And yet today, some prominent thinkers are telling a different story: Capitalism is dead. It’s a contention that’s explicit in the subtitle of Yanis Varoufakis’s bold new book, “The drumbeat of eulogies for capitalism — such as the media theorist McKenzie Wark’s “Capital Is Dead: Is This Something Worse?,” an important interlocutor for Varoufakis — all point to the emergence of Big Tech as a breaking point in the story that goes back to the Industrial Revolution. The giant tech companies — Amazon, Apple, Meta, Alphabet and Microsoft, along with Baidu, Tencent and Alibaba — are not participants in markets so much as they are markets themselves. (Amazon founder Jeff Bezos owns The Washington Post.) These platforms sell goods or host ads only as a secondary feature. Their primary function, according to a growing chorus that includes Varoufakis, is to extract rent.
But stagnation, for Varoufakis, would be the least of our problems. He describes the replacement of traditional capital by what he calls “cloud capital,” which no longer focuses on growth, value and profit, but instead on rent extraction and control. The “cloudalists” are the new capitalist bosses, and their influence extends far beyond the workplace to nearly every facet of your app-powered daily life. According to Varoufakis, when we are the product — as we are when our clicks and searches generate profit for massive corporations, when our data is bought and sold — we’ve gone over from the relative freedoms of capitalism to technofeudalism, in which those who control the platforms have direct control over the rest of us, reducing us to the station of “cloud serfs.”
In other words, the rise of Big Tech is not just, as some have called it, the Fourth Industrial Revolution. It is the end of the agreement that dissolved feudalism, from which grew both capitalism and democracy. Capitalism, as Marx pointed out, freed workers by dissolving the bonds of feudalism. The vassal who labored for a lord was bound to that lord and his land. By contrast, capitalist workers were free to exchange work for money, and “free” to starve if they did not. Contrast this to the positive freedoms of democracy: Varoufakis suggests that our digital world effectively destroys these and wipes away the beating heart of capitalism with them. Cloud capital, he tells his firmly Marxist father, creates a mirage that looks like capitalism. But what seems like profit, and what seems like work, in the cloud, is really rent and a new, high-tech form of serfdom.
It’s hard to read this book and deny its power. Cloud-based workers routinely see their accounts suspended, often for reasons that have nothing to do with their own labor — as was the case when platforms pulled out of Russia in 2022 — or even without explanation at all. Varoufakis describes such developments as “sanitised tech-terror.” When work shifts to the cloud, people’s very ability to survive depends on access to platforms, much as it once relied on a lord’s fields. If you’re in the cloud “fief,” you play by its rules, and whatever value is generated goes disproportionately to its lord. If you’re banished from the territory, good luck.
This technofeudalism is global, and Varoufakis provides a compelling — if chilling — account of the emerging “new Cold War” between U.S. and Chinese “cloud fiefs.” He sees the coming finance wars as a result of state-cloud cooperations that simply cannot be defined as “capitalist” in any traditional sense. But is this right? Should we really give up on thinking of global economics as specifically “capitalist”?
I’m not convinced. Capitalism isn’t a rigid formula, and the freedom it promises has always been precarious. Marxists have long thought about the problem of what happens outside the factory — and about our cultural values, our daily lives, as they relate to capitalism. Marx himself suggested that capital’s “subsumption” of labor gave everyday life an illusory quality in which it seemed as though commodities were more real than the humans who made them. Digital technologies firmly connect everyday life to capital, changing what it means to be “free” in a state of constant, for-profit tracking. Maybe the question is not whether capitalism can survive the cloud but whether freedom can.
Throughout the book, Varoufakis’s ventriloquized father asks him, in effect: But isn’t this just more capitalism? Varoufakis insists it is not, but I tended to side with his father as I read. Maybe Marxists are simply struggling to articulate what a truly global capitalism looks like, one enabled by the same digital technologies that track and surveil. What is truly valuable in that global economy is obscured by the massive algorithmic machinery that crunches numbers for finance and international trade, obscuring the human problem of what we want and what we need. But that very opacity is what Marx called the “value-form,” the way that “the economy” becomes an abstraction, rather than something humans do. This problem is worse than ever, and to the extent that it is a crucial part of capitalism, we still very much live under the umbrella of that label. The main virtue of Varoufakis’s book is that it poses the problem of global digitally mediated value. This by itself is illuminating, whether we adopt the term “technofeudalism” or not.
