Yanis Varoufakis explains how big tech is economically dominating your life

Wall Street and big Tech and the city of London together on your identity you have to pay to use your own identity if we're going to defeat them and if we're going to turn this into a viable Society the global Society we must forget about taxing we must think in Old Marxist terms how do we take their Capital away from them this is not a viable system it's a system we live in We Are stampeding towards Oblivion Janice hello how are you very well good very happy to be here very happy to have you here um before we get into the subject matter today your book techno feudalism um I'd invite you to tell the audience who you are what you do in your own words well I used to be an academic that no one knew anything about because I I was cocooned in my University Office writing esoteric texts that maximum 20 people around the world cared for and I didn't mind until I started feeling in the early 2000s that the world is heading towards another 1929. discontinuating let's put it rightly and at that moment I thought that I don't have the right the moral right to carry on playing around with my mathematical models of Game Theory and I started writing fiery articles and books including the global Minotaur which became quite a significant text even if I'm saying so myself um it was a time when I was also shifting from Australia to my home country Greece which was always going to be Ground Zero of the European great financial crisis and at some point having opened my mouth once too often and written too many articles about it a young man who was leading the Greek opposition at the time this is nine 2010 11 12 13. at some point he invited me to become the Finance Minister if he were to win which I did and so you know from obscure mathematical texts I was elevated to becoming the Finance Minister of the most bankrupt state in Europe the world that lasted five six months because we had packed the Prime Minister and myself that we would never accept another bailout loan under conditions of crashing eighty percent of the population he decided that he wanted to surrender I decided I'm not going to surrender and that's it I resigned and then created my own party uh going from small victory to ground failure um writing books all the time as therapy so that's why okay perfect let's let's indulge them in another hour of therapy talking about this book um but we're going to get into the concepts in it we're going to go into it in detail but top line for people who are just here to begin with what's it about why is it important why should people read it we all feel in our bones that this crisis is never ending it is metamorphosizing taking different you know from a piece of deflation following prices and falling wages it went to a class of the cost of living crisis of inflation we know that there is something dismally wrong with the world that you know capitalism was always existing but produced crisis and new funding forms of poverty and depravity but what has been happening over the last 15 years excuse me um is unique we haven't experienced that since the 1770s 1780s this so the universal sense of angst that everybody shares including of course about the climate my view is that the reason why we're experiencing this is not that capitalism is going through another one of its normal crisis but rather we are at a turning point very much like the 1770s 1780s when there was a great transformation as Carl polani put it from feudalism to capitalism under feudalism power sprang out of the land anybody who owned land the land of gentry had power and it was all sorts of power packed in one political power economic power cultural power if you were you know there is there aristocracy or part of it you had it and you couldn't distinguish between political and economic power and the wealth came out of rent the rents that the aristocrats the landed generally charged vassals and peasants and so on and then there is this great shift from land to Machinery to Capital and from rent to profit through the commodification of land the commodification of Labor even though patients work very hard their labor was not accommodated they couldn't quit didn't receive a wage there was no labor market similarly for land there was no market for land yeah they had it we didn't have it and then everything was commodified so that was capitalism it starts here in this country and in Amsterdam uh around the end of the 18th century and it continues to this day now I mentioned before that Inc was in the 2000s that I I was feeling that some major crisis was coming and 2008 the city of London Wall Street Zone in my estimation created a Rapture in capitalism it wasn't anything like not even like 1929 it was even more substantial to that and for a number of years I was trying to think about what on Earth is happening and I came to the very controversial conclusion which is this book that in the same way that we shifted from feudalism to capitalism we're now shifting without realizing it to a new form of feudalism a very Advanced almost science fiction form of defeated this is why I call it techno Federalist but essentially with a new land which is a cloud and we have new a New London Gentry you can call them Cloud the list or you know the technical Lords the Lords of the cloud like Jeff Bezos just one example of Zuckerberg and power is shifting from the owners of Machinery of standard machines even industrial robots even Advanced Machinery to the owners of this network of machines that creates this digital version of land and just one last point to explain to our audience what I mean by that when you enter Amazon.com or Alibaba or one of those digital platforms people think that they enter a Marketplace they do not enter the marketplace they enter a digital system because come to think of it even though you buy yourself it's all mediated by an algorithm that belongs to one person who doesn't produce anything except for this landscape and how does bases make his billions if you produce a book or you know a bicycle or anything that you sell through Amazon.com he keeps 40 that's their rent suddenly we've gone from profit students but this time it's not rents that you charge for the use or the lease the leasing of land but the leasing of the cloud so I call them Cloud rents and the more I thought about that the more I convinced myself that this is a great transformation which is hugely important not theoretically but for me the idea of the liberal individual gone you know you can't you can only longer be a genuine liberal or even a Libertarian if I'm right social democracy gone because what was social democracy it was a kind of mediation between Industrial capital and organized labor gone because industrial Capital now is being exploited by the the those people they get 40 of whatever it is that they produce and no one is going to negotiate with their basis no one no government can make any group of workers uh sit down with Jeff Bezos or they can make Jeff business in plan with any group of workers and carry out a Social Democratic bargain or New Deal or whatever and also if you look at the clash between the United States and China why is this happening Taiwan is not the reason that one was always a problem National Securities of the reason my view is that what you have is two kinds two clouds victims clashing the American one based on Silicon Valley and Wall Street and the Chinese one Europe is non-existent because we don't have a cloud so anyway that's that's the whole story really and we'll drill down their details in the book perfect and we'll get into those details over the course of this conversation before we do get onto that subject matter I'd like to loiter around this point about the end of capitalism about what's killing capitalism and whether or not you know you mentioned 2008 2009 is it fair to say whether actually capital is the force that's causing capitalism to come to an end at the moment that's a great irony uh we use I'm look I'm a Marxist I'm a left-winger full disclosure folks right and I remain amongst and I think that this is a Marxist analysis I mean I'm there's even an appendix with a Marxist political economy take for nerds if you're a nerd Marxist and you want to look at what is the actual political Max political economy behind this book there's an appendix and you don't have to read it but it's there for you to you know to to tell people that you've read it yeah yeah of course so you know we I'm saying this because we of the left always imagine that we were brought to this Earth by chance and nature and whatever in order to overthrow capitalism that capitalism will be over thrown by the organized lift by the organized labor unions didn't happen we failed we are dismal abysmal failures no doubt about that right all of us yep um so what did the trick capital went through a historic mutation from a produced means of production because if you think about a fishing rod Dimension an industrial robot something we have produced in order to produce other stuff it's a produced means of production but Cloud capital is a produced means of behavior modification that's very different so effectively you've taken the if you remember Mad Men the wonderful television series and Don Draper right so you automate don't trip you turn him into Alexa and he does much more than simply put ideas to your mind as to what you want firstly it trains you to train it to train you to train it to input into your mind preferences and at the same time the moment you have that preference for something that need for some good it sells it to you by passing all markets in that sense capital ism so talk about this Amazon Alexa example a little bit more because this Cloud Capital idea is what underpins underpins techno feudalism right how does it differ from traditional Capital you covered it as a little bit and also how does it turn us the user if you like into the surface of feudalism past advertisers have always been in the business of indoctrinating us right of putting ideas of manufacturing Desires in our soul this is the major transformation transition from early capitalism to more advanced Monopoly capitalism after the second world war in the 19th century the capitalism that Adam Smith was talking about was all about you know producing bread and you know ale and meat and carriages and horse manure and stuff things that people needed through a market-based mechanism for Distributing productive resources uh and using the price mechanism in order to equilibrate demand and supply and all that that's before the war after the war you've got the big conglomerates in the United States primarily that emerged from the war economy these these huge immense productive capacity they can produce a lot more washing machines that American families wanted so they had to find markets outside and they needed they need to manufacture Desires in our in our soul for the things that they could produce because they could produce a lot more than what we needed so they had to convince us that we needed more than we needed and that's Von Draper that's advertising right but that was human beings it was a new profession the purpose of which was to convince you to buy stuff one-way Street Don Draper comes up with an idea wonderful poster on the motorway you see it you say I want that then you go and buy it still a very significant change back in the 50s 67s and so on today what you have is Alexa sitting on your desk or Siri on your phone or Google Assistant you know all those contraptions which present themselves as your saves so you said you know set the alarm clock for 10 35 order milk tell me a story play music you stream a video all those things so it's great I mean I I'm addicted to all those machines by any state of the imagination um but that's not what Alexa is Alexa is an interface with Cloud Capital belonging to one man or to a few men usually men um and what you do is you you give it information about yourself so you train it so that it knows you and then it starts giving you recommendations about books to read pieces of music to listen to frims to watch which are spot on I don't know about you but when Spotify recommends music it's usually music I like when Amazon recommends books it's always books I want to read it knows me yeah right which is very impressive and we are impressionable people so when Alexa recommends something to me day after in day out that I want at some point wouldn't you recommend something else I will want it or I will at least buy it and it will always be quite close not exactly what I would have selected a bit harder but quite close right so this is a two-way street this is an infinite regress I tell it things so that it can tell me things so I can tell things and therefore it acquires a great deal of power over my thinking and my preferences and my desires and my aspirations even and the most important thing here is that it is the same software the same mechanism not just software warehousing and all that that can actually send it to me directly by passing any capitalist the capitalist then becomes a vassal to that so this is the this is what is so different to Don Draper Don Draper could not sell you anything himself he could convince you to go into the shops and buy it uh and one final thing the reason why this Cloud capital in my book and in my mind is very different to very Advanced pieces of Technology like Rockets or industrial robots which are also very Advanced Contraptions but the great difference is that Capital until now required wage labor to be created so from the steam engines to the industrial robots today they were workers they are workers in factories together with machines and other robots and other pieces of produced means of production that actually build the stuff so you need a capitalist who employs labor machinery buildings electricity technology and Zone to produce the capital not amazon.com not Cloud Capital most of cloud capital is produced by me and you because you know that very well that why can't we compete with Elon musk's former Twitter X even if you and I were great coders and produced such a Network such a such a piece of software for short form debating which is much better than Twitter even if we did who will join it yeah all our followers are on Twitter X I can't say text yeah um so the capital of x is us and all our tweets amazon.com every time you buy something right or you like something or you upload a review of some book or some product you're adding to the Capital stock so we are creating the you know a large part of cloud Capital so Cloud capital is a new form of capital because of the way it reproduces itself it can reproduce itself using self-labor by people who don't even know themselves so that's why I call them called us Cloud serves because we do all this work even if we don't do anything just we have our phone on us and we are walking around London Google Maps knows where we are and that enriches its capacity it's Cloud capital for telling people whether it's congested and where they shouldn't go whether you know this shop is a popular one or a less popular one so Capital that produces and that produces itself that is a major discontinuity in the development of our Technologies and the social economic system we live in we'll um we'll talk about this point in more detail in a moment I think because it's interesting that um shoshana zuboff in surveillance capitalism she she argues that those inputs those behavioral well activities that the companies then monetize that it forms part of a new capitalist system it doesn't go as far as saying feudalism but maybe we can talk about that in a moment but I just wanted to pick you up on you referred to Alexa as she instead of it yes and it's a female name and I wonder maybe you do maybe you don't maybe this question goes no what role sort of the anthropomorpha anthropomorphosizing these Technologies has of turning them into people of turning Alexa into a woman of turning Syria where you can tell Siri to be whoever you want to be but I wonder if you whether you think that's significant or perhaps you don't I don't know of course this is significant uh the the greater the capacity of the machines to present themselves as humans the greater the power of this infinite regress where we're training to train us to train it to train us and so on and so forth now you mentioned and you know an important book surveillance capitalism from which I've learned and which I think is important part of the story but doesn't go far enough because it continues to treat those corporations as Monopoly capitalists now Henry Ford Thomas Edison where Monopoly capitalists they had created Network companies I mean Thomas Edison was the Elon Musk of his era think about it um in the early years the first decade 1903 1904 he actually electrocuted a hapless elephant at Coney Island in order to demonstrate that the electricity the alternative kind that you use which belong to Westinghouse which was coming out of a Westinghouse Powerhouse uh was Lethal because he was selling a direct current which would not have killed the elephant or a human being so concentrated power huge egos new fungal Technologies this is not new and the capacity of those people especially Henry Ford to monopolize markets through technological advancement and to create desires into people's minds besides they didn't know they had this is not new it's there of course big Tech has turbocharged it and it is true that they have such direct access through Alexa and Siri and so on and our phones really I mean our tablets to us that that Monopoly power the capacity monopolize a market is now much greater than it was before the second world war however where I go further is that I'm making the point that amazon.com and thousands of such companies now all over the world in Indonesia in Malaysia especially in Africa this shift from the market to digital platforms these digital platforms are not markets and the I mean Ford how did he make his money selling cars he made the cars and sold them to you now the owners of these platforms of the Cloud do not make anything they are go betweens they are essentially around tears and you may say well why don't you call it the interior capitalism well we could in the same way we could call capitalism industrial feudalism it wouldn't be wrong but it wouldn't allow our minds to concentrate on the fact that here is a great transformation to another social system which relies on rents not on Monopoly profits thus the great difference with Ford the great difference with Hilton the great difference with McDonald's you know all those people actually produced goods and services that that they monopolized and convince you you really needed them basis and the rest do not produce anything they are creating a new kind of uh um rent which sucks the economic energy out of the capital sector which is now becoming a vassal to their own cloud-based Empire I think that's a different story let's talk about their technological advancements then yeah um specifically which ones you think were integral to Cloud Capital first emerging and also where they came from where they where are they based where where do these technical technological advancements start they start with the development of algorithms that could actually improve themselves when I was a student ages ago algorithms were dumb they were like recipes you know you take this ingredient that ingredient you mix them together then if this happens then you do that if the other happens then you do something else and that's how programs learned how to produce good statistics solve mathematical problems organ you create Excel these were dumb algorithms the moment you have reinforced learning in algorithms so you have algorithms that do not have set objectives they have a variety of objectives that the algorithm can select from it's a little bit like telling a chef uh prepare a dish of meat lasagna but at the same thing that if in the process you realize that the quality of the meat is not what it should be you can have a vegetarian you can change your objective and then going beyond that algorithms that could monitor their own efficiency and could change alter their own functioning in order to become more efficient that's the beginning of artificial intelligence and of course now with generative learning and large language models you have I you know at some point this is a hegelian dialectical idea a quantitative changes led to the qualitative changes in the same way that you know when you lose your hair which hair must you lose before your declared bold there is no answer to that but there is a point when at some point people say oh you're a Baldi right speaking from experience similarly at some point I can't pinpoint precisely when the development of algorithms and their capacity to improve themselves and learn from themselves and alter their own substance at some point this was a singularity not that they became a sentient they never did and I don't believe they ever will but okay this is science fictional at some point they managed to acquire this capacity to do that which Cloud Capital does in my book and I think what's important as well and you point out in the book is that the consequences that techno feudalism isn't actually inevitable as a result of those technological advancements that the political and social conditions were absolutely crucial yes so what are those social and political conditions too the first one was the privatization of the internet because internet one the first internet that came out of the military industrial complex in the United States the Pentagon when they brought in research scientists from the universities and all sorts of enthusiasts coders to contribute to the creation of the original internet it was a Commons it had nothing to do with capitalism so to this day when you read a website you use this http ancient language computer language right but that's some somebody created that which allows us to read websites that person didn't get a penny for it it was a contribution to the commons to the internet Commons similarly with the the various engine Technologies still used to send and receive emails SMTP and so on you may have seen those you know those were all protocols created by enthusiasts who rewarded in a variety of ways but not monetized it was called Janet do you know that joint academic Network nice before it was called the internet uh at least in this country it was called Janet what were you using it for uh well initially to exchange data with other academic researchers and um emails were called batch files because you would create a little batch of messages and put them into a file and that file would then be readable in America by some colleague there so but it was a Commons it was like the comments before the enclosures so we had the neutral enclosures with big Tech after 2001. and the most important development there is that they owned and privatized your identity you cannot prove who you are on the internet today you've got subcontractor identity from large corporations so a bank knows who you are right so it can vouch on the internet through codes that it shares with Google or Apple because how does Apple know that it's you it asks you to input your data from your credit card or your debit card so they take it from the bank so Wall Street and big Tech and the city of London together on your identity you you have to pay to use your own identity that's a privatization of not just the comments but of yourself of the individual to this day there's no way you can say it's me I'm here's proof that it's me the state could have done that State could have certified who you are and given you you know a long number which is you and a PIN number to certify that but the state doesn't do that it leaves it to the private sector to the contaminants so that's one the second development which created technophidalism that spawned huge quantities and qualities of cloud Capital was the response by our governments and central banks to the 2008 crisis because after April 2009 uh I don't really do remember this there was this meeting here in London presided over by Gordon Brown of the G7 essentially they decided to refloat finance to bail out the bankers worldwide and they print it together over 13 years 35 trillion dollars right 35 trillion dollars and they gave you the finances at the same time they practice austerity here in Britain in Greece across the European Union in the United States austerity for the many and socialism for the finances now what why why is this connected to Cloud Capital because when you create all this amount of huge quantity of money which circulates sloshes around the circuits of Finance but people are there have no money because of austerity and they can't buy anything industrialists you know the captains of industry and so on you know say take Volkswagen for instance right or General Motors they look at the little people say as if they can afford to buy something equivalent to Tesla we're not going to invest in it we're not going to mass-produce Goods that these people won't be able to buy but they have all this money because the seller banks have printed it and given the finances the finances want to give it to these industrialists so the industrialists think Apple has 200 billion 200 billion of savings now why do they want money from the central bank if they have savings they don't but the Central Bank picks up the phone says I'm going to give it to you for free so Apple says all right give them and you know what they do they go to the stock exchange and buy Apple shares share price goes up their bonuses are linked to the share price they're taking more money in you know Mr cook and the rest Steve Jobs before uh the only ones who took this money and invested it were the ones who invested in Cloud capital you know the Jeff Bezos and so on there is no doubt that all the money that has gone into creating the optic fiber cables crisscrossing the oceans the server Farms the algorithms Ai and so on nine out of ten ten dollars or pounds spent on that came from the huge quantities of money printed by the central banks by the states so the um awful response by our governments to the 2008 disaster was part and parcel of what created the oomph the funding for the cloud Capital that now is taking over the world it's interesting actually we um we got Mariana maticato in here recently talking about the state's role I'm you know I'm sure you know the entrepreneurial state right and the state's role often in being the first mover for a lot of this stuff it's socializing the risk accepting the risk of let's say creating the technology we needed to put a man on the moon but then at the end it's a private company who reaps the rewards it's the private company who takes the profits and the risk is socialized the profits are privatized I wonder what you're reading on the states in Black you know in quotes not not the United States I mean a a nation State's role is in establishing techno feudalism and whether or not you view that relationship between the likes of a musk a Bezos as a parasitic one that they are sort of benefiting from the investment that a state has made in the past look Mariana's thesis is absolutely correct for decades the military industrial complex the state has been Central in investing and guiding the investing and having you know good single servants I'll use a a term of abuse or phrase that neoliberals use to abuse the state picking winners and decided that yeah they're going to be the internet the internet was not didn't spontaneously emerge it was a decision of some people in the Pentagon to create the internet for military purposes but nevertheless it it did not come out the marketplace and then the state comes in and invests every technology in your iPhone or your Samsung phone or whatever was invented as a result of some government grant which was directed in that Wi-Fi came out of the csiro in Australia what did the Australian government get for that zero because it was offered to the commons same with GPS GPS was given for free and they put the chance for it but they gave it away for free and then these companies that privatize the clouds privatize the internet and that's okay then also privatize the returns and use it in order to exert more power and to deplete the capacity of the state to continue doing that which is like an idiot who sits on a branch of a tree and starts sowing the branch that I think is more or less the Mariana matricata story it's a good one and I agree with that but as part of the same story comes my story because by effectively emptying the state of content of you know deep professionalizing the state shifting everything to the private sector subcontracting everything to those conglomerates the state created a much greater crisis in 2008. that would have happened had the state not done this and then the private sector That was supposed to know better that's a nearly better story right that the market Knows Best collapsed under the weight of its own stupidity and criminality that was the case in 2008 and a half place vacuum State a state that doesn't have the expertise that it once had this is a problem we have today you know the state does not why do you think the hs2 is not going to be built because the state doesn't have any civil servants who know how to plan the construction of a major project anymore the subconscious um but still they are responsible for saving capitalism from itself in 2008 2009 under Gordon Bronson so what did they do the only thing they know how to do which is to print huge contents of money and give it to the same people who destroyed the newly destroyed capitalism in 2008. and then what do they do they give it away most people most companies like Volkswagen and Ford and so on go and buy back their own shares except for some really smart people like Zuckerberg bases masks and so on who take the money and they are the only ones who invest and I wouldn't call them parasites you know I mean I dislike all of them but the I personally I consider Elon Musk be an evil genius the emphasis on the genius he's absolutely spectacularly Smart in the way that SpaceX he beat NASA on its own game he actually created spaceships that can actually land on their bottom right without being destroyed yeah that's not to be scoffed at so these people created capital goods what are called Cloud Capital which is wonderful that we have it I mean I'm all in favor of artificial intelligence I mean when I I spent the summer translating this book using Depot and of course working on on top of it I loved it you know I'm I'm addicted to my phone and to know Google and to all those things no Facebook I hate it but um I use Twitter all the time even though it's um it's like who put it that way I can't remember you said it magnificently it's like taking everything that's been written on the walls of male toilets all over the world and putting it online but nevertheless you know when I want to publicize my book I use Twitter when I want to have a political fight with somebody I have it over over Twitter I'm not again I'm not saying that they are useless I'm not saying that they are parasitical what I'm saying is that it's a form of capital which is creating a new social economic order which is not viable and it's not the fault of the Machinery it is not the fault of the Technologies um it is who owns them but that is a Marxist critique of capitalism to begin with the problem is not the machine the problem is who owns the machines and who doesn't have access to them unless they provide free labor or very cheap labor in the case of capitalism free labor in the case of techno Fields let's talk about that that order a little bit more then we've named the individuals that sort of the cloud lists the people that could be said to form our new ruling class let's talk can you talk a little bit more I should say about how their rise and their Supremacy then places people like you and me as surfs in that system how that Dynamic works awesome the moment they can create a cloud Thief which attracts us because let's face it if I want to buy a book quickly which I can't find on Bookshop .co.uka I'll go to Amazon and buy it especially if I need to read something quickly and get it on Kindle I go to the page the relevant page if I'm writing an op-ed for a newspaper I do it so they create a cloud Thief which you really need and want to be on once you're on it you are helping without realizing it reproduce its Capital stock the Capital stock that gives it power over you so you are a surf without knowing it a voluntary serve but of course the worst slavery is the one that people volunteer for right Jeff Bezos then can use the attractiveness of this Cloud Thief essentially to siphon off the capital sector most of the profits because you when you charge 40 percent rent for anything sold on your Cloud feed then essentially you decimate The Profit basis of the capitalist so the capital is the standard capitalist the old-fashioned Capital this becomes a vassal to the Cloud capitalist or Cloud list I call them Cloud the list for short we are Cloud serves to them in the Amazon warehouse the people who work there as precarious they don't have any rights really their precarious labor okay Norman blood Nomad Land Watch the movie if you haven't and you see what I mean they have uh electronic devices strapped to their wrist which monitor that every move tell them you know which um part of the warehouse to to go to next what box to pick up so they are Cloud Pros I mean if you've seen the wonderful movie Modern Times by Charlie Chaplin what he depicts there is now full on through the cloud because it's the same Cloud Capital that connects Alex on your desktop your laptop which creates Cloud capital or recreates the cloud capital of amazon.com the software that drives proletarians or precarious precariously employed workers in in the warehouse the drivers who are delivering the stuff this is all a new form of mutant Capital which are called Cloud Capital which also puts the lead on the profitability of the capitalist class which means that because these people never pay tax that states will always be impoverished States will then have to increase v80 which is the most regressive tax so you know it's it's the plot thickens it it becomes a completely different kind of system one could call it Rental Capital capitalism platform capitalism but I insist on shifting away from the word capitalism because it will help us concentrate our mind on what a gigantic transformation is the equivalent of moving from feudalism to capitalism do you think we'll ever be able to tax them effectively no why well because they're too smart and they have better accountants than the government is and they can shift from one country to another um and it is impossible to create the state power or recreate the state power against their own cloudless power defeat them legally in terms of accounting in terms of how they manage to push their profits from one jurisdiction to the other until it lands in some jurisdiction where no corporate tax is being um levid uh if we're going to defeat them and if we're going to turn this into a viable Society the global Society we must forget about taxing them we must think in Old Marxist terms how do we take their Cloud Capital away from them and how do we socialize it so you it is possible it's easier to to imagine the end of the private property of cloud Capital then at least imagine the proper taxation of cloud rents we can't answer that in a moment we'll talk about viable Alternatives what a more Progressive call it a Utopia future whatever your life looks like however is there do you find it compelling to suggest I I sit here in this conversation with you and I go yes you know what I don't want anything to do with this I'm getting rid of my phone I'm getting rid of my laptop and I'm gonna go and live in a cabin in the woods and grow my own vegetables forget about it see you later I don't want to engage how do you answer that criticism how do you try and compel people to not go God this is the power the wealth of the forces we're up against is so significant that I just don't have the appetite to try and combat it there aren't enough wooden Huts for all of us to do that and I don't believe you will do it you may claim you may feel desperate and you may think that this is a lost cause and you may think say that ah I'm going to go and do that but you're not going to do it even if you do it you know two months later you'll come back you will crawl back into London using your phone again no so to find my weather because you know an escape to a bucolic um past that never really existed yeah is not the solution is it possible though to opt out maybe not in the way I've just described but you know you talked earlier about the way these companies co-opt our identities is it possible for us to opt out of that process is it possible for us to steal back it's like saying is it possible for somebody who comes from rags to end up with ridges that is yes but only if it's one person or a handful of persons a handful of persons could rise from Rags to Riches they can go from being you know Amazon warehouse workers to being cloudy lists no doubt no doubt there is this degree of social Mobility but it is impossible for society to escape as a society from techno feudalism you mentioned at the beginning the geopolitics or the conflict Cold War whatever you like between the United States and China and that it's wrong to understand that conflict as a sort of traditional geopolitical game but instead is a conflict between two um superpower Cloud thieves so please can you talk about that a little bit more and I guess I'd ask you glibly as well who's winning that war okay before I answer the second part let me explain what I mean the rise of China is an American story in the same way that the creation of the European Union is an American project we Europeans like to think that we had a fantastic idea to end the war in Europe we had that idea but the EU would never have been created whether without Americans uh planning and executing the plan for the creation of the EU similarly the rise of China okay thanks Yao ping played an important role by opening up but what happened essentially was this uh there was a dark deal I call it in the book between the United States as ruling class and the Chinese Communist Party industry would shift from the United States manufacturing to China China would be the Chinese capitalists would be exporting to the United States they will be getting paid in dollars that the United States would have to print because the United States was a deficit country remains a deficit country but that deficit would be sustainable why because all the profit the dollar profits or the vast majority of the dollar profits of the Chinese capitalists will go to Wall Street and be invested in real estate in shares in derivatives and in bonds and in other words a large part of the Chinese profits from selling to the United States would be financing the American government yeah that's a synergy they are accomplices the Chinese Communist party and the American renter capitalists are partners so why are now are they now moving apart and threatening the world with Armageddon with a new cold war that may end up into a thermonuclear war that question was in my mind on my mind for a very long time and I didn't have an answer to it um until I noticed WeChat WeChat is an application that belongs to tencent a conglomerate a big Tech Megalis in China and I realized that the West doesn't have anything like that you know imagine if there was an app and by the way that's what Elon Musk wants to do when he calls and everything up that's WeChat imagine there is an app that allows you to send messages watch Tick Tock like videos um watch movies listen to music everything that Spotify Netflix Instagram WhatsApp signal and so on do everything in one app Plus free payments you don't have that now here you need to download the application of Lloyds Bank of Barclays Bank or Bank of America and so on they're charging them in the leg to make payments or they charge Proprietors shops shopkeepers and I'm in the leg Apple pay they charge huge rents for making these transactions WeChat free payments and you could have into each other up all you need is a bank account somewhere in China in one so suddenly this amazing deal that the United States would have with China but also with the European Union a little aside when the Euro came out everybody was saying oh this is great because we Europeans will be able to compete with the dollar the exorbitant privilege of the dollar and the supremacy of the dollar is going to be challenged by the year that never happened it never will happen why because if you're a German industrialist if you you know Mercedes-Benz or a Dutch industrial list you don't want the euro to usurp the power of the dollar because your money most of your profits come from selling to the Americans now the Americans are a deficit country the only reason why you you sell to them is because they have the straight deficit which they covered with dollars and the only reason why you accept dollars because of them the the exorbitant privilege of the dollar so you don't want the euro to undermine the power of the dollar as a European capitalist right that's that's the greatest strength of the American dollar is foreign capitalists not the CIA not the American Military not Biden none of these people it is a foreign capitalist who freak out at the thought of the the dollar will lose its uh its Authority in power um that applies to the Chinese capitalists who do not want to see the one the Chinese currency overtake the American one but the Chinese because they have due to the power of Chinese Communist Party fused their big Tech to their big Banks something is not happening in the United States walsley would never allow Silicon Valley to go anywhere near the payment system right so they are at low at loggerheads Big Tech and Silicon Valley sorry Silicon Valley and uh Wall Street in China they refused the one thing that's why you have WeChat add to that the Central Bank digital currency which allows you and me to followers as well to have a digital wallet in China with free transactions in one of course right suddenly the predominance of the dollar comes into question Trump Administration started the Cold War by freezing Huawei out in my estimations because of that nothing to do with Huawei posing in national security threat or anything like that and then you have the war in Ukraine and the confiscation of 400 billion dollars owned by the Russian Central Bank by the West primary of the United States I'm not going to start a conversation about whether they should have done that or not all I'm saying is that if you are a Saudi Arabian Prince an Indonesian oligarchy and of course a Russian but even a Ukrainian oligarchy you never know what happens after the war right and you see that these Americans um have no qualm confiscating your money hundreds of billions of dollars then you think twice before you put all your money in dollars so this super highway of payments of free payments that the Chinese have created which they didn't even want to use themselves because they want the American dollar because their capitalist profits come from them again suddenly it sees a lot of traffic and Wall Street they are their pants excuse my French it's welcome because they think oh my God here we have an alternative to the dollar system I think this is what's up underpinning the new Cold War when Biden announced that essentially what he told the Chinese in the fall of 2021 was we will prevent you from becoming an adult technological Advanced country when when you ban the sale of advanced ships chips to Country like China you're saying you will stay technologically backwards well that's a that's a declaration of war so they start decoupling themselves and they start putting more emphasis on this alternative payment system so it's a class of two Cloud thiefs two Cloud technophilisms a clash between two Payment Systems both of them digital both of them living on the cloud one dollar denominators the other one denominated and where is Britain where is the European Union nowhere we are utterly insignificant it's a reassuring place to be isn't it um so I don't mind being insignificant it's just that you know our politicians have not gotten onto that what's actually happening yeah yeah they keep thinking up when you're making Britain Great again the European Union that um is going to become a significant Force um if we integrate more and we have more countries Balkans in Ukraine and so on rubbish we are nobodies it is China on the one hand with the coalescence of the bricks around it and the United States on the other hand that's a very unstable world to live in and doesn't occur very well for the European continent including Britain could you talk a little bit about how cryptocurrency fits into that Network because I assume on the one hand uh this possibly democratized direct discrete system for financial transactions essentially threatens the stability in the supremacy of those two Payment Systems you just mentioned though I think that crypto is overblown um it's macroeconomically and sociologically insignificant it is technically fascinating when the algorithm for Bitcoin came out um by Nakamoto or somebody called in 2008 I spent quite a few months studying it I was fascinated by the technology and why is magazine interviewed me back then what did I think of it and I said it's a fantastic solution to a problem we have not discovered yet it's not money and it can never be money and I explained the book White can never be met it can be a speculative asset which is what it is I mean nobody uses Bitcoin to buy stuff and it would be crazy to use it to buy stuff if you think about it because imagine that I mean to begin with Bitcoin has a fixed Supply it has to have a fixed Supply in order to have value but the moment lots of people use it to buy things and more people come in demand for Bitcoin increases so it's dollar value or pound value Rises at some point when it exists a certain point if it starts working as a functions as a currency then people who are better of using pounds again and keeping holding their Bitcoin so there is a plateau there is an inbuilt ceiling which does not but prevents Bitcoin or any other cryptocurrency from functioning like a means of exchange so then it becomes a speculative thing and then you have an oligarchy of those early adopters uh who have are sitting on very valuable piles stashes of Bitcoins so I don't find it interesting I find the the blockchain um technology very interesting and uh in my in previous book another now which was a political science fiction novel where I imagine another now how think how could things have developed today in a socialist world after 2008 how would things work blockchain is part of the deal uh but it is not a way out of capitalism or technophidalism is a technology that we will use once we are free of the Yoke of capital you address the book to your father who hope that a capitalist order would be replaced by a socialist Utopia for the benefits of society and and one of the Striking things well I was about I wanted to ask you was about to ask you you're almost interviewing yourself um about another now because obviously was one of one of the things that socialism right is that there are very few blueprints out there about what the future Society could look like and that is provided um in another now you have described it you have just literally described it as science fiction so I don't know how valid it is um for as a comparison to techno feudalism and as an alternative but you you sort of you mentioned democratized company and democratize money and I wonder if you do think those are viable alternatives to the reality that you're describing in this book yeah the only viable models because what we have now is not viable it's real but it's not sustainable the economic crisis we are facing and which will continue to face have to do with the fact that you know value is created in a tiny sector of the economy which is shrinking the capitalist sector of the economy that's where value is produced by wage labor but that is shrinking we have an increase in domain of free labor um of cloud service of cloud capital of the platforms which are parasitic to a shrinking Capital space so our crisis financial crisis economic crisis cost of living crisis are going to be getting worse and worse and worse just like the climate crisis so this is not a viable system it's a system we live in but we are stampeding towards Oblivion both socially and environmentally so the reason why I wrote another now by the way science fiction is not about any Fairy stuff science fiction is not about the future science fiction is an Innovative way of writing about the past in the present that's why I always loved science fiction so as a socialist and a politician I always have to answer the the guy in the pub or the last in the pub who says to me okay Mike if you don't like the way things are how should they be and this is a difficult question and I didn't have an answer that's why I sat down and I wrote that novel which was about you know if if our Evolution Occupy Wall Street and so on had succeeded in 2008 what could life be like now given the Technologies we have and you know the the Fallen nature of humanity that is a given right we are imperfect people beings so I try to imagine what would covert law be like so I advocate uh the idea of one one worker one employee uh one share one vote which if you think about it it's such an easy idea in the same way you have one vote when you go to the polling stations you have one vote as a worker and you cannot buy votes you cannot lease votes you cannot rent them in the same way you can't in the political system so imagine that suddenly without a revolution without having um you know without storming Buckingham Palace so the Winter Palace or whatever suddenly you have totally democratized the world of work and you have done away with stock exchanges because you can't sell and buy shares then what's the point of a soccer change and if you have the Central Bank the bank of England let's say or the European Central Bank giving each one of us a free digital wallet with a pin number where we can park our money then what's the point of having an account with Lloyds Barclays you don't even need to be authoritarian and and and and ban them they would just shrivel and die unless they can provide you with services that they're not providing you you now I mean the only reason why you now have an account with a private Banker is the only way of of using your money so another now was all about being practical in a science fiction Type of Way in answering the question how could things be functioning today do you think we can get there well I don't think I'm going to live to see it if that's what you're asking mind you I'm getting old anyway so that doesn't matter so this is the bad news the bad news that is that I'm not optimistic but I think that to be optimistic today you have to be a real fool given that there's no empirical evidence pointing to good outcomes but then again imagine this imagine this being the 1770s and I mentioned the 770s because that was the time when Adam Smith was writing his wealth of nation Nations which spearheaded spearheaded introduced the world to the great transformation of the time from feudalism to capitalism if I'm right that today we're living the same moment of transformation from capitalism to techno feudalism a good point in time to compare ourselves with so imagine this was the 1770s and I was able to take advocating a world without slavery and you were interviewing me and you said do you think this is going to happen I probably could say to you no I can't imagine you know there had been no Human Society without slavery beforehand so how could the human mind in the 1770s imagine a world where slavery was universally condemned and banned so on the one hand totally pessimistic on the other hand absolutely hopeful good I'm sorry Focus thank you so much for coming in I really appreciate it thank you very much

Channel: PoliticsJOE

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Keywords: Politics, UK politics, British politics, Parliament, Government, Westminster, news, breaking news, conversation, politics news, politicsjoe, joe songs, boris johnson song, keir starmer song, new media, novara, labour party, brexit, Yanis Varoufakis interview, Yanis Varoufakis European Union, Yanis Varoufakis elon musk, Yanis Varoufakis on tech, Yanis Varoufakis Jeff Bezos, Marxist debate on big tech, big tech regulation, yanis varoufakis china, yanis varoufakis bitcoin

Id: oDutkVRwrt8

Length: 64min 10sec (3850 seconds)

Published: Fri Oct 06 2023