Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche

Historical Insanity

Vladimir Putin is the Logical Outcome of Oligarchy

The world needs to learn Vladimir Putin is the logical outcome of oligarchy. Russia’s oligarchy created Putin and put him in power.

History shows oligarchy always leads to dictatorship in one of two ways. First, the oligarchs give a tyrant power to protect their wealth and status. Or second, the people support a tyrant to protect them from the oligarchs. 

Tyrants rise to power by promising to protect the people from the oligarchs, or the oligarchs from the people. Putin is an expert at both games. For example, Putin rewards select oligarchs with control over large swaths of the Russian economy. Second, Putin plays the strongman on Russian TV and punishes a few oligarchs to keep the mob happy.

Putin is a Creature of Oligarchy

In particular, Putin goes after oligarchs who do not support his sick regime. For example, Putin imprisoned oil tycoon Mikhail Khodorkovsky. Forbes estimates Khodorkovsky was the richest man in Russia in 2003. Khodorkovsky’s “crime” was funding opposition parties.

Conversely, Putin rewards oligarchs who support him. For example, Putin created a new class of Russian oligarchs loyal to him by giving away state contracts in the early 2000s. In particular, Putin gave Russian government assets to oligarchs that support him.

Additionally, Putin lets oligarchs keep their wealth, or take it out of the country, if they keep out of politics. Hence, Putin got power and kept it by allowing the oligarchs to loot the country.

Putin is a creature of oligarchy. The Oligarchs put Putin in power and kept him there.

Oligarchy in History

History shows dictatorship is the inevitable outcome of oligarchy. Ancient Rome, for example, went from quasi-democracy to oligarchy to dictatorship to monarchy.

Similarly, the oligarchy of France’s Ancien Regime triggered the chaos of the French Revolution, which gave rise to Napoleon I’s militaristic French Empire. Likewise, Russia’s 19th century oligarchy led to the Russian Revolution and the Soviet dictatorship, which spawned today’s Russian oligarchy.

How Oligarchy leads to war

Putin shows another result of oligarchy: militarism and nationalism. Oligarchs promote a large military to protect their wealth and line their pockets with defense contracts. Additionally, oligarchs often launch wars to steal the resources of other countries.

For example, one rationale for Putin’s invasion of Ukraine is to seize that nation’s wheat production. Ukraine is the world’s ninth largest wheat producer, World Population Review estimates. Ukrainian farmers grow around 26.2 million metric tons of wheat a year. Wheat is a valuable export in an increasingly hungry world.

Wheat is only one of many Ukrainian resources Putin and his mob want to get their hands on. For example, Entreprogrammer notes Ukraine is an important source of many minerals; including lithium (a key ingredient in batteries), uranium, iron, titanium, mercury, graphite, and manganese.  

Oligarchy leads to war because when oligarchs finish looting their own country, they pillage other lands. Historical oligarchies such as the Ottoman, Spanish, Dutch, French, Roman, British, Russian, Soviet, and Japanese empires waged war for resources. Often because they had no money to buy the resources.

How Oligarchy Leads to Fascism

It is in the interest of oligarchs to promote political leaders who encourage mindless loyalty and blind obedience to the state or nation.

Accordingly, Putin promotes the ideas of fascist and Russian nationalist philosophers, such as Ivan Ilyin, and the reactionary early 20th century Russian politician Petr Stolypin. The goal is to encourage loyalty to the system and criminalize dissent.

Similarly, oligarchs sometimes support racist or anti-Semitic politicians in order to distract the people from their activities. For example, in the Jim Crow-era, American South corrupt Democratic politicians and local oligarchs promoted racism and segregation to protect their own wealth and power. The politicians and oligarchs backed Jim Crow to keep black and white middle and working-class citizens from uniting against them.

One logical result of oligarchy is fascism. To explain, some oligarchs become fascists, or promote fascism, to protect their wealth. For example, in 1930s Germany, some oligarchs supported Hitler because they believed the Nazis could protect them from Communism.

Oligarchs often finance fascists, or promoters of fascist ideologies, as an alternative to socialism or Communism. Additionally, many oligarchs sincerely believe in fascist ideologies.

Notably, the heyday of fascism was the 1920s and 1930s, was also the heyday of Communism in Europe and the United States. During that period, many fascists, including Benito Mussolini, Adolph Hitler, and Francisco Franco, received direct, or indirect, support from oligarchs.

Will our Oligarchy lead to Tyranny?

Americans need to examine the catastrophe of Vladimir Putin carefully because the United States is becoming an oligarchy.

Notably, Russia is the country in which billionaires (a popular euphemism for oligarchs) control the largest share of the nation’s wealth. The Financial Times estimates oligarchs control around 35% of Russia’s gross domestic product (GDP) in May 2021.

Frighteningly, the United States had the fourth largest percentage of the national wealth controlled by the super-rich in 2021, Morgan Stanley Chief Global Strategist Ruchir Sharma estimates. Conversely, the country with the second highest level of oligarch wealth was Sweden. Sweden is one of the world’s most egalitarian countries.

Yet, the similarities between the American and Russian oligarchies are striking. For instance, the $640 billion held by the richest 500 Russians exceeded the wealth of 99.8% of the Russian population, or 114.6 million Russians, the Boston Consulting Group estimates.

Similarly, Statista estimates around 10% of America’s rich hold around 68.8% of the nation’s wealth in 2021. Furthermore, another 9% of the nation’s rich held around 37.7% of America’s wealth in 2021. In contrast, the bottom 50% of US residents held around 2% of all American wealth in 2021.

Oligarchy American Style

Statistically, America’s oligarchy resembles Russia’s. However, America still has strong but weakening democratic and republican institutions.

Conversely, both of America’s governing political parties have become more nationalist, militaristic, and authoritarian in recent years. For example, the Republican Party has become openly racist, nationalist, and white supremacist. Additionally, the Republican leader, former President Donald J. Trump (R-Florida), undermines democratic norms by questioning elections and demanding absolute obedience.

Similarly, the Democrats and other leftists openly support oppressive measures, such as the Patriot Act and increased censorship. For example, President Joe Biden (D-Delaware) expressed support for more police funding in his 2022 State of the Union of the address. Biden even said “the answer is to fund the police.”

Additionally, cancel culture and the suppression of free speech in media are popular on the left. For example, many Democrats applaud social media companies deplatforming of Trump and demands to ban the right-wing Fox News network. Predictably, some Democrats imitate Republicans by canceling anybody who questions Biden’s abilities and agenda.

Notably, both parties support growing military spending. Notably, the US Senate passed a $768.2 billion 2022 defense budget with an 89 to 10 vote in November 2021. The US Senate is evenly divided and gridlocked between Democrats and Republicans, yet it agrees on increasing the military budget. Thus, both parties agree on militarism.

Similarly to Russia, America has seen a growth in the popularity of fascism, racism, nationalism, class warfare, and militarism as oligarchy and inequality increases. America is already well on the way to oligarchy and dictatorship.

The antidote to oligarchy is not dictatorship but equality and strong democratic institutions. Frighteningly, America responds to oligarchy with growing income inequality and weakening democratic norms.

Unfortunately, I predict Americans will learn the wrong lesson from the Putin disaster in Russia. Instead of learning the dangers of oligarchy, Americans will assume their imagined moral superiority separates them from the Russian barbarians. Hence, Americans will keep marching down the road to oligarchic catastrophe as they try to rally the world against Vladimir Putin’s idiotic dictatorship.

If we want to prevent future Vladimir Putins. The world needs to get rid of oligarchy once and for all.