Who Cooked Adam Smith’s Dinner?

Katrine Marçal (trans. Saskia Vogel)


Feminism has always been about economics. Virginia Woolf wanted a room of her own, and that costs money.

In the late nineteenth and early twentieth centuries women joined together to demand the right of inheritance, the right of ownership, the right to start their own companies, the right to borrow money, the right to employment, equal pay for equal work and the option to support themselves so that they didn’t need to marry for money, and could instead marry for love. 

Feminism continues to be about money. 

Feminism’s aim for the past decades has been to take money and privilege from men in exchange for less quantifiable things like ‘the right to cry in public’. 

Or at least that’s how some people put it. 

More than six years have passed since 15 September 2008, the day the American investment bank Lehman Brothers filed for bankruptcy. Within a few weeks banks and insurance companies around the world followed suit. Millions of people lost their jobs and their savings. Families were forced to give up their houses, governments fell, the markets shook. Panic swept from one part of the economy to the next and from one country to another as a system that couldn’t stand up any more stumbled forward. 

We watched in wonder. 

If everyone just works, pays their taxes and keeps quiet, everything will sort itself out. 

That’s what we’d been taught.

But that was false.

After the crisis, one international conference was held after another. Book upon book was written about what had gone wrong and what needed to be done. Suddenly, everyone seemed to be criticizing capitalism, from Conservative politicians to the Pope in Rome. It was said that this crisis was a paradigm shift, that everything would now be different. The global financial system needed to change. New values would have to dominate the economy. We read about greed, about global imbalances and about income inequality. We heard ad nauseam that the Chinese word for ‘crisis’ was made up of two characters, one meaning ‘danger’, the other ‘possibility’. 

(Which isn’t correct, by the way.) 

Six years later the financial sector has recovered. Profits, salaries, dividends and bonuses are back to what they once were. 

The economic order and the economic story that so many thought would disappear with the crisis proved to be stubborn. Intellectually robust. The question is, why? There are many answers. This book aims to give you one perspective on the matter: that of sex. 

And not in the way you might think. 

If Lehman Brothers had been Lehman Sisters, the financial crisis would have turned out differently, said Christine Lagarde in 2010, when she was still France’s Minister of Finance. 

Presumably not entirely seriously.

Audur Capital, an Icelandic private equity fund entirely run by women, was the only fund of its kind that made it through the crisis without so much as a scratch, she pointed out. And there are studies that show that men with higher testosterone levels are more prone to taking risks. Excessive risk-taking is what causes banks to capsize and financial crises to occur, so does this mean that men are too hormonal to run the economy? 

There are other studies that show that women are at least as prone to taking risks as men, but only when they are in the middle of their menstrual cycles. Is the problem with male bankers that they are like ovulating women? What is the connection between the business cycle and the menstrual cycle? 

Further studies note that girls in all-girls schools are just as eager as boys to take risks. Girls in mixed schools, on the other hand, are more cautious. In other words, norms and ideas about what your sex is in relation to the so-called opposite sex seem to matter. 

At least when the opposite sex is present. 

We can joke about these things, or take them seriously, but one fact remains: Lehman Brothers would never have been Lehman Sisters. A world where women dominated Wall Street would have had to be so completely different from the actual world that to describe it wouldn’t tell us anything about the actual world. Thousands of years of history would need to be rewritten in order to lead up to the hypothetical moment that an investment bank named Lehman Sisters could handle its over-exposure to an overheated American housing market. 

The thought experiment is meaningless.

You can’t just switch out ‘brothers’ for ‘sisters’. 

The story of women and economics is much bigger than that. 

Feminism is a tradition of thought and political action that goes back more than two hundred years. It is one of the great democratic political movements of our time, no matter what you think about its conclusions. And feminism has also accounted for what is probably the largest systemic economic shift of the last century. 

Some would say ever. 

‘Women went to work in the 1960s’: that’s how this story is usually told. 

But it’s not true. Women didn’t ‘go to work’ in the 1960s or during the Second World War. 

Women have always worked. 

What has happened in the last decades is that women have changed jobs. 

From working in the home, they’ve taken positions out on the market and started to take payment for their labour. 

From having worked as nurses, carers, teachers and secretaries they have started competing with men as doctors, lawyers and marine biologists. 

This represents a gigantic social and economic shift: half of the population has moved the majority of its work from the home to the market. 

We went from one economic system to another, without really being aware of it. 

At the same time, family life has been transformed. 

As recently as 1950 American women on average gave birth to four children each. Today that number is down to two.

In Great Britain and the USA, women’s family patterns have arranged themselves in accordance with their level of education. Well-educated women have fewer children, and they have them later in life. Women with less education have more children, and they have them a lot younger. 

In the media, both of these groups are depicted as caricatures. 

The career woman with the screaming baby in her briefcase, she who waited until she turned forty to push out her offspring, and now she doesn’t even have time to take care of it. 

She is selfish, irresponsible and a bad woman. 

The young working-class mother sitting in her council flat, living off benefits and without a man in her life. 

She is also selfish, also irresponsible and also a bad woman. 

The debate about the colossal economic shift that we have gone through often starts and ends here: in opinions about how individual women, or caricatures of these women, should live their lives. 

In Scandinavia, where society invests enormous sums in childcare and paid parental leave, a woman’s family pattern is more unified, no matter what her level of education is. Generally she gives birth to more children as well. But even in these world-renowned welfare states women earn less than men and the number of women in senior management positions in business is small compared with many other countries. 

Somewhere there is an equation that no one has managed to solve. 

Maybe we don’t even have the language to talk about it yet, but it is without doubt an economic equation. 

Many people are afraid of economics. Its words, its authority, its rituals and its apparently all-encompassing incompre- hensibility. The period that led up to the great financial crisis was a time when we were asked to hand the economy over to the experts. It was said that they had solved the issues for us and we weren’t competent enough to understand their solution. It was a period when central bankers could become celebrities and be named ‘Man of the Year’ by Time magazine for cutting interest rates to save western civilization. 

That era has passed. 

This is a story about being seduced. It’s about how insidiously a certain view of economics has crawled under our skin. How it has been allowed to dominate other values, not just in the global economy, but in our own lives. It’s about men and women and about how when we make toys real, they gain power over us. 

To tie it all together, we need to start at the beginning.

Who Cooked Adam Smith’s Dinner? Katrine Marçal (tr. Saskia Vogel)