The following is an examination of Michael Polanyi’s political
and economic thinking. In this context, I focus on two aspects
of his thought: moral inversion and polycentricity. Regarding
moral inversion, I will suggest that Polanyi’s early encounter with
Dostoyevsky’s story of the Grand Inquisitor from The Brothers
Karamozov was formative. Regarding polycentricity, I will show
how this concept parallels in important ways the principle of
subsidiarity as developed in Catholic social thought. I will conclude
by briefly considering if and how these two Polanyian
concepts are relevant for understanding and addressing our
contemporary situation.1


Early Influences

Perhaps it is no surprise that during World War I Polanyi’s
interests were not confined to chemistry. His first political
writing, titled “To the Peacemakers: Views on the Prerequisites of
War and Peace in Europe,” was published in 1917 while World
War I raged. In it, Polanyi argues that a lasting peace would not
be forged unless ancient hatreds and prejudices were first removed.
If that could occur, Polanyi saw the possibility of a united
and prosperous Europe, a Europe that could once again enjoy the
freedom of movement and the intellectual vibrancy that pre-war
Europe had hinted at: “We must love a united Europe, the recreation
of our truncated life. People leading the world should
release themselves from mutual fear and from dams built against
each other. They should seek to exploit the forces of nature and
the riches of the earth, and henceforth, a new age of riches and
welfare, never seen before, will open up before us.”2 But this could
not happen as long as individual states could threaten each other.
Polanyi argues that the state must be transcended. His solution is
“to place the supreme power above the nations, to set up a
permanent European army which would guarantee, along with
the United States, the rule of our civilization on the earth.”3

A piece titled “New Skepticism,” published in 1919, is far
more pessimistic. In this short essay, Polanyi expresses his
skepticism about the possibility of politics. Speaking on behalf of
the scientists and artists who, Polanyi claims, were co-opted by
various political forces, he argues that the new task is simple: “On
account of the devastations brought by wars and revolutions we
need to awake to the fact that popular belief in politics disintegrates
our societies and sweeps everything away.”4 Anticipating
his later argument that economic and social factors are too
complex to make the planning of complex human systems possible,
Polanyi notes that “society is so complicated that even
science cannot calculate the future effects either of any institution
or of any measure, and people involved in politics, with their
rough minds and passionate fancies, are a thousand times less able
to foresee whether the institutions they demand will meet their
interests in the last analysis.”5 As a result of this incapacity to
calculate future effects, Polanyi argues for a new skepticism, one
that is suspicious of the claims of politicians, one that is not taken
in by the irrational fears and hopes peddled by the political
leaders. In the wake of the devastation of the Great War, Polanyi
recognized the need to consider the roots of political disorder.
“Our job is exploring the truth; dissecting the confused images of
politics and analyzing the belief in political concepts; finding the
originating conditions of political illusions and what animates the
imagination to fix illusions to certain objects.”6

In 1919 Polanyi, a non-religious Jew, was baptized into the
Roman Catholic Church. According to his friend Lady Drusilla
Scott, Polanyi’s conversion was influenced by Dostoyevsky’s
Grand Inquisitor as well as Tolstoy’s confessions of faith.7 Given
the political wreckage that was Europe of 1919 and the skepticism
about politics voiced in the “New Skepticism” article, it is interesting
to consider how Polanyi’s meditations on these authors
may have influenced the development of his thought. It is especially
useful to look to the Grand Inquisitor for clues about the
development of Polanyi’s political philosophy, for the themes of
freedom, skepticism, and moral truth—so profoundly articulated
by Dostoyevsky—lie at the heart of Polanyi’s entire post-scientist
career.

The story of the Grand Inquisitor is told by Ivan Karamozov
to his younger brother Alyosha. It is set in Seville, “during the
grimmest days of the Inquisition, when throughout the country
fires were burning endlessly to the greater glory of God.”8 Christ
appears in the city, not as a conquering king but as an unassuming
man, who, despite his unremarkable appearance, is recognized at
once. He touches the sick, raises a dead girl, and is summarily
thrown into prison by the Grand Inquisitor. Under the cover of
night, like Nicodemus centuries before, the Grand Inquisitor
comes to the cell where Christ is held. And then follows a
monologue, uninterrupted by Christ, wherein the Grand Inquisitor
attempts to justify the way he and his fellows have employed
their power.

Christ, during his earthly ministry, preached freedom to
those in bondage. In resisting Satan’s three temptations, summarized
in the idioms of miracle, mystery, and authority, he demonstrated
that humans can choose to resist easy resolutions to
human tensions. And in resisting these temptations, humans
exercise and preserve their freedom. But, according to the Grand
Inquisitor, humans cannot possess both happiness and freedom.
Freedom is terrifying, and the mass of men cannot bear it. They
seek one who will give them happiness in exchange for their
freedom, and they gladly make the trade. A new Tower of Babel
will be constructed by those who are now tasked with providing
for the happiness of the masses.

They will beg us: “Give us food, for those who promised us fire
from heaven have not given it to us!” And that will be the day
when we shall finish building their tower for them, for the one
who feeds them will be the one who finishes building it, and we
will be the only ones capable of building it. . . . So, in the end,
they will lay their freedom at our feet and say to us: ‘Enslave us,
but feed us!’ And they will finally understand that freedom and
the assurance of daily bread for everyone are two incompatible
notions that could never coexist! . . . They will marvel at us and
worship us like gods, because, by becoming their masters, we
have accepted the burden of freedom that they were too
frightened to face.9

The ultimate goal of this reign of the wise and strong few over
the timid masses is the happiness of all. But, the Inquisitor
recognizes that there may be many years of bloodshed before that
glorious end can be realized. “Our work is only beginning, but at
least it has begun. And, although its completion is still a long way
off and the earth will have to face much suffering until then, in the
end we shall prevail, we will be Caesars, and then we shall devise
a plan for universal happiness.”10 Of course, universal happiness
cannot be perfectly realized when various and competing ideas of
happiness exist. Thus, perfect happiness requires perfect unity,
and this is the ultimate political goal of the Inquisitor. Man’s
“unquenchable thirst for unity” will only be slaked when individuals
are relieved of the burden of conscience thus “enabling him
finally to unite into a harmonious ant-hill where there are no
dissenting voices.”11 This “reign of peace and happiness”12 will
arise only when the individual freedom of the masses is relinquished
to those who are capable of both suffering the burden of
freedom and wielding the power of the sword.

But while the motivation behind the violent use of power is the
perfect unity and happiness of all, a dark secret lies at the heart
of this glorious project. While the rulers will claim to rule in the
name of God, this is merely a device to appease those people who
still retain some idea of fidelity to this deposed sovereign. In fact,
the Inquisitor’s secret is that he no longer believes in God. In
order to achieve the ends for which he labors, he comes to realize
“that only the guidance of the great, wise, and dreaded spirit
would make it possible to organize feeble and undisciplined men
in such a way as to make their lives bearable.” As a result, he
submits to the guidance of “the wise spirit of death and destruction.
And so he is willing to use lies and deception to lead men
consciously to their death and destruction, while at the same time
deceiving them, so that they will not see where they are being led,
so that, at least on the way, these wretched, blind creatures may
think they are happy.”13

Four notable elements emerge from this story: First, the
desire for perfect happiness and perfect unity provides a powerful
engine motivating the actions of those holding the reins of power.
Second, those who are wielding power deny the existence of God.
In so doing, they simultaneously deny a transcendent grounding
for moral truth. Thus, they destroy those moral constraints on
human action that, in times of belief, rendered certain means
unacceptable. Dostoyevsky recognizes the implications of this
skepticism. Several times in the course of the novel, his characters
lament the fact that if there is no God, then everything is
permitted. Third, the means to achieving unity is fidelity to the
spirit of death and destruction. The storm of political chaos will
have to be weathered before society can hope to find safe harbor
on the other side. Finally, Dostoyevsky’s Grand Inquisitor paints
himself in tragic terms claiming that he, suggesting a new type of
Christ, has taken on the suffering of the people by assuming their
freedom. As a result, the wielder of power conceives of himself as
the victim, thus psychologically insulating himself from accusations
that he is abusing his power.

That there are important parallels between the story of the
Grand Inquisitor and Polanyi’s political thought will become
apparent as we progress. As we have seen, the Grand Inquisitor
quite willingly wields his absolute authority over the masses so
they can be relieved of the terrible burden of freedom, a Godgiven
freedom that must be eradicated in order to make way for
the creation of a better world, a world superior to the one created
by God. Yet, the Inquisitor recognizes that in the person of Christ
there is a challenge to his authority. After justifying the political
abuses ostensibly committed for the happiness of the people, the
Inquisitor falls silent. “The old man longs for Him to say something,
however painful and terrifying. But instead, He suddenly
goes over to the old man and kisses him gently on his old, bloodless
lips. And that is His only answer.”14 Apolitical power manifested
in an act of love is contrasted with the bloody hands of revolutionary
utopianism. In light of the devastation that was Polanyi’s
Europe, it is little wonder that he would be skeptical of the
promises of political power and attracted to the profound example
of Christ as depicted by Dostoyevsky. But while this story
may have attracted Polanyi to the person of Christ, it is far less
clear how it would lead him toward the Roman Catholic Church.
Of course, as Alyosha points out, the story does not give a fair
picture of the Roman church, but instead “it represents only the
worst there is in Catholicism—its inquisitors and Jesuits.”15 So it
may be possible to imagine Polanyi looking beyond the abuses and
mischaracterizations. Conversion, though, may have been seen as
advantageous to the young Polanyi (born into a Jewish family),
and some have suggested that his conversion was more a matter
of expediency than conviction. At the same time, his ongoing
concern with religion, especially Christianity, suggests more than
a purely pragmatic conversion.16

Regardless of the specifically religious influences of
Dostoyevsky’s Grand Inquisitor on Polanyi, I want to focus on
Polanyi’s political philosophy in relation to this text. While a
definitive causal line is not to be found, two things are significant:
1) close friends have noted the influence of this work on the
formation of Polanyi’s thought, and 2) to a remarkable degree,
key features of Polanyi’s notion of moral inversion reflect central
concepts in Dostoyevsky’s story of the Grand Inquisitor.

Moral Inversion

The modern world is characterized by its rigorous fidelity to the
idea of science. When this is coupled with a materialistic conception
of reality, the implications can extend far beyond the realm
of science, and the very core of moral and political structures can
unravel. Harry Prosch, who co-authored Polanyi’s last book,
Meaning, notes that Polanyi’s “critique of contemporary epistemology
was, in fact, generated by an ethical problem: the damage
he thought this epistemology was doing to our moral ideals.”17
Indeed, the moral and political implications of objectivism are a
frequent topic in Polanyi’s writings. This, perhaps, is not surprising
given Polanyi’s firsthand experience with political oppression
and lifelong concern about the philosophical roots of totalitarianism.

According to Polanyi, the modern revolution, led by such men
as Descartes and Bacon, included a disdain for any knowledge
based on tradition or authority.18 At a certain level this rejection
was warranted, for in the limited range of scientific investigation
empirical observation must be given a prominent role. The
success of science in the last four centuries attests to the positive
impact of a rejection of certain assumptions that found their roots
in Aristotelian metaphysics and in sanctioned interpretations of
the biblical texts. But, while a limited rejection of tradition and
authority was beneficial to the scientific enterprise, the momentum
of modern philosophy continued to push toward the wholesale
rejection of both. This culminated in the intellectual and
political events surrounding the French Revolution. In light of
this radical shift in orientation away from tradition and authority,
Polanyi argues that history can be divided into two periods. On the
one hand, all societies that preceded the Revolution in France
“accepted existing customs and law as the foundations of society.”
While it is true that there “had been changes and some great
reforms . . . never had the deliberate contriving of unlimited social
improvement been elevated to a dominant principle.”19 On the
other hand, the French revolutionaries embraced with zeal the
ideal of the unlimited progress of man, both morally and materially.
“Thus, the end of the eighteenth century marks the dividing
line between the immense expanse of essentially static societies
and the brief period during which public life has become increasingly
dominated by fervent expectations of a better future.”20

This optimistic and passionate drive toward human perfection
was accompanied by an objectivist view of knowledge.
According to Polanyi, the combination of Cartesian doubt and
Lockean empiricism produced a view of reality that precluded any
truth claims that did not admit of empirical justification. Thus,
religious and moral claims were a priori ruled out-of-bounds by
a theory of knowledge that did not admit of such claims.21 This
effectively produced a skepticism about all claims to knowledge
not grounded in empirical investigation. Thus, the authority of
religion, specifically Christianity, which had held a dominant
position for centuries, was undercut at its foundations. Scientism
became the new religion, and its priests, the scientists and modern
philosophers, employed epistemological objectivism as their instrument
of worship.

Skepticism, of course, is not unprecedented. In antiquity the
Stoics embraced a skeptical view of the world, but modern
skepticism is different because it occurs in a culture steeped in the
residue of Christianity. “The ever-unquenching hunger and thirst
after righteousness which our civilization carries in its blood as a
heritage of Christianity does not allow us to settle down in the
Stoic manner of antiquity.”22 Thus, although modern philosophy
does not permit the consideration of the truth claims of Christianity,
the memory of Christianity remains and produces a passionate
urge to pursue righteousness even though modern philosophy
has rendered the reality of moral truth impossible.

As a result, the deep moral impulses, which are the product of
a Christian heritage, are combined with a skepticism that denies
the reality of the very impulses modern man feels most acutely.
Polanyi describes this situation as follows:

In such men the traditional forms for holding moral ideals had
been shattered and their moral passions diverted into the only
channels which a strictly mechanistic conception of man and
society left open to them. We may describe this as a process of
moral inversion. The morally inverted person has not merely
performed a philosophical substitution of material purposes for
moral aims; he is acting with the whole force of his homeless
moral passions within a purely materialistic framework of purposes.
23

Moral inversion, then, is the combination of skeptical rationalism
and moral perfectionism, which is nothing more than the
“secularized fervour of Christianity.”24 But, whereas moral perfectionism
within a Christian context is moderated by such
doctrines as original sin and the promise of perfection at the end
of history, the perfectionism of a post-Christian world provides
no such moderating counterbalances. Thus, the passionate perfectionism
of Christianity persists despite the rejection of the
doctrines which, in times of belief, prevented it from wrecking
havoc on the society committed to its ideal. Furthermore, skeptical
rationalism precludes rational justification for the moral
impulses that course through the collective veins of Western man.
Thus, two contradictory elements meet in the phenomena of
moral inversion: skepticism and moral perfectionism. In practical
terms, the end of perfection is retained while the means to
achieving that end are no longer limited by moral constraints. But
why, Polanyi asks, should such an obviously contradictory doctrine
be held, especially by moderns who pride themselves in their
intellectual rigor? “The answer is, I believe, that it enables the
modern mind, tortured by moral self-doubt, to indulge its moral
passions in terms which also satisfy its passion for ruthless
objectivity.”25

Polanyi distinguishes between two manifestations of moral
inversion. The first is personal, while the second is political. The
first is found in the modern nihilist. If traditional morality has no
justification, man’s choice is all that exists apart from the bare
facts of science. Thus, all moral ideals are discredited. “We have,
then, moral passions filled with contempt for their own ideals.
And once they shun their own ideals, moral passions can express
themselves only in anti-moralism.”26 The nihilist denies any
distinction between good and evil. Thus, on the personal level,
moral inversion produces the individual nihilist, Turgenev’s Bazarov
or Dostoevsky’s Raskolnikov, for example. The second manifestation
is political. When skepticism and moral perfectionism are
embraced, the political restraints provided by traditional morality
are destroyed. The perfectionist element demands “the total
transformation of society” but because moral distinctions are
denied, there is no limitation on the political means to achieve the
desired result.27 Thus, in political terms, moral inversion produces
the political excesses described by Dostoyevsky in The
Possessed or, more generally, in twentieth-century totalitarianism.
28

Here we encounter a curious puzzle: how is it that some
modern societies apparently escaped the frenzied passion produced
by moral inversion while others did not? This question is
important because it appears to be the case that all modern
Western societies have, in fact, embraced the twin elements that
constitute moral inversion, namely skepticism and moral perfectionism.
The answer, according to Polanyi, is found in what he
terms “pseudo-substitution.” In short, those societies that avoided
the descent into immoral morality in fact continued to embrace
traditional morality in practice while denying its reality in theory.
This, according to Polanyi, merely indicates that “men may go on
talking the language of positivism, pragmatism, and naturalism
for many years, yet continue to respect the principles of truth and
morality which their vocabulary anxiously ignores.”29 Polanyi
argues that both Britain and America have managed to escape the
grim inhumanity of moral inversion by virtue of this dichotomy
between practice and theory. This achievement was rendered
possible by a sort of “suspended logic,” which allowed the British
and Americans to avoid pursuing their theoretical positions to
their practical ends.30

While this solution is a possible way to avoid the negative
consequences of moral inversion, it is less than ideal, for it does
not dispense with the problem but only holds it at bay through a
process of self-deception. Eventually a more suitable solution
must be found. The problem of moral inversion is, for Polanyi, the
direct result of objectivism, which represents a false theory of
knowledge that does not recognize moral truth as legitimate.
While it is true that modern man has, due to a partial rejection of
tradition and authority, produced innumerable technological
advances, the pendulum has swung too far in the direction of
rationalism and skepticism. Thus, modern man “must restore the
balance between his critical powers and his moral demands.”31
This recovery indicates a more stable solution, for it attempts to
overcome the epistemological shortcomings of modernity, which
have created the possibility of moral inversion in the first place.

In light of this discussion, it should be clear how Polanyi’s
concept of moral inversion shares important elements with
Dostoyevsky’s story of the Grand Inquisitor. As we have seen, the
two elements constituting moral inversion are 1) the drive for
perfection and 2) moral skepticism. Both elements lie at the heart
of Dostoyevsky’s story. Polanyi’s solution, as we have seen, is a
return to an account of knowledge that once again opens the door
to the possibility of moral and religious truth. Dostoyevsky does
not focus on the specifics of a theory of knowledge, but he, along
with Polanyi, concludes that faith is central to the enterprise. As
Dostoyevsky’s fictional character, Father Zosima, puts it, “Only
the masses of simple, humble people and their growing spiritual
power will be able to convert the atheists, who have been uprooted
from our native soil.”32 Of course, the faith spoken of by Zosima
is the Russian Orthodox Church, the version of the Christian faith
that had deep roots in the history and traditions of the Russian
people. Polanyi’s fiduciary framework is not specifically religious,
much less sectarian. Nevertheless, an element of faith is at the
heart of both, and while Polanyi is not directly advocating a
specific religion, his theory of knowledge clearly opens the door
to the possibility.

Polycentricity

In addition to the idea of moral inversion, Polanyi’s political
philosophy also includes a concept that he dubs “polycentricity.”
The following discussion of this concept will be cast in terms of
economics, but it is important to bear in mind that the concept
itself applies to any complex endeavor where the coordination of
human beings must occur: science, soccer, chess organizations,
and, of course, politics.

Polanyi was a vocal and energetic opponent of command
economies and devoted significant energy combating such theories.
According to Polanyi, there are really only two imaginable
ways of arranging economic systems: a market economy or a
planned system. Polanyi resolved the dilemma in unequivocal
terms: “I affirm that the central planning of production . . . is
strictly impossible.”33 That being the case, Polanyi could assert
with confidence that “there exists no radical alternative to the
capitalist system.”34 The flaw that fatally impedes any centralized
economy is the fact of human finitude. A centralized system (or
what overconfident advocates might call “scientific planning”) is
predicated on the belief that the central authority is capable of
gathering and assimilating all of the available information about
every aspect of the economic system and then making decisions
based upon that information.

An obvious problem, of course, is that “the central authority,
however properly constituted it may be as a government, is in fact
ignorant of the desires of its constituents as far as their day-to-day
wants are concerned.”35 In short, in any complex economic
system there exist multiple centers, and a single centralized center
can never completely and accurately represent the desires and
needs of the various players. This apparently insurmountable
problem of centralization is rooted in what Polanyi calls
“polycentricity.” To address economic questions adequately, one
must employ a polycentric approach rather than a centralized
one. A polycentric system is one that operates according to the
mutually adjusting actions of independent participants. The coordination
or order that ensues is not commanded from the top but
rather is what Polanyi called a “spontaneous order,” a term
Austrian economist Friedrich von Hayek would later appropriate
from Polanyi.36 Polanyi argues that wherever complexity exists,
the same principle will apply. “It applies even to a sack of potatoes.
Consider how ingeniously the knobs of each potato fit into the
hollows of a neighbor. Weeks of careful planning by a team of
engineers equipped with a complete set of cross-sections for each
potato would not reduce the total volume filled by the potatoes
in the sack so effectively as a good shaking and a few kicks will do.”
This is even more evident when we turn to human relations. For
example, “take a soccer team of eleven mutually adjusting at every
moment their play to each other, and pit it against a team each
member of which has to wait before making a move for the orders
of a captain controlling the players by radio. Central direction
would spell paralysis.”37

If economic systems are in fact polycentric, it would follow
that any attempt to institute a truly centralized economy would be
doomed to failure. Polanyi saw the Soviet attempt to implement
a command economy as a clear vindication of his argument.

The early phase of the Russian Revolution thus presents an
experiment, as clear as history is ever likely to provide, in which
(1) Socialist economic planning was pressed home; (2) this had
eventually to be abandoned on the grounds that the measures
adopted had caused an unparalleled economic disaster, and (3)
the abandonment of the Socialist measures and the restoration
of capitalist methods of production retrieved economic life from
disaster and set it on the road to rapid recovery.38

Polanyi pointed out that despite the rhetoric coming from the
Party, “communism broke down in the famine and was repealed
by Lenin in March, 1921. In 1921 Russia largely returned to
private capitalism. The New Economic Policy left all but the main
industries to private persons, thus restricting itself to a direct
control of about 10 per cent of production.”39 Here Polanyi
distinguishes between pure communism, which seeks to abolish
the entire market mechanism, and socialism, which, despite the
government ownership of major industries, relies fundamentally
upon the market. Thus, in order to prevent a repeat of the disaster
of 1921, the reality was clear. “Publicly owned enterprises must
therefore operate through a market even though this may be
heavily overlaid by a pretense of central direction.”40 What was
called planning in the Soviet economy, then, was really something
far different. “The target of the next two or three months is fixed
by adding to the results of the last period a small percentage of
expansion.”41 But merely demanding that each sector expands
gradually is hardly an example of the sort of scientific planning of
which the Party boasted. Polanyi calls the bluff to this pretense.
“This is not central direction but a ubiquitous central pressure,
which forces enterprises to operate constantly to the limits of
their capacity and to widen this capacity from quarter to quarter
by a process of trial and error.”42

But while Polanyi is a fierce opponent of collectivism, he is at
the same time no laissez-faire libertarian. He accuses both the
libertarians and the collectivists of error when it comes to
understanding the role that government can play in economic
matters.

The orthodox Liberals maintain that, if the market is limited by
the fixation of some of its elements, then it must cease to function,
the implication being that there exists a logical system of
complete laissez faire, the only rational alternative to which is
collectivism. That is precisely the position which collectivists
want us to take up when asserting that none of the evils of the
market can be alleviated except by destroying the whole institution
root and branch.43

As we saw above, Polanyi is convinced that there are only two
conceptual economic arrangements and one of them, collectivism,
is inherently defective. Capitalism is the only viable option,
but this does not imply that the state has no role other than
enforcing contracts and preventing fraud. Indeed, the state can
work, albeit at the margins, to ensure that the market operates as
effectively as possible (by curtailing monopolies, for instance). As
he puts it, “while the State must continue to canalize, correct and
supplement the forces of the market, it cannot replace them to any
considerable extent.”44

Polycentricity and spontaneous order characterize all complex
human endeavors. Centralization invariably leads to inefficiency
if not complete paralysis. Yet, there is, and perhaps always
has been, a temptation to centralize authority. To be sure, some
events such as war actually seem to demand centralization. Yet,
according to Polanyi, the price of centralization is the reduction
of creativity and the freedom that such creativity requires. Again
we see that freedom is at the core of Polanyi’s concerns. The idea
that economics or science or politics could be centrally planned
was one he fought against for most of his life.

Subsidiarity

While Polanyi develops his idea of polycentricity primarily in
the context of economics and the practice of science, it also
bears on the complexities of governing a modern nation state.
Any attempt to dictate from a central authority all of the details
involved in organizing and directing a modern state would,
eventually, lead to paralysis. Here we see an interesting convergence
between Polanyi’s notion of polycentricity and the principle
of subsidiarity articulated and developed primarily in
Catholic social thought.

The term “subsidiarity” was first used by Pope Pius XI in his
encyclical Quadradesimo Anno (1931). In this document, Pius XI
builds upon the ideas put forward by Pope Leo XIII in his
encyclical Rerum Novarum (1891). According to Leo XIII, a
society is a complex whole consisting of many parts that must
remain distinct. This distinction is necessary for the flourishing of
the various elements in society. They cannot be what they are
supposed to be if they are controlled by a central authority. Thus,
“the State must not absorb the individual or the family.”45 The
same principle applies to all other secondary associations that
comprise a complex society—for example, labor unions, local
municipalities, and societies for mutual help. “The State should
watch over these societies of citizens banded together in accordance
with their rights, but it should not thrust itself into their
peculiar concerns and their organizations, for things move and
live by the spirit inspiring them, and may be killed by the rough
grasp of a hand from without.”46

While the central concern of Rerum Novarum is the plight of
the working class and justice for the poor, by 1931 the political
landscape had undergone a shift. Pius XI, while building upon the
work of Leo XIII, focuses his attention on the problems that
accompany the phenomenon of individualism. Individualism
arises with the destruction or attenuation of “that rich social life
which was once highly developed through associations of various
kinds.” In such a circumstance “there remain virtually only
individuals and the State.” While this situation is surely harmful
to individuals, Pius argues that the State is harmed as well, for
“with a structure of social governance lost, and with the taking
over of all the burdens which the wrecked associations once bore,
the State has been overwhelmed and crushed by almost infinite
tasks and duties.”47 Pius argues that a healthy society consists of
“a graduated order” of secondary associations in accordance with
the “principle of subsidiarity.”48 He frames the principle in moral
(and ultimately metaphysical) terms.

Just as it is gravely wrong to take from individuals what they can
accomplish by their own initiative and industry and give it to the
community, so also it is an injustice and at the same time a grave
evil and disturbance of right order to assign to a greater and higher
association what lesser and subordinate organizations can do. For
every social activity ought of its very nature to furnish help to the
members of the body social and never destroy and absorb it.49

The State, then, has functions particular to it, such as defense.
Additionally, it properly acts as a facilitator that ensures the
various secondary associations enjoy the freedom to operate
according to their internal principles. Jacques Maritain expresses
this in terms of an umpire.

The State would leave to the multifarious organs of the social
body the autonomous initiative and management of all the
activities which by nature pertain to them. Its only prerogative in
this respect would be its genuine prerogative as topmost umpire
and supervisor, regulating these spontaneous and autonomous
activities from the superior political point of view of the common
good.50

Practically speaking, the principle of subsidiarity, if applied,
would result in a flowering of secondary associations each free to
pursue its own ends—limited, of course, by the stipulation that
the ends sought do not run counter to the common good. This
emphasis on decentralized initiative and the creativity that such
decentralization makes possible dovetails at the level of practice
with Polanyi’s notion of polycentricity. But while the practical
ends are complementary, the justifications underlying the two
positions are significantly different. Polanyi’s argument rests
primarily on the principle of efficiency. It is more efficient
economically or politically to allow the various component parts
to work independently toward ends that each individual selects
under the supervision of a central authority but not planned by
that authority. Polanyi does, though, argue that such a situation
can only exist if it is undergirded by a mutual commitment to
certain transcendent ideals—such as justice and charity—that
exist beyond any efficiency arguments. On the other hand, the
principle of subsidiarity, as described in Catholic social thought,
begins with a robust Thomistic metaphysic complete with an
account of the common good rooted in a human nature oriented
toward certain natural and supernatural ends. Such an account
may provide an aura of intellectual satisfaction to a person
inclined in that direction or already committed to the complex
intellectual framework that Thomism requires, but if such commitment
is a necessary condition for accepting the practical
principle of subsidiarity, then one should not be surprised if the
principle is not widely embraced by a society characterized, as is
ours, by religious pluralism as well as metaphysical skepticism or
at least metaphysical minimalism.

Polanyi’s Politics Today

In conclusion, I want briefly to explore if or how Polanyi’s
political ideas are relevant in the political setting of the early
twenty-first century. Polanyi’s political reflections spanned two
world wars and the subsequent cold war. He wrote to defend
liberty against those who were motivated by a passion for power
and informed by the philosophies of Communism and National
Socialism. Marx and Lenin, of course, embraced a materialistic
account of reality and, at the same time, wrote in the wake of
centuries of Christianity. This combination of metaphysical
skepticism and a longing for perfection created the volatile
dynamic Polanyi called moral inversion. But today communism,
as a political ideology, is dead. There are, to be sure, pockets
throughout the world where the news has not yet arrived, but by
and large, communism as an ideology was a feature specific to the
nineteenth and twentieth centuries.

Today we in the West face different threats. Perhaps radical
Islam is the most obvious. The question, then, is whether the
category of moral inversion is helpful in understanding this new
threat, and it seems that the answer is no. The metaphysical and
moral skepticism is gone while the moral passion remains in full
strength. Both the communist and the Islamicist are motivated by
a passionate desire to alter the world, but, at the same time, the
communist has no belief in an afterlife that includes, among other
things, special rewards for martyrdom. To be sure, once a person
had fully absorbed the teachings of the Party, he might be willing
to sacrifice himself for the communist cause, but the phenomenon
of suicide attacks seems almost exclusively tied to a religious
conviction that the voluntary loss of life will be richly compensated
in the life to come. In short, the communist “true believer”
was willing to sacrifice innumerable lives for the sake of a
historically inevitable world communist state.51 But the Islamicist
is quite happy to sacrifice himself for the rewards he will reap in
heaven. The communist is characterized by moral passion and
metaphysical skepticism while the Islamicist is characterized by
moral passion and metaphysical certainty. The concept of moral
inversion, then, is not adequate to describe this new dynamic.

However, in addition to the external threat posed by radical
Islam, we are also beset by internal challenges in the form of racial
individualism and creeping statism. At first blush it would appear
that these forces are opposed to each other and thus must find
their origins in distinctly separate cultural and political soils. But
on closer examination, it appears that individualism facilitates the
centralization of power. Tocqueville noticed this in his assessment
of the strengths and weaknesses of American democracy. A
robust tradition of secondary associations provides a buffer
between the central government and the individual. Tocqueville
argues that equality of conditions, when taken to their logical
conclusion, would lead to the breakdown of secondary associations,
but these associations are precisely where individuals find
meaning and identity in the complex web of communities of which
they are a part. The present age is one characterized by an
attenuation of the robust associational life lauded by Tocqueville,
and many have expressed concern about the resulting isolation that
Tocqueville feared. In short, as Tocqueville puts it, “aristocracy
links everybody, from peasant to king, in one long chain. Democracy
breaks the chain and frees each link.”52 But with the breakdown
of the ties that previously bound individuals to one another,
people tended to forget the communities to which they belonged.

Thus, not only does democracy make men forget their ancestors,
but also clouds their view of their descendants and isolates them
from their contemporaries. Each man is forever thrown back on
himself alone, and there is danger that he may be shut up in the
solitude of his own heart.53

Thus, equality of conditions tends to breed isolation, and
isolation tends to blind individuals to anything beyond their
immediate self-interest. A void, once filled by secondary associations,
is created and the state readily expands to fill the vacuum.
But in the wake of this expansion, freedom is truncated, for the
opportunity—and what is more important, the incentive—to
form secondary associations diminishes. It is for these reasons
that Tocqueville puts so much stock in secondary associations,
for only in the context of a robust associational life is the “art of
freedom” practiced and preserved.

Polanyi’s emphasis on the epistemic role of tradition, community,
and authority, as well as his notion of polycentricity,
serve as an antidote against both radical individualism and
creeping statism. First, according to Polanyi, much of our knowledge
is acquired through the example of others, and such learning
requires submitting to the authority of one who has mastered a
particular set of skills.54 But if knowing is an art, and if learning
an art requires submitting to the authority of a master, then it
follows that there must exist a tradition by which an art is
transmitted, and any attempt categorically and systematically to
reject tradition is logically incompatible with knowing. If that is
the case, then we must conclude that the ideal of a tradition-free
inquiry is simply impossible. “No human mind can function
without accepting authority, custom, and tradition: it must rely
on them for the mere use of a language.”55 But, the traditionalism
that Polanyi advocates is in no way static. Polanyi’s appreciation
for scientific discovery leads him to comprehend tradition as an
orthodoxy that enforces a kind of discipline on those subject to
the tradition, but the orthodoxy is a dynamic one in that “it
implicitly grants the right to opposition in the name of truth.”56
A tradition, of course, requires the presence of a community
committed to its perpetuation. Since knowing is an art that
requires one to enter into a practice by virtue of submission to the
authority of a master, and since traditions are embodied in and
transmitted through practices, knowing is fundamentally communal,
for traditions do not exist apart from the communities that
embrace them and transmit them to subsequent generations. This
emphasis on authority, tradition, and community serves to
counter, at a fundamental level, the modern impulse toward
radical individualism, for, if Polanyi is correct, human beings are
constituted epistemically in a manner that is far closer to Aristotle
than to Hobbes or Locke.

Second, as we have seen, the principle of subsidiarity justifies
in metaphysical terms the goodness of various forms of association.
It also sets limits on interference in those associations by
state power. Likewise, Polanyi’s concept of polycentricity seems
to touch on a permanent principle of complex human relationships.
Polanyi recognizes that freedom and creativity cannot
flourish in the context of centralized control. The contemporary
practical advantage of polycentricity over the principle of
subsidiarity is clear when we consider the robust metaphysical
foundation upon which the principle of subsidiarity rests. If
subsidiarity can only be coherently defended in the context of a
Thomistic metaphysic that includes a theory of nature, human
nature, and the common good, then its prospects are dim at least
for the foreseeable future. If the principle of subsidiarity provides
the important means by which to articulate and defend a complex
society comprised of a variety of associations of free individuals
pursuing ends properly suited to them, then perhaps the principle
of polycentricity is an means by which to approximate the
practical political results while side-stepping the metaphysics. Of
course, such a solution, if the principle of subsidiarity (along with
its guiding metaphysics) is true, is not completely satisfying. But
unless and until the philosophical climate changes, it may be the
best that can be done. Interestingly, Polanyi’s theory of knowledge,
which creates room for a renewed discussion of metaphysics,
might in time make possible the general acceptance of the
principle of subsidiarity or a Polanyian version thereof.

Mark T. Mitchell
Patrick Henry College

NOTES

  1. The following books by Michael Polanyi are referenced in
    this paper. Contempt of Freedom: The Russian Experiment and
    After (New York: Arno Press, 1975); Knowing and Being, ed.
    Marjorie Grene (London: Routledge & Kegan Paul, 1969); Logic
    of Liberty (Indianapolis: Liberty Fund, 1998); Personal Knowledge:
    Towards a Post-Critical Philosophy (Chicago: The University
    of Chicago Press, 1958); Society, Economics, and Philosophy:
    Selected Papers, ed. R. T. Allen (New Brunswick, NJ: Transaction
    Publishers, 1997); The Tacit Dimension (Garden City, NY:
    Doubleday & Co., 1966); Michael Polanyi and Harry Prosch,
    Meaning (Chicago: University of Chicago Press, 1975).
  2. Polanyi, in Allen, Society, Economics, and Philosophy, 24.
  3. Ibid., 27.
  4. Ibid., 30.
  5. Ibid.
  6. Ibid., 31.
  7. Drusilla Scott, Everyman Revived: The Common Sense of
    Michael Polanyi (Grand Rapids: William B. Eerdmans Publishing
    Co., 1985), 182.
  8. Fyodor Dostoevsky, The Brothers Karamazov, trans. Andrew
    R. MacAndrew (New York: Bantam Books, 1970), 299.
  9. Ibid., 305.
  10. Ibid., 310.
  11. Ibid.
  12. Ibid., 311.
  13. Ibid., 315.
  14. Ibid., 316.
  15. Ibid., 314.
  16. Scott, Everyman Revived, 182.
  17. Harry Prosch, “Polanyi’s Ethics,” Ethics 82 (1972), 91.
  18. Polanyi, in Grene, Knowing and Being, 65; in Allen,
    Society, Economics, and Philosophy, 215; The Tacit Dimension,
    63; Logic of Liberty, 10, 18.
  19. Polanyi, in Allen, Society, Economics, and Philosophy, 79.
    Cf. Polanyi, in Grene, Knowing and Being, 8, 65.
  20. Polanyi, in Allen, Society, Economics, and Philosophy, 79.
  21. Polanyi, in Grene, Knowing and Being, 46.
  22. Polanyi and Prosch, Meaning, 20.
  23. Ibid., 18.
  24. Polanyi, in Grene, Knowing and Being, 10. Cf. The Tacit
    Dimension, 57ff; 85ff.
  25. Personal Knowledge, 228.
  26. The Tacit Dimension, 58.
  27. Ibid., 58.
  28. The literary examples are Polanyi’s.
  29. Personal Knowledge, 233.
  30. Polanyi, in Grene, Knowing and Being, 22. Cf. Knowing
    and Being, 67–9; Logic of Liberty, 121–2.
  31. Polanyi, in Allen, Society, Economics, and Philosophy,
    105.
  32. Dostoevsky, The Brothers Karamazov, 354.
  33. Logic of Liberty, 136.
  34. Ibid., 170.
  35. Polanyi, in Allen, Society, Economics, and Philosophy,
    148.
  36. Polanyi first uses this term in print in 1948 (“The Span of
    Central Direction” republished in Logic of Liberty). Hayek’s first
    published use of the term is in his 1960 work The Constitution of
    Liberty (Chicago). Hayek acknowledges his debt to Polanyi ( page
    160).
  37. Polanyi, in Allen, Society, Economics, and Philosophy,
    168.
  38. Logic of Liberty, 163.
  39. Contempt of Freedom, 62.
  40. Polanyi, in Allen, Society, Economics, and Philosophy,
    171.
  41. Ibid., 177.
  42. Ibid., 178.
  43. Ibid., 140.
  44. Logic of Liberty, 171.
  45. Quotations from Rerum Novarum (May 15, 1891) taken
    from The Church Speaks to the Modern World: The Social Teachings
    of Leo XIII, edited, annotated, and with an introduction by
    Etienne Gilson (Garden City: New York: Doubleday & Co. 1954),
    § 35.
  46. Rerum Novarum, § 55.
  47. Quotations from Quadragesimo Anno (May 15, 1931)
    taken from The Church and the Reconstruction of the Modern
    World: The Social Encyclicals of Pope Pius XI, edited, annotated,
    and with an introduction by Terrence P. McLaughlin (Garden
    City, New York: Doubleday & Co., 1957), § 78.
  48. Quadragesimo Anno, § 80.
  49. Ibid., § 79.
  50. Jacques Maritain, Man and the State (Washington, DC:
    Catholic University Press of America, 1951), 23.
  51. It is interesting to note the irony of a historically inevitable
    state that must be the object of human striving.
  52. Alexis de Tocqueville, Democracy in America, trans. George
    Lawrence, ed. J. P. Mayer (New York: Harper Collins Publishers,
    1988), 508.
  53. Ibid.
  54. Personal Knowledge, 53.
  55. Polanyi, in Grene, Knowing and Being, 41.
  56. Ibid., 70.