Yanis Varoufakis, Greece’s former Finance Minister and renowned academic and economist, has just completed a tour in Australia in conjunction with the release of his latest book “Technofeudalism: What killed Capitalism”.
Organised by the leading think tank, the Australia Institute, the speaking tour saw Varoufakis engage with audiences throughout Australia culminating with an address at the National Press Club in Canberra. He was also a guest on the ABC Q&A program.
Yanis Varoufakis did not disappoint with his forthrightness on issues of the day, ranging from his views on the ‘death’ of capitalism, Australia’s place in the world, the “New Cold War” (against China), the genocide in Gaza, and the rise of neo-fascism as a direct assault on democracy.
The rise of technofeudalism
The central thesis of his new book is that capitalism has in effect been replaced by what Varoufakis calls “technofeudalism” brought about by the rise of big tech companies controlled by latter-day robber barons - or “cloudalists” - who have amassed unbelievable wealth in the form of “cloud capital” through the incredible advances in digital technology. This mutated new form of capital has in effect killed capitalism.
According to Varoufakis, the major tech companies, including Microsoft, Apple, Amazon and Meta, have undreamt power and have effectively morphed into a new ruling class. The capitalisation of these ‘Magnificent Seven’ firms is larger than the capitalisation of every listed company in the United Kingdom, France, Japan, Canada and China taken together.”
Varoufakis cites Jeff Bezos’ Amazon as an exemplar of the new technofeudalist economy. Amazon’s algorithm knows you better than you know yourself and the outspoken Greek-Australian economist invites us to consider the six things that cloud capital does all at once:
1. It grabs our attention.
2. It manufactures our desires.
3. It sells to us, directly, outside any actual markets, that which will satiate the desires it made us have.
4. It drives and monitors waged labour inside the workplaces.
5. It elicits massive free labour from us, its “cloud-serfs”.
6.It provides the potential of blending seamlessly all that with free, digital payments.
The result is a cloud capital fiefdom made of digital algorithmic capital which literally lives inside your phone and your laptop.
Machine networks, commonly known as the cloud, have created a kind of feedback loop that removes individual agency: we train the algorithm to find what we like and then the algorithm trains us to like what it offers. In other words, automated behaviour modification.
In short, according to Varoufakis, we have become cloud serfs, or unpaid producers of data, which disproportionately benefits these “digital overlords”. And we are sustaining them whenever we post reviews, rate products, upload videos, rants, photos, and so on.
A new twist to “surfing” (serfing) the net, perhaps?
Australia’s Involvement in the 'New Cold War'
Varoufakis railed against what he described as a new Cold War between the United States and China into which Australia has been dragged. And why? Because there are only two countries in the world that have cloud capital, America and China, and the United States establishment recognises that Chinese cloud capital presents a "clear and present danger" to its hegemony because capital flows have increasingly been migrating to the Chinese digital payment system, even from Europe.
The world, according to Varoufakis, is witnessing a fundamental clash between two techno-feudal systems, one denominated in US dollars, the other in Chinses yuan.
After the GFC and right up to 2023, the central banks printed an estimated US$35 billion (in the form of 'quantitative easing') and some 90% of that money made its way into big tech companies such as Mark Zuckerberg's Facebook (now Meta).
But Australia, and Europe for that matter, can no longer afford to be complacent.
In Australia's case, Varoufakis cautions that we are facing a common predicament, a "creeping irrelevance" due in large part to the fact that we have invested far too little for far too long and, secondly, because Australia has been content to go along in an "unconsidered slide from strategic dependence on the United States to a non-strategic, self-defeating servility to Washington’s agenda".
The Impact on Australian Democracy
Yanis Varoufakis bemoaned the rise of the far right or what he described as “neo fascists”, however you want to describe the likes of Trump, Le Pen, or those behind Advance Australia, who in his words are “quick-marching humanity to climate catastrophe and to social decay”.
Self-deprecatingly, he reminds his audience that he is mostly known as that “failed finance minister of the most bankrupt state in Europe”, a reference to Greece’s parlous debt condition during the Global Financial Crisis and its prolonged negotiations for a 'moratorium' from lenders.
But that also needs to be kept in a proper perspective. As the former Greek politician explains, he was elected in 2015 following a catastrophic, cataclysmic collapse not just of Greece but the whole of the European Union’s banking sector, leading to a domino effect with Greece simply being the "canary in the mine".
The sight of a leather-jacketed Varoufakis greeting his then British counterpart, George Osborne, in Downing Street is one for the ages although the two have since sparred over the issue of the return of the Parthenon Sculptures now that Osborne is the Chair of the Trustees of the British Museum.
But Varoufakis also reminds his audience of the somberness of the occasion when he told the German Finance Minister, Wolfgang Schäuble, that they were both democrats and both believed in the Enlightenment and, yet, austerity would lead to fascism.
In the case of Greece, Varoufakis fears that that is turning out to be the case, noting that the big winners in the most recent Greek elections were The Spartans, who are the mutation of Golden Dawn, the banned Greek neo-Nazi party, as well as the parties known as The Greek Solution and Niki (or Victory). After all, it’s in the names.
Genocide in Gaza
Varoufakis also poignantly spoke of the dire situation in Gaza.
He urged that Australia must first restore its international reputation of blindly following America into lethal adventures in Afghanistan and Iraq and now its “active and crucial complicity” in Israel’s deliberate war crimes in Gaza, East Jerusalem and the West Bank.
On several occasions, Varoufakis was asked to comment about the refugee crisis in Gaza and the suspension of funding to the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA). His response was pointed:
“Children are not starving in Gaza today, they are being deliberately starved without hesitation and without remorse. The famine in Gaza is not collateral damage, it is intentional policy the purpose of which is to defeat a population and ultimately to root them out of that land by lending credence to the notion that Israel is exercising the right of self-defence and by defunding on the basis of an unsubstantiated allegation the only agency that can ameliorate the starvation in Gaza. Australia has damaged its already wounded reputation.”
That Australia has now belatedly announced the resumption of funding to UNRWA may be seen as vindication of the criticism it received but as Varoufakis told his audience at the National Press Club the reversing of the decision to withdraw the UN relief agency funding would be a case of "too little, too late for the Australian government".
Yanis Varoufakis is a provocative thinker and speaker. The Greek City Times team was delighted to catch up with Yanis at the sold-out event at the State Library in Sydney. The queue that formed after the presentation to get their copy of his latest book signed was evidence that Yanis Varoufakis remains an influential and respected commentator.
Whether capitalism as we know it is dead, or dying, may be controversial but Yanis Varoufakis' latest book is a timely reminder of the existential dangers the world is confronting.
Postcript: Lost in AI Translation
In researching this op-ed I came across two articles from reputable sources where the words attributed to Yanis Varoufakis were hilariously lost in translation, in what perhaps could also be described as the “death of semantics in the cloud”.
In discussing the dire situation in Ukraine, the AAP news service dutifully reported Varoufakis inviting us to imagine an Australia “that helps bring a chess piece in Ukraine as opposed to a mindless forever war that is going nowhere."
Yes, there may be a stalemate on the ground and neither side is close to a proverbial checkmate (if we are to use chess analogies). However, Varoufakis was actually imploring Australia to use its best efforts to achieve a "just peace" in the Russo-Ukrainian war.
And then, according to the Australian Financial Review, Varoufakis lamented that Australia has allowed itself to slide from strategic dependence on the United States to a non-strategic, self-defeating civility to Washington’s agenda.
Civility? No. The controversial economist is actually having a dig at our cringeworthy servility to the USA. After all, strategic geopolitical considerations are not shaped by politeness.
George Vardas is the Arts and Culture Editor.
