Economic Overlords Are Destroying Democracy — and Our Lives
Economic power is political power. We spoke with Peter Phillips, author of Titans of Capital, about how the capitalist class is subverting democracy and controlling the lives of billions through massive investments in everything from food to war.
The board members of the top 10 investment management firms control nearly $50 trillion in assets. (Matteo Colombo / Getty Images)
- Interview by
- David Moscrop
Titans of Capital: How Concentrated Wealth Threatens Humanity, the upcoming book from Peter Phillips, professor of sociology at Sonoma State University, explores the influence of the “titans” — the board members of the top ten investment management firms who control nearly $50 trillion in assets. In conversation with Jacobin’s David Moscrop, Phillips explains how these 117 corporate overlords wield unparalleled economic and political power, shaping global policies and deepening economic inequalities. They exploit crises like global warming and rising food prices, using institutions like the World Economic Forum (WEF) to promote their interests.
Despite their immense power, they remain wary of mass politics and social movements, recognizing the potential for resistance from below.
Beware the Titans
Who are the titans, and what makes them titans?
The titans are a kind of working sociological category, representing the board of directors of the top ten investment management companies in the world: BlackRock, Vanguard, UBS, Fidelity, State Street, Morgan Stanley, JPMorgan Chase, Amundi in France, Allianz SE in Germany, and Capital Group.
I chose ten companies to create a manageable sample size, resulting in 117 people whom I call “titans.” These are the most powerful people in the world — they decide where almost $50 trillion worth of capital is going to be invested.
That wealth controlled by these 117 people is unprecedented. When I wrote my book Giants five years ago, it was already staggering, but it has since more than doubled. So it’s quite a transformation.
Economic power is political power. Political power can be used to reinforce and grow economic power, and vice versa. How do the titans manage this process of using their political power to boost their economic power and their economic power to boost their political power?
It’s not that they have direct political power. The US government, military, and intelligence agencies are designed to protect the vital interests of the United States and global capital. While they do accommodate the needs of the Titans and may have direct communication with them, it’s not like they stake direct marching orders. It is more a matter of influence.
The titans participate in a number of policy groups, the Atlantic Council being one of the most powerful. At least half of them go to Davos every year, further extending their reach into corridors of power. Ultimately, capitalist governments are structured to protect capital, which is why the wealth of the titans continues to increase.
Investing in Misery
These people exist to accumulate capital. They pressure the state to set rules that facilitate accumulation of capital. You write that the titans profit from the climate crisis, from war, and from addictions. What’s the strategy here? Is it simply that they’re nihilists — they don’t care where they get their money? If there’s an opportunity, they’re going to seize on and exploit it?
Well, one of their biggest problems is finding sufficient safe investment opportunities. They have more capital than there are secure places to invest, which pushes them into speculative investments. They must continually find new opportunities or push political agendas that open up different areas for new investment. They would love to see the authoritarian patronalism of Putin’s Russian Federation replaced by a pro-capitalist government to crack open the country’s vast natural resources.
Their need to grow and achieve returns in the 6, 7, 8 percent range or higher means they constantly need new investment opportunities. This relentless pursuit often leads to speculative investments, which can sometimes go wrong, or investments into areas that have negative consequences, such as fossil fuels contributing to global warming. They have $400 billion invested into the world’s top gas- and oil-producing companies, a commitment they can’t easily reverse. That’s one of the biggest reasons that global warming continues — because of that capital investment. There’s no effort to undo that. There would be no way to take that $400 billion and put it somewhere else that would continue to provide similar growth.
The titans won’t waste a crisis if they can exploit it. You argue that the affordability crisis has been good business for them. How have, for instance, rising food prices boosted their bottom line?
Well, they’re widely invested in the biggest food companies. They have $85 billion in Archer-Daniels-Midland. They have $165 billion invested in Cargill. The consequence of inequality and rising food prices is dire: several hundred million people in the world live on just $2.15 a day, and 80 percent of people in the world live on less than $10 a day. This vast inequality continues to grow, leading to twenty-five thousand deaths daily from malnutrition alone.
Davos: Shield for the Rich
Big finance is very good at creating and using institutions to support their ends or to whitewash their records or to run PR for them. You write about Davos and the World Economic Forum specifically as examples. How do the titans use Davos and the WEF as a PR machine?
They’ve embraced the World Economic Forum because it provides a platform to promote the idea of good governance and universal security. But it’s largely propaganda aimed at defending capitalism. The titans recognize the growing inequalities and resulting resistance that top-down capital accumulation can provoke among global populations. So they’re trying to mitigate that. By participating in forums like Davos, they attempt to portray capitalism and their activities as beneficial and equitable. Nothing could be further from the truth.
They claim that extreme poverty has been declining, and it had been until the pandemic hit, causing it to rise back up by a couple hundred million people. However, even before the pandemic, the decline in extreme poverty was primarily due to progress in one country: China. China deliberately eliminated extreme poverty, defined as living on $2.15 cents a day. While China still has several hundred million people living on $5 a day, it has successfully eliminated extreme poverty according to the UN’s definition. In contrast, extreme poverty has not been eliminated anywhere else in the world and has actually increased in several capitalist countries.
Do the titans have a weakness? They seem so tremendously powerful that the long-term project of undoing the plutocratic order and struggling for economic democracy and justice seems extraordinarily difficult. Do you see any points at which they’re vulnerable?
They’re vulnerable to mass politics and social movements of any kind: civil rights movements, anti-poverty movements, and urban unrest, even though such unrest can be violently repressed by governments worldwide. This vulnerability is one of the reasons Davos meets annually — to accommodate or make changes that can preempt any potential social movement developments that might threaten them.
They’re afraid of revolution from below because they’re just a small minority of people with extreme wealth trying to maintain this inequality — and it’s growing ever greater. Following [Karl] Marx’s understanding, it does seem inevitable that these underclasses will eventually resist, saying, “we’re not going to play anymore.” The titans are constantly aware of this and trying to mitigate it as best they can.