By Michael Dresdale
Saturday, June 13, 2026
In California’s gubernatorial primary, Tom Steyer — the
billionaire investor and patron of progressive causes — was widely seen as the
standard-bearer of the Democratic Party’s socialist faction. He won the
endorsements of the Bernie Sanders-founded Our
Revolution and progressive stalwarts like Representative Ro Khanna (D., Calif.), despite the vast personal fortune
he amassed as a hedge fund manager — a job that sits just below Big Oil
executive in the progressive hierarchy of moral opprobrium.
But despite having poured over $200 million of his own money into electing
himself, he will ultimately be on the outside looking in come November. Steyer
outspent former Health and Human Services Secretary Xavier Becerra on
advertising by a nearly twenty-to-one margin, but Becerra has advanced to
the general election; Steyer, in contrast, failed to secure enough primary
votes to get the second spot on California’s November ballot, losing out to
Republican Steve Hilton.
Steyer’s underwhelming performance has exposed the limits
of the very charge he and Sanders have spent the past year prosecuting: that
what fundamentally ails America is oligarchic control of politics.
In barnstorming the country on his “Fighting Oligarchy”
tour, Sanders has pressed his case in characteristically blunt terms: “You
have to be blind not to see that what we have today is a government of the
billionaires, by the billionaires, and for the billionaires.” Yet when
billionaires themselves have tried to convert dollars into votes, the results
have been disappointing-bordering-on-dismal. Beyond his gubernatorial bid,
Steyer spent nearly $350 million boosting his run for the 2020
Democratic presidential nomination — an effort that failed to win him even a
single delegate. Michael Bloomberg, whose fortune makes Steyer’s look like a
modest nest egg, spent over $1 billion on his own 2020 campaign; for all that
expense and trouble, the only primary contest he won was American Samoa’s — presumably home to many grateful users
of the Bloomberg terminal. As New York’s June primaries approach,
Representative Dan Goldman (D., N.Y.) — scion to the Levi Strauss fortune —
looks to be on the cusp of political annihilation at the hands of former New
York City Comptroller Brad Lander, despite outraising Lander three-to-one and pledging to match every donated dollar.
To be fair, the claim that American politics is fundamentally oligarchic
does not rest on billionaires holding office themselves. Politicians must still
raise money to campaign, and that necessity creates an opening for the moneyed
classes. Billionaires need not enter the scrum, this view holds, when so many
elected supplicants will do their bidding.
The contention that politicians serve their donors rather
than their voters is as old as electoral politics. Political scientists have
long tested its explanatory power in contemporary American politics. In 2014,
two of them, Martin Gilens and Benjamin Page, lent the view support in a paper
finding that the preferences of the rich overwhelmingly shape public policy. A
subsequent stream of research, however, challenged the assumption that those
laws were passed because they pleased the donor class. To cite just one
paper complicating the Gilens and Page view, Alexander Branham and his
co-authors found that a huge swath of the rich’s apparent wins could
as easily be credited to the fact that their desired policies also enjoyed
middle-class support. When their preferences diverged from the middle class’s,
the rich won only 53 percent of the time — and even then, the policies leaned
in no consistent ideological direction.
Step back from the regressions, and the pattern of which
causes have won and lost this century suggests that the Business Roundtable and
its allies have not held the whip hand in our politics. In 2013, the U.S.
Chamber of Commerce — the institutional home of Sanders’s reviled plutocrats — spent $50 million backing Congress’s push for comprehensive
immigration reform. That effort died in the Republican-controlled House at the
hands of grassroots opposition. Thirteen years later, neither President Trump’s
immigration crackdown nor his dizzying array of tariffs ranks high on corporate
America’s wish-list.
Perhaps nowhere do America’s billionaires appear more
politically impotent than in their own backyards. New York and California are
home to 38 percent of the nation’s billionaires, many clustered in New
York City and San Francisco. But the two states levy two of the highest top marginal tax rates in the country, with New
York City throwing in an upper-bracket income tax of its own for good
measure. Moreover, the recent political trajectories of both states — and their
most dynamic cities — bear little imprint of billionaire control. In New York
City, the mayoralty was won by the self-avowed socialist Zohran Mamdani, who
ran on ratcheting up taxes on the wealthy. The state declined to enact the full
suite of Mamdani proposals, but one tax it did adopt falls on the expensive apartments that the rich keep as second homes.
Mamdani has pressed his agenda by picking fights with individual billionaires.
In California, meanwhile, several billionaires have fled the state to escape a proposed wealth tax headed for
the November ballot, one that would carve a one-time, five-percent chunk out of
their fortunes.
The more one wrestles with the many instances of
billionaire interests losing in the political arena, the clearer it becomes
that “oligarchy” has become a political crutch for the left — a way of
explaining away defeat as the work of class opponents cunningly deploying their
financial power, rather than as the expression of sincere disagreement on the
part of the mass of American voters. Many people may have discrete complaints
about America’s imperfect capitalist reality, but few of them, false consciousness
or not, are eager to see it thrown overboard wholesale.
The danger of the left’s embrace of the oligarchy thesis
is that it risks blinding the public to a genuinely valuable aspect of American
capitalism. “Oligarchy” does fairly describe many economies, past and present. The
Economist’s crony-capitalism index captures the difference: It measures
the share of a country’s billionaire wealth drawn from state-dependent,
rent-heavy sectors — telecoms, mining, casinos, defense — against the share
generated in competitive ones. Unsurprisingly, the 2023 rankings put Putin’s
Russia at the top, with crony wealth equal to 19 percent of GDP. In the United
States, the figure was 2 percent.
The left blurs this distinction, treating inequality as
equally condemnable whether it springs from cronyism or from competition.
Representative Alexandria Ocasio-Cortez’s (D., N.Y.) insistence that there is no ethical way to amass a billion
dollars underscores the point. Earning a billion dollars — or many times that —
by building a company that hundreds of millions of people freely use is a
supremely pro-social act. Of course, we can debate in good faith how much a
productive billionaire ought to pay in taxes. But our scorn should be reserved
for those whose path to wealth runs through a Machiavellian climb into the
inner rings of power, only to use that proximity to exploit their fellow citizens
rather than serve them.
One of the strongest criticisms of the Trump
administration is that it, too, is blurring the lines between these two modes
of capitalism through the intense personalization of the executive branch. As
the Wall Street Journal has documented, Trump has taken
a personal hand in the Food and Drug Administration’s drug approvals, the
Federal Trade Commission’s merger reviews, and the Federal Communications
Commission’s authority over broadcast licenses. The administration can offer a
plausible rationale for any one of these interventions. Cumulatively, though,
they leave a different impression — that the administrative state’s technocracy
has been restored to a clientelist species of democratic control.
Unsurprisingly, spending on lobbying targeting the White House has surged to
record levels.
Robert Dahl, the political scientist and great student of
American government’s messiness, described America’s pluralist political reality as one of
“multiple centers of power, none of which is or can be wholly sovereign.” The
threat to that reality does not come from a creeping control by business over
government, but from government’s desire to insinuate into every corner of
business — a tendency visible in different forms in both political parties.
Should the trend hold, and a growing share of our companies come to feel that
their fates rest on the centralized decisions of regulators and politicians rather
than the dispersed judgments of investors and consumers, then today’s
overheated accusations will be borne out as tomorrow’s sober predictions.
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