The techno-feudal economy

    Yanis Varoufakis is best known for his short stint as Greek finance minister in 2015 during a stand-off with the European Central Bank, the International Monetary Fund and the European Commission. He’s used that platform to speak out about capitalism and publish several books.

    This interview with EL PAÍS is interesting in terms of his analysis of our having moved beyond capitalism to what he calls ‘technofeudalism’. Varoufakis believes that this new economic order has emerged due to the privatisation of the internet and the response to the 2008 financial crisis. Politicians have lost power over large corporations and the system that has emerged is, he believes, incompatible with social democracy and feminism.

    Capitalism is now dead. It has been replaced by the techno-feudal economy and a new order. At the heart of my thesis, there’s an irony that may sound confusing at first, but it’s made clear in the book (Technofeudalism: What Killed Capitalism). What’s killing capitalism is capitalism itself. Not the capital we’ve known since the dawn of the industrial age. But a new form, a mutation, that’s been growing over the last two decades. It’s much more powerful than its predecessor, which — like a stupid and overzealous virus — has killed its host. And why has this occurred? Due to two main causes: the privatization of the internet by the United States, but also the large Chinese technology companies. Along with the way in which Western governments and central banks responded to the great financial crisis of 2008.

    Varoufakis’ latest book warns of the impossibility of social democracy today, as well as the false promises made by the crypto world. “Behind the crypto aristocracy, the only true beneficiaries of these technologies have been the very institutions these crypto evangelists were supposed to want to overthrow: Wall Street and the Big Tech conglomerates.” For example, in Technofeudalism, the economist writes: “JPMorgan and Microsoft have recently joined forces to run a ‘blockchain consortium,’ based on Microsoft data centers, with the goal of increasing their power in financial services.”


    Capitalism only brings enormous, terrible burdens. One is the exploitation of women. The only way women can prosper is at the expense of other women. No, in the end — and in practice — feminism and democratic capitalism are incompatible.

    Source: Yanis Varoufakis: ‘Capitalism is dead. The new order is a techno-feudal economy’ | EL PAÍS

    Dark Tech and Project Cybersyn

    I read Evgeny Morozov’s book To Save Everything, Click Here a few years ago and found it frustrating. It’s about the “folly of technological solutionism” so, while I agreed with the broad argument, I thought he presented it in an annoying way.

    Here, Morozov is interviewed about his podcast The Santiago Boys, which explores into Project Cybersyn, an ambitious project from 1971 to 1973 under Salvador Allende’s Chilean government. The project aimed to use cybernetics to efficiently manage state-owned enterprises but faced various internal and external challenges, including U.S. interference and internal political tensions.

    What’s useful in this interview is the discussion of “dark tech,” highlighting the technological vulnerabilities and challenges faced by socialist projects like this. Morozov argues that the legacy of Project Cybersyn offers valuable lessons for contemporary discussions on socialism, technology, and governance. He emphasises the need for technological sovereignty and a nuanced approach to management and planning. So yes, we could learn a thing or two.

    Nick Serpe: What was Project Cybersyn?

    Evgeny Morozov: Project Cybersyn—short for “cybernetic synergy”—aimed to aid the Chilean state in managing the enterprises being nationalized by the Unidad Popular government. A significant hurdle was the lack of sufficient managerial staff to oversee them. Allende’s opponents, including the U.S. ambassador, were making things even harder by encouraging managers and other professionals to flee the country.

    As with most science and technology projects, the path toward Cybersyn was not linear. It didn’t emerge as a culmination of some strategic plan to use computers in management; the whole process was more chaotic—and even its name came at a later stage. It all started with an effort to bring some external expertise to Chile. Fernando Flores, a high-ranking member of the Allende administration, felt that he needed help in dealing with all these nationalized companies. So he sought the guidance of the British management consultant Stafford Beer, even going to London to meet him. That encounter resulted in Beer agreeing to go to Chile. This collaboration eventually blossomed into what we now recognize as Project Cybersyn.


    In the end, Cybersyn was a tragedy—and a drama. This project started in an optimistic, even utopian political environment. The Santiago Boys worked off the assumption that Allende would be allowed to govern, and they would be able to build a different economy in Chile. These assumptions were quite unrealistic. If you know anything about how ITT, the CIA, local industrialists, the government of Brazil, and other forces were trying to prevent Allende from even coming to office, you would never think that such optimism was warranted—especially when Allende won the election with only one-third of the popular vote and relied on a very unstable coalition of six parties.

    Source: Liberty Machines and Dark Tech | Dissent Magazine

    Saying "I don't know" is a privilege

    Paul Graham is a smart guy. He’s a venture capitalist, and here he’s in conversation with Tyler Cowen, an economist. Both men are further to the right, politically, than me — so I winced a little at their references to the ‘far left’.

    That being said, it’s an interesting episode and Cowen’s rapid-fire questioning is a useful tactic for getting guests to be more candid than they would otherwise be. What I found fascinating about Graham’s responses was that he would often say “I don’t know” instead of the prosaic “that’s a great question”. I guess once you’ve got the standing he has, there’s no need for him to pretend otherwise.

    Tyler and Y Combinator co-founder Paul Graham sat down at his home in the English countryside to discuss what areas of talent judgment his co-founder and wife Jessica Livingston is better at, whether young founders have gotten rarer, whether he still takes a dim view of solo founders, how to 2x ambition in the developed world, on the minute past which a Y Combinator interviewer is unlikely to change their mind, what YC learned after rejecting companies, how he got over his fear of flying, Florentine history, why almost all good artists are underrated, what’s gone wrong in art, why new homes and neighborhoods are ugly, why he wants to visit the Dark Ages, why he’s optimistic about Britain and San Fransisco, the challenges of regulating AI, whether we’re underinvesting in high-cost interruption activities, walking, soundproofing, fame, and more.

    Source: Paul Graham on Ambition, Art, and Evaluating Talent (Ep. 186) | Conversations with Tyler

    The sleight of hand of crypto

    Cory Doctorow is doing the rounds for his new book at the moment. But because he’s Cory, he’s not just phoning it in, or parroting the same lines.

    Take this interview in Jacobin, for example. Yes, he’s talking about why he decided to write a story about crypto, but he’s so well informed about this stuff on a technical level that it’s a joy to read the way he explains things.

    There’s this kind of performative complexity in a lot of the wickedness in our world — things are made complex so they’ll be hard to understand. The pretense is they’re hard to understand because they’re intrinsically complex. And there’s a term in the finance sector for this, which is “MEGO:” My Eyes Glaze Over. It’s a trick.


    A lot of the crypto stuff starts with what a sleight-of-hand artist would do. “Alright, we know that cryptography works and can keep secrets and we know that money is just an agreement among people to treat something as valuable. What if we could use that secrecy when processing payments and in so doing prevent governments from interrupting payments?”

    After this setup, the con artist can get the mark to pick his or her poison: “It will stop big government from interfering with the free market” or “It will stop US hegemony from interdicting individuals who are hostile to American interests in other countries and allow them to make transactions” or “It will let you send money to dissident whistleblowers who are being blocked by Visa and American Express.” These are all applications that, depending on the mark’s political views, will affirm the rightness of the endeavor. The mark will think, that is a totally legitimate application.

    It starts with a sleight of hand because all the premises that the mark is agreeing with are actually only sort of right. It’s a first approximation of right and there are a lot of devils in the details. And understanding those details requires a pretty sophisticated technical understanding.

    Source: Cory Doctorow Explains Why Big Tech Is Making the Internet Terrible | Jacobin