Techno-Feudalism Feasts Upon Us All

What if the Marxists made a mistake? What if the inevitable transition point for Capitalism isn't socialism but feudalism? Yanis Varoufakis, one of the most influential modern economists, believes that this is the case, and his compelling argument is as chilling as it is necessary to hear.

Capitalism and feudalism, a brief history

Classical capitalist doctrine came about because of a recognized problem with feudal systems: the owner of a piece of land didn't need to do anything more than own that piece of land to extract rents from it. He could sit back in comfort, knowing that his inherited wealth would remain intact. For the capitalists, this complacency meant that feudalism was inherently anti-competitive. After all, what incentive did the feudal owner have to increase productivity, to better the state of his lands or his workers? What incentives to find novel technologies and systems would there be if the drive to compete were deadened by guaranteed rents paid out no matter what happened?

Capitalists wanted to do away with the feudal system, which they saw as inherently unjust, with a highly competitive system wherein only continuous improvement and progress could ensure the survival of one's enterprise. In the idealized version of this model, no business person would be able to sit by complacently. If you didn't treat your workers well enough, they could move to your competitor, who paid better. If you didn't invest in better methods of production, the competitor who did would beat you at your own game. In this ideal, even a totally new operator on the capitalist playing field could work his way to the top by being a passionate enough (and cunning enough) innovator.

Marxists saw inherent problems with the capitalist model, however. Capitalism, they argued, was inherently self-destructive, and inherently Imperialist. Capitalism could only continue to see "progress" for as long as it could continue to expand. This expansion would, at first, force capitalist societies to engage in resource wars with other capitalist powers, usually at the expense of people in poorer and less-developed countries. Eventually, so the Marxists argued, capitalism would eat its own tail, becoming a self-destructive ouroboros. And, much like that ancient symbol of the snake eating itself, the idea was that Capitalism's self-destruction would give way naturally to a new social plateau: socialism.

This is, by the way, explicitly what drives China's desire to grow its middle class. In a sense, China's route toward a Marxist socialist revolution is by artificially creating all the capitalist conditions necessary for true socialism to emerge.

But, what if capitalism doesn't have an inevitable end in socialism? What if the end of capitalism is just... more feudalism?

The death of capital; long live the king

Capitalism "is now dead," says Yanis Varoufakis, "It has been replaced by the techno-feudal economy and a new order" (Vega, 2023). "[We] are acting as ‘cloud-serfs’ — working as unpaid producers of data to disproportionately benefit our digital overlords" (Rose, 2023).

This is the same point Cory Doctorow makes in his wonderful essay for Locus Magazine, Capitalists Hate Capitalism. "Who wouldn’t want to get off the competitive treadmill? What capitalist wouldn’t love to stop watching over their shoulder for upstarts wait­ing to put them out of business?" (Doctorow, 2024).

The first capitalist philosophers saw capitalism as a golden field of endless competition, where societal improvements were made inevitable, and where kingpins could be unseated by any bright young mind that came along with enough gumption and wit to force a change. Marxists recognized that this would not improve inequality, that capitalism would lead to horrifying excess and the gross proliferation of Imperialism. But the predictions of the Marxist about what capitalism's downfall looks like aren't bearing fruit. That it will self-destruct is clear, but that what must emerge from that self-destruction is good, less so.

Varoufakis believes that we have reached a stage of "techno-feudalism," a state where new feudal lords exist in the form of massive and impenetrable technological monopolies that control every aspect of our lives (digitally and physically). These giants suck up rent from us in the same way that the old feudal lords used to, but with even less accountability and direct connection to the land.

"That’s why," Doctorow writes, "Warren Buffett has such a heroic priapism for investments with ‘‘moats and walls’’ that prevent other companies from competing with them" (Doctorow, 2024).

What he's talking about is how all modern businesses, and those in the tech sectors especially, try to function. Rather than fostering competition, modern business theory argues for the creation of walled and moated gardens: spheres of absolute control.

Think of it like the old "company stores" for coal mining towns. The mining company owns the town: the house you live in, the store you buy from, and the street between the two. They also pay you. This is the same idea Amazon is striving to achieve, and Google, and Apple. They will all fight one another at a meta-level - legal titans on a dark-mirror Olympus vying - but that type of competition isn't accessible to us, any more so than a feudal serf could expect to become the King of England.

As the anarchist researcher Michel Luc Bellemare writes, "we are fundamentally and inescapably immersed in granular trench-warfare against totalitarian-capitalism, i.e., techno-capitalist-feudalism," (2020, p. 10). Extending his argument against techno-capitalism to a rallying cry, Bellemare goes on to write:

"Indeed, this fragmented age is the age of postindustrial, post-modern totalitarian-capitalism, i.e., techno-capitalist-feudalism. The terminal stage of capitalist instrumental-rationality, wherein the iron cage of bourgeois-capitalism is total, devoid of exit or end. As a result, medieval-feudalism returns, redux, and refurbished high on capitalist accelerations and massive doses of methamphetamine, grinding down members of the general population, the 99 percent, into fine luxurious powders, snuff to the new royal-court of the global libertarian aristocracy, namely, the 1 percent."

Whichever way you look at it, things are not alright in modern society. Capitalism is remarkably efficient at producing unlivable conditions for the masses, while tricking us (Steven Pinker style) into believing we're living in the bestest time ever. And yet, I refuse to stand with the dour predictors of absolute nihilism; I refuse to accept either pole: things are not better than they have ever been, nor are they worse than it is possible to solve.

The key, I think, is a type of concerted unity: it is a coming together of a plurality of people across the world stage. It is the acceptance of human beings as human beings while rejecting false dichotomies that attempt to absolutely correlate people with what they believe. It is to settle into the Taoist view of the world: that change is inevitable, and that our goal must be alignment with the natural state of ourselves and our environments.

If these mega-corporations profit off our illnesses, let us find remedy in one another. If they seek to own the town, let us create new spaces to inhabit. If they build digital platforms with walls and guards, let us create new languages of interoperability that defy them and all they stand for.

Whatever we do, it must be done in the spirit of care, compassion, and the desire for self-transformation. But, perhaps I'll let Lao Tzu through Ursula K. Le Guin, wrap things up with Chapter 36 of the Tao Te Ching (p. 43).

What seeks to shrink
must first have grown;
what seeks weakness
surely was strong.
What seeks its ruin
must first have risen;
what seeks to take
has surely given.

This is called the small dark light:
the soft, the weak prevail
over the hard, the strong.

References

Bellemare, M. L. (2020). Techno Capitalist Feudalism. Blacksatin Publications Ltd.

Doctorow, C. (2024, March 4). Cory Doctorow: Capitalists Hate Capitalism. Locus Online. https://locusmag.com/2024/03/cory-doctorow-capitalists-hate-capitalism/

Le Guin, U. K., Laozi, & Seaton, J. P. (2019). Tao te ching: A book about the way and the power of the way. Shambhala.

Rose, E. (2023, November 4). Technofeudalism As Explained By Yanis Varoufakis. The Sanders Institute. https://sandersinstitute.org/technofeudalism-explained-with-yanis-varoufakis

Vega, M. Á. G. (2023, October 11). Yanis Varoufakis: ‘Capitalism is dead. The new order is a techno-feudal economy.’ EL PAÍS English. https://english.elpais.com/economy-and-business/2023-10-11/yanis-varoufakis-capitalism-is-dead-the-new-order-is-a-techno-feudal-economy.html