Neoliberalism was neither new nor particularly liberal when it was imposed fifty years ago. Its great advantage was its marked departure from classical liberalism: although it deferred to liberal thinkers, it shared neither their method nor their idea of the market. Today we are on the verge of another equally profound ideological innovation.
Unlike Adam Smith or John Stuart Mill, neoliberals did not feel compelled to demonstrate (theoretically or empirically) how the market, left to its own devices, could be delegated to convert private profits into collective prosperity. For them, the invisible hand was divine and infallible, and even when the market failed, any attempt to correct it through collective action was doomed to even worse failure. It was a position that suited Wall Street perfectly.
In the 1970s, they craved such doctrinal indifference to any real evidence of the consequences of total deregulation of financial markets. When the United States became a deficit-ridden nation and President Richard Nixon shocked the world with his decision to unpeg the dollar from gold in 1971, successive US administrations chose to reinforce US hegemony by widening (rather than narrowing) the country's fiscal and trade deficits.
Predictably, Wall Street banks were assigned the crucial task of recycling (in the form of Treasury bonds, stocks, and real estate) the dollars that foreign exporters accumulated from deficit-driven US demand for their products. But to do so—to become the linchpin of this audacious plan for global surplus recycling—bankers had to be free of regulatory constraints, which meant reeducating legislators and the public, who had been accustomed since 1929 to fear an uncontrolled financial system. This requirement was perfectly fulfilled by the fundamentalist orthodoxy of neoliberalism, which exalts the sanctity of unregulated markets.
Today, a new form of capital on the rise (cloud capital, that is, networked algorithmic machines that give their owners extraordinary power to modify our behavior) needs its own ideology to fully liberate itself. This new system, which I have called technofeudalism (a mode of production and distribution powered by cloud capital), replaces markets with cloud fiefdoms (e.g., Amazon) and capitalist profits with cloud rents.
To realize the full power of cloud capital, its owners (people like Jeff Bezos, Peter Thiel, Mark Zuckerberg, and Elon Musk) need a new ideology. Just as Wall Street financiers needed neoliberalism after the Nixon Shock, this new ideology must sustain cloud capital’s growing dominance in three ways.
First, the colonization of human activity needs to be legitimized. Starting with the loosening of regulations in areas such as driverless vehicles and AI-powered medical and legal services, the new ideology must justify the unlimited replacement of fallible, recalcitrant human beings with cloud-capital-powered machines, in all areas, including the work that gives us. The more cloud capital can penetrate tasks hitherto performed by humans, the more cloud rents will flow to the techno-feudal class.
Second, the new ideology must legitimize the colonization of state institutions, especially the privatization of public data through the transfer of data to the cloud capital of megatech companies. For example, it must justify Musk's use of of its Department of Government Efficiency to connect its cloud capital systems to various federal agencies, or the permanent linking of the interfaces of Palantir (Thiel's defense company) and Google with the Pentagon, so that their cloud capital is indispensable to the military industry.
Third, it is necessary to legitimize the colonization of Wall Street. Zuckerberg was the first techno-feudalist to attempt to create his own digital currency (pound), and Wall Street blocked them. But then Musk's purchase of Twitter (now X) led to a bolder attempt to create a "universal app" capable of challenging Wall Street's monopoly on payments. Spurred by President Donald Trump's executive order directing the Federal Reserve to create a strategic reserve of cryptocurrency, megatechs (which seek to provide unrestricted cloud financing outside of traditional financial markets) need more than ever to justify the fusion of their cloud capital with financial services.
The new ideology is already here. I call it technolordism, and is a mutation of transhumanism (a creed that promotes blurring the lines between the organic and the synthetic until humans achieve true freedom, or even immortality). Just as neoliberalism used classical liberalism, distorting it with the addition of a divinity (the infallible market), technolordism becomes functional in the triple colonization that cloud capital aims to advance, by replacing thehomo economicus neoliberal for an amorphous being human: a continuum between the human and AI.
Technolordism also replaces the divine entity of neoliberalism.
The repercussions of the social transformation accelerated by technolordism are staggering. They include unprecedented macroeconomic instability, the abandonment of democracy even as an ideal (a position defended by Thiel, one of the first prophets of technolordism), and the end of universities.
In this context, Trump is a godsend for technofeudalists; a magnificent long-term investment. Copyright Project Syndicate
