dismallyOriented

last week's reading was Technofeudalism by Yanis Varoufakis; this book is interesting primarily because it is Varoufakis' attempt to put to paper a unified theory of the economic system he thinks is currently replacing (or perhaps has already replaced) capitalism. this is the much-talked-about "technofeudalism," through which (to simplify) cloud capital¹ is used to create cloud proles ("waged workers driven to their physical limits by cloud-based algorithms") and cloud serfs ("persons unattached to any corporation (i.e. non-workers) [who] choose to labour long and often hard, for free, to reproduce cloud capital’s stock, e.g. with posts, videos, photos, reviews and lots of clicking that makes digital platforms more attractive to others.") who are forced to partake in the cloud fiefs that enrichen cloudalists.

now, i will say i am in agreement with Varoufakis and his description of a change in the economic system; technofeudalism is obviously real, manifested most prominently in the large-scale transition to a digital rentier economy, and it is innately linked to things like enshittification. i diverge from Varoufakis here though. i think he does not make an especially compelling case in attempting to distinguish technofeudalism as a wholly distinct economic system that has eaten capitalism from the inside-out. when, for example, he describes the form of Amazon at length—

Imagine the following scene straight out of the science-fiction storybook. You are beamed into a town full of people going about their business, trading in gadgets, clothes, shoes, books, songs, games and movies. At first, everything looks normal. Until you begin to notice something odd. It turns out that all the shops, indeed every building, belong to a chap called Jeff. He may not own the factories that produce the stuff sold in his shops but he owns an algorithm that takes a cut for each sale and he gets to decide what can be sold and what cannot.

If that were all, the scene would evoke an old Western in which a lonesome cowboy rides into town to discover that a podgy strongman owns the saloon bar, the grocery store, the post office, the railway, the bank and, naturally, the sheriff. Except that isn’t all. Jeff owns more than the shops and the public buildings. He also owns the dirt you walk on, the bench you sit on, even the air you breathe. In fact, in this weird town everything you see (and don’t see) is regulated by Jeff’s algorithm: you and I may be walking next to each other, our eyes trained in the same direction, but the view provided to us by the algorithm is entirely bespoke, carefully curated according to Jeff’s priorities. Everyone navigating their way around amazon.com – except Jeff – is wandering in algorithmically constructed isolation.

This is no market town. It is not even some form of hyper-capitalist digital market. Even the ugliest of markets are meeting places where people can interact and exchange information reasonably freely. In fact, it’s even worse than a totally monopolised market – there, at least, the buyers can talk to each other, form associations, perhaps organise a consumer boycott to force the monopolist to reduce a price or to improve a quality. Not so in Jeff’s realm, where everything and everyone is intermediated not by the disinterested invisible hand of the market but by an algorithm that works for Jeff’s bottom line and dances exclusively to his tune.

—i personally find it hard to believe that what is described is a new economic system rather than the logical, morphological conclusion of an omnipresent capitalist monopoly/oligopoly. in other words, i think that technofeudalism is primarily describing an inevitable outcome of the hyper-consolidated capitalist economy that we currently live under, particularly as separation between our digital and physical existence blurs.

probably the easiest way to illustrate my contention is to ask yourself one question, which is: doesn't it just obviously make sense for a monopoly (or oligopoly) under capitalism to establish a rentier relationship with its consumers as the next incremental step in maximizing profits? the very nature of a monopoly (or oligopoly) is that there is no real freedom of choice; either you consume a commodity or product on the terms of the monopoly providing it or you do without it—effectively the ideal leverage needed to create a rentier relationship where one did not previously exist. to say that the modern economy is rife with leverage of this sort over consumers is also putting it lightly: avoiding the rentier monopolies and oligopolies is not a particularly serious option when they operate most of the internet's digital scaffolding, facilitate most of the internet's traffic, and mediate most of the internet's commerce. (even Varoufakis recognizes consumer withdrawal as an untenable option in most cases.)

this behavior does not seem new

my contention might prompt a question like why this did not occur previously—or at least did not occur unambiguously—in the prior history of capitalism. i cannot claim absolute knowledge on this subject, but the capability to do this seems like it would be a function of globalization and corporate consolidation more than anything. i suspect that pre-Information Age capitalists were prevented from such things because they generally lacked the kind of infrastructural omnipresence major corporations have today; they also had, in many cases, stronger regulatory and political headwinds to contend with; and in some cases they also simply had too many serious competitors to realistically implement the kinds of at-scale rentier economies which now permeate our daily lives.

it is also true, though, that in some pre-Information Age cases capitalists did still have one or more of these dynamics working in their favor—and they often demonstrated an orientation toward rentier relationships as such (just on a smaller scale versus today). company towns and company stores—although not exact matches to what is taking place here—were one such reasonably widespread example; these institutions, which persisted until the proliferation of the automobile and the decline of industrial paternalism, often gave corporations extremely direct and extractivist power over the lives and labor of their employees. at the larger scale, AT&T's long-held Bell System vertical monopoly also supports the belief that a rentier relationship is the next logical step for any sufficiently entrenched monopoly (or oligopoly). beyond the structure of the Bell System (which obliged its operating companies to pay a "license contract" of up to 2.5% of their gross annual revenues to AT&T, plus cash dividends, in exchange for AT&T's services), AT&T was alleged by the Antitrust Subcommittee of the House to have

forced competitors “engaged in the rendition of telephone service to acquire AT&T patent license under threat of (...) patent infringement suits,” or refused “to issue patent licenses except on condition” to be able to control the telephone manufacturer or by “refusing to authorize the manufacture (...) of telephones (...) under patents controlled by (...) the Bell System” or by “refusing to make available to the telegraphy industry the basic patents on the vacuum tube” that are essential for telegraphy to compete with telephone or by refusing to purchase equipment “under patents which are not controlled by Western or AT&T, which are known to be superior”

this was fairly straightforward attempt to make a rentier relationship out of AT&T business partners and consumers, if you ask me. (the behavior was also, as an aside, instrumental in justifying the 1956 consent decree that limited AT&T's monopoly to a maximum of 85% of the US telephone network, obliged it to divest its holdings in other countries, and made all of its patents royalty-free.)

where i think Varoufakis gets his wires crossed

if i had to guess what part of Varoufakis' analysis steers him toward a conclusion i don't agree with, it would be in making the following assertion:

[...]a commodity is a thing or service produced to be sold for profit. Search results are not produced to be sold. Alexa and Siri do not answer our questions for a fee. Like Facebook, Twitter, TikTok, Instagram, YouTube, WhatsApp, their purpose is entirely different: to capture and modify our attention.

Varoufakis uses this assertion to advance the conclusion that "[...]this power over our attention that allows them to collect cloud rent from the vassal capitalists who are in the old-fashioned business of selling their commodities. Ultimately, the cloudalist’s investment is aimed not at competing within a capitalist market but in getting us to exit capitalist markets altogether."

but i think this is—in several ways—a rather obvious misread. it is, for one, actually quite debatable whether search results—and data more generally—"are not produced to be sold;" but even if they aren't intended to, there is still exceptional market incentive to do so once that data has been collected, making any distinction an academic one. in the words of Richard Seymour, data is "one of the most profitable raw materials yet discovered [...] We write to the machine, it collects and aggregates our desires and fantasies, segments them by market and demographic and sells them back to us as a commodity experience." that data has such undeniable value gives meaning to that oft-repeated axiom, "If you're not paying for the product, you are the product." that data becomes profit when commodified is also, arguably, the very thing which gives rise to the regime of surveillance capitalism we increasingly live under.

there are also no shortage of other commodities to be considered: attention, as even Varoufakis notes in another section of the book, is also a commodity (albeit an abstract one) in a capitalist economy; it has, needless to say, become a dominant dynamic in the digitally-mediated attention economy. algorithms also commodify our everyday lives, our self-image, our person. virtually anything and everything in the digital space is at risk, at any point, of being turned into a commodity—because the system we live in, although increasingly unrecognizable from traditional Marxist descriptions of the economy, is still an essentially capitalist system defined by production for profit.

i suppose you could say my belief here, then, is one described by Murray Bookchin. in Social Ecology and Communalism (2006), he wrote that—

Capitalism is unquestionably the most dynamic society ever to appear in history. By definition, to be sure, it always remains a system of commodity exchange in which objects that are made for sale and profit pervade and mediate most human relations. Yet capitalism is also a highly mutable system, continually advancing the brutal maxim that whatever enterprise does not grow at the expense of its rivals must die. Hence “growth” and perpetual change become the very laws of life of capitalist existence. This means that capitalism never remains permanently in only one form; it must always transform the institutions that arise from its basic social relations.

—and this is what i think Varoufakis has failed to take into account in some way. the capitalist system was always bound to change with the Information Age, because the Information Age begat a wholly new set of social relations and mediums to mediate them; likewise, the financial system has never been a stable one, always mutating into new things that trailblaze new assets for speculation and profit. neither change means that we have left capitalism, though, it just means that capitalism has taken a new form—really, it's no more than the basic interaction of base and superstructure.

we are still governed by capitalists who want wealth, and their corporations which exist to make objects for sale and profit. companies like Uber still angle, fundamentally, to give a return on investment. as argued (rather convincingly, in my view) by Palo Alto author Malcolm Harris, there is a surprisingly direct throughline between the archconservative, anti-New Deal economic ideology of Herbert Hoover and the modern sentiments of Silicon Valley capitalists and their technology today. says Harris at one point, "Even Silicon Valley’s liberals worship [Friedrich] Hayek"—Hayek being one of the cadre of capitalist thinkers promoted by the Hooverites in their war against liberalism and the social safety net. (Milton Friedman is another.) technofeudalism seems, to me, a noteworthy new development but fundamentally more of the same capitalist ideology.

notes

¹ defined by Varoufakis as

[...]the agglomeration of networked machinery, software, AI-driven algorithms and communications’ hardware criss-crossing the whole planet and performing a wide variety of tasks such as inciting billons of non-waged people (cloud serfs) to work for free (and often unconsciously) at replenishing cloud capital’s own stock; or helping us switch off the lights while recommending to us books, films and holidays, etc., so impressively in tune with our interests that we become predisposed to other goods sold on cloud fiefs or platforms (e.g. Amazon.com), which are running on exactly the same digital network that helps us switch off the lights while recommending to us books, films and holidays, etc.; or utilising AI and Big Data to command workers’ labour (cloud proles) on the factory floor while driving the energy networks, the robots, the trucks, the automated production lines and the 3D printers that bypass conventional manufacturing