products, increased further network dimensionality, complexity, and uncertainty’, which played key roles in causing the global financial crisis. While Haldane (2009) has pushed students of finance to rethink the ‘financial network’, it is rather the digital economy that is even more closely associated with the creation of what is most likely the most massive and systemically important network in the history of human civilisation. Not only have Internet connected devices, the information communicated via them, and the social functions that depend on the networked ‘world wide web’ become absolutely immense – they have grown at a particularly stunning rate. As Goldin and Mariathasan (2014, p. 112) show, the amount of data on the Internet has increased massively in an incredibly short period of time – in 2013 total Internet data traffic per day was greater than 1 exabyte, which was equal to the annual data traffic 10 years prior. This increase of over 300 times in 10 years is far more than previous increases in media use and traffic (see Castells et al., 2007). While the Internet was originally a state project, the overall momentum of innovation of the digital economy has increasingly been driven by competitive market imperatives (see Curran, 2018). ²⁰ Consequently, the continual unfolding and emergence of digital networks is driven by commercial imperatives for the purpose of maximising economic returns to the proprietor of the company. As such, as with environmental problems and problems of complexity in finance, gains from increasing the importance and the scope of the network that runs through one’s own platforms is one’s private gain, while the emergent systemic risk that comes from greater interdependency and importance of digital networks is a cost shared across the network as a whole. ²¹

Goldin and Mariathasan (2014, pp. 112–118) consider the growing interdependence driven by the increasingly networked digitalisation of social and material life as a powerful example of the threat of the ‘butterfly defect’ where growing global complexity and interdependence threatens to create further fragility and risk to social and material systems. While Goldin and Mariathasan (2014) see this as primarily the product of the increasing growth of interdependence of networks – which undoubtedly plays a role – the particular fragility that we are increasingly facing is further intensified by the specific orientation via which this interdependence is driven. That is, this is not merely a problem of the ‘logic of networks’ in itself (Castells, 2000), but rather the way the momentum of innovation of these networks is constantly shaped by private gains and social externalisation of costs to the maximal amount (see Curran, 2018). That is, the cumulative production of these massively interdependent digital networks, with immense social implications, via individually advantageous transactions that increase the market value of digital giants, continually externalises the systemic risk produced, thus further intensifying the fragility of these networks.

The Internet has become an increasingly important means of criminal activity, which often creates significant risks for others. Authorities in the United Kingdom have recently estimated that 48% of crime in the United Kingdom has a cyber dimension (Jones & Kuchler, 2017). The recent WannaCry cyberattack exemplifies the growing importance of cyber risk, and on a truly global scale – affecting 99 countries worldwide (Larson, 2017). In terms of its impacts, one-third of the UKs National Health Service (NHS) was rendered inoperative, Chinese students were locked out of their university files, over 1000 computers at Russia’s interior ministry were disrupted, as were billion dollar businesses, such as FedEx and Telefónica (Jones & Kuchler, 2017). ²² While undoubtedly, cyber risk is increasing everywhere, many of the worst risks are growing due to the picking of low lying fruit because of fragility intensified by commercial motives. The operating system that was targeted by WannaCry, Windows XP, had not been supported by Microsoft since 2014 (Financial Times, 2017). Having been introduced in 2001 and while the software still worked well for millions of computers around the world, Microsoft stopped supporting this software in 2014 in a clear case of attempting to force customers to upgrade to newer Microsoft products. After 2014, it cost users as much as $1000 per device to have their device supported and as an editorial in the Financial Times (2017) argued, ‘When Microsoft extols the virtues of upgrading and “shared responsibility,” it is extolling the virtues of giving Microsoft more money’.

In this way, the Internet and the systems built upon it, including social media, increasingly function as ‘the infrastructures of everyday life’ (Seymour, 2020, p. 173; see also Stalder, 2018, p. 57). Given the increasing dependence of every aspect of society on networked computation, for ever growing aspects of life ‘the environment and the experience of it actually ceases to function in the absence of code’ (Bridle, 2018, p. 37). Ultimately, this massive dependence on increasing vulnerable digital networks is not simply a product of the articulation of the Internet as a technology, but rather fundamentally shaped by the economic interests of the dominant firms that have sought to maximise user dependence on these networks so as to maximise user numbers and data collected as a means of maximising economic returns (see Feenberg, 2017, pp. 46–47; Fuchs, 2012, p. 214; Wark, 2019, p. 13).

Given the increasing impact of malware attacks, in particular ransomware attacks, alongside the increasing commercial push to further develop networked interdependent life through the commercial Internet of Things (IoT), the potential for digital systems wracked by ‘normal catastrophes’ continues to grow (see also 117th Congress, 2021; Townshend, 2013; Sanger & Perlroth, 2021). As Polanyi himself emphasised in his discussion of the nineteenth-century industrialisation, the cumulative consequences of the chase for profit in a competitive market system when there is only ex post regulation of past disasters create a momentum of innovation that constantly threatens new material and social disruptions and catastrophes. ²³

Conclusion

This article has argued that Polanyi’s social theory provides a powerful basis for critically reflecting upon the current digital industrial revolution without rejecting industrialism or digitalism in principle. Polanyi provides a path to critique the current trajectory of the corporate, platform-based articulation of the digital economy without likewise rejecting the way that digital affordances can support and amplify existing social goods. Thinking with Polanyi to confront the challenges emerging from the digital economy, this article argues that limitations on laissez-faire may place boundaries on the scope of the self-regulating market, but do not necessarily counteract the social and material disruptive forces associated with the dynamics of the market system. Reflecting on the transformations in attention and sociality and the growing tight-coupledness of society driven by the articulation of digital networks, this article argues that the potential for competitive market driven innovation in a period of industrial revolution continues to have the capacity to massively disrupt social and natural life.

The potential to dismiss the concerns about changes in attention or sociality or the tightly coupled society as abstract, distant concerns is significant – yet the Polanyian principle is important here. These changes are generated by millions of economically maximal transactions and the cumulative impacts of this economically driven dynamism can re-organise social and natural life in highly dysfunctional ways – as the first industrial revolution showed so starkly. And moreover, as discussed above, most of the worst risks are only perceived after the fact. With respect to the attention economy, the saturation of people’s social lives of these devices has been extremely rapid, with smartphone ownership in the US among adults increasing from 7% in 2007 to 77% in 2017 (Ward et al., 2017, p. 140). With people checking their smartphone almost 100 times a day and with 46% of people indicating that they could not live without their smartphone (Pew Research Center 2015 in Ward et al., 2017, p. 140), it has been a veritable revolution in the way that we interact and the way in which tasks which were previously solitary are being completed. Yet research capturing the diverse cumulative, systemic impacts of these changes is still only in their relative infancy and can no longer be ex ante studies of the potential impacts, but rather must be ex post studies of what has already been done.

It should be noted that how the articulation of digital economy is remaking attention and sociality and generating a tightly coupled and fragile society by no means exhausts the potential points of disruption emerging from the digital revolution. The impact of improvements in Artificial Intelligence (AI) (specifically machine learning) and its fusion with robotics ²⁴ on labour markets is another fundamental risk emerging from the digital economy juggernaut. It has already been estimated that AI played a key role in de-labourisation of existing industrial production in the United States (Waters, 2017) and more dystopian analyses suggest that revolutions in AI could lead to widespread unemployment in the next two decades (Frey & Osborne, 2017, p. 265; Ford, 2015). Even more moderate discussions suggest that the competition of AI with labour has significantly increased inequalities via wage suppression of less educated and more routine workers and that this process could continue to be further intensified as take-up of AI grows (Acemoglu & Restrepo, 2020; Kaplan, 2016). While AI is being proposed as a way of further increasing the profitability of companies (Accenture, 2017) even for discussions that conceive of humans as able to modify their work patterns to maintain existing employment levels, the responses to competing with robots that are incessantly replacing human skills will lead to a labour market that will further intensify the precarity and life dislocation that come along with highly flexible and constantly changing work patterns. ²⁵

Nevertheless, it is important to concede that identifying the existing trajectories of these risks is complicated (see Urry, 2016), especially as the reflexivity of human beings to move against collective threats while retaining the deeper potentials within the age is always a possibility. While the suboptimal dialectic of unleashed capitalism and then ex post counter-movement to address the worst damages of the market system is one potential future, Polanyi’s work also provides potential pathways to contemplate an alternative future. This article has focused primarily on the failures to update Polanyi’s critique of the first industrial revolution. Yet it also has sought, in an exploratory manner, to investigate the extent to which re-engaging with Polanyi’s work can provide a basis for moving beyond capitalism as a social-economic system that continues to generate imperatives for pursuing maximal exchange value despite the immense social, economy and environmental costs of the unceasing pursuit of economic growth. In this vein, this article suggests that exploring Polanyi’s distinction between markets and the market system may provide a viable basis for contemplating social futures in which the contemporary crises of the market system can be unmade. ²⁶ How this task can be achieved requires much more investigation, but a rethinking of Polanyi suggests that only when the self-regulating market is embedded in alternative social and natural logics will the ability of the market system to constantly disrupt and damage social and material life be properly limited.