It was the 12th of August, 2020. Nine o'clock in the morning, in London, the news came out that the national income of Britain (GDP) had fallen by more than 20%. That had never happened before in the history of capitalism - British GDP falling by 21% or so in one year. It was not anticipated. The markets were expecting a fall of 8,9,10%. No one was expecting a 21% fall.
Fifteen or sixteen minutes later, the London stock exchange went up by 3%. There can be no explanation of that along the lines of capitalism.
This is how the Greek economist, Yanis Varoufakis, described essentially the official death of capitalism and its replacement by something even worse. The thing he calls "technofeudalism".
While Varoufakis in various discussions struggles to explain why capitalism is already dead, it's rather funny that people still willing to debate on something that's already dead (capitalism) against something that's far from being practically implemented (Socialism), since this something that died has been already replaced by something even worse. That is, a kind of 21st century corporate feudalism which drives civilization further away from a Socialist Utopia.
The beginning of the end of Keynesian capitalism, took place half century ago, when in 1971, one of the worst presidents in the history of the United States opened the door to the domination of financial capitalism and the correlated destructive neoliberalism.
Throughout all these decades since Nixon opened the gates of hell, neoliberalism completely prevailed in the entire West and elsewhere through a peculiar cultural totalitarianism. The fraudulent ideology hypnotized the masses by offering a fake prosperity that came out mainly from the excessive money-borrowing from households to cover even their basic needs.
The 2007-08 big financial crisis was almost inevitable. Yet, instead of seeing a mobilization by the state similar to that after the 1929 crisis, we saw the opposite. The state intervened to save the advocates of the free market, at the expense of the taxpayers and the working class.
And it could have become quite obvious that capitalism (in its last transformation) already died in 2008, if the governments in the West hadn't spent huge amounts of credit energy to keep the rotten system alive.
Another Greek economist, Kostas Lapavitsas, describes another unprecedented thing that happened back then, which brought the system just one step prior to total collapse. As Lapavitsas says:
That crisis was global, systemic - the entire system came very close to collapse, and it was structural, it was deep, it wasn't because of some accident. This was a crisis of financialization - and where did it come from? Strikingly enough, it came out of the financial system, and out of lending to the poorest sections of the US working class. This is an extraordinary thing. Historically, we've never seen anything like it - that lending to workers and particularly to poor workers, could destroy the capitalist system.
The fact that the governments extended the life of the dying system, gave the time to the most powerful to prepare ground for zombie capitalism's successor, in order to significantly extend their power globally. The transition from the dead capitalism to a new type of feudalism is taking place today under our noses. And grotesquely enough, it happens while we still debate about whether capitalism should be preserved or replaced.
Varoufakis focuses on technofeudalism and the BigTech digital monopolies that control almost every aspect of life, as people increasingly depend on digital environments for almost every activity. Yet, it seems that, unfortunately, the situation is much worse.
Behind the glamorous facade of the new technologies - glamorous enough to act like a powerful drug that disorientates especially young generations from the real issues - the big picture is being revealed for those who have the will to clearly see the dystopian reality.
And this reality includes the attempt by the big corporations to control not just digital environments, but also vital resources in the real world. New revelations indicate that big corporations in 2019 made a first organized attempt to institutionalize land-grab in order to control the global food production.
The blog identified such a dark prospect already since 2014. We wrote back then that having secured the new labor force through fully automated machines, what has left for the dominant elite now, is to take all the resources. Big corporations are grabbing huge cultivable areas especially in the developing countries in order to control food production.
But even without all that information, the feudal nature of the new system is unfolding in front of our eyes, as long as we have the will to see it. Think about it. A declining capitalism that didn't manage to recover from the 2007-08 global financial earthquake, passed the COVID-19 pandemic to the hands of the new feudalism. Why on earth a feudal system would be interested to deal effectively with such a health crisis, instead of using it to boost the power of the modern oligarchs? Indeed, the mega-billionaires saw their fortunes grow bigger, when millions more workers struggle even harder, just to keep their heads above the water. And how about the BigTech oligarchs like Branson, Bezos and Musk, who thought that a space race would be OK at such an extremely difficult time for the many? Such a hubris!
"Billionaires playing astronaut" remains one of the more repugnant displays of obscene inequality in 2021. https://t.co/as78keuPDw— Peter Daou (@peterdaou) December 26, 2021
The only thing now left to ask, is whether there are any signs of hope to fight such a dystopian development. We believe there are.
The Anglo-American axis and soon after the entire West, became the main carriers of neoliberalism throughout the 80s and 90s, until the major financial crisis of 2007-08. Neoliberalism's shock doctrine was first implemented in Chile, later in Russia, South-East Asia and elsewhere with devastating results.
However, China managed to escape the disastrous wave and followed a different path, which resulted in a far more successful and truly viable model. And that's the last thing the Western financial/corporate oligarchy would like people to see against its failed model, which of course is quite successful only for maintaining oligarchy's power and interests.
As the US empire was occupied with the disastrous outcomes from its wars in Iraq and Afghanistan, we saw the Pink tide - a political wave and perception of a turn towards left-wing governments in Latin American democracies moving away from the neoliberal economic model at the start of the 21st century. A resurgence of the pink tide was kicked off by Mexico in 2018 and Argentina in 2019, and further established by Bolivia in 2020 along with Peru in 2021, and Honduras and Chile in 2022.
And even inside the motherlands of neoliberalism, we saw Leftist politicians becoming quite popular particularly among young generations. The political scenery would have changed radically if the terrified establishment hadn't spent so much propaganda energy and fraud to prevent politicians like Bernie Sanders and Jeremy Corbyn taking the power.
The blatant failure of the neoliberal model made it very hard to continue propagating its typical narratives to brainwash, especially young generations, about its alleged success. And this became very clear when even Joe Biden was forced to declare inside the US Congress that one of neoliberalism's most basic and fraudulent narratives (Trickle-Down Economics), has never worked.
These developments among others, indicate that the Western neoliberal establishment struggles harder and harder to maintain neoliberal status quo. And the fraudulent neoliberal principles are necessary for the transition from neoliberalism to the 21st century corporate feudalism. Yet, the elites always seem to be at least one step ahead. And we believe there are two main reasons for that.
First, the elites accumulated so much power in previous decades that ended up controlling almost entirely the economic and political decision centers.
Second, the cultural totalitarianism designed to secure neoliberalism's sovereignty, penetrated so deeply inside the brains of entire societies, that, today, it looks like it is almost impossible to be removed.
It is evident that the key slogans of neoliberalism lost most of their power. Yet, younger generations seem to only beginning to scratch the surface of this cultural Matrix inside which they were born and trapped. And the complete liberation of their minds appears to be a very slow and difficult process.
And even worse, many others will keep defending the new Dystopia, completely ignoring that capitalism died and replaced by something even worse. It's actually what Morpheus explained to Neo about the Matrix: "... most of these people are not ready to be unplugged. And many of them are so inured, so hopelessly dependent on the system, that they will fight to protect it."
This - desirable for the elites - behavior, can only be achieved if the transition towards the corporate feudalism is as smooth as possible and silent. And it appears that at least for now, this goal has been met.