I think this loss of historical materialism might have come at the same time as Marxists adopted the idea of culture as the dominant way in which oppression and exploitation are reproduced. They talked of 'the means of cultural reproduction', by which they meant literally reproducing capitalism as a world order and oppressing the masses. So they weren't saying 'culture is also important, let's look at how it contributes,' but they were saying 'culture is how capitalism maintains itself; it's culture that is central'. That was the Frankfurt School, anyway. (I think there were some big fights and the socialist left tended to veer to a more materialist class analysis. They were also interested in raising class consciousness, but they thought the way to do this was to explain how economic exploitation worked. I think even in the 80s and 90s this analysis persisted. But eventually the left came on board and are now the leaders of wokeism.)
But then, by moving the focus from the economy to the culture, I wonder if the neo-Marxists built a theory that was essentially incapable of changing? They believed that 'the ruling culture is always the culture of the ruling class.' So in a way they sort of stopped history by inventing this permanent condition where the ruling class basically control our minds. They then had to fit everything into this condition, and they did this by essentially jettisoning anything that didn't fit. And they could do this, because postmodernism said that nothing really meant anything, and the post-structuralists led the way in showing how to use words to take literally everything apart, except for this one idea which was then considered to be 'material reality'.
Having said that, maybe another part of this is the beginnings of mass media - Walter Benjamin wrote about television, and television in particular was seen as the new 'opium of the masses'. The cultural hegemony was sustained by these new mass media, with the ruling class able to now mind-control people far more easily. This idea, as well, has been really influential. (I'd really love to also put Marshall McLuhan in here somewhere. He had a really different take on the media, and he both predicted the internet and knew it would be a force for evil.) Ironically, it is social media that is mind-controlling the masses, not through hegemony, but through addiction. And more ironically, it doesn't propagandise for one supremacist worldview; it propagandises for the idea that there is no truth at all.
It's interesting that as critical theory and postmodernism and social justice meet and fuse, they actually don't become more complex and multivalent and proliferant of meaning. They actually become less complex and less dynamic, and less capable of creating meaning. They tend towards slogans as the highest point of explication. Because it's a success of the theory if there is only one thinkable thought: revolution! So it's always working its way towards shedding everything that's unecessary, deconstructing everything that can contradict it, until it ultimately becomes both theory and activism in one.
It is absolutely pissing down with rain here so I'm just sitting trying to figure this out! I think I'll need to listen to it about ten times. Thanks so much for talking about it!