How Capitalism Becomes Feudalism (Severance and Technofuedalism)

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Video Version | Podcast Version

Unlike most of my videos, I’m going to try not to spoil too much of the first season of Severance, because I want you to watch it, and I want you not to have to watch it to enjoy this video. This will spoil a number of particulars about the premise, though.

In the late 19th century, as the Second Industrial Revolution rapidly expanded the demand for coal, coal towns popped up across America from Pennsylvania to Colorado. The largest number, though, were in West Virginia, where 80% of America’s coal was mined by the 1930s.

Living conditions in these coal towns were among the worst in the country, with miners living in small, closely packed, hastily and cheaply built shacks or in some cases merely tents, for which honor the miners paid a monthly rent. Few of these towns had running water or amenities of any kind save for the ubiquitous bordellos and saloons. Almost all goods could only be purchased from a single store owned by the coal company. These goods included the food they ate as well as the very shovels, pickaxes, explosives and other gear the miners needed to do their job, all sold at wildly inflated prices. Often, the miners would be paid not in money at all but in a company scrip that could only be used at the store, and if they couldn’t afford what they needed on the pay they were given (often intentionally) they were given it on credit, creating a debt they could never repay thereby binding them to the coal mine forever in a type of slavery called debt peonage. Other mines were worked by slavery under another name, as convicts were ‘leased’ to the mines from prisons. Local sheriffs were appointed in sham elections and then paid to deputize the mine’s private security, with the primary aim of keeping out unions that might threaten this system of exploitation. Children began working in mines at as young as eight years old. Workers who were injured or unable to work would be evicted without compensation. Workers who died would have their families evicted without compensation.

Such immiseration proved to be a powder keg. Despite the best efforts of the mining companies, the conditions in these towns often still led to unions and strikes. The companies violently cracked down on these efforts, often with the aid of government, leading to retaliations, confrontations, and massacres. The largest showdown would be the Battle of Blair Mountain in 1921 where 10,000 coal miners faced off against 3,000 lawmen and strikebreakers who employed machine guns and dropped bombs on them from bi-planes.

Company scrip continued to be used in coal mines until the 1960s.

Writer and activist Cory Doctorow has an expression: “capitalists hate capitalism”. In its idealized, Adam Smithian form, capitalism operates by firms competing in markets for both customers and labor, leading to lower prices and better service for the former and higher wages and better working conditions for the latter. However, capitalists have constantly striven to undermine markets in order to gain greater control over both customers and workers, through monopolies, oligopolies, trusts, price fixing, and so on. Billionaire Warren Buffet, lionized as the “Oracle of Omaha”, built his career on finding companies with what he calls “moats”—literally invoking feudal castles to describe the business’s monopolistic power. As Buffet puts it, “if you’ve got the power to raise prices without losing business, you’ve got a very good business.” And as I discussed in “Star Trek into Socialism”, capitalists have long pushed to roll back the labor rights won by workers in the early 20th century, including things we take for granted like the 8-hour work week, weekends, and child labor laws.

Company Coal Towns are only one of the most egregious examples of how, if they can, companies will use their market positions to reduce their workforce to as abject conditions as possible. Without the means to leave their land and find employment elsewhere, paying for their own means of production in the form of mining equipment, but giving over almost everything they mined to their bosses, the West Virginia company town miner was closer to the Medieval serf than the capitalist wage laborer.

In the TV show Severance (2022-present), employees of the Lumon corporation agree to have a microchip installed in their brains so that they cannot remember anything that happens in their workplace. As a corollary, while at work, the workers can’t remember anything that’s happened outside their workplace, including their own past and identity. Essentially, in the language of the show, the “innie” becomes a distinct person from the “outie”.

In underground, windowless rooms, “innies” sit at computers resembling those from the 1980s—the entire show has a deliberately anachronistic and jumbled sense of style and technology, making time on the show feel as warped as the sense of time of the characters. (Hat tip to Skip Intro for this observation.) Idly, they often speculate what their outies are like.

The “innies” cannot quit. And at any rate, since their only memories are tied up with their employment, for them quitting would “effectively end [their] life, as [they’ve] come to know it”.

They are the ideal worker who only exist to produce value for the company and have no lives outside of the company.

Silicon Valley has been famous for offering “perks” to employees like a free cafeteria with world-class food, ping-pong tables, massages, nap room, showers, and so forth. These are offices designed not merely as places to work, but places to live, encouraging workers to stay all hours, sleep there, keep working when they wake up. The job becomes their life.

In China, where labor rights are far more lax, this all takes on a more sinister dimension. Workers for companies like Apple and Tesla are known for working what’s called the 996 hour system, which is to say 9AM to 9PM, 6 days a week. Employees live in dorms adjacent to the factory, and during COVID lockdowns often were forbidden from leaving the worksite for days or weeks at a time.

While economists and politicians have praised the effects of offshore manufacturing on local economies, with local salaries in China often increasing four times over with the arrival of major factories, Apple manufacturer Foxconn was still forced to put up suicide nets to keep its employees from leaping to their deaths, suffered worker walkouts over unsafe conditions, while workers (who are not allowed to organize) protesting sudden pay cuts were beaten by security forces and police. The walls of the Foxconn factory are adorned by slogans from its CEO like “growth, thy name is suffering” and “achieve goals or the sun will no longer shine”.

American capitalists are of course delighted to have workers spend their waking hours in such conditions. As Elon Musk put it, “[In China] they won’t just be burning the midnight oil, they will be burning the 3am oil, they won’t even leave the factory type of thing, whereas in America people are trying to avoid going to work at all.” This hasn’t stopped him from forcing his US workers to labor 100-hour weeks. Dedicating every waking moment to Tesla, though, won’t stop them from notifying you via form email when you’re surplus to requirements. A company might cheerfully refer to employees as family but in reality you’ll never be more important than a line item on a P&L report.

But even as rising union membership in the US shows a trend kicking back against the further immiseration of the worker by capitalists like Musk, capitalism itself is busy transforming into something else entirely.

The work done by Severance’s amnesiac employees is literally incomprehensible. Numbers appear on a screen, and they must stare at them until they inspire feelings, like fear or a sense of wrongness. These numbers are then identified and isolated. It is not clear to anyone why this is important or how it benefits anyone, the labor completely obscured from any value it might create.

Elsewhere in the company, an art department chooses the wall paintings and the design for the handbook covers and tote bags.

The company keeps the workforce divided through means such as planting stories about one department rising up in a cannibal assault against another. The obvious absurdity of this is made possible only by the total myopia of the workers, whose understanding of the world is more-or-less defined by what the company chooses to tell them (it’s indicated that they still know basic things like what country they’re in, but how extensive this is isn’t clear). Workers who distrust each other aren’t likely to organize against their employer.

Meanwhile, outside we find a world in which a dire economic situation has made it worthwhile for people to have part of their life severed in exchange for company-provided housing and relative comfort. Many also seem to enjoy no longer having to worry about work, that entire part of their lives and the drudgery and alienation it entails effectively taken care of. And yet despite this our lead character’s real life seems empty, hollow, and without purpose. The only book we see in any depth in the outside world is a self-help book written by the protagonist’s brother-in-law, full of trite cliches about how to find meaning in life.

In the book Technofeudalism: What Killed Capitalism (2024), economist Yanis Varoufakis proposes that much as feudalism transitioned into capitalism, we are now transitioning into a new kind of “technofeudalism”, with the internet allowing a few companies to capture huge “platforms” over entire market segments and all the operators within them.

We think of feudalism and capitalism as if the transition between the two were clean and total, when the reality is far more complicated. Under feudalism, merchants bought and sold goods for profit, however their economic activity was dwarfed by the rents they and everybody else paid to the feudal lords who owned the land, with peasant and serf farmers giving over the majority of their crops. As merchant profits began to dwarf those of feudal lords, those lords responded by evicting their peasants and serfs from their farms and replacing them with businesses, and then by inventing joint stock corporations that allowed them to purchase shares of other businesses, until the feudal economic system based on rents had been largely replaced by the capitalist one based on profits. But vestiges of the old system remain, as alluded to by the word “landlord” itself, a landlord today extracting rent from tenants for the privilege of living on their property continue a feudal-style relationship, in some cases literally as the King of England still collects rent from lands that were part of the crown’s historical fiefdom. There’s a difference between a landlord under Capitalism and one under Feudalism, in that land is commoditized and thus regularly bought and sold as financial assets, and that a capitalist landlord is typically also responsible for the buildings on their property. But economists like Karl Marx drew a sharp distinction between the capitalist, who runs a business that produces goods and services, and the rentier, who merely extracts rents from properties and leases.

Today Amazon, which once sourced the goods it sold like any other store, now functions primarily as a place for other sellers to hawk their goods. Apple and Google share a duopoly over phone apps chiefly developed by others. Companies like Uber function not as taxi companies but as mechanisms by which individuals with their own cars offer a taxi service. Even a service like Patreon functions merely as a middleman between users and other users, extracting a percentage of their income for access to their platform.

Meanwhile, social media companies like Facebook and Xitter leverage the free labor of their users to sell their attention to advertisers, just as Google’s YouTube offers up its mostly unpaid videos, a new kind of virtual serfdom (where serfdom is a relationship to the means of production rather than a personal identity—you’re a serf to the social media company even while you’re an employee to your employer).

China’s WeChat, meanwhile, has become the ultimate middleman, dominating messaging, social media, gaming, payments, classifieds, ride-sharing, and other services in that country. Almost everything that we commonly think of as internet activity in China now goes through WeChat and from which WeChat extracts revenue.

In other words, Varoufakis argues, these platforms have become less like capitalist businesses and more like feudal fiefs from which their lords extract “rents”.

But these new marketplaces aren’t like that old ones where someone might peruse the wares of the different sellers on a more or less equal basis; instead what does and does not get put in front of the customer is governed entirely by algorithms under the platform’s control, with sellers forced to pay the platform extra if they want a better placement. And ultimately these algorithms work neither in the interest of customer or the seller, but only the platform. While the cab driver of old picked up fares where they found them and created their own strategies for maximizing revenue, the Uber driver is subject to an algorithm that’s been known to, for example, learn how much money they’ll try to earn before clocking out and then provide increasingly smaller fares in order to keep them on the road longer.

Social media platforms have openly experimented with deliberate emotional manipulation and churn up constant feeds of outrage and misinformation in the interest of maximizing “engagement” even if advertisers don’t necessarily want their ads shown next to vaccine denial and hate speech.

Our new technofeudal lords thus influence and control our social and economic lives and thoughts in ways their aristocratic ancestors could have hardly fathomed. And gradually, their steadily enshittifying fiefdoms are swallowing the entirety of our economy.

So-called AI is really just another form of algorithm based on sucking down massive quantities of data to try and predict desired outcomes—jacked up autocomplete with great PR. But all of these algorithms have a dirty secret, because even an internet full of content isn’t enough to prevent them from being morons. And so huge armies of people are paid to “train” them.

The first of this new class of service began with Amazon’s Mechanical Turk in 2005, described cheekily by Jeff Bazos as “artificial artificial intelligence” but known more commonly as “microtasking”. On Mechanical Turk, workers perform a bewildering array of small, strictly time limited tasks like audio transcription, data processing, survey taking, or bizarre requests such as posting pictures of their feet, paid on a per-task basis for an average of $2 an hour. As AI expanded and its need for training data expanded, most major tech companies have developed their own internal version of the service, while other similar services have proliferated and consolidated, such as Clickworker, Appen, Playmate, Microworkers, and Zhubajie. Some services serve particular niche functions, such as Scale, which hires workers to process data for warehouse robotics, or Lionsbridge which specializes in speech recognition, “sentiment analysis”, and chatbot training. This kind of work can require specialized knowledge—Lionsbridge claims a worker base of 500,000 linguistic experts including translators—the sort of knowledge that once could earn someone well-paid, white collar employment transformed into low-paid microtasks.

Search engines and social media networks employ microtask-workers to validate the accuracy of search results as well as in the far more harrowing realm of content moderation, where workers sift through hate speech, violence, and pornography, including child pornography, enduring untold trauma for their wages. And it’s important to underscore how none of these algorithmically-based or so-called “AI” services could operate without these sorts of workers propping them up. Amazon made headlines for opening “Go” stores where users would simply scan their phone on the way in, take what they wanted, and leave, relying on AI to identify the person and what they took to take payment. Except this “AI” actually relied on a thousand people in India who reviewed 700 out of every 1,000 sales.

And so rather than a technological marvel, Amazon Go was unveiled as just a new way to outsource jobs to the Global South, a less obvious version of the restaurant group now sourcing cashiers in the Philippines who take orders via Zoom. AI itself, meanwhile, stands revealed as less a miracle of automation than a way of atomizing wage labor, transforming once stable employment into low paying piecework.

It’s a fitting metaphor then that the Mechanical Turk service is named after a real 18th century hoax in which a ‘robot’ in a Turkish outfit played chess, ultimately revealed to be manipulated by a person hidden underneath.

Workers paid on a per-task basis are deemed contractors rather than employees, part of the cohort the World Bank euphemistically calls “microentrepreneurs”, which includes everything from rickshaw pullers to people who sell their own organs on the black market. These sorts of workers, who also include so-called “gig workers” like Uber drivers and the like, in truth have “none of the freedoms of an independent contractor [and] none of the rights afforded an employee”, as per Work Without the Worker by Phil Jones (2021), from which a lot of this information comes. A more accurate way of describing this kind of worker is the “precariat”, a class subject to permanent employment and financial insecurity forced to do all manner of unpaid labor (such as sourcing the next “gig”) as part of their jobs. On Mechanical Turk, for example, workers spend more time looking for tasks than completing them. Meanwhile, the person who requests a task has complete liberty to not approve the work and therefore not pay for it. One of the largest surveys across microwork sites indicates that 30 percent of work goes unpaid. Predictably, this drives up the hours someone must put in to survive. A study on microwork in Africa found Kenyan microworkers regularly putting in 78-hour weeks.

Further, many microwork sites, such as Picoworkers, Swagbucks, InstaGC, and Crowdlower, pay workers not in money at all but in gift cards and vouchers. On Mechanical Turk, most workers outside the Global North can only be paid in Amazon gift cards. Thus microwork platforms have reinvented the company scrip and the company store. Meanwhile, just as the coal miners of old had to pay for their own picks and shovels, and just as Uber drivers pay for their own cars, microworkers pay for their own computers, phones, and so forth.

Companies like Uber pin their hopes of massive profits on eliminating the driver entirely and replacing them with self-driving cars. But just as Amazon Go was only the illusion of AI-powered checkout, self-driving cars likewise rely on human teams constantly monitoring the cars, because left to their own devices self-driving cars keep killing people.

Much has also been written about the threat of artificial intelligence and automation to explode unemployment—in fact it was the subject of one of my earliest Literate Machine episodes, on the Doctor Who episode “Kerblam!” But the reality is starting to look more like this new form of peasantry/serfdom, in which both skilled and unskilled labor is transformed into precarious, mind-numbing data sorting for subsistence wages in the service of algorithms.

Meanwhile, the servers that power these algorithms consume massive quantities of energy. ChatGPT alone is already consuming the energy of 33,000 homes. One paper suggests that the global demand for water for AI systems could be half that of the UK by 2027. And all this while climate scientists are predicting that we’re going to blow past the 1.5C target for global warming and end up somewhere closer to 2.5 or 3C, with the results being described as “semi-dystopian”.

For office culture, the innies of Severance have a single, multivolume, Biblically-formatted tome in the form of the Company Handbook. To alleviate boredom they go on periodic trips to the “Perpetuity Wing” to see statues of previous CEOs, all descendants of the founder Kier Egan, a monarchal dynasty. Beyond the statues is a meticulous reproduction of Egan’s childhood home. The name “Kier” is used by the workers as an epithet, his word cited as scripture, the man simultaneously regal and divine like a Roman emperor.

The workers are to live by Egan’s commandments, to learn the think like him, to embody him in word and deed. By doing this they embody values that will “one day save the world”, according to former CEO, Myrtle Eagan.

As I discussed in my episode on meritocracy and Elon Musk, the rich love the idea that America is a meritocracy because it means that they deserve their riches by dint of merit. If you have billions of dollars obviously you must be some kind of genius. Silicon Valley is full of cults built around successful Founders, who are seen as a breed apart with the vision and drive to change the world. There is a whole subgenre of self-help books dedicated to helping you be like the rich—not merely about how to make particular financial moves, though books on that exist as well, but as per The 7 Habits of Highly Effective People (1989) there’s a focus simply on the habits and “mindset” of the rich. Being a rich person isn’t merely about creating a company with a good “exit strategy”, buying real estate, or purchasing assets at a low price and selling them at a high one, it’s about the first thing you do when you wake up in the morning and whether you’re “constantly learning” (by reading self-help books and biographies of the rich natch) or if you “listen more than [you] talk”. This folds naturally into ideas like “New Thought” that teach that if you believe hard enough in what you want, it will naturally come to you, as typified by books like Think and Grow Rich (1937), The Power of Positive Thinking (1952), and The Secret(2005). This, in turn, is wound tightly with the Prosperity Gospel of American Evangelical Christianity which teaches that if you send money to your church and pray hard enough, more money will come back to you (which certainly helps the churches and their owners grow rich). Success becomes not something material gained through ownership of capital but something mystical attained by emulating behaviors, molding yourself in the image of Great Men, and being a true believer.

That belief won’t actually bring you wealth and that the rich invariably come from privilege is a feature of this belief system rather than a bug. “Temporarily embarrassed millionaires” don’t agitate for higher taxes on the rich, or strike against their employers, or see wealth inequality as a problem in need of addressing. The Great Men are Great because they believed hard enough that the universe “actualized” their belief, and if you’re not great (yet) you simply must not have enough faith. And anyone who complains that the system isn’t fair just has a “victim” mentality and blames others for their lack of success.

And of course this all turns inevitably anti-democratic, since a democracy ostensibly grants every person an equal vote, while the rich see themselves as more deserving of power than the rabble. Tim Dunn is only the most obvious example of a billionaire dedicating his wealth to establish a new theological monarchy based around people keeping to their “natural” roles, envisioning human society as a beehive with some born leaders and others drones. Other billionaires like Peter Thiel declare that they “no longer see democracy as compatible with freedom”, and back the idea of a “dark enlightenment” to literally roll back the Enlightenment and return the world to its “proper” order—which is to say, back to Feudalism.

For jobs well done, Innies are rewarded with perks of little value—finger traps, caricature pictures, a dance party that lasts a single song, a surreal waffle-eating dance performance.

If they misbehave, they’re sentenced to time in the “Break Room”, a clever play on words because while the workers get a “break” they are being “broken”, forced to recite an apology for their actions until their interrogator thinks they believe it.

When Helly, the new worker at the company, demands termination, she receives a video message from her outie declining the request on no uncertain terms, saying,

I understand that you’re unhappy with the life you’ve been given. But you know what? Eventually, we all have to accept reality. So, here it is. I am a person. You are not. I make the decisions. You do not.

And yet, we’re told later that the CEO of the company thinks of its workers as his family. When we finally meet this CEO, he speaks of how one day everyone in the world, “They’ll all be Kier’s children.”

The implications are striking—that the company wants to reduce the whole of humanity to the status of “not-people” who are simultaneously the founder’s “children”. One is reminded of the Rudyard Kipling poem “White Man’s Burden” (1899), in which non-white people are portrayed as “half devil and half child” whom white men have a paternal duty to both control and look after. Except the here the fiction of race is stripped away leaving nothing but humanity divided into worker bees and the queens they serve.

Marx proposed that one of the Achilles’ Heels of Capitalism was that it took the peasantry–previously widely dispersed across farmland–and gathered them into factories where they could talk and organize. But the internet has broken that paradigm, and workers among the new precariat might never talk to one another at all.

Still, microworkers aren’t quite like the serfs of old who hardly knew anyone outside their family and immediate community. For example, on subreddits like TurkerNation and MTurkGrind, Mechanical Turk workers communicate and engage in communal support, such as raising funds for Turkers (as they’re called) in need. A web forum hosted on a site called We Are Dynamo engaged Turkers in a letter-writing campaign to Jeff Bezos asking for better pay and improvements to the site’s functions. However, the site used the Mechanical Turk API itself to verify its users were actual Turkers, and when Amazon discovered this they shut down Dynamo’s account. As shown by its union-busting efforts, Amazon does not want its workers organizing for their own collective gain.

Meanwhile in Britain, the Independent Workers’ Union of Great Britain formed to organize and advocate for gig workers.

The question then is whether such stirrings of labor unity and action can actually effect meaningful difference in working conditions as piecemeal microwork spreads across the economy. One could easily imagine a strike of content moderators forcing companies to the table by flooding social media with horror. The question is whether workers so geographically spread, precariously employed, and watched by militantly hostile employers could even organize to that point.

If the deskilling and immiseration of the working class continues, it will inevitably run up against the problem of underconsumption, which is to say that ever poorer people will no longer be able to buy the goods being produced, companies will fail, and the economy will contract.

The US government previously goosed the economy by cutting interest rates and printing money, but ultimately most of that money simply flooded into the hands of investors, which allowed them to take big losses establishing platforms like Uber and accelerating larger trends of corporate feudalism. In parallel, since 2008 there have been global increases in both protests and riots (what MLK called “the language of the unheard”). Pair that with the ecological disaster now unfolding, and you have a recipe for violence and terror and, as I explored in Loki: How Conservatism Becomes Fascism, a hotbed for fascism as people try to find stability in a strong hand which will only ever crush them.

One of the often overlooked things about serfdom and slavery is that it always came with the threat of violence from below. Without a peaceful means of exercising their will, the underclass expressed themselves through constant cycles of slave revolts and peasant rebellions. The success of a Democracy depends on an electorate that feels that their votes and non-violent efforts can make an actual material difference in their lives. Once that is removed, all that’s left is violence. The question, as with climate change itself, is whether we can steer the ship away from the cliff in time.

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Special thanks to all my Patrons: Kathryn Carruthers, Gabi Ghita, Hristo Kolev, Kevin Cafferty, Ulysse Pence, Wilma Ezekowitz, Mike Gillis, Christian Frost, IndustrialRobot, Not Invader Zim, Jason Quackenbush, Arthur Rosenfield, and Nancy S. Rosen

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