Jeff Bezos is so clearly an oligarch. Daniele Venturelli/Getty Images
When you hear the word “oligarch”, you might imagine someone like Farkhad Akhmedov, one of the 50 wealthiest Russians. In his book Mastering the Universe, economics professor Rob Larson writes that Akhmedov’s personal superyacht features a pair of helipads, a mini-submarine, and a pool across nine decks. His enjoyment of this floating “beast” is marred only by his anxiety about “keeping it from his ex-wife”.
The amount of wealth hoarded by Russian businessmen is staggering. Forbes estimates Akhmedov’s 2025 net worth at $1.6 billion. To put that into perspective, imagine an immortal being, perhaps a vampire, travelling to the New World with Christopher Columbus in 1492. Every day since then, the vampire somehow acquires the equivalent of 1,000 contemporary American dollars. He never spends any of it. Perhaps he just stacks the money in coffins. The vampire will become a millionaire by sometime in 1495. In 2025, though, he’ll still be less than a fifth of the way to having a billion dollars.
Akhmedov is clearly very wealthy. Yet if he were an American, he wouldn’t even make it into the list of the 400 wealthiest US citizens. Why, then, does Russia have “oligarchs” while America apparently only has rich people?
Occasionally, Bernie Sanders will use the o-word to describe people like Elon Musk and Jeff Bezos, each of whom have hundreds of times the net worth of Farkhad Akhmedov. When this happens, the most common rebuttal is that Russian oligarchs typically owe their wealth (at least in part) to their political connections, whereas American billionaires became wealthy through the power of the free market.
It’s true that plenty of Russian oligarchs owe much of their wealth to a particularly brazen form of corruption. In the Soviet era, economic resources were, in theory, the collective property of the whole population, though in practice they were controlled by an unaccountable state bureaucracy. After the collapse of the USSR, no one asked the Russian people whether they wanted to enter an era of capitalism or experiment with some form of democratic socialism instead. There was no popular referendum on whether to privatise public assets. Instead, in many cases, canny bureaucrats simply turned state enterprises into their own private fiefdoms, while the population at large underwent economic shock therapy.
There are three big problems, however, with the idea that America’s ultra-wealthy capitalists aren’t oligarchs because they made their fortunes the “right way”: in the private sector. The first is that the distinction between the two systems is less clear than it might seem at a quick glance. In post-Soviet Russia, private-sector actors grew astoundingly rich off the state, as one economic order was surpassed by another. But many ultra-rich Americans also benefit plenty from political connections, and none of them are too proud to accept government handouts.
The richest man in the United States, Elon Musk, has earned tens of billions of dollars directly from government contracts. That’s many times more than the total wealth of a typical Russian “oligarch”. And that’s not to mention SpaceX and Tesla, which, as Chris Isidore writes, both “got started” (and “survived their early days”) thanks to assistance from state and federal policies, government contracts and loans. That’s the foundation on which Musk’s fortune was built.
More generally, the American tech sector, often celebrated as a powerhouse of private-sector innovation — and certainly the source of a great many billionaires — has benefited dramatically from the blurred lines between private wealth and state policy. The only TED talk I ever recommend that people watch is one by the economist Mariana Mazzucato, who goes through the components of an iPhone one by one and discusses where they come from. Pretty much everything that makes a smartphone “smart”, from the GPS to the touchscreen to Siri to the internet itself, stems from public-sector innovation. The breakthroughs happened in the Department of Defense or in public universities or via researchers in labs funded by grants from the federal government. In a less explicit way than the Russian oligarchs, America’s tech oligarchs have found ways to convert state investment into private profits.
The second and deeper problem with the denial of American oligarchy is that an oligarch isn’t just someone who gets rich the wrong way. “Oligarchy” is government by a small group of powerful individuals. What makes someone an oligarch is that they exercise great power, not that they benefit from association with those who do.
The power of American plutocrats plays out on multiple levels. First and most obviously, American business magnates have direct power over the lives of vast numbers of employees. Musk or Bezos can replace any particular Tesla or Amazon worker far more easily than that worker can replace the source of their livelihood, and so these men run their businesses like miniature dictatorships. This economic power translates in turn into massively disproportionate political influence.
These days, in fact, America’s billionaire corporate overlords exercise more oligarchic power over the political process than their counterparts in Moscow and Saint Petersburg. As Larson writes, when Vladimir Putin consolidated his personal rule, his “mandate was to bring” the oligarchs “back under control”. The informal “entente” held that Russia’s ultra-rich would scale back their interference with politics, and not “complain too much when Putin’s state locked up political opponents”. In exchange, a more stable regime would secure their property and wealth.
American oligarchs have made no such compromise. When Musk is mad about a potential spending deal in Congress, for example, he can spend all day rage-posting about it on X, and explicitly threaten to finance primary challenges against any Republican congressmen who votes for the deal. Few politicians would dare ignore such a threat. Even the billionaire who currently serves as President of the United States hesitates to butt heads too directly with Musk on contentious issues. After all, Musk’s riches put Trump in the White House. Compared to Musk’s $455 billion, Trump’s fortune of $6.61 billion is almost cute.
Nor are the oligarchs confined to the Republican side of the aisle. Kamala Harris had 83 billionaires donating to her campaign. According to a report from Americans for Tax Fairness, Harris received $143 million in billionaire donations — though this looks modest compared to Trump’s $450 million. Even so, those 83 billionaires would almost certainly have exercised real political influence in a Harris administration.
The relentless concentration of private wealth, and with it the political influence of the wealthy, has metastasised in recent decades under Republican and Democrat presidents alike. American oligarchs have shot into the financial stratosphere, at least in part, due to the decades of market-fundamentalist public policy first popularised by Ronald Reagan but continued by the likes of Bill Clinton (who gave us Nafta and a grimly Dickensian “welfare reform”) and Barack Obama (who responded to the 2008 crash by bailing out banks and leaving homeowners underwater). Even Trump, who campaigned as a “populist”, spent much of his first term pushing lower taxes for the wealthy and slashing the regulatory state. And the somnolent administration of Joe Biden wasn’t prepared to reverse this trend.
If this process has been slower and less dramatic than the birth of the Russian oligarchs at the close of the Soviet era, its results have been far more striking. Four Americans (Musk, Bezos, Mark Zuckerberg, and Larry Ellison) are expected to become trillionaires within the next five years. And following a decades-long, highly effective business offensive against union organising, the vast majority of American workers are unorganised. America’s labour laws are vastly less favourable to union organising than regulatory regimes in otherwise comparable nations. “Sympathy strikes”, for example, where one group of workers joins a strike to help another win their demands, are illegal. But it is perfectly legal to “permanently replace” striking workers. This leaves us with no political force that could meaningfully stand up to the power of America’s oligarchs.
We could at least start by acknowledging that American oligarchs exist. It is an act of moral evasion to insist on using morally neutral terms to describe “very rich” Americans while we call their comparatively poor cousins in hostile nations “oligarchs”. As they say in Alcoholic Anonymous, the first step is admitting that you have a problem.
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SubscribeProf. Burgis is most definitely left of centre. But so what? He makes an interesting point. There are three strands of thought here.
Musk, Bezos et al have grown rich, in part off the back of government-funded inventions. Good for them. But do their businesses resemble Standard Oil during the Gilded Age? Are they monopolies, who act against the public interest? Burgis is silent on this.
Where Burgis is voluable is about the political influence their wealth brings. Americans can deal with that by limiting political donations.
Finally, using social media as a bully pulpit. Does it have much effect? A century ago, politicians quailed before the likes of Northcliffe and Beaverbrook. But the power of the press was always more apparent than real. Can we say the same about Musk?
If you don’t like musk don’t buy his crap.
Where was Prof Burgis when the billionaires were almost all firmly behind the Democrats?
Or are they only a problem and do they only become oligarchs when they cease to tow the party line?
Is Prof Burgis another mediocre, dishonest, corrupt left wing academic?
Absolutely. No one mentions Soros or the Clinton Foundation groupies of the corporate sector.
Good point, although it is hard to know if this is intellectual dishonesty or just the fact that the Left is generally a few years behind in realizing what is going on (lab leak, vaccine ineffectiveness, border crisis, working class shift to the Right, perils of wokeness, etc., etc., etc., etc.). For just about every major political and cultural shift, the Left denies, denies, denies, then minimizes, minimizes, minimizes, and only very late begrudgingly accepts.
This is a very interesting and counter-intuitive observation. So the left is more conservative than the right; progressives are more conventional than reactionaries. I never thought of it that way before!
Nah, they just love their lies more.
Some people might say the good professor was on his knees under the desk when Soros was sitting at the desk sneaking and sleazing away.
Northcliffe was the single most important reason we jumped into The Great War (WWI). He was even more culpable than the deplorable Asquith.
I very much doubt that any man living today has anything like so much power.
‘Thanks be to God’.
This seems ultimately a question for the US government and people – i.e. how they wish to tax and regulate these huge tech companies. They’re currently letting them do whatever they want (like keeping their profits and IP in countries like Ireland so they can avoid paying US taxes). These are all decisions that could be changed and different tradeoffs made.
I’m not convinced that these tech near-trillionaires are any more exploitative of their workers than company bosses in the past. Those fortunate enough to work in their companies generally do very well. It is the external costs (on those who don’t) that are the concern.
If/when the US tech/AI stock bubble bursts (these men may well never become trillionaires), the illusion that all Americans are benefiting from their work through a rising stock market may vanish and a rather different perspective set in.
Not so sure about this:
“After all, Musk’s riches put Trump in the White House.”
Kamala Harris had more money backing her. And the US voters put Trump in the White House.
Didn’t someone say yesterday that 1% of Americans pay 40% of the Federal tax take?
What’s so wrong with that? And surely it deserves its rewards?
I’m more concerned with companies avoid corporate taxation here (and not with individuals).
But my main point – where I think we agree – is that it’s far too easy to blame rich individuals who are only responding to the prevailing laws and regulations and the signals these send out. In the same way I’d consider the banking regulators more at fault than the bankers in 2007 (at least for the non-criminal end of banking).
As RAZ notes below, we can’t forget the role of QE (government policy) in creating the tech wealth/asset bubble.
Prior to the ‘Judgement of Death Act, 1823,
FRAUD was a capital offence.
As to QE, even at the time it was castigated as madness at best.
I knew from the photo at the beginning of the article that the conversation would devolve into contemplating asset bubbles.
Fake news.
My concern is the government’s.use of the tech companies to get around the 1st amendment. Need to comtrol speech, get SM platforms to do it for you. Want.programmable money without the overt taint of a social.credit system? Get Cirrcle to do it for you (UK example). .We live in a kleptocracy in my view.
What happened in Russia as part of the so-called shock therapy seems to happen in the US and the West in slow motion. It could be seens as a symptom of failed neoliberalism, however, there are also differences.
First of all, I think it is true that US oligarchs are also a products of the state but in a less deliberate manner. Mariana Mazzucato makes a good case, in many ways, Silicon Valley is essentially the commercialization of DARPA.
But there is another massive source of public money that made the oligarchs into oligarchs all of a sudden:Quantitative Easing (QE). The insane amount of money printing after the 2008 crisis (approximately 5 trillion) and then again during the pandemic (approximately 10 trillion), ended up disproportionally in financial assets such as tech stocks It also pushed interest rates down on credit pushing up asset prices even further. It is really obvious if you look at the numbers: net worths of some billionaire’s increased tenfold after 2020.
However, this also shows a major difference with the Russian oligarchs. Russian oligarchs typically own essential resources such as oil, whereas the wealth of tech oligarchs is often based on speculative stocks with high price to earnings ratios. That means that the value of their companies are not that high because they sold a lot of stuff. Instead they just got a huge amount of money from investors who were sitting on piles of (QE) liquidity. A .com style bubble burst or a 2008 credit crisis, or a combination of the two, might evaporate much of their wealth as well. It therefore makes some sense that the ultra-wealthy will use their new wealth to acquire essential things such as land, real estate, energy resources and political power. It should be obvious why that is a threat to the middle class.
American oligarchs only wield more power than Russian ones because the don’t have to kowtow to a dictator and his horrendous FSB/Mafia protectors. I would rather see a democratic form of mitigation than one that employs oligarchs as a means of furthering dictatorship.
Sympathy strikes sound unreasonable (what does that directly have to do with the union or its members) but if they are to be allowed then the employer must be allowed to also sack for striking. The balance is maintained by the cost of meeting the employees’ demands vs the cost of sacking them all and having to start again with a new workforce.
And while on that point why are huge redundancy payments required? Notice payments sure, but why more?
“imagine an immortal being, perhaps a vampire, travelling to the New World with Christopher Columbus in 1492. Every day since then, the vampire somehow acquires the equivalent of 1,000 contemporary American dollars. He never spends any of it. Perhaps he just stacks the money in coffins. The vampire will become a millionaire by sometime in 1495. In 2025, though, he’ll still be less than a fifth of the way to having a billion dollars.”
I’ve always wanted to be a vampire for this precise reason.
Seriously though, it does put it into perspective of just how absurdly rich some people have become. It cannot possibly be ‘earned.
It is fascinating and disgusting at the same time that the “progressives” were all in on the billionaires as long as the vast majority did what the “progressives” told them. Now that some of the billionaires are daring to question the “progressive’s” version of the Naked Emperor, the billionaires are dangerous oligarchs. The tell that the “progressives” are just loud, dangerous hypocrites is the cloak of silence regarding Soros. Soros is the oligarch siphoning of crazy amounts of government money worldwide to push “progressive” tyranny. A close second would be Bill Gates. The free press talk about both, but the “progressive” media complex won’t talk about either.
The world would be a better place if Soros and Gates would fall into a black hole.
Where was this pearl clutching when the mega rich – the tech titans, black rock, much of Wall Street, etc were aligned with the left? George Soros bought a bunch of district attorneys who ignore crime, and any criticism of him was deemed to be anti semitic. Try principles instead of principals.
You had no issue last year, when they were all on your side
I’m sorry for being disrespectful, but is the person in Mr. Bezos’s arm in the photo above a real person or a blow up doll from a high end toy shop?
‘High end?’ I think you are being a tad generous there.
Rubbish. American “Oligarchs” made their huge fortunes transparently, legally providing goods and services desired by the masses. (Like your I-phone)
Russian “Oligarchs” made their fortunes by asset-stripping Russia.
One is transparent and legal, the other is illegal Mafia type thuggery.
They could not be more different.
Have any of you considered a correlation between the Overton Window concept being tossed about and William Gibson’s book The Periferal? The underlying theme in William Gibson’s tale is that a very powerful group of people are attempting to force the majority of humanity down a subjectively real rabbit hole.
I sense this happening in real time with the discussion of the Overton Window and all this psychological propaganda demanding that we liberals be abashed and back on our heels because we perpetrated the vile crimes of believing in a kinder world where DEI was a normal perception of life and what ever it is we are doing to get shoved so derisively under the Woke umbrella should be considered that horrible badness, “Woke” whatever the f..k that means
This is a very large attempt to shift the “normal” range of perceptions into a dangerous realm, a white nationalist realm, a realm with very harsh separation of castes, of haves having full freedom to behave as bohemians, while the rest of us grind along behaving properly making the f*****g economy work, and if we make provocative statements like the f*****g economy sucks, we are remanded to hell.
In my mind, the battle for reality is what is transpiring here. There are some very big, very powerful players pushing us down a rabbit hole, just like in ‘The Periferal’
What is a “normal” range of perceptions? BLM, Net Zero, DEI? Who defines ‘normal’?
Every time I read an UnHerd article written by Ben Burgis, I wish that there came a critique of it written by Thomas Sowell.
A good discussion to have, but there’s something fundamentally out of whack about comparing Bezos (despite what he chooses to hang off his arm in that picture) and Amazon with the Russian guys who have gained charters to steal from the head guy who managed to gain control of Russia the good old fashioned way, by killing anyone who got/gets in his way. Yeah yeah, beyond Russian obscene wealth, but I think the better comparison and the one we have to think about is Bezos et al via tech and Rockefeller/Morgan et al via industrialization.
That in the US oligarchs are not referred to as oligarchs is proof of their power.