Page 18 - Iton 12

Karl Polyani, a Hungarian economic theorist, developed a cultural approach to economics, which
emphasized the way economies are embedded in society and culture. In the excerpt below, he
discusses what he refers to as three “fictitious commodities”: labor, land, and money, and describes
why they were invented as commodities to be bought and sold in today’s market industry.
The crucial point is this: labor, land, and money are essential elements of industry; they also must be organized
in markets; in fact, these markets form an absolutely vital part of the economic system. But labor, land, and
money are obviously not commodities; the postulate that anything that is bought and sold must have been
produced for sale is emphatically untrue in regard to them. In other words, according to the empirical
definition of a commodity they are not commodities. Labor is only another name for a human activity which
goes with life itself, which in its turn is not produced for sale but for entirely different reasons, nor can that
activity be detached from the rest of life, be stored or mobilized; land is only another name for nature, which is
not produced by man; actual money, finally, is merely a token of purchasing power which, as a rule, is not
produced at all, but comes into being through the mechanism of banking or state finance. None of them is
produced for sale. The commodity description of labor, land, and money is entirely fictitious...
But the more complicated industrial production became, the more numerous were the elements of industry the
supply of which had to be safeguarded. Three of these, of course, were of outstanding importance: labor, land,
and money. In a commercial society their supply could be organized in one way only: by being made available
for purchase. Hence, they would have to be organized for sale on the market--in other words, as commodities.
The extension of the market mechanism to the elements of industry--labor, land, and money--was the
inevitable consequence of the introduction of the factory system in a commercial society. The elements of
industry had to be on sale.
Karl Polanyi, The Great Transformation: The Political and Economic Origins of Our Time (1944); Excerpts
from Chapter 6, "The Self-Regulating Market and the Fictitious Commodities: Labor, Land, and Money"

In a series of letters between Herzl and Baron Rothschild, Herzl ultimately understood that the Jewish
People could rely only on themselves to build a Jewish state, and not on the wealthy class from amongst
them. An excerpt from one of Herzl’s letters is below:

From Theodore Herzl’s letters to the Rothschilds:
And your inconceivable wealth has grown, and is still growing. In every place, it is increasing at a faster
rate than the wealth is increasing generally in the countries wherein you reside. Therefore, your wealth
increase can only be at the expense of the [Jewish] nation’s wealth, despite the fact that you are personally
coming from the most respectable of places.

Therefore, in the Jewish State we will not tolerate your frightening wealth, which has the ability to
strangle our economic and political liberation…

Gentlemen, if you refuse to join us then we will most certainly have to place you on a special list; we will
not allow you to enter our country, in the same way that pretenders to the throne of the Kingdom of
France are not allowed to enter France, even though they are the offspring of the majestic families of
France.