Technofeudalism: What Killed Capitalism

Format: Book
Author: Yanis Varoufakis
Label: Vintage
Year: 2023
Download here: Archive

"Ok boomer."

That was the response I got when I told my friends I don't use Spotify because I'm not for sale. I'm well aware I sound like a boomer when I say things like that. When I urge people to stay away from Spotify, Facebook, TikTok, Google and all the other tech giants. But I'm not saying it because I don't understand the platforms or that I'm afraid of change (like a boomer would). I'm saying it because I understand the platforms and want change. We're living in the age of technofeudalism and if we don't start paying attention, we're fucked beyond belief.

(Since the point of this review is to get you interested, not overwhelmed, by this topic I'll be bringig up just a few of the points in a general manner without further explanations. If you want to fact check and/or deepen your knowledge I'll have a link section at the end.)

In his book 'Technofeudalism: What killed capitalism' (2023), Yanis Varoufakis explains how capitalism slowly evolved and ultimately was replaced with what he calls technofeudalism (I've also seen proposals from others to use the term "data feudalism"). How "big tech became the world's feudal overlords – replacing capitalism with a fundamentally new system that enslaves our minds, destroys democracy and rewrited the rules of global power". He talks about why he wants to specifically call it technofeudalism, why it's important to differentiate it from capitalism (by not calling it, for example, cloud capitalism), how we got here and what to do about it going forward.

A photo of Yanis Varoufakis standing in front of a black curtain backdrop

In broad terms, it goes like this:

How technofeudalism came to be

Capitalism has since its very inception been facing the risks of its own economic brittleness. From the Great Depression (1929-1939), through the Nixon shock (1971) and the Global Financial Crisis (2007-2008) it's no surprice capitalism has been forced to evolve. With the arrival of the internet the opportunities for financiers and their banks to get away with increasingly shitty moves exploded. Through one economic crisis after another, with central banks printing trillions of dollars to save their beloved system rendering money devalued in the process, capitalism slowly but surely figured out new ways to commodify everything in their path, even people. What if people's attention could be capitalized on? And what if their behaviours could be modified to maximize profit? What if they, through their everyday actions, could be made to unwittingly work (as in beta testing, algorithm training, content production etc) for the very platforms they percieve as "free"?

"To use the personalised services their algorithms provide, we must submit to a business model based on the harvesting of our data, the tracking of our activity, the invisible curating of our content. Once we have submitted to this, the algorithm goes into the business of selling things to us while selling our attention to others. At that point something more profound kicks in which gives the algorithm's owners immense power – to predict our behaviours, to guide our preferences, to influence our decisions, to change our minds, to thereby reduce us to their unpaid servants, whose job is to provide our information, our attention, our identity and above all the patterns of behaviour that train their algorithms."
p. 78-79

The landscape today

Today we're not only controlled and capitalized on at our work places, we're owned and capitalized on in our private time as well. Our behaviours are constantly being modified by big tech through the various apps, storefronts and social media we statistically browse for several hours a day. We're being watched far more closely than we could ever imagine. In the name of data harvesting, mind you, not because they want to know about your kinks and secrets.

"I am less worried about what they know and far, far more worried about what they own."
p. 73

Democratic values are eroded through relentless desinformation, people growing up today succumb to mental illness because they are constantly made to convert their sense of self into a brand in a world where every last piece of one's identity is being owned by one company or another.

"And yet, astoundingly, our digital identity belongs neither to us nor to the state. Strewn across countless privately owned digital realms, it has many owners, none of whom is us: a private bank owns your ID codes and your entire purchasing record. Facebook is intimately familiar with whom – and what – you like. Twitter remembers every little thought that caught your attention, every opinion that you agreed with, that made you furious, that you lingered over idly before scrolling on. Apple and Google know better than you do what you watch, read, buy, whom you meet, when and where. Spotify owns a record of your musical preferences more complete than the one stored in your conscious memory. And behind them all are countless others, invisibly gathering, monitoring, sifting and trading your activity for information about you. With every day that passes, some cloud-based corporation, whose owners you will never care to know, owns another aspect of your identity."
p. 72-73

A medieval painting of five important figues, with their heads being different logos of big tech

Why this isn't just a modern variant of capitalism (such as, for example, "cloud capitalism")

Cloud capital is different from the capital found under traditional capitalism in several ways: The goods are produced at zero cost (content is created by the users). The incidiously predatory marketing happens automatically (the users are constantly being manipulated by the algorithms they themselves help train for free at all times). The fuel to the machine isn't profit, it's rent (even the richest of companies have to go through the digital channels which are in the true position power, your Googles, your Apples, your Amazons).

Big tech (in feudalism: fiefs) is collecting rent from companies (in feudalism: vassals). These companies are using, for example, algorithm controlled warehouse workers (in feudalism: proles). At the bottom we have us (in feudalism: serfs), voluntarily labouring for free. This is why technofeudalism is a proper word for it, because the structure is the same. It's not traditional markets directly run by the capitalists to produce and sell goods anymore, the hiearchy is instead pretty much identical to the one found in a feudal system.

The biggest modern catalysts

The pandemic, Biden's ban on chip exports to China and Putin's war against Ukraine is said to be the three largest catalysts into cloud capital in recent time. The pandemic because of obvious reasons, the ban and the war because... Well, the reason China has become the second out of the two largest players in this (the US being the other) is because The Dark Deal went sour. China no longer, understandably, wants to keep their end of the bargain where they, as with all other deals you do with the US, can't avoid automatically letting them get the upper hand. The US tried to put a stop to China's digital development by declaring a chip export ban (badly disguised as homeland security stuff) and China developed their own digital currency to not be completely dependent on the dollar and have every trade being piggy backed on by Wall Street (as is the case for the rest of the world). Their digital currency efforts didn't quite take off, however, until Putin invaded Ukraine. The US issued sanctions against Russia, including freezing their central bank assets, which made Russia turn to China to be able to avoid american middle men. Several other major capitalists got a wake up call when they saw how easy it is for the US to freeze assets in order to get what they want and explored opportunities to instead go the China route. So, in their attempt to stop China from developing their own cloud capital and then issuing sanctions towards Russia, the US instead inadvertently helped China boost their cloud capital and further the economic unrest and distrust internationally.

Medieval painting of serfs working under a vassal

How to resist

Since technofeudalism isn't made up of traditional markets it won't be possible for a state to break up the cloud capital. There's no use in putting a cap on price roofs since the services are already as cheap as they can be, or "free". Crypto currency, which has the potential to act as a democratized currency, has already been transformed into neo-liberal garbage that can't fill a single useful role in this matter (at this point). What is needed, then as in now, is to organize. But this time it isn't enough to merely organize the workers on the floors, today we need to organize large parts of the entire technofeudalism food chain to be able to make a difference. And one could say it's harder to unite workers and organize an uprising in a time where everyone is digitally isolated from each other, sure. But that same digital landscape provides far more useful tools for communication across borders and distances than ever before in history.

"As long as there is even the remotest chance of a successful cloud rebellion, then our only chance of achieving a good life […] is to hope and act without the slightest of guarantees."
p. 213

When reading this book, I sometimes caught myself falling in the same mental pits that I, as an anarchist, have grown to disdain in others. When Varoufakis brought up points about how we could get a lot more done online if we could freely use the internet as the decentralized horizontal platform it started out to be I found myself objecting to this sentiment in the same manner that people tend to object to the thought of an anarchist society. If the rulers of our entities didn't exist - how would they function at all? Every person can't be an expert in everything they want to achieve. I wasn't entertaining the possibility of such tools being present without moneymakers at the top, much like a lot of my political opponents aren't. But of course there are people willing to put in the effort in all sorts of areas. Open source projects and crowdfunding is happening everywhere online. People tend to help out when they can and many of the things we can do online today came about from unpaid voluntary work. It's just that the internet has become this walled off garden, a property owned by a few large companies in such a totalitarian way that it's beginning to be hard to imagine anything else at this point. And if that isn't the horrific wake-up call you need to start paying attention I don't know what is.