If You Imagine that Jeff Bezos Lives in that Castle, You’ll Understand Techno-feudalism

A great friend of Inside Telecom and a frequent contributor, Cesar Tabr, sent me an interview yesterday between Channel 4’s Krishan Guru-Murthy and Yanis Varoufakis, former Greek Finance Minister.

Mr. Varoufakis was explaining society’s journey from about eight hundred years ago to today. What made the interview fascinating was his ability to take an extremely complex timeline and simplify it to the point where, for me, the mists cleared and I understood why I had been feeling so uneasy about the tech giants recently.

The former minister started by explaining the feudal system of medieval Europe, when land held the key to value. The royal families of the various kingdoms owned the land. They would lend land to the so-called noble class, who had earned the right to nobility through extended family connections, military service or just because the King or Queen happened to like them.

Below nobility in the class system were vassals, who lived on the land as tenants, paying nobility for the privilege. Below the vassals were the serfs. This class would live on the land and till the soil. They would give a pre-determined share of their crop to the nobles in return for a place to live and security. It was a system that worked for society for about four hundred years, in which wealth was based on rent. And then it didn’t work.

Because then, systematic agriculture triggered mechanization, which slowly evolved into a society which harnessed machinery for elements of civil communities. It wasn’t too long after that when the economic power base of these kingdoms moved from those who owned the land, to those who owned the machines. Rent as a wealth builder gave way to profit as a wealth builder.

Thus, feudalism gave way to capitalism.

Capitalism has now been with us for hundreds of years.

But it, too, has given way to another societal era. But as a community model, it isn’t a giant leap forward. If anything, it’s been a backward jump. But we’ve hardly been aware of it even though we’ve been complicit in its creation.

This is Techno-feudalism

It’s a term that has existed for a year or two, but the jargon in which it’s been explained has been pretty obtuse. Unless you’re a historian, economics whizz and psychiatrist all in one, that is. Until Yanis Varoufakis came along and completed the eight hundred year journey by elucidating that the land of feudalism has become the connectivity of techno-feudalism. Those who control connectivity are demanding, and getting, ‘rent’ by charging exorbitant markups for every transaction made on the internet. Like the noble class of eight hundred years ago, these modern lords own nothing. Except a platform in a cloud. The ‘rent’ that people pay for the privilege of transacting on their platforms has made these companies the wealthiest on the planet.

Every step I’ve relayed to you from the interview is obvious, I know.

But the way that Mr. Varoufakis has reconstructed feudalism has made me all too aware that we really am just serfs. And we’re paying homage to a man who owns nothing.

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