Can Markets Corrode Relationships?

Kristen Ghodsee discusses her research on how love and relationships function under socialism and capitalism, and what economists miss about the rise of right-wing populism in Eastern Europe

Kristen Ghodsee is a professor of Russian and East European Studies at the University of Pennsylvania, and author of the new book,Why Women Have Better Sex Under Socialism: And Other Arguments for Economic Independence” (Bold Type Books, 2018). She talks to INET Economics Editor Aaron Freedman about her research on the how market economies shape romantic relationships, and the specific ways women in Eastern Europe have experienced the transition from communism to capitalism. The transcript that follows has been edited for clarity.

Aaron Freedman: One of the main themes of your book is how market forces affect sexuality, gender, and relationships. How does that work?

Kristen Ghodsee: This argument basically goes back to discussions that early utopian socialists were having in the 1830s and 1840s. They were trying to look at the relationship between building a socialist world and the emancipation of women. One of the things that a lot of people don’t realize is that well before the Bolshevik Revolution in 1917, socialists were really grappling with whether or not you could have socialism without women’s emancipation or whether women’s emancipation was a fundamental component of any kind of socialist society.

Most of these utopian socialists and later­­ scientific socialists—like August Bebel, Friedrich Engels, and Alexandra Kollontai—all had this understanding that capitalism commodifies human relationships in a particular way. In The Communist Manifesto, there’s this beautiful passage that talks about how market economies basically reduce human relations to “naked self-interest,” to “callous cash payments.”

People who were theorizing about women’s rights—especially those theorizing about romantic relationships and sexual relationships—were basically trying to say that when society places the entire burden of childcare onto women, without giving them opportunities for their education or for any kind of professional training, they are always going to be forced into economic dependence on men. That dependency on men is going to create a situation whereby women themselves become a type of commodity.

My argument is a very simple one: When women are able to take care of their own material needs and those of their children—and I am talking about through a wider social safety net that socializes some of the care work that women do in bringing up the next generation—then women are not economically dependent on men. That means that if women are in unhappy or abusive or otherwise unsatisfying heterosexual relationships, they have the freedom to leave those relationships. In that situation—where women have a kind of economic autonomy that is supported by the socialization of a lot of their domestic roles—that autonomy basically allows for a more egalitarian relationship with men.

Do you feel mainstream economics has done an adequate job of explaining how market forces interact with sex and gender? What do you feel economists need to do better to understand the social dynamics that you lay out in the book?

I do think that if you go back to Gary Becker and household economics, there was an attempt to try to understand the family through an economic lens. Some economists, especially feminist economists and labor economists, have really understood that free markets discriminate against women in these very specific ways. But I don’t think that there are many mainstream economists who write on the economics of love or sexuality. The only exception is a concept called “sexual economics theory,” which was not formulated by economists but by social psychologists.

That said, there are some pockets within economics where they are dealing with issues of affection, and the way that affection and emotions become commodities. But I certainly don’t think those concerns are very central to the mainstream of the economics discipline, at least as far as I can tell. Now I’m not an economist, but one of my very close friends and a former co-author is a feminist labor economist. She did a read of my book before it went to press. She really felt that this argument of trying to think about sexual relations within the framework of economics is valuable and not done nearly enough in mainstream economics.

More broadly, traditional economics has really erased these intimate questions of personal, human relationships. They get factored out of economic questions because either they’re not considered important or they’re not considered to have value. Obviously, I think that’s changing when we think about the way that for-profit apps, like Tinder and Bumble, are generating income from our personal relationships. It may be that in the future, economics will have to attend to these questions more carefully. I think at the current moment, however, mainstream economics is really blind to a lot of these questions. Which is profoundly disturbing, since for most people human relationships—with romantic partners, friends, parents, children, etc.—are the most important parts of their lives.

What policies are needed to decommodify sexuality and relationships in capitalist society today?

I try to lay that out really clearly in the book. We need 100% job-protected, paid parental leave. Those policies have been implemented in places like Sweden and Iceland and Denmark. They’ve been also implemented in Western Europe. I think the United States is one of the few countries, and it’s the only country in the developed world, that doesn’t have some type of government-mandated paid maternity leave or parental leave. That’s absolutely essential.

The second thing is we need to have universal, federally subsidized childcare and pre-K education for all children in this country. Because the lack of childcare is precisely what keeps so many women in the home. Women who want to work, but cannot find quality childcare that is affordable. So they’re therefore forced to stay home, which ends up creating a really vicious cycle: Because women have to leave the labor force, they get paid lower wages. Because they are paid lower wages, when a heterosexual couple has a child and they have to decide who’s going to stay home with the child, it’s obviously going to be the person who gets the lower wage.

The third thing I talk about in the book is that if there were some kind of national jobs program or jobs guarantee, as is being discussed now in the United States, there need to be quotas so that not all those jobs go to men.

Your book mainly deals with heterosexual relationships under socialism. How do queer relationships and queer sexuality function under capitalism and socialism?

This is a question that is really important. The capitalist and traditional societies in which women are most economically dependent on men—being shuttled from fathers to husbands who can provide for them—are also the most heteronormative. Any deviation from heterosexuality is severely punished. But in societies where women are more independent and can take care of themselves, there is more tolerance of a variety of sexualities, because the family unit is not the economic unit responsible for the care of women and the raising of the next generation.

We can see this very clearly when we look at places like Scandinavia, where there are larger social safety nets and greater levels of gender equality, and where homophobia is less severe. I think that it’s really important to understand the relationship between compulsory heterosexuality and capitalism. Capitalism requires the unpaid labor of women in the home. It’s what bolsters capitalist profits in the economy. The minute you start to unpack the bourgeois nuclear family, you are a threat to capitalism. If I were to write another book or another piece, I would really like to explore the ways in which most queer relationships are naturally anti-capitalist, even if they don’t think they are, because they are a challenge to the way that property gets passed down through inheritance, through the bourgeois nuclear monogamous family.

Any challenge to the property relations of the family is really ultimately a challenge to the wider system of private property that capitalism needs in order to function.

Much of American society and culture has this triumphalist mentality concerning the fall of communism in Eastern Europe. This is especially true in economics, which took it as a given that the future of these countries’ economies after state socialism should be liberal, capitalist markets. What do you think Americans—and American economists in particular—can learn from looking at the history of Eastern Europe since 1989?

The theory of the neoliberal Washington Consensus in the late 1980s and 1990s was that if you just privatize state-owned enterprises and if you liberalize prices and remove subsidies then suddenly these beautiful markets would spring forth, fully formed. What we saw in the transition from Communism in Eastern Europe is how untrue that is. For markets to truly function you have to build—among the population—certain democratic preconditions, certain social trusts, certain kinds of political consensus. This idea that markets are just somehow natural and that if you release them from the shackles of totalitarianism, they will just spring forth fully functioning is just utterly silly.

Yet I think that a lot of very neoclassical conservative economists believe that that’s true. So, to the extent that we look at this situation in eastern Europe today and there are all these problems, those problems always seem to get blamed on communism. Very little attention is paid to the way that these markets were implemented in the 1990s, in many cases by Western economists.

It’s important to go back and read people like Jeffrey Sachs. In 1990, he wrote this incredible article, “What Is To Be Done,” which laid out a plan for shock therapy for Eastern Europe. But, what a lot of people forget is that Sachs said that this process needed to be coupled with a really large social safety net, because there would be a lot of social pain that would come out of this process. Only a few years later, Sachs resigned as economic advisor to Russian President Boris Yeltsin because he thought the privatization process was corrupt and out of control, and he wanted nothing to do with it.

I think U.S. leaders—Bill Clinton in particular—and Western leaders more broadly, didn’t really care so much about the social pain that was being inflicted, and really focused on creating markets. They believed very strongly that once you got the markets up and running, prosperity would increase and the rising tide would lift all boats.

But instead, what happened—and I think this is such an important lesson for economists today—is was massive amounts of inequality. Unsustainable amounts of inequality. So that now, 30 years after the fall of the Berlin Wall, what do we have in the region? We have a slow slide backwards toward authoritarianism. That has less to do, I think, with communism and more to do with the ways in which economists tried to shove free markets down the throats of people in eastern Europe without first building the political consensus that this was the right way to go.

What are the ways in which the transition from a state-owned to market economy affected women in Eastern Europe?

This is the question that is at the crux of most of my research. Let’s go back for a second and remember that in the 19th century, all these socialist theorists were basically saying that capitalism is really bad for women. It erodes women’s rights. It makes them commodities. It creates this economic dependence that limits their freedom, so on and so forth. But we need a test case to evaluate that theory. If you look at the transition from socialism to capitalism in Eastern Europe, what you have is almost laboratory conditions to see exactly how the implementation of a free-market economy affects women. It was the perfect test study.

Looking at Eastern Europe over the last thirty years, what we find, of course, is these socialist theorists writing in the middle of the 19th century were, in general, quite correct, in that women’s labor in the home, women’s reproductive work, and the care work that is generally outside of the formal labor market, are all completely devalued in a capitalist economy.

For example, under state socialism women were required to work, but they also had children. So the state had this massive social safety net, which meant job-protected paid maternity leave. It meant kindergartens and crèches. It also meant child allowances. There were all sorts of policies that were put in place so that women could be both mothers and workers and full citizens of their societies.

But what happens after 1989 or 1991, depending on where you are in the region, is that most of these policies are removed. In some cases, it’s really insidious, because some governments, like the Czech Republic and Slovakia, pushed women out of the labor force in order to keep unemployment rates lower. They basically say: “You guys have been suffering from this double burden of being mothers and workers for so long. Surely you want a vacation. You can just go home and watch TV and do yoga or whatever it is that women do when they’re at home: clean and cook and so on and so forth.”

Some countries extend maternity leave but remove job protection and lower the compensation, so that they’re basically forcing women to stay home and become economically dependent on men. We see this throughout the region. More and more women find it harder to compete in competitive labor markets when they have children.

So what happens? Obviously, women stop having children. Birth rates in this part of the world, after 1989, absolutely plummet. It’s so bad in the former East Germany that the German press essentially calls it the “womb strike”—it’s a birth strike. Women are reacting to this terrible situation, this economic upheaval and the removal of all these rights and protections that they once had. I think that what we can see after 1989 and really the last 30 years is exactly what happens to women when you institute a market economy and that market economy is predicated on the shredding of the previously robust social safety net that in some ways socialized the care work that women do in the home.

Based on your research, what do you think commentators on Eastern Europe miss when they analyze the rise of right wing populism in countries like Poland and Hungary?

I think that the western media consistently undermines or undervalues or refuses to see the impacts of inequality in societies where we have promoted democracy and free markets. What we’ve done instead is created these really unequal—toxically unequal—societies. So that when we look at survey data of Hungarians or Poles, even though they have less inequality than countries in Latin America, they dislike inequality a lot more. A lot of people in these countries say they would much rather have a government that takes care of the people than a dynamic economy with lots of individual opportunities for wealth creation. There’s a consistent preference for living in more equal societies and having limitations on economic freedom over living in these wildly unequal societies and having the possibility for a few folks to get spectacularly rich.

Of course, when people say that kind of thing, or when the survey data shows that kind of thing, the Western press says “Oh, they still have the communist mentality. They’re saddled with the baggage of Marxism,” or whatever. But then, look at what’s happening in France with the yellow vests. Look at what’s happening in the U.K. with Brexit. Look at what’s happening in the U.S. Massive inequality is toxic everywhere. Of course, I think the thing about Eastern Europe is that it was in some ways the canary in the coal mine. The fact that those countries were drifting back to a kind of authoritarianism should have warned us that these policies, this uncritical belief in market fundamentalism, erodes the basic institutions that you need for democracies to function.

I know that there have been plenty of people who have been critical voices out there saying that we need to pay attention to inequality. But I think that the relationship between inequality and authoritarianism is something that people have not really discussed when looking at Eastern Europe. They want to see everything in terms of ancient ethnic animosities or nationalist proclivities. But actually, these leaders are really making policies that appeal to people’s frustration at the inequality that has been the result of the last 30 years of free-market capitalism.

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