I foolishly took it upon myself to read not only the assigned chapters, but the whole of Polanyi's magnum opus, The Great Transformation, and for the past few days have been lost in the labyrinth of 19th-century poor laws and monetary policy in the Weimar Republic. But this book was immensely profitable, if I may borrow a market-based metaphor.
In particular, three of Polanyi's simplest, most commonsensical contentions were extremely illuminating to me and greatly bolstered my ability to criticize capitalist orthodoxy.
The first, on page 48, is Polanyi's contention that the concept of homo economicus that Adam Smith and the economists after him put forth, of man as naturally engaging in trade and barter to further his economic interest, is pure invention. Far from being a simple description of man's nature, it is thoroughly unnatural. Man is, and throughout history has been, primarily motivated not by individual economic interests, but by social interests. His economic decisions, as well as all other decisions, were determined by his need to preserve his social status, and to conform with accepted social norms, because man is fundamentally a social being. As soon as you state this truth, it becomes blindingly obvious. Even two centuries of market dominance have been unable to overcome human nature in this respect--when we look around at what motivates people's buying and selling choices, even in the modern West, the chief factor is clearly not economic interest, but social status. Why on earth do women spend hundreds of dollars on brand-name clothing that is no more useful than nearly identical clothes that sell for a tenth the price? Why do men spend thousands of dollars on sleek sports cars to drive on crowded city roads? Clearly not economic interest, but desire for social status. The same applies to much of what drives the housing market and other huge chunks of the global economy. Marketing experts know better than to listen to the claim that man trades primarily for his economic interest; it's about time professional economists woke up to the fact as well.
Second is Polanyi's argument that land, labor, and money are of course not commodities at all--they are "fictional commodities." Land and labor are simply part of the basic fabric of natural human existence; only if they are torn completely away from their natural foundations can they begin to function as commodities, but even then, nature will continually re-assert itself, and the market will never gain uncontested mastery over them. Money is naturally merely a tool to facilitate exchange; to exalt it beyond this is to subject it to dangerous pressures which it cannot bear. Of course, it is not impossible to argue that to treat these as commodities is, all in all, an advantageous innovation, but Polanyi insists that economists be honest and recognize it as an innovation. Classical economics must renounce its absurd claim to be simply an objective description of the way the world works (which is how Christian conservatives justify submission to it) and acknowledge that it is rather a bold and dangerous prescription for how to make the world work.
Third is Polanyi's argument on p. 164 and following that a society may be destroyed and misery may increase even when economically, every one is doing better and better. This pokes a big hole in the last defense of free-market capitalism--that, in the end, it benefits poor and rich alike, by causing the wages and economic prosperity of all to increase. Far more destructive to human well-being than simple economic privation, Polanyi argues, is the destruction of the social structures and norms which give human existence stability and meaning. Of course, this destruction also has economic consequences, because, as capitalism advances and individual "prosperity" increases, the social support systems that will protect each member of society in case of crisis disappear; the individual is left to his own resources, which, though they may have been augmented by economic progress, are insufficient for the task. This observation of Polanyi's is intensely relevant to the current world situation, where capitalist industry is taking complete control of Third World countries, often with devastating social consequences. Anti-capitalists lament the deprivation, poverty, and exploitation of the common people, while defenders of capitalism insist that, on the contrary, statistics show that these people's incomes and economic prosperity are growing. The capitalist defense may be partially true, but the whole truth is much worse than the anti-capitalist lament; the people of Kenya, Bangladesh, or Vietnam may have a higher income, but with the result of the destruction of the fabric of society, of all in man that cannot be commodified, the result, in short, that C.S. Lewis calls "the abolition of man.".