Donald Trump and his family, according to the careful reporting of David Kirkpatrick at the New Yorker, are reported to have amassed $4 billion since the start of his presidency through a dizzying panoply of schemes, most of which appear to be designed to pump up the value of his assets (crypto holdings, his golf clubs and hotels, and so on). In addition, investigators have alleged that Trump has used his position to manipulate the stock market to enrich himself, that he has seized massive amounts of congressionally appropriated money, and that he seems intent on converting the Internal Revenue Service into an instrument of self-enrichment. All of these alleged methods of wealth extraction depend directly on Trump’s political position and exemplify an intensification of the widely documented phenomenon of politically engineered asset-price inflation that has been so marked over the last couple of decades.

For the economist Stephen Maher, however, there is not much to see here. In a critique of my recent Sidecar blog post entitled “No Substitute,” he states that “the notion that productive investment is giving way to unproductive speculation” is a “left shibboleth,” of which he offers both a conceptual and an empirical critique. Conceptually, says Maher, “Rent is a deduction from the total output produced across the economy,” and therefore “it cannot expand without limit,” although what exactly this limit is, and how we would know it had been reached, is left undisclosed. Empirically, Maher adduces the fact that major tech companies invest heavily in new technologies and have earned mostly the average rate of profit and therefore are not rentiers.

This critique mis-specifies the view it purports to engage. Indeed, it neglects to even mention the central concept upon which that view is based: political capitalism. The political capitalism thesis is quite different from what Maher terms variously neofeudalism, rentier capitalism, or monopoly capitalism. Pace Maher, it fully acknowledges that Big Tech has been competitive and has engaged in investment. As Robert Brenner and I put the point in “The Long Downturn and its Political Results”: “Certainly, the big tech companies would like to be monopolists and they have gone to great lengths to secure direct state support for their effort. But the fact remains that the enterprises of the tech sector continue to be subject to the competitive constraint, dependent on investment and highly rivalrous terms of technical advance.” The point is rather that intertwined with the productive economy, and dragging it down, is an unproductive predatory and extractive sector in which rates of return are based primarily on political relationships rather than productive investment. Does Maher really deny this? It is difficult to see on what basis he would do so.