Until 1973 homosexuality was listed as a mental illness in the Diagnostic and Statistical Manual (DSM) of the American Psychiatric Association. Originally listed as a "sociopathic personality disturbance" in the first edition of DSM in 1953, homosexuality was "upgraded" to a mere "sexual deviation" in 1968 with the release of DSM-II.
In 1973, when homosexuality was removed from DSM-II, there was a great deal of controversy about that decision in the psychiatric community. Many psychiatrists and psychologists still believed that homosexuality was a psychopathology which must invariably cause impairment and distress. Others recognized that the impairment and distress often seen by clinicians were a byproduct of stigma and social repression of homosexuals. This group argued that the pathologization of homosexuality in the DSM was a form of social control that itself contributed to the social stigma and to the harm it did. See DSM-II_Homosexuality_Revision.pdf
The famous decision did not come about as a result of a lengthy professional debate on the scientific merits. It happened in an important national political context -- the Watergate Affair -- and revelations surrounding Nixon's "Enemies List" and his conduct of the Vietnam War. This was an era in which much of academia was very loathe to be seen as authoritarian, and very sensitive to charges of political complicity in upholding the cultural status quo. This was the heyday of "humanist psychology" and of second wave feminism. The "backlash" of "angry white men" was still a gleam in the Koch brothers' eyes.
This anti-authoritarian atmosphere undoubtedly contributed to the willingness of the head of the APA to "do the right thing" and remove homosexuality from the DSM. His decision occurred immediately before the actual vote, and as a result of being taken into a room in which many psychiatrists he knew personally were present and came out to him as homosexual. Thus, this major change in the legal status of homosexuals turned on a knife edge and actually had nothing to do with "scientific evidence". The issue had never been about "science", only about political prejudice posturing as "science". The fear that the APA would be stigmatized as an "establishment institution" was the primary driving factor behind the change in the DSM.
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Today, transsexualism is still listed as a mental illness in DSM (DSM-IV-TR 302.85 "Gender Identity Disorder" or GID) . But recent years have not been times of challenge to authoritarians... on the contrary, in the past few years very prominent psychologists have done DOD "research" on torture methods at Gitmo and even now still hold multi-million dollar DOD contracts to continue such research. This is not 1973. Supporting authoritarianism and oppression of minorities does not make one an intellectual pariah today, as it did in 1973, when liberalism was still the considered the norm for educated people.
At present the committee responsible for deciding whether transsexuality is retained in the next edition of DSM is headed by a psychologist -- Kenneth Zucker -- who practices NARTH-style reparatist therapy on transkids, and has supported state interventions to take custody of transkids away from parents who were allowing them to live in the chosen gender. The committee is also stuffed with like-minded friends of Zucker. The chances of transsexuality being removed from the next edition of DSM seem very small at the moment.
I believe that if the decision to remove homosexuality from DSM were being taken today, by these people, it would remain an official mental illness. But they don't have that choice. They only have TG people -- and this time they intend not to lose their power over a stigmatized group.
I should mention that some in the Canadan trans community fear that if GID is delisted, their national health care may no longer cover transition costs. For US trans people, there is no national health care and our insurance almost never pays a dime. We are expected to pay all costs out of pocket, and must also bear the stigma of a diagnosis of a psychosexual mental illness in the same category as child molestation. This stigma makes it effectively impossible for us to work in K-12 education, for example.
Links:
Gender Identity Disorder Reform
Transition Issues
Trans News Updates
(Scroll down a bit to read the "Special Summary News Section: Zucker's role in the pathologization of gender variance")
