Can we Fix Capitalism? Yanis Varoufakis vs Gillian Tett
What this covers
Yanis Varoufakis and Gilian Tett came to the Intelligence Squared stage in a conversation chaired by Anne McElvoy, to debate whether capitalism is broken and if it needs to be fixed. Tett and Varoufakis both agree that the current model of capitalism needs to change but they differ radically in the solutions they proffer.
Gillian Tett is the pioneering columnist who has spent the last decade documenting the rise of ‘conscious capitalism’, a movement led by businesses that have concluded they can no longer afford to ignore issues like climate change, income inequality and social justice. Yanis Varoufakis is the former Greek finance minister who oversaw the bailout crisis in 2015 and has spent the last decade calling for a kinder vision for the global economy.
Is capitalism past its sell by date? Or can it be reinvented for the digital age?
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Varoufakis argues capitalism has already evolved into techno-feudalism through financialization and platform monopolies, making reform impossible; Tett counters that capitalism can be fixed by returning to Adam Smith's principles of competition, transparency, and moral foundations while using modern tools like digital technology and data portability.
- Central bank money has decoupled financial markets from real economy, destroying capitalism's profit mechanism
- Platform monopolies like Amazon create non-market techno-feudal systems that cannot be regulated like Standard Oil
- Returning to Adam Smith's four requirements (market access, price transparency, ownership-management alignment, shared moral foundations) with modern digital accountability can restore competitive capitalism
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Racial capitalism and racial inequality (as described by Cedric Robinson and Black Lives Matter) operate independently of capitalism's economic structure and would persist in any economic system, making racial justice a distinct problem from capitalist reform.
“but that doesn't account for what cedric robinson has written about racial capitalism and actually racial inequality and the black lives matter movement about it which is very anti-capitalist so in your utopic models what”
The environment was treated as an 'externality' in economic models and corporate balance sheets, meaning the costs of environmental damage were ignored in profit calculations, causing a massive flaw in capitalist accounting that undervalues the true cost of production.
“these lovely economic models these lovely corporate balance sheets these lovely big data sets are all very bounded and marked by tunnel vision you don't need to apologize because i agree with you i was trying to needle you but um but they basically treat everything that isn't inside the economic model or the balance sheet as an externality or a footprint something outside that model and what i would argue is that one of the things that went very badly wrong with a lot of the corporate vision and the economic models was treating the environment as an externality they ignored who was going to pay for the damage that was created or the cost of the natural resources they were that's quite a big flaw in the capitalist argument”
In August 2020, British GDP fell more than 20% (the first time in British capitalist history), but within 15-16 minutes the London stock exchange went up because market players immediately anticipated Bank of England money printing to refloat the disaster, demonstrating complete decoupling of financial markets from real economy
“in the summer of 2020 here in london i think it was the 12th of august when you had the announcement that your gdp fell by more than 20 for the first time in the history of british capitalism...and yet 15 16 minutes later the london stock exchange went up...because market players thought oh my god 20 plus then this immediately nanoseconds later they thought okay if we're panicking the bank of england are panicking so they're going to print loads of money”
Quantitative easing works by central banks printing money and giving it to banks as overdrafts, banks refuse to lend to small businesses, so instead they call large corporations like Google, Apple, Volkswagen and offer them free money; these corporations don't need money so they take it and buy back their own shares, creating stock market appreciation disconnected from business fundamentals
“what happens is qe means that uh you know the central bank prints money they give it they effectively given a higher a larger overdraft to you know the bagless banks deutsche banks of the world they look at you people to say oh no we're not going to lend them because they're hopeless so they pick up the phone they call volkswagen siemens asks them you know google apple and they say do you want a few billion those people don't need money because they already have stashes of money...they take it and they go to the stock exchange and they buy back their own shares”
Milton Friedman's shareholder capitalism model from the 1970s operated under assumptions that are no longer valid: that people could outsource social and ethical decisions to governments while companies focused on balance sheets, and that people did not have information access; today people distrust government and have radical information access
“back in the 1970s when milton friedman developed his vision of shareholder capitalism which i did not agree with there were two things that were very different one back then people thought that they could outsource the really difficult decisions in life the social stuff to governments and companies just worried about their balance sheets and secondly you did not have radical transparency and most people did not know what was actually happening inside companies today we have a world where no one actually trusts the government to get stuff done and we have a world where all of you have cell phones with extraordinary levels of access to information”
Power is not primarily determined by information asymmetries but by material capacity to coerce: if one person has a gun and you don't, power exists regardless of information parity; if you're starving and your kids are hungry, you have no agency regardless of information access.
“information is power and exorbitant power is goes hand in hand with the exorbitant asymmetry in information uh but it's you know this power comes it's not simply based on information if i have a gun and you don't have a gun you know i have power over you if you're starving if your kids are going to bed hungry at night and the only way of getting you know some milk or bread is uh you know to do whatever i ask you to do then that's not the question of the symmetry of information”
Anthropological perspective on capitalism reveals that many aspects of capitalism's supposed failures (barter, non-market exchange, different ownership models) have existed successfully in human societies for millennia, suggesting that today's capitalism is culturally specific rather than natural or inevitable.
“one of the messages that anthropology tries to hammer home is that by immersing yourself in the lives of others who seem strange to you you don't just get empathy for another point of view and a vision of how you could do things differently you also get the ability to look back at yourself with more clarity and understand yourself because the fish can't see water unless they jump out of their fishbowl and i think that's what we need to do today because we assume that the vision of capitalism that we've seen in the last 20 or 30 years is the only vision of capitalism out there that could possibly exist and that's simply not true the profit principle the competition principle the idea of trade has been expressed in many different ways markets have been expressed in many different ways too”
There is a fundamental distinction between markets and capitalism; markets (price discovery through competition) can exist without capitalism (private ownership of capital), and the future should focus on preserving markets while eliminating capitalist property relations.
“so you're saying adam is not relevant because the financial markets today don't tie into the real economy and because essentially you have platform monopolies on technology yes and even the companies that are not platform companies through private equity takeovers they're being taken over loaded by with debt which is financialized those companies are then split up asset stripped so you have the squeezing of the capital sector of what adam smith would consider to be the capitalist sector you know the squeezing of it completely until all you have is central banks on the one hand financial markets and the platforms so let me turn around and say like this would you believe that competition is a good thing in an economy absolutely okay let me ask for questions do you believe that prices are useful yes yes i've read my highest okay i understand do you believe that profits are a good thing as an incentive and that you should reinvest profit back into ventures no but i do believe that”
Capitalism has two defining characteristics throughout all its historical transformations: (1) profits are the fuel that drives it and get reinvested as new capital, and (2) markets are created through commodification of land and labor, creating the labor market following enclosures
“capitalism retained two main characteristics first the fuel that drives it is profit profitability profit which then gets reinvested becomes new capital and the thing goes on the second characteristic of capitalism is markets the creation of the labor market following the enclosures uh the eviction of the peasants from the lands created a mass of workers who then became the proletariat the commodification of the land every process production process extraction process is happening through markets so profits and markets central pillars of capitalism”
Wall Street in the early 2000s was missing all four of Adam Smith's components: people did not have equal access to markets due to powerful cartels controlling the show; prices were not transparently accessible; ownership and management were not aligned because pension funds outsourced decisions to asset managers; and there was no shared moral ethical framework
“if you dial back and think about what was happening two decades ago on wall street you can see that all four of those components were missing people did not have equal access to the markets because guess what it was powerful cartels on wall street and the city of london who were running the show they didn't have access to prices...there wasn't effective collision of ownership and management...there hasn't been a shared moral framework”
Not everyone gets their news from newspapers anymore—people get news from internet sites that have the capacity to dominate the internet, which are the same corporate interests, so claims about radical transparency and information democratization underestimate continued concentration of media power
“newsflash not everyone gets their news anymore from newspapers much like i'd love them to do it i'm afraid they do not even not newspapers but they do get it from even from the internet sites that have the capacity to dominate the internet absolutely right”
Capitalism has evolved through multiple distinct forms: Adam Smith's merchant capitalism, the large monopoly capitalism of the second industrial revolution (Henry Ford, Edison), big government capitalism with the New Deal and Great Society, and financialized or interior capitalism after that
“capitalism has transformed itself so magnificently over the centuries you know the capitalism of adam smith doesn't exist it's not the baker the brewer and the butcher since the second industrial revolution it was you know the henry ford's the edisons the large monopoly or the goblet capital then we had big government with the new deal and the great society then after that we had financialized capitalism or interior capitalism”
Profits have ceased to be the fuel of the economic system; central bank money is now the fuel, and without central bank money the entire system collapses, even for profitable sectors like big tech which are squeezing out other sectors
“i already see the end of capitalism because on the one hand profits have ceased to be the fuel of the economic system we have it is central bank money now without central bank money the whole thing collapses even the sectors that big tech and so on that are highly profitable they are squeezing out all the other sectors”
Platform companies like Amazon and Facebook are not alternative markets but new technological systems where everything bought and sold is controlled by one algorithm and one owner, creating a techno-feudal system unlike capitalism
“they are not alternative markets they are new technological systems you enter amazon you exit the marketplace you exit capitals you enter a realm where everything that is being bought and sold is controlled by one algorithm one person one owner this is like a fifth dome only it's a techno techno victim”
To reform tech today and create a more ethical tech system, you don't need to abolish barter but rather change the terms of trade by (1) increasing transparency about how data is used, (2) increasing transparency about what companies do with data inside the company, and most crucially (3) enabling data portability so consumers can pull their data out and switch to competitors
“if you want to reform tech today and create a more ethical tech system you don't necessarily need to abolish barter you need to change the terms of trade of barter and that means essentially giving consumers more power in that bar to trade which involves one more transparency about how data is being used more transparency about what the companies are doing inside the company with your data and most crucially and this comes back to the power of market forces data portability if we had the ability to pull our data out of any tech company and go somewhere else we'd actually have the beginnings of a proper market for our service”
The word 'company' comes from Latin 'con paneo' meaning 'with bread' because companies were originally seen as groups of people who ate together and then did business together, suggesting companies are fundamentally about human community and shared consumption
“i don't know how many of you know here where the word company comes from originally i talk about it in my book it originally comes from latin from old old italian actually con paneo meaning with bread because companies were originally seen as groups of people who ate together and then did business together”
Anthropology teaches that immersing yourself in the lives of others who seem strange allows you to get empathy and understanding of different ways of doing things, and also allows you to see yourself and your own assumptions more clearly—like how fish can't see water unless they jump out of their fishbowl
“by immersing yourself in the lives of others who seem strange to you you don't just get empathy for another point of view and a vision of how you could do things differently you also get the ability to look back at yourself with more clarity and understand yourself because the fish can't see water unless they jump out of their fishbowl”
Short-termism and capitalism are 'identical twins,' creating incentive structures that prioritize instant gratification and instantaneous profits over solving long-term problems like climate change that require global coordination and competition.
“capitalism and short-termism are like identical twins and essentially you have them hand-in-hand to have instant gratification to technology and also instantaneous markets but we live in a world where you have long-term problems for climate change and you need global coordination not competition how is capitalism going to be compatible with that”
Financial markets and corporate capture of regulation make meaningful reform impossible because when power is so heavily concentrated, no government on the planet can regulate effectively without those regulations being captured by the concentrated interests, making reformist approaches futile.
“it's impossible they will always be captured because the concentration of power now under this what i call technocriticalism is always going to be so gigantic that there is no government on this planet however well meaning its functionaries that can do it”
Adam Smith's theory of capitalism has two essential books: The Wealth of Nations (about competition and trade) and The Theory of Moral Sentiments (about shared moral ethical and legal foundations), and successful markets require four components: free access to markets, free access to transparent prices, alignment of ownership and management, and shared moral ethical and legal foundations
“adam smith laid out his two his vision of capitalism his vision of market forces he didn't use the word capitalism his vision of markets he had two books the wealth of nations about competition and trade and the theory of moral sentiments...that vision essentially argued that there were four components you needed to make markets effective you needed to have free access to markets...free access to prices...an illusion of ownership between the people who managed ventures and actually owned them...and a shared moral ethical and legal base”
Pension funds have become so concentrated (State Street, Vanguard control 90% of NYSE) that they cannot provide alternative ownership structures or constraints on corporate power, becoming themselves instruments of oligarchic control.
“the pension funds will always be taken over by those who happen to have a greater um percentage so why not ownership than others they will all i mean look look at you know the three big you know state street vanguard and so on the control yeah 90 of the new york stock exchange”
Transparency and information access have radically increased today compared to past decades—whether through leaked papers like the Pandora Papers or social movements like #MeToo that use information-sharing platforms to coalesce fragmented and powerless women—demonstrating that information distribution has shifted from tightly held vertical hierarchies to more democratic access
“if innovation is power then some elements of the power structures are changing today because in the past information really was held very tightly by vertical hierarchies and trickled down or at least as they wanted today information is available to many many people...whether it's the leak of the papers that we've just seen the last pandora papers in the last 48 hours suddenly casting a spotlight...whether it's things like hashtag metoo where suddenly women who had been fragmented powerless isolated managed to use an information sharing platform to coalesce”
Socialism and capitalist reform both face the same problem: advocates for capitalism must violate liberal principles (allowing regulatory capture and monopoly power) to sustain it, while socialists must violate their principles (requiring coercion) to implement socialism, making both systems logically untenable, as Friedrich von Hayek noted about socialism.
“friedrich von hayek the great guru of the libertarians even of thatcher once said that you know socialists are not bad people he said about us the problem is that in order to enact socialism they have to do to do things that contradict their principles i reverse that and i'm saying that those who are advocating in favor of capitalism but they're not you're not bad people you want good things and things that we share but in order to do it you will have to violate your own liberal principles”
Adam Smith is no longer relevant to understanding modern economies, just as Karl Marx was irrelevant to understanding the Soviet Union, because the preconditions Smith identified for markets to function (competition, price information, profit incentives) no longer exist in a system dominated by central bank money and platform monopolies.
“if what i'm saying holds water then adam smith is simply not relevant he's as relevant as karl marx was in the soviet union when you were there in other words not at all”
Winston Churchill's statement that democracy is the worst form of government except for all the others that have been tried applies to capitalism: it is the worst way to organize an economy except for all the others that have been tried, making it still preferable despite flaws.
“i happen to believe to channel i hate to say it boris johnson by quoting winston churchill that actually competition and profit is the worst way to organize an economy except for all the others that have been tried”
Greenwashing and corporate environmental schemes like those in Greece after forest fires demonstrate that market-based green growth is being co-opted for profit extraction—large corporations offered locals 20 euros per day while stripping rights and planning to replant with genetically modified trees to harvest biomass for green energy, converting forests into fifth domes controlled by Monsanto and Bayer
“when it comes to profit making it's very fast so the day after we were devastated and the flames died down large corporations came and took over the attempt to prevent those uh forests from uh becoming mud baths...first thing they did was to offer contracts to the local population that effectively signed all their rights away for 20 euros a day...they're trying to win um new contracts for replanting the forests using genetically modified trees that will grow very quickly...the devastation of the flora and the fauna of the land and the conversion of these areas in heavy and so on into fifth domes of monsanto bayer”
Green growth and environmental solutions require moving beyond tunnel vision economic models and balance sheets that treat the environment as an externality or footprint; companies should measure and include environmental costs in valuations using impact-weighted accounting and environmental social governance accounting
“if you could actually start measuring that and putting that into your models you start to get a very different vision of how companies are valued how they're looking at the world there are ways of doing that and people are developing that impact weighted accounting impact weighted accounting esg accounting”
Racism, patriarchy, and discrimination run deeply in human nature and societies—progress can only reduce toxicity that breeds more racism and xenophobia and sexism, but cannot eliminate these fundamental human traits; Varoufakis says he has a Nazi, racist, and sexist living inside himself that he constantly battles
“i don't believe that my side of politics even my very quaint version of socialism even if we manage to sort out all the problems with corporations with the power of capital to exploit...that we can deal with patriarchy or racism discrimination runs very deeply in our societies...i look into myself and i find a nazi living in me a racist living in me a sexist living in me i constantly have battles with me with myself and anybody who tells me that you're not like that you're lying we are all like this we all have a dark side”
The winners of a profit-driven competitive system will inevitably co-opt the political system meant to regulate them, making unequal market access inevitable in capitalism.
“my question is in this competitive system driven by profit where money is basically what you're uh where wealth is basically what you are valued by isn't it inevitable that the winners of the system will co-opt the political system that is supposed to cre and therefore unequal access is inevitable”
State and large corporations are in cahoots working together, and media outlets are owned by the same corporate interests, so transparency claims about exposing environmental crimes are illusory—newspapers, radio stations, and TV stations never report what's really happening on the ground
“the transparency is an illusion because you know i'm telling you now what most of those people know in those areas of the forests but i can tell you that not one television station not one radio station not one newspaper has ever reported on what is really happening on the ground they are owned by the same corporate interests”
Oscar Lange was a 1920s communist and socialist who, unlike Marxist central planners, believed in markets and competition without central planning and believed in a market-based system that Varoufakis has tried to map out in his work—a precedent for market socialism
“oscar lange...one of friedrich von hagek's great adversaries...oscar lanky was a socialist communist actually who believed in not the center he was completely against the idea of of a central plan but he was in favor of what effectively i have tried to you know to map out in this book”
Adam Smith was completely wrong about barter—he thought it was an old-fashioned prehistoric practice involving cavemen swapping berries for meat that would die out with money and credit, but barter actually exists in many communities simultaneously with money and credit
“there's one thing that adam smith got totally wrong in fact several things but here's the most important thing for today he thought that barter was an old-fashioned prehistoric practice that really just involved cavemen sitting around in caves swapping piles of berries for meat and he presumed that barter would essentially die out once you invented money and credit he was a hundred percent wrong”
Cooperatives and alternative ownership structures are not being widely adopted despite their success because they are being gobbled up by larger companies—private equity and tech companies buy them out, not because they don't work but because there's no level playing field in an environment where large fish eat smaller fish
“why aren't there more companies copying that because they're being gobbled up this is why because you know think of the the trustee savings bank remember what happened to it it was gobbled up so the idea of cooperatives that work is well established from the 19th century in this country yeah cooperative banks cooperative supermarkets and so on that work magnificently but in an environment in an economic environment where you know the the the large fish it's a smaller fish”
Adam Smith himself was totally against public limited companies with liquid ownership traded on stock exchanges because he understood that the moment ownership is split into tiny tradeable pieces, the prerequisites for a well-functioning competitive market are destroyed
“he was totally against public limited companies because he understood that the moment you have liquid ownership you have the ownership split up in tiny little pieces that can be traded anonymously in the stock exchange suddenly his prerequisites for a well-functioning competitive market are gone”
Theodore Roosevelt successfully broke up Standard Oil through antitrust legislation and anti-monopoly laws, but modern governments cannot do the same with Amazon, Facebook, and tech platforms because the concentration of power is so gigantic that no government however well-meaning can regulate it
“standard oil was a monopoly there was a market you know they managed to corner the market every petrol station in almost every state was owned by them by user market right compare standard oil and contrast it with amazon...i do not believe it is possible to do that which roosevelt did with standard oil”
Capitalism's prerequisites for functioning (baker, brewer, butcher able to operate on shared moral sentiments) are destroyed by economies of scale and scope that came with the second industrial revolution and digital revolution, eliminating both the moral foundations and the ability of small businesses to survive
“the problem is that with the second industrial revolution and now especially with the digital revolution you have economies of scale in the economies of scope that destroy both the moral bed on which the baker the brew and the butcher can operate as well as their businesses they are taken over by starbucks or whatever and then suddenly both the theory of the modern of moral sentiments and the wealth of nations goes out of the window”
Capitalism has always been intertwined with the state, and the illusion is that wealth is produced individually and then the state socializes it, when in reality the state has always been part of capitalism's evolution; the state is not external to capitalism but constitutive of it
“you reminded me of this great illusion that is motivated that you know capitalism is a system where wealth is produced individually and then the state comes and socializes it when it's exactly the opposite and the state has always been part of the evolution of capitalism”
Capitalism as a system has been historically contested—Marx, Lenin, Stalin, Cold War communists, Maoists and Jeremy Corbyn have all claimed to see capitalism's death coming, yet here we are still debating it, suggesting that predicting capitalism's demise has proven unreliable.
“she's just trying to put together a list in my head and it's a pretty obvious one but it goes something like this karl marx vladimir ilyich lenin stalin boo any number of post-war communist leaders and supporters after the great rift in in europe of course in in 1939-45 1968 radicalism maoism and on home turf jeremy corbyn um sort of in illustrious company um you see that the line of argument there's and each of them has seen the death rows of capitalism in some form and yet here we all are having a discussion about whether we can fix it”
2021 is analogous to the 1790s when Adam Smith was writing—capitalism is a small pocket emerging within feudalism that will eventually dominate, just as capitalism is now emerging within and overthrowing itself to create techno-feudalism, which will eventually supersede capitalism entirely
“i think that 2021 is a little bit like the 1790s when adam smith was writing the wealth of nations in the sense that the world was feudal but there were small pockets of capitalism that were emerging...we are in a similar moment i think that capitalism is on his way out not because the left one...have managed to overthrow...but capitalism is overthrowing itself in the same way that feudalism overthrew itself”
Network effects and economies of scale (people use Facebook because everyone else uses Facebook, people use TikTok because people they follow are on TikTok) cannot be overcome by changing corporate ownership structure or property rights because the technological structure itself creates non-market power
“let's face it the reason why people are in facebook is because everybody else is in facebook so it's economies of scaling the condoms of scope and there is nothing you can do about that uh by changing the you know the system and one more thing teenagers aren't on facebook do you have kids teenagers wouldn't be seen dead on facebook fashions change surprisingly fast okay whatever i mean the people who are on tick tock be on tick tock because the people they follow are on tick tock so this these are the network economies”
Barter—the exchange of data for services—is alive and thriving in silicon valley today; tech companies are running on wholesale swaps of data for services that do not involve money, and this is invisible in economic models and corporate valuations because economists treat it as free services
“silicon valley actually runs off barter the wholesale swap of data for services that is the bedrock of much of the tech sector today it does not involve money and we have no way of talking about it day to day except to say that it's free”
Jeff Bezos became $50 billion richer during the pandemic not because of Amazon's profits but because of the increase in share market value driven by central bank money printing, demonstrating that wealth accumulation is now divorced from entrepreneurship and business success
“why is jeff bezos 50 billion dollars richer than he was at the beginning of the pandemic it's not the profits of amazon of his businesses it is the increase in the share market because what happens is qe means that”
Capitalism cannot be fixed and is already irrelevant because it has already been superseded by techno-feudalism; talking about how to regulate capitalism through government and regulation is missing the point because capitalism is a dead system that has evolved beyond itself
“capitalism is not a problem anymore...in the same way that you know if we were having this discussion in the in 1800 how can we fix feudalism the answer is it's not relevant capitalism is already taking over let's talk about capitalism i would say in the 1800s similarly today i'm saying capitalism is no longer relevant it's dead”
Varoufakis worked for a real company in Washington state (2011-2012) with 350 employees and $1.2 billion annual revenue that operated successfully with complete flat management, worker voting on business plans via revenue-sharing formula, and bonus allocation via Eurovision-style peer voting system, proving worker-owned market systems can scale
“this is this is a really existing example i won't mention the company but i've worked for that company back in 2011 2012 it's in washington state united states so imagine look it up look it up imagine a company where the revenue total revenue is divided in four parts...the rnd segment is decided as a result of a vote where the members employees vote between different business plans...and it worked really very well with complete flat management”
The only way to prevent Facebook monopoly power is to implement one-share-one-vote employee ownership, which would eliminate the separation of ownership and control that allows tech platform monopolies to form.
“corporate law which says one employee one share that kills off the power of facebook what is your proposal okay”
Wealthy Western progressives calling for capitalism to be fixed face an asymmetric problem: developing nations like China, India, Nigeria, and Bangladesh don't want to 'catch up' to Western levels of consumption and environmental destruction, but face the same obstacle as the West—the need to move beyond Thatcher's 'TINA' (There Is No Alternative) dogma.
“i have no doubt that the large majority of people in india in bangladesh in nigeria in south africa in china itself do not want to play catch catch-up with the west in the sense of more cement more environmental destruction more destruction of their communities more blocks of flats you know destroying their villages i'm sure that they would like to be empowered the difficulty that we have with people in indian bangladesh is the same difficult we have here in the united kingdom in greece in france and germany and it is because you mentioned david graber the difficulty is to move away from thatcher's dogma of tina that there is no alternative to what david was saying that everything could be different”
Many companies are doing better environmentally today than they were two or three decades ago, suggesting that radical transparency and multiple stakeholders (government, companies, NGOs, citizens) working simultaneously produces environmental improvements even if motivated by diverse interests.
“it is a good thing that actually we're not just relying on the greek government alone to deal with replanting those forests it's good that we have citizens armed with cell phones giving you the data you just quoted and it's good that we've had companies coming in and feeling the need to do something about it even if they are being essentially up driven by less than virtuous principles and even if some of the things they're doing are wrong many of the things that companies are doing today are better than they were doing two or three decades ago”
Teenagers are already abandoning Facebook for TikTok, showing that even massive network effects can be overcome by changing fashions and new platforms, suggesting Varoufakis underestimates the power of consumer choice and network effects are not permanent.
“teenagers aren't on facebook do you have kids teenagers wouldn't be seen dead on facebook fashions change surprisingly fast okay whatever i mean the people who are on tick tock be on tick tock because the people they follow are on tick tock”
An alternative to current capitalism would be a system where you join a corporation and receive one share granting one vote, allowing participation in decision-making and borrowing of resources (like a library card), and when you leave you hand back your share and take out your capital, creating competition between worker-owned companies with no distinction between profits and wages
“imagine a world where you join a corporation and you get one share in the same way that you enroll in university you get a library card and that library card that one share gives you one vote it allows you to do stuff you know borrow books participate in decision making and so on and then when you have to leave when you leave you take your capital out and you have to hand over your library card your one share”
Companies should be recognized as being about humans and groups of people competing together and building things together, with money recognized as a means to an end driving forward the economy and growth, not an end in itself
“if you put those two books together the vision of capitalism that i uphold is one where companies are recognized to be about humans and groups of people competing together building things together and money is a means to an end the fuel that drives forward the economy and growth”
The only thing preventing Varoufakis's Amazon-as-feudal-overlord scenario from being realized is the existence of some resistance, and the closest historical precedent is the feudal system controlled by a single lord, making platform capitalism literally neo-feudalism.
“the only thing i can imagine coming close to that is the fifth doom you know downtown abbey the lord owns the whole thing only this time it's a technology and the power that that bestows upon the people who own it”
The belief that 'there is no alternative' (TINA) to capitalism is Thatcher's dogma that blocks people from imagining different economic futures, but alternatives are possible if people exercise collective imagination.
“the difficulty is to move away from thatcher's dogma of tina that there is no alternative to what david was saying that everything could be different”
The word 'finance' comes from Old French 'veneer' meaning 'to finish', suggesting that finance was originally about paying off debts and finishing actual tangible commercial transactions—a means to an end—rather than endless loops of money creating speculation that is an end in itself
“the word finance comes from old french veneer meaning to finish which sounds completely bizarre because people think that finance is basically never ending loops of money going round and round like sugar in a candy floss maker building a bigger bigger puff of speculation that's kind of meaningless but originally finance was about paying off blood debts and finishing actual tangible commercial transactions it was a means to an end not an end in itself”
It is possible to reimagine and fix capitalism's flaws through combination of digital technology enabling more people to be empowered, being forced to widen lens beyond balance sheets to environmental factors, and through actual debate like this where previously opposed parties find more agreement than disagreement
“it is possible to reimagine capitalism it is possible to fix its flaws...i would argue we actually could with a combination of digital technology the fact you have more people empowered the fact we're being forced to widen our lens beyond balance sheets to look at things like the environment and the very fact that we're having this debate today tonight where actually janice and i have probably ended up agreeing on more than we've been disagreeing”
Competition is a good thing in an economy, and Varoufakis agrees that competition is valuable, prices are useful, diversification of roles and specialist functions is good—areas of substantial agreement between the two speakers despite their apparent opposition
“would you believe that competition is a good thing in an economy absolutely okay let me ask for questions do you believe that prices are useful yes yes i've read my highest okay i understand do you believe that profits are a good thing as an incentive and that you should reinvest profit back into ventures”
The next generation will be the big players in determining whether capitalism is fixed or what replaces it, suggesting that generational change and youth agency will be determining factors in economic transformation
“who are the big players in this fixing capitalist who is going to address it or fix it...inevitably the next generation”
Most people would prefer to receive 'free' services from Google and Facebook without paying money, even if it means accepting data collection, because the hassle of using money to pay for services would be greater than the value of privacy protection.
“i'm going to tell you sparta is alive and well today big time because silicon valley actually runs off barter...i would expect if i was to go to all of you in the room today and say would you like to pay for your services that you get from google facebook your email would you like to use money to buy all that and in exchange they can't take your data or they'll pay you for it you might say well yes for privacy reasons but i guess that many of you would actually say you know what i don't want the hassle of having to use money to pay for it i like getting free services”