Original

Is capitalism dead? Greek economist Yanis Varoufakis thinks it is, and he knows who killed it — phys.org — 9 November 2023 (LINK)

Edited version

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The article argues that owners of the new digital trading platforms are able to charge exorbitant rents (30-35%) for access. "This is not extracting profit through the production or provision of goods and services, as these platforms are not a "service" in the sense in which the term is used in economics. They are extracting rents in the form of the huge cuts they take from the capitalists on their platforms. The Big Tech platforms are exempted from free-market competition."

The article also discusses how our unpaid labor contributes to the wealth and power of the new ruling class through our use of cloud-linked devices.

"Every time we use our cloud-linked devices [...] all of us contribute to 'the wealth and power of the new ruling class' through our 'unpaid labor.' We train their algorithms, which train us, to train them, and so on, in a feedback loop whose goal is to shape our desires and behavior. They are 'selling things to us while selling our attention to others'."

"Approximately 80% of the income of traditional capitalist conglomerates go to salaries and wages, according to Varoufakis, while Big Tech's workers, in contrast, collect 'less than 1% of their firms' revenues'.

Among his proposals, also made earlier: "ending the cloudalists faux 'free service' model and replacing it with a universal micro-payment model, instituting a Bill of Digital Rights, and using digital technology to 'democratize companies' (with decisions being taken collectively by 'employee-shareholders')."

AI version (LEO)

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The article discusses how capitalism has evolved into a technologically advanced form of feudalism, where traditional capitalists have become vassal capitalists and Big Tech companies have become the new lords.

The article argues that the 2008 Global Financial Crisis (GFC) and quantitative easing measures have contributed to the rise of cloud capital and the emergence of a new ruling class. The author, Yanis Varoufakis, argues that we are now in a post-capitalist society where markets have been replaced by digital trading platforms and profit has been replaced by cloud capital as the fuel that drives the global economy.

The article also discusses how our unpaid labor contributes to the wealth and power of the new ruling class through our use of cloud-linked devices.

ChatGPT version 1 May 2025

In his book Technofeudalism: What Killed Capitalism, economist and former Greek finance minister Yanis Varoufakis argues that capitalism has been supplanted by a new system he terms "technofeudalism." He posits that traditional capitalist structures—centered on markets and profit generation—have been overtaken by digital platforms dominated by Big Tech companies, which he likens to modern-day feudal lords.

Varoufakis introduces the concept of "cloud capital," referring to algorithm-driven platforms like Amazon and Apple's App Store. These platforms control access to digital marketplaces, dictating terms for sellers and extracting substantial fees—up to 30–35% of revenues — akin to feudal rents. Traditional capitalists become "vassal capitalists," reliant on these platforms for market access, while consumers and users contribute unpaid labor by interacting with these systems, thereby enhancing the platforms' algorithms and reinforcing their dominance.

He traces the rise of technofeudalism to the aftermath of the 2008 financial crisis, highlighting how quantitative easing and austerity measures funneled wealth into Big Tech, decoupling financial markets from the real economy. This shift has led to increased wealth concentration, weakened democratic institutions, and a new form of economic hierarchy.

Varoufakis concludes that recognizing and understanding this transformation is crucial for reclaiming democratic control and addressing the challenges posed by this new economic order.

ChatGPT version 2 May 2025

In the article "Is capitalism dead? Economics professor thinks it is, and he knows who killed it" published on Phys.org, economist and former Greek finance minister Yanis Varoufakis argues that capitalism has been supplanted by a new system he terms "technofeudalism." This concept is detailed in his book Technofeudalism: What Killed Capitalism.

Varoufakis contends that traditional capitalism—characterized by markets and profit-driven enterprises—has been overtaken by a system dominated by digital platforms and Big Tech companies. In this new order, these tech giants act as "digital lords," controlling access to online marketplaces and extracting rents from businesses that depend on their platforms. For instance, developers on Apple's App Store may pay up to 30% of their revenues, while Amazon sellers might surrender 35%, akin to feudal dues.

He further explains that these platforms have replaced open markets with controlled digital environments where algorithms dictate visibility and terms of trade. Businesses operating within these ecosystems become "vassal capitalists," subject to the rules and whims of the platform owners. Non-compliance can result in exclusion from these vital digital spaces, jeopardizing their operations.

Varoufakis's thesis suggests that the rise of "cloud capital" and algorithmic control marks a departure from capitalist principles, ushering in a modern form of feudalism where power is concentrated in the hands of a few tech conglomerates.

For a more in-depth exploration of Varoufakis's perspective, you can read the full article here