Rogelio Polesello, Untitled, 1970


Considerations about the book by Yanis Varoufakis

According to Yanis Varoufakis, in his astonishing Technofeudalism: what killed capitalism,[I] capital is now in the clouds; to the delight of an entire court of astonished people, he peremptorily states that capital is no longer found so much in machines, but has transformed into an algorithm and, as if it were smoke, has risen to the heavens. It's amazing, since by being close to the stars, the damn thing made the markets unemployed. It is also admirable because, in this way, the timorous managed to expand its scope: now it not only exploits salaried workers in the sphere of commercial production, but also rips the skin off capitalists.

These are statements so abysmal that it is necessary to prove that they were said: “Cloud capital killed the markets and replaced them with a kind of digital fiefdom, where not only the proletarians – the precarious – but also the bourgeoisie and the vassal capitalists, are producing surplus value (…) [for certain lords]. They are producing rents (rent). They are producing cloud rent, because the fiefdom is now a cloud fiefdom, for the owners of cloud capital.”[ii]

I need to examine these statements carefully, because – I confess – I was stunned by them. As Yanis Varoufakis also says that his “book falls directly into the Marxist political-economic tradition” and that it is “a piece of Marxist erudition”, I do not need to ask permission to compare what he writes in a spectacular way with what he said Karl Marx. Are they convergent?

You have to start from the beginning. In The capital, explaining what commodity fetishism is in the fourth section of chapter I, its author says that “the mystery of the commodity form consists, simply, in the fact that it reflects to men the social characteristics of their own work as objective characteristics of products of the work itself.”[iii] And?

Well, I need to show what point I want to get to. The neoclassical theory, which dominates the minds of 90 percent of economists and which legitimizes those who must be considered competent, says that the machine is capital, gold is money, the commodity is merely a good. Therefore, saying that algorithms (with their data) is capital (cloud capital) does not seem to be a violation of dominant scientific reason.

However, Marx considered this type of formulation to be vulgar, as an example of the superficiality of “vulgar economics”. Because, as in all of them there is only the consideration of phenomena as they appear, they are expressions of the fetishism that is inscribed in commodities in general. The social characteristics of work are being attributed to the product of work. In all of them, there is a confusion of the form with the support of the form, of the value with the use value.

To avoid falling into fetishism, it must be said that capital is a machine, money is gold and good is a commodity, ways of saying that place capital as a subject that does not pass through its predicates. In this case, one should not say capital-cloud (cloud capital), but cloud-capital, that is, capital in the cloud (capital in the cloud) if you don't want to fall into commodity fetishism.

Yanis Varoufakis states, furthermore, that the economic system is no longer aimed at obtaining profit as Marx assured. In chapter IV of Book I, for example, the latter author said that “use value should never be treated as an immediate goal of capitalism. Nor isolated profit, but only the incessant movement of gain.” Therefore, capitalism aims to obtain profit and more profit with the goal of accumulation, making capital grow.

Yanis Varoufakis, even though he is a Marxist, disagrees with this central position: “If capitalism is market-based and profit-oriented, well, then this [what we have now] is no longer capitalism, because it is not market-based. It is based on digital platforms that appear to be technological fiefdoms or cloud fiefdoms. [These fiefdoms] are driven by two forms of gain. One is cloud rent, which is the opposite of profit, and the other is central bank money, which finances cloud capital construction. Now, that’s not capitalism.”

Well, in this passage there is a clear identification of capitalism with what neoclassical economists call the market: for them, who understand this mode of production through mercantile circulation, capitalism is a market economy. But as we well know, for Marx, capitalism is characterized by the capital relationship, that is, by the relationship between capital and the work subsumed by it (salaried, enslaved or self-employed).

However, as “capitalism = market economy” for Yanis Varoufakis, he can come to the brilliant conclusion that, if platforms now dominate, we are no longer in capitalism. But, even from this perspective, he is wrong because platforms operate by selling goods, they are inserted in markets, they are ways of organizing markets. Platforms do not replace markets, they internalize them through marketing algorithms (Amazon is the best example of this process).

But there is another confusion in Yanis Varoufakis' superficial theorizing. He seems not to know that, in contemporary capitalism, the dominant form of capital is financial capital or highly concentrated capital as it can also be called. The first name, as is known, was coined by Rudolf Hilferding in the book of the same name, back in 1909. Also used by Vladimir Lenin in Imperialism – superior phase of capitalismo, received in the 21st century a pertinent update made by François Chesnais in his Finance Capital Today (2016)

In this book, financial capital is thought of as the form of capital that came to dominate after overcoming the capital that moves through large industry, as presented in The capital, exclusively on the D – M – D' circuit. The basis of financial capital are corporations through which capital moves not only in the D – M – D' circuit, but also in the D – D' circuit. As a result, it acts both as capital and as capital as a commodity. And this last category was presented by Marx only in chapter XXI of book III of his magnum opus.

In the words of François Chesnais, financial capital is constituted through the “concentration and centralization, simultaneous and intertwined, of money capital, industrial capital and commercial capital” and, in this configuration, operates transnationally, giving expression to imperialism . Chesnais thus distinguishes financial capital from finance or financier capital, that is, “the concentrated monetary capital that operates in financial markets”.[iv] The latter, according to him, is operated by banks, funds of all types, holding companies, but also by the finance departments of non-financial corporations.

If Yanis Varoufakis had a good understanding of Marx's work, he would not say, furthermore, that the form of earnings on platforms is rental income (rent). This notion denotes a gain externally associated with capital and, consequently, is foreign to its conceptual system. The notion of rentierism comes from Joseph Proudhon, having arrived in contemporary economic theory – because it is harmless, it expresses a silly protest – through John M. Keynes. It is quite evident that this notion is contained in the thesis that “property is a theft”, that “property is unsustainable, because it demands something for nothing”, the core of the critique of capitalism made by the great anarchist philosopher mentioned above.

To better understand Yanis Varoufakis's path, it is necessary to take three steps. In the first one already given, it is noted that capitalist platforms are just a material support of financial capital, a means of making money from corporate companies. What moves through the platforms – it must be emphasized – is financial capital. In the second step to be taken, the categories of “capital” and “profit” are understood. The third includes the categories of “capital as a commodity” and “interest”. Here is what is found in chapter XXI, of book III:

About capital: “money (…) transformed into capital and, by virtue of this transformation, can go from a given value to a value that values ​​itself, which multiplies. It produces profit, that is, it enables the capitalist to extract from workers a certain amount of unpaid labor, surplus product, surplus value, and appropriate it.”

Regarding the use value of money as capital: “it thus acquires, in addition to the use value it has as money, an additional use value, namely, that of functioning as capital. Its use value, once transformed into capital, consists precisely in obtaining profit.”

About capital as a commodity: “In this condition of possible capital, of a means for the production of profit, it becomes a commodity, but a sui generis commodity. Or, what amounts to the same thing, capital becomes a commodity.” And in this condition, whether as money or as a means of production, it is lent to obtain a gain.

Regarding the gain of capital as a commodity: “The part of the profit that pays you is called interest, which is nothing more than a particular name, a particular item for a part of the profit, which capital in operation, in terms of put it into your own pocket, you have to pay the owner of capital”.[v]

Well, it was from this perspective that, in previous articles, I criticized the book Techo-feudalism[vi] by Cédric Durand: Technofeudalism or socialism of capital, About technofeudalism e Criticism of technofeudal unreason. In summary, I argued in these articles that platforms have become a material basis for corporate capital, something that came with the third technological revolution, after the globalization of capital, as described by François Chesnais. But the intention was also to present in these articles a thesis about the process of socialization of capital, a thesis that is re-presented here.

Corporate capital, generally based on share capital, is no longer private capital, but social capital, the capital of directly associated individuals: it “consists” – to use some of Marx’s own words in chapter XXVII of Book III – “in overcoming the capital as private property, within the limits of the capitalist mode of production itself”. Far from overcoming capitalism, this contemporary configuration realizes capital as a concept and is also a mark of the decline of capitalism. Consequently, doing justice to Marx's rigor, instead of techno-feudalism, one should speak provocatively of “capital socialism”. Instead of rent-seeking, therefore, we should speak of “jurism”. 

Now, it is well known that Yanis Varoufakis identifies capitalism with the industrial capitalism of large industry, whether in the competitive configuration of the 19th century or in the monopolistic configuration of the 20th century. Hence he sees the need to “make a linguistic transition from the word 'capitalism' to something else”. Because something different happened in capitalism after the advent of the post-war period that transformed it as a system of production relations. For François Chesnais, this is financialized capitalism; for Yanis Varoufakis, it is the haunting techno-feudalism. But one could also say that it is supercapitalism.

According to him, capitalism still exists, but it is being exploited by another system that has superimposed itself on it: technofeudalism. According to this performing economist, this system now parasitizes capitalism, which still exists and in which value and surplus value are still produced. Now, it is possible to doubt it since it is quite evident that corporations operating on platforms still aim to obtain profit, whether in the form of industrial profit or in the form derived from interest. Capital not only exploits, it also expropriates; he also sucks like a jurist vampire.

And they seek this increased gain not only by generating surplus value in their domains, but also by capturing it either in the price formation process or through financial applications. Therefore, fictitious capital, that is, capital that does not directly command the production of surplus value, but that also seeks to increase its value, is also capital. Therefore, capital is the social relationship that subsumes, directly or indirectly, work.

To conclude, I would like to quote an excerpt from Yanis Varoufakis' writing with which I agree: “I hope that perhaps these growing tensions will push humanity towards a decisive confrontation between good and evil – between the oppressors and the oppressed. But the rapidly approaching climate catastrophe poses the risk that we will reach the point of no return before that resolution occurs.”

The evil he points to, as I have said, is not precisely neofascism, but neoliberal suicide, that is, neoliberalism radicalized because it has become paranoid. Therefore, I cannot agree with him when he says that the solution is a new and mere “Bretton Woods”.

* Eleutério FS Prado He is a full and senior professor in the Department of Economics at USP. Author, among other books, of Capitalism in the 21st century: sunset through catastrophic events (CEFA Editorial) []


Yanis Varoufakis. Technofeudalism: what killed capitalism. Hoboken, Melville House Publishing, 2024, 304 pages. []


[I]. This book, as expected, received the endorsement of the performance philosopher, Slavoj Zizek.

[ii] See Moscrop, David – Are we transitioning from capitalism to silicom serfdom? – An interview with Yanis Varoufakis. Jacobin USA:

[iii] Marx, Carl – Capital – Critique of Political Economy. Book I. São Paulo: Abril Cultural, 1983.

[iv] Chesnais, François – Finance Capital Today – Corporations and banks in the lasting global slump. Leiden Brill, 2016.

[v] Marx, Carl – Capital – Critique of Political Economy. Book III. São Paulo: Abril Cultural, 1983.

[vi] Durand, Cedric – Techno-feudalism – Critique de l'économie numérique. Paris, Zone/La Découvert, 2020.

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