I had the sense going in that I was going to struggle with the ideas in here, but that’s how learning happens. I’m no political scientist, but I work in the capital markets and read a lot about tech and finance, so a lot of the ground he covers is in my comfort zone.
The pitch is that capitalism is dead, and what has replaced it is a fiefdom similar to the introduction of private property that birthed capitalism in the first place. In short, the internet has enabled an economic system that has eliminated the free market, replacing it with huge monopolies that manipulate us relentlessly, seeking rent, not profit. Think The Age of Surveillance Capitalism mixed with The Attention Merchants with a side of They Live.
At first there’s a lot to nod at: Varoufakis makes the case that the the stock market and the finance world have become detached from fundamentals – starting around 2008, the combination of austerity, quantitative easing and zero-ish interest rates basically stopped companies from investing in innovation, instead deploying capital in unproductive ways such as share buybacks, real estate investment and complex financial instruments. He calls out private equity as being anti-capitalist, as they seek to create a rent-based model for their investments, to the detriment of the firms they purchase. Hard to argue with that.
He also looks at how the internet went from open and free technology protocols to a collection of walled gardens with deep surveillance capabilities. Sure, with a couple of caveats.
It’s around this point that he goes full Naomi Klein or Cory Doctorow – interesting ideas that don’t seem fully baked, written with smarm and disdain for those he perceives as the culprits (bankers, Bezos, etc.). It’s difficult to take seriously when every sentence is dripping with spite and hyperbole.
He deems Alexa and other smart speakers to be nefarious, deep surveillance tools, feeding all of our data into the Amazon machine and forcing us to do things that aren’t in our best interest. This is a stretch to say the least.
The critic in Jacobin magazine(!) summarizes the trap that the author sets for himself (the whole piece is worth a read, better than mine):
Contrary to motivating narratives that might appeal to investors — which Varoufakis’s discussions of technology often seem to echo, only with the moral conclusions inverted — Alexa has proven [impossible](https://arstechnica.com/gadgets/2022/11/amazon-alexa-is-a-colossal-failure-on-pace-to-lose-10-billion-this-year/) to monetize. The promised self-reinforcing dialogue has mostly become a worthless chain of mundane requests: “Alexa, play Taylor Swift! Alexa, tell me the weather!” Galactic power indeed. Despite salutary attention to the physical infrastructure behind the cloud, he takes all too seriously tech promoters’ promises of exponential growth. Time and again, these marketing narratives have proven hollow. Plenty of cloud capital is simply vapor. (emphasis mine)
He continually describes social media posts as ‘unpaid labour’, which is an idea that I thought we had seen the last of around 2018. This idea is always a red flag — as though we’re all forced to tweet at risk of not paying the bills, or that Instagram has no value to me. We’re all poor mindless dupes who keep contributing freely to the social media platform that does nothing for us (except keep us in contact with friends and family, help find and build community, provide entertainment at no cost, etc).
There are shockingly few references, even though a ton of the material has been written about extensively by others. In fact, many of his endnotes simply reference another paragraph by the author, or a piece by him published elsewhere. The index doesn’t mention Shoshana Zuboff, Tim Wu or many others whose work must have been foundational to his thinking about technology and monopoly.
Lastly, a few statements are fully discrediting. He seems to believe that the fall of the USSR was a tragedy, and the end of a dream for all true leftists. He believes that China is a helpless victim of economic manipulation of an American government desperate to keep the USD from being replaced as the global reserve currency (yet never acknowledges the massive state sponsored surveillance programs, intellectual property theft and efforts to infiltrate and influence foreign governments that China engages in openly).
I will let this sentence stand on its own merits:
Indeed, the great irony, from a Western perspective, is that the only political force that can do anything to keep the cloudalists in check and thus the hope of democracy alive is the Chinese Communist Party.
Anyway: There are a lot of good takes on history and capital’s influence on corporate and consumer behaviour – the basic idea that the golden age of advertising changed consumption patterns in ways that are still being used today is good. There are ideas and metaphors in here that I’ll probably think about long after the book is gathering dust on my shelf — but I don’t expect I’ll ever pull it out to recommend to someone.
Here’s a list of books that should either have been cited in Varoufakis’ book or to read instead. If you have others that fit on this list, let me know!
The Age of Surveillance Capitalism by Shoshana Zuboff
The Curse of Bigness and The Attention Merchants by Tim Wu
Chip War by Chris Miller
Blood in the Machine by Brian Merchant
Chaos Under Heaven by Josh Rogin
The Big Myth by Naomi Oreskes and Erik M. Conway
These are the Plunderers by Gretchen Morgenson and Joshua Rosner