Is capitalism dead? Yanis Varoufakis: Capitalists are now subservient to “technological feudal lords”

“He was briefly the Greek finance minister in 2015,” recalls Greek economist/politician Yanis Varoufakis. conversation. Now his new book asks the question: “What killed capitalism,” with the first word in the title providing the answer.

“Technological feudalism.”

Varoufakis argues that we no longer live in a capitalist society… “Today, capitalist relations remain intact, but techno-feudal relations are beginning to overtake them,” Varoufakis writes. He suggests that traditional capitalists have become “subordinate capitalists.” They are dependent on and dependent on a new breed of “masters” – Big Tech – who are generating vast fortunes through new digital platforms. A new form of algorithmic capital has developed – what Varoufakis calls “cloud capital” – and it is displacing “the pillars of capitalism: markets and profits.”

Markets have been “replaced by digital trading platforms that look like markets, but are not.” The moment you enter amazon.com, you are “out of capitalism” and into something of a “feudal feudalism”: a digital world that belongs to one man and his algorithm, which determines which products you will see and which products you will not. If you are a seller, the platform will determine how you can sell and which customers you can communicate with. The terms by which you interact, share information, and trade are dictated by an “algorithm” that “works for Jeff Bezos’ bottom line”…

Access to “digital fiefdom” comes at the cost of exorbitant rents. Varoufakis points out that many third-party developers in the Apple Store, for example, pay 30% “on all their revenue,” while Amazon charges its sellers “35% of revenue.” He argues that this is like a medieval feudal lord sending a sheriff to collect a large portion of the produce of his serfs because he owns the estate and everything within it.

“There is no invisible hand of the market” here. Big tech platforms are exempt from free market competition.

Meanwhile, users are training their algorithms for them without their knowledge – so “in this interaction, we are all high-tech ‘cloud serfs’… (T)he ‘cloud capital’ we generate for them is growing all the time.” Their ability to generate more wealth, and thus increase their power, is something we are only beginning to realize.
Nearly 80% of the income of traditional capitalist conglomerates goes to salaries and wages, according to Varoufakis, while Big Tech workers, in contrast, collect “less than 1% of their companies’ revenues”… For Varoufakis, we are not just making a living. Under a technological revolution, but an economic revolution driven by technology. It challenges us to come to terms with what has happened to our economies—and our societies—in the age of Big Tech and Big Finance.
Thanks to Slashdot reader ZipNada for sharing the article.