Replacing Technonationalism With Technofeudalism
It's Not A Good Trade
On Tuesday, I wrote that:
Eisenhower warned us to beware the military-industrial complex, but I suspect (and I think it’s already happening) that we will look back on the complex with fondness. At least they thought they were serving the country; the new burgeoning elite seems mostly concerned with signaling how deep into the tech scene they are, society be damned.
Tanner Greer, writing a review of the Palantir executives Alex Karp and Nicholas Zamiska’s book The Technological Republic in American Affairs, takes this idea much further, looking at the technological revolution that led to the development of the first national American ruling class and contrasting it to our current day’s version.
He begins by noting that the state of affairs prior to the creation of this ruling class is much like the way technology executives think of things today.
The wealthiest elite groups of the antebellum era thus resembled Karp’s picture of the contemporary tech elite: they were suspicious of executive power, distrustful of American nationalism, insulated from the American public, and focused their investments in whatever field promised the highest returns, regardless of the political consequences for doing so. Many were localists; some were Atlanticists. Almost none were nationalists. Their favored politicians, men like Franklin Pierce, William Marcy, Howell Cobb, and James Henry Hammond, dismantled America’s system of centralized finance, slashed its tariffs, vetoed internal improvements, shoved industrial policy down to the states, and maligned the rising class of industrialists.
America’s most powerful regional elites simply had no material stake in a technological republic, and they lacked the nation-spanning institutions or social networks needed to lead one. The handful of antebellum statesmen who, with Daniel Webster, urged Americans to become “one people, one in interest, one in character, and one in political feeling,” were rewarded with a lifetime of political disappointments.23 All of this would change with the Civil War.
What knit the nation together was the war that threatened to tear it apart.
The conflict elevated two social groups that had hitherto played second fiddle on the American stage: the disparate Northern regional elites, newly united beneath the Republican banner, and the rising class of industrialists and their financiers.24 The first seized the commanding heights of the Union’s politics; the second built the commanding heights of its economy. War bound them together in a common techno-nationalist project. The personal ties, institutions, and ideology that saved the Union would continue long after the guns went silent at Appomattox.
The ascent of this new elite class was hastened by the eclipse of its old rivals. With a few Maryland grandees excepted, the great planter aristocracy—ferociously hostile to both industry and the Union—followed their states in secession. Before their rebellion was over, the economic and political foundations of their power lay in ruins. Their ports were blockaded; their fields were stripped bare by marauding armies; their traditional customers found other sources of cotton; and emancipation, in a stroke, erased the largest store of Southern wealth.25 During Reconstruction, the plantation class was denied formal political power; after Reconstruction, they were only a junior coalition partner in the weaker national party. It would be a full century until any representative of a secessionist state would be elected president.
The Republicans of the 36th Congress moved quickly to exploit the absence of Southern obstruction. They advanced a legislative program which has since been called “the blueprint for modern America.”26 The package included vast land grants to transcontinental railroads, high tariffs to stimulate domestic manufacturing, and a host of measures designed to spur national development. As the Civil War stretched on, demand for iron, rail lines, machine tools, telegraph wires, steam engines, and armaments surged. The combination of new protective tariffs and the threat of Confederate commerce raiding ensured that domestic producers met this demand. For enterprising industrialists, this was an extraordinary opportunity to amass wealth on a scale that antebellum America had never offered.27
War also birthed a new kind of American financier. At the outset of hostilities, Washington lacked both the taxation machinery to fund its armies and the appetite to inflate away the nation’s currency. Instead, it turned to a rising class of bankers who marketed bonds in Philadelphia, Boston, and, above all, New York. These financiers, in turn, closely advised the federal government on how to design a national banking system capable of supplying the Union with a universal currency and a uniform system of credit.28 Young upstart J. P. Morgan began his ascent serving as one of these financial intermediaries.29 He was not alone in this. Out of the ten largest banks in New York City in 1870, five did not exist before the war.30
To a striking degree, the war effort was sustained through the voluntary efforts of the Union’s most prominent citizens. Some of these contributions, such as John D. Rockefeller’s sponsorship of thirty Cleveland soldiers, were individual.31 Others required association. Across the North’s largest cities, prominent citizens organized Union League Clubs, which functioned both as social clubs for nationalist elites and as political action committees for the Union cause. Through the course of the war, the members of the Philadelphia Union League Club would outfit “nine regiments, two battalions, and a troop of cavalry.”32 Its New York counterpart would print 900,000 Unionist pamphlets and would put New York’s first black regiment into the field.33
More impressive still were the efforts of the New York City Union Defense Committee, organized days after the first shots at Fort Sumter; it rushed workers to fix sabotaged rail lines, aided the families of poor conscripted soldiers, and raised a total of sixty regiments.34 The Sanitary Commission, a volunteer aid society led by the same upper-class northeastern elites that flocked to the Union League clubs, mobilized and trained thousands of nurses to tend to the North’s wounded and sick. A similarly organized Christian Commission provided religious literature and services to soldiers and sailors on every front of the war.35
The men who joined this effort drew from it a new national consciousness. “What I learned from the Civil War,” recalled Oliver Wendell Holmes Jr., who served as a regimental officer in the Army of the Potomac, “was that Boston is just one city in America.”36 It was a lesson learned by many young Boston Brahmins on the frontlines. Of each class that graduated from Harvard between 1855 and 1861, between a third and a half went to war.37 They were thrown into a great melting pot of young northeastern patricians. Of 120 Union staff officers who were not West Point graduates, ninety-three were natives of the New England states, New York, and Pennsylvania; of 134 cavalry officers, seventy-three were natives of the Northeast.38 There, working in close contact with commanding officers who had earlier worked with the regional railroads, these young men would gain firsthand experience with the industrial methods of organization, logistics, and accounting that powered the Union war machine. And they would not forget these skills when they returned to civilian life. As historian George Fredrickson observed, the war transformed them “from a demoralized gentry without a clearly defined social role [in national life] into a self-confident modernizing elite.”39
This would shock and disconcert their fathers and grandfathers; most were still devoted to the romantic individualism that had dominated American culture during their own youth.40 The Civil War thus marked a decisive generational turning point. Most Union generals were in their thirties or forties when they assumed command; their junior officers were younger still. Nor was the Union’s civilian leadership dominated by elder graybeards. In William H. Seward’s words, at the dawn of the Civil War, the Republican Party was “chiefly a party of young men.”41 Wall Street saw it the same way. One prominent financier later recalled that the struggle to mobilize finance occurred just after the panic of 1857, during which the “old conservative element [of Wall Street] had fallen . . . and its place supplied by better material and with young blood.”42 The Civil War both elevated a new generation of elites into public life and served as the crucible that defined their worldview; they would carry this worldview with them through the rest of their public careers, which often stretched well into the twentieth century.
What followed was a near-century of deliberately reshaping society to match the changes wrought by technology.
The magnates of the Gilded Age grasped a lesson their twenty-first-century successors have largely forgotten. Technological development is only possible when a governing coalition commits to it; potential coalition members must be courted and convinced.69
The Eastern Establishment understood its project in generational terms. They knew that the integration of the American nation and the growth of American power would not be accomplished in their lifetime. They wanted their children to inherit their select position in American society—and to be worthy of that inheritance. These anxieties came to a head in the 1880s, as the first generation with no memory of the Civil War came of age. During this decade, New England boarding schools like St. Paul’s reinvented themselves as national preparatory academies for the sons of the industrial elite, drawing students from New York, Pennsylvania, and Ohio.70 In their wake came a crop of new boarding schools—Lawrenceville (1883), Groton (1884), Hotchkiss (1892), Choate (1896), St. George’s (1896), Middlesex (1901), and Kent (1906)—each catering to a nationally defined upper class.71
Ivy League universities would follow suit. In the 1870s, Harvard instituted a standardized test for admissions that could be administered outside of Boston. By 1880, applicants were sitting for them in New York, Pennsylvania, Ohio, Illinois, and California. Alumni clubs were sprouting up in America’s major cities just as quickly, and the Board of Overseers soon opened to Harvard graduates living outside of Massachusetts.72 The result was a truly national institution and a reliable training ground for corporate America. On any given year between 1860 and 1900, between one-quarter and one-half of all Harvard students studied business.73
These institutions were not, and could never be, a complete replacement for the Civil War experience, though they did seek to cultivate the virtues the Civil War generation revered, such as patriotism, self-discipline, rationalism, professional competence, and physical courage.74 Just as importantly, they gave the children of a geographically dispersed elite a shared background, a common set of expectations, and enduring social bonds. Social clubs, intermarriage, and business partnerships reinforced these ties, allowing the Establishment to act with coherence and confidence long after the war had faded from living memory.
The economic, social, and political activities of the Eastern Establishment were mutually reinforcing pillars of a larger program. Members of the Establishment used the wealth generated by new technologies to secure political influence, used that influence to sustain a national market and legal framework geared for yet more technological expansion, and then presided over a conscious effort to preserve and transmit the values of their class to future generations, ensuring that the unity and discipline they gained in shared struggle would not dissipate amid power and prosperity. Through these means, a techno-nationalist elite guided America’s development for more than seventy years. Under its stewardship, the United States became the world’s wealthiest, most industrially advanced, and most powerful nation: a true technological republic.
The contrast with our new class of technological elites in waiting is stark. Greer first lays out his framework for what constitutes a governing class.
Any governing class requires three things: a political coalition to which it owes allegiance and over which it exercises influence; an economic base that provides this class with wealth and unites its members around shared material interests; and finally, a set of institutions, rituals, and social customs that give this class a culture distinct from the country at large. Absent the first two, a leadership class lacks the power to lead; absent the latter two, it lacks the ability to act as a class. The Eastern Establishment’s seventy-year dominance rested on its possession of all three.
And then highlights how this new generation of tech executives falls short.
Part of Karp and Zamiska’s problem lies in how they conceive of this task. The Technological Republic speaks of the fusion of a “sector” and a “state,” but sectors and states are abstractions; what must be fused are people. This was also true for America’s first techno-nationalist elite. Behind the Eastern Establishment stood a dense web of personal ties that bound its families together. Many of these ties were consummated, quite literally, on the marriage bed. Karp and Zamiska are loathe to think in these terms. They write a great deal about the engineering elite’s waning commitment to Western civilization, but they have little to say about its waning commitment to raising the next generation of that civilization. The Eastern Establishment was self-consciously reproductive: it built schools, endowed universities, and founded literal dynasties. Part of building “a shared culture . . . that will make possible our continued survival” is creating the children who will survive us.77
The only concrete suggestion Karp and Zamiska offer for stopping the “most talented minds of our generation [from] splintering off . . . from the nation” is to restore “a core curriculum situated around the Western tradition” in America’s top universities.78 To this end, an entire chapter of the Technological Republic is spent relitigating the “canon wars” of the 1980s. This is thin gruel. If John Calhoun lacked national feeling, it was not for want of reading Plato and Homer, nor can the public-spirited ethos of the old Eastern Establishment be chalked up to a reading list. It was first forged in total war. It was later passed on and maintained through a lifelong system of education and socialization that started with the spartan boarding schools of youth and culminated in restrictive codes of behavior that governed all adulthood. A two-semester survey of the Western canon is no substitute for a way of life.
Karp and Zamiska recognize that Silicon Valley’s engineering elite lack the cultural confidence to defend any way of life. In a revealing passage, they lament that America’s technologists shy away from “the vital yet messy questions of what constitutes a good life, which collective endeavors society should pursue, and what a shared and national identity can make possible.”79 This fundamentally misdiagnoses the problem, however. Silicon Valley’s failing is not that its leaders refuse to ask such questions: it is that they refuse to answer them. Here Karp and Zamiska cannot escape the disease they so confidently diagnose. They insist that “the reconstitution of a technological republic will require a reassertion of national culture and values” but never tell us what those values are.80 They lament that Silicon Valley has been swallowed by “narrow and thin utilitarianism,” yet they do not articulate a richer moral vision to replace it.81 There is no passage in the Technological Republic that attempts to “define the good life” or “describe what a shared national identity can make possible.”
The technologists of an earlier century were not so reticent. They spoke frankly about their understanding of duty, hierarchy, patriotism, and moral standards. They preached an ethic of service to the nation that both sustained their power and defined its use. So confident were they in their vision of American life that it not only defined the worldview of their children and grandchildren but gave those descendants the ambition to “Americanize” the rest of the country, and, in time, much of the globe.
This is not to say that the old elite were unambiguously good. One can’t help read the words “Americanize the globe” and think of the final death of this class — George W. Bush’s disastrous misunderstanding of the assignment and his quixotic project to spread democracy around the world — but at least they had an ethos.
The new technofeudalist leadership class believes in nothing. Their profoundly nihilist project seeks acceleration for acceleration’s sake. As Tuesday’s post should have shown, even great material rewards leave them feeling empty.
In The Brothers Karamazov, the Devil mocks Ivan by laying out the utopia that will be born once mankind gives up their belief in God:
“Once every member of the human race discards the idea of God (and I believe that such an era will come, like some new geological age), the old world-view will collapse by itself without recourse to cannibalism.... Men will unite in their efforts to get everything out of life that it can offer them, but only for joy and happiness in this world. Man will be exalted spiritually with a divine, titanic pride and the man-god will come into being.... Everyone will know that he is mortal, and will accept his death with calm and dignity, like a god. He will understand, out of sheer pride, that there is no point in protesting that life lasts only a fleeting moment, and he will love his brother man without expecting any reward for it.... And so on and so forth. Very sweet!”
This is said sardonically, but our current technofeudalist elite class believes this authentically. Replace God with Nation or Virtue or whatever higher value you’d like and it doesn’t make a difference; the Sam Altmans of the world seek to collapse the current order and offer nothing to take its place. Technofascism would be better than this.
News Scan
Trump Says Iran Talks “In Final Stages”; WTI Breaches $100; Iran Declares Hormuz “Controlled Maritime Zone”
Source: CNBC
Date/Time: May 20-21, 2026
President Trump’s declaration that US-Iran negotiations are in the “final stages” sent WTI crude below $100 per barrel for the first time during the conflict — Brent settling at $105.02, a drop of over 5% in a single session. But Iran simultaneously announced creation of a “controlled maritime zone” in the Strait of Hormuz, entrenching rather than relaxing its control of the waterway. Oil rebounded on May 21 as markets priced uncertainty back in: Iran indicated it is “reviewing” the US proposal and Trump said he is willing to wait “a few days.” Peace talks face a core impasse — Iran is seeking US recognition of its sovereignty over Hormuz, which US and international law experts say violates freedom-of-navigation principles. The gap between Trump’s “final stages” framing and Iran’s continued Hormuz hardening suggests the oil-price downside thesis depends on a deal that remains structurally far from complete.
CNBC
FOMC Minutes Confirm Majority Hike Bias; Four Dissents Most Since 1992
Source: CNBC / Federal Reserve
Date/Time: May 20, 2026
Minutes from the April 28-29 FOMC meeting — Jerome Powell’s final session as chair — revealed that a majority of participants now view rate increases as “likely appropriate” if inflation continues running persistently above 2%. Four policymakers dissented from the final statement, the most since 1992. Three of the four (regional presidents Logan, Kashkari, and Hammack) opposed not the decision to hold at 3.5-3.75%, but the easing language embedded in the statement, which they wanted removed. A fourth dissenter, Governor Miran, voted for a cut. The minutes confirm that the incoming Warsh Fed is inheriting a committee that has already pivoted internally toward tightening — making June 16-17’s first Warsh-chaired FOMC a live meeting. With CPI above 3% and core PPI elevated, markets now price roughly 50% odds of a June hike.
CNBC
Eurozone Flash PMI Hits 31-Month Low as Germany, France, and UK All Contract
Source: Bloomberg / Euronews / S&P Global
Date/Time: May 21, 2026
The S&P Global Eurozone Composite PMI fell to 47.5 in May — the lowest reading in 31 months — from 48.8 in April, with all major economies registering accelerating contraction. Germany contracted for the second consecutive month; France posted its sharpest slump since the COVID-19 outbreak in April 2020 (French firms turned pessimistic about the year ahead for the first time since November 2024); the UK Composite PMI slumped to 48.5 — a 13-month low — from 52.6. The data confirms that the energy-price shock from the Iran war is transmitting into genuine demand destruction across Europe: manufacturing reversed sharply after a brief April uptick, services decelerated, and business confidence fell across the board. The European Commission’s spring forecast, also released today, formally labeled the situation a “stagflationary shock” — fastest inflation since 2023 alongside a marked growth slowdown. The ECB faces a June 10 rate decision where the macro picture is unambiguously deteriorating even as price pressures persist.
Euronews
UK Private Sector Contracts as Starmer Loses Health Secretary; 97 Labour MPs Seek His Removal
Source: Bloomberg / CNN / CNBC
Date/Time: May 21, 2026
The UK Composite PMI collapse from 52.6 to 48.5 — the first contraction in 13 months — compounds a deepening political crisis uniquely complicating the BOE’s policy path. Health Secretary Wes Streeting resigned from the cabinet on May 14, following four junior ministerial departures on May 12, explicitly citing lost confidence in Starmer’s leadership. Within the parliamentary Labour Party, 97 MPs openly want Starmer to resign or set a departure timeline, with 147 more uncommitted. The political uncertainty creates a feedback loop: a potential leadership vacuum suppresses business and household confidence (amplifying the PMI contraction), complicates near-term fiscal planning, and keeps gilt markets on edge. For the BOE, a country where both the economy and the government are simultaneously deteriorating makes the rate path harder to calibrate — a June hold is probable, but the medium-term path is clouded by both stagflation risk and political instability in combination.
Bloomberg
BOJ Board Member Koeda Calls for Rate Hike; Japan April Trade Surplus Massively Beats
Source: Bloomberg / Japan Times
Date/Time: May 21, 2026
BOJ board member Junko Koeda said the central bank should raise rates at an “appropriate pace,” warning that persistent high oil prices from the Iran war risk pushing underlying inflation above 2% on a sustained basis. She also flagged concern about the costs of prolonged negative real rates. Her signal reinforces the case that at least five of the nine BOJ board members now favor action at the June 16 meeting — markets price a hike at 70%, and two-thirds of economists polled by Reuters agree. Supporting the hawkish case, Japan’s April trade balance registered a ¥301.9 billion surplus — versus a ¥44.5 billion deficit analysts expected — its third consecutive monthly surplus, driven by soaring exports and a sharp drop in energy import values. The trade data removes a potential dovish argument. Together with last session’s Q1 GDP growth of +2.1% annualized, Koeda’s statement gives the BOJ an unambiguous macro backdrop for June action.
Bloomberg
France’s Moulin Confirmed as Bank of France Governor Despite Parliamentary Opposition
Source: Bloomberg
Date/Time: May 20, 2026
The French parliament failed to block President Macron’s nominee Emmanuel Moulin as Bank of France Governor: 58 of 110 combined chamber members voted against — a majority opposed, but the 3/5 supermajority required by the French Constitution to formally reject the appointment was not reached. Moulin, a Macron loyalist and explicit advocate of shared euro-area debt instruments, will succeed François Villeroy de Galhau when he steps down in June. His appointment to the ECB Governing Council adds a voice on the fiscal-activist wing at a particularly sensitive moment: the ECB faces a June 10 decision where its own inflation mandate points toward further tightening even as the stagflation data argue for caution. Moulin’s arrival also carries weight for the EU joint fiscal capacity debate — a Bank of France governor openly supporting eurobonds changes the institutional tenor of that conversation within the ECB framework.
Bloomberg
Australia Unemployment Jumps to 4.5%, Sharpening RBA Policy Dilemma
Source: ABS / CommBank / Reuters
Date/Time: May 21, 2026
Australia’s unemployment rate rose 0.2 percentage points to 4.5% in April — above the 4.3% expected and the highest since November 2021 — as employment fell by 18,600. The data arrives weeks after the RBA raised the cash rate 25bp to 4.60% in May, its third consecutive hike, justified by de-anchoring inflation expectations. Money markets have now pared back further tightening expectations, effectively removing the 20% probability of a June hike. The RBA faces the same stagflation dilemma as the BOE — having tightened into demand destruction while inflation remains structurally elevated by energy costs. CommBank now expects unemployment to peak at 4.6%. The episode is a template for how other G10 central banks hiking into oil shocks may face the same bind: policy tightening works on demand, but supply-driven inflation does not yield, leaving central banks with a weakening economy and still-elevated prices.
CommBank Research
China Government Spending Contracts 7.3% in April, Undermining Stimulus Narrative
Source: Bloomberg
Date/Time: May 20, 2026
China’s broad government expenditure fell 7.3% year-over-year in April — the sharpest pullback in six months, accelerating from the 2.5% decline in March. Fiscal revenues meanwhile rose 2%, widening the income-spending gap in the wrong direction: Beijing is spending less relative to prior year at exactly the moment when the economy faces compounding headwinds from war-driven energy costs and subdued domestic demand. Last session’s data showed a broad April miss on fixed-asset investment and retail sales; today’s fiscal data suggests the government’s net impulse is contractionary rather than supportive. The headline 4% deficit target and special-purpose bond program remain on paper, but monthly execution is signaling restraint. The combination of weak private demand, deteriorating business confidence, and a government pulling back on fiscal support represents the strongest evidence yet of a stall on the deflation escape — China’s core macro question for 2026.
Bloomberg
Nvidia Posts Record $81.6B Revenue, Q2 Guidance $91B; AI Capex Accelerates Despite War
Source: CNBC
Date/Time: May 20, 2026
Nvidia reported Q1 FY2027 revenue of $81.6 billion — up 85% year-over-year and 20% quarter-over-quarter — driven by data center revenue of $75.2 billion (+92% YoY). Q2 guidance of $91 billion significantly exceeded the $86.84 billion analyst consensus. The company also announced $80 billion in additional share repurchases and raised its quarterly dividend from $0.01 to $0.25. Despite the blowout results, the stock declined post-earnings on sell-the-news dynamics, suggesting AI capex is fully priced in equities. The macro reading cuts both ways: unabated AI infrastructure investment signals that corporate capex has decoupled from the war shock, but the same datacenter demand surge — at hundreds of megawatts per facility — will amplify the energy demand side of the global supply crunch for months to come, complicating the “oil demand will fall as the war resolves” thesis.
CNBC
Goldman Sachs: Global Oil Stockpiles Falling at Record Pace
Source: Bloomberg
Date/Time: May 21, 2026
Goldman Sachs reported that global crude and product inventories are declining at their fastest ever pace as Middle East war supply disruptions compound seasonal demand. Even as Trump’s “final stages” language briefly pushed WTI below $100, Goldman’s analysis underscores why oil rebounds quickly on any peace uncertainty: the physical market is structurally tight and getting tighter. The bank’s inventory analysis corroborates the IEA’s unscheduled warning from last session, and suggests that even a partial Hormuz reopening would take weeks to translate into material stockpile rebuilding. The implication is that oil at $95-100/bbl is close to a floor even under a peace scenario, meaning the energy-driven inflation impulse persists regardless of how negotiations resolve — a direct challenge to the “wait and see whether the shock is temporary” framing at both the ECB and the Fed.
Bloomberg
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