"Oh Liberty! How many crimes are committed in Thy name"

Albert Otto Hirschman on Karl Polanyi's The Great Transformation: 

"As Karl Polonyi showed memorably in The Great Transformation (1944), the English Poor Laws, especially as supplemented and reinforced by the Speenhamland Act of 1795, represented a last ditch attempt to reign in, through public assistance, the free market for labor and its effects on the poorest strata of society. By supplementing low wages, particularly in agriculture, the new scheme was helpful in ensuring the social peace and in sustaining domestic food production during the age of the Napoleonic wars. 

But once the emergency was over [Napoleonic wars], the accumulating drawbacks of the system of combining relief and wages came under strong attack. Supported by belief in the new political economy "laws" of Bentham, Malthus, and Ricardo, the reaction against the Speenhamland Act [protecting poor agricultural workers] became so strong that in 1834 the Poor Law Amendment Act (or "New Poor Law") fashioned the workhouse [debtor's prison labor] into the exclusive instrument of social assistance....

It was not long before this new regime aroused in turn violent criticism. As early as 1837 Disraeli inveighed against it in his election campaign: "I consider that this Act [of 1834] has disgraced the country more than any other upon record. Both a moral crime and a political blunder, it announces to the world that in England poverty is a crime." 

In E.P. Thompson's retrospective judgement, "the Act of 1834...was perhaps the most sustained attempt to impose an ideological dogma, in defiance of human needs, in English history." 

In Polanyi's history the "great transformation" in 1834 is a takeover, modern economic rationalizing, free enterprise ideology, and dominating Laissez-faire politics and the British empire setting the political economic standard and exchange rates around the world, essentially separating and elevating economics in political administration over other human needs in society, and to considerable corrosive effects, as Polanyi laments. By his lights, 1834, was in fact not so great a transformation at all. It was, basically, more like a hinge event, a fateful turning point, and marks the solidification of the oppressive politics that goes along with the development of classical liberal economic theory. Bentham and Malthus lead the debates and, especially the latter, demagogs Social Darwinism decades before Darwin: supporting poor relief is subsidizing the unfit and increasing scarcity pressures on the productive.

 But there was also, yeah, an almost immediate Polanyi "double-movement" response, and no sooner is the Act of 1834 law, abandoning and/or imprisoning the poor, then working classes are protesting and pushing for voting rights and better working conditions. Asymmetric war ensues, to be sure, with no equal Newtonian reaction, not even close, grinding poverty, get-rich bubbles and brutal busts, worker's fighting for living wages, often against state or private militias, but enough people are getting by and getting ahead expanding on the great technological innovations of the day (electricity, indoor plumbing, soap, etc) and great migrations to the west in the States and South America and Australasia to stave off revolution. 

Or until two massive world wars of the early 20th century, actually in an important sense culminating what was started in the 1834 end to the poor laws, cutthroat competition drunk on innovations in war technology and nearly a century of imperialist global gunboat diplomacy and trade-by-war profiteering finally culminates the industrial revolution with a couple of massively shattering industrial world wars. And especially because of the world wide great depression, precipitated by market bubble excesses, mind you, that was sandwiched between these two devastating wars. 

These great transformations were great for exposing the crucial role the government plays in the economy, during war, and when the economy crashes, suggesting the possibility of re-integrating economics and politics with all of society's needs, a new political economic model of leadership Polanyi calls "embedded liberalism." The New Deal order was "embedded liberalism," and delivered about half a century of the best shared prosperity growth numbers the country knows. And so, supposedly, was "embedded liberalism" the language of the Bretton Woods international order set-up after WW2 in the International Monetary Fund and World Bank. But, notably, these global institutions were pushing hard by the 1960s, by contrast, for neoliberal privatizing reforms long before Great Britain or the US handed over the keys to corporate rule again. 

But, at any rate, by 1980, neoclassical, free market fundamentalism strikes back triumphantly, Republicans taking the Whitehouse and cutting taxes on big businesses while cutting social spending, and abandoning unions and workers to credit card debt and health care bankruptcies. And by the 1990s the big business corporate lobbies have turned against big environmental reforms and the bottom falls out of the working middle classes, wages stalling at 1979 levels into the 21st century. 

And here we are, again. 

Polanyi at work.