Capitalism is suffering a crisis of care

The West is facing a crunch point. Inequality and low wages, fertility rates below population replacement levels, increasing health problems related to daily stress, inadequate provision of child care and elderly care, a stubborn gender pay gap, and a slowdown in economic growth.

All these problems have a common cause that economists have so far failed to grasp: the crisis in care. Care is that concern which distinguishes us from robots. It’s what leads us to make decisions that otherwise look irrational. And, frustratingly for researchers, it’s really tricky to capture.

But what goes on in the public sphere – that pay gap, that growth slowdown – cannot be understood without first understanding care. Which means we can’t understand what goes on in the public sphere until we understand life at home.

A short history of care

For centuries the household and the workplace were often one and the same thing, blurring the boundaries between production and reproduction. With the Industrial Revolution, ‘work’ shifted out of the home and into the factory. New industries and new technologies favoured a combination of brute strength and capital – as famously depicted in the murals of artists like Benton. The Male Breadwinner Model was born, and alongside it, the ‘feminisation’ of the home: men earned and women cared. Production was remunerated in money, whilst reproduction was remunerated in social esteem and virtue. And when women did work outside the home, such as in the “dark satanic mills” of the Greater Manchester cotton industry, commentators decried the “destruction of the family” and the de-feminisation of women.

Karl Marx, famously not a supporter of women’s equality, lamented the loss of free domestic labour that women’s labour market participation represented. Dr Hawkins, factory surgeon and inspector, noted in 1833 that the working wives of the industrialising cities “fall remarkably short of the usual characteristics of the English wife”. Those women were not fulfilling their domestic duties “no cookery, no washing, no making, no mending, no decencies of life, no invitations to the fire-side.”

“Family wages for men” was the trade union cry, and by the middle of the twentieth century, the separate spheres of production and reproduction had been crystallised by the state. Rather than using growing tax-revenues to support women’s re-entry into the workforce by ‘socialising’ care, policy measures were built on the assumption that women were housewives, like the daily school timetable which made anything other than part-time work near impossible or pensions which rewarded male wages more than female ones. But by the 1980s, the marriage of liberal feminism with pro-market thinking resulted in the double-earner family, which contracted out care to an army of low-wage cleaners and nannies, often from overseas.

This marketisation of care has not, however, provided a complete solution, particularly for families who cannot afford to purchase care through the market. The great contradiction of capitalism, as academic Nancy Fraser has shown, is that it both requires care but also makes its provision increasingly difficult.¹

Economic models have failed to take account of care

The public sphere is only as strong as the private foundations upon which it is built. That’s the lesson behind the famous feminist saying: ‘personal is political’. Addressing the numerous problems in the economy means breaking down the traditional division between the home and the public sphere, because, as feminist economists such as Marilyn Waring and Nancy Folbre have pointed out, production in the market depends on care within the home.² ‘Personal is political’.

Yet the mathematical models so beloved of economists fail to recognise this. Instead they rely on the notion that private individuals make rational decisions about how much to work and what to spend their earnings on. It is like a science fiction world in which we are all robots – there is no love, no sex, no power and no emotions. We are assumed to be economically active and to have no dependence on – or responsibility for – anyone else.

But we are not robots, and care is vital to our existence. Not just in childhood and old age, or even in times of illness, but through the care we receive from our loved ones every single day. It is care that reproduces the human race, that sees us through periods when we are most vulnerable and that makes the daily grind just about manageable.

While economists focus on independence, individualism and reason, care involves the polar opposite: dependence, relationships and emotion.³ Altruism, reciprocity and responsibility for others all feature. The economic model upon which policy decisions have been taken is highly flawed, and that has led to a crisis in care.

The Crisis of Care is a barrier to economic and social progress

The economic gains from women’s (re)entry into the workforce over the past century cannot be understated, in fact estimates suggest further great gains if that trend continues.⁴ However, as women have entered the workforce, the care gap that has opened up as a result is creating daily stress and strain in the lives of so many working families.

It can be seen in the double burden women carry in working and providing the vast majority of care within the home. Which is both hindering women’s ability to achieve greater equality in the labour market and leading to the increasing health problems we see related to the stress of juggling care and paid work. In the UK, according to the British Social Attitudes Survey the typical woman spends 36 hours a week on unpaid work in the home, compared to 18 hours for men.⁵

And this failure to factor in care needs, and therefore develop adequate market or public-sector solutions, is contributing to fertility rates falling below population replacement levels – the result of a ‘baby strike’ as women reject that double burden of earner and domestic caregiver.⁶

It also risks increasing inequality between poorer and richer women: richer families can contract care out in a way that poorer families cannot afford to.

The social and economic impact of the failure to value care, to anticipate the care gap, and to plan accordingly can also be seen in the care industry itself. Care has historically been undervalued – taken for granted – and so, when provided through the market, has been relatively lowly paid. And the inherent difficulty in raising productivity in a sector so dependent on personal interactions, so labour-intensive, helps to explain why despite significant market expansion pay remains so low.⁷

This, of course, has wider economic and social implications. Families struggling to make ends meet on low pay, suffering from in-work poverty, have associated health and welfare costs. And the low pay care sector not only acts as a general drag on productivity, but families employed within it are limited in their ability to spend and save.

Were it not for economists’ neglect of care, many of these problems could have been anticipated. And anticipating them would have been key to avoiding them. Only by bringing care centre stage will we be able to place the economy – and, more importantly, people’s wellbeing – on a stronger footing. It’s time to put care at the heart of economic thinking.

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Dr Victoria Bateman is Fellow in Economics at Gonville and Caius College, Cambridge. She writes regular economic commentary for Bloomberg View and CapX, and is known for her stance on Brexit and for using art to explore perceptions of the female body.

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