The Real Crisis in the U.S.: How Monopolies, Oligarchy, and Political Corruption Are Shaping Our Future

The economic struggles currently facing most Americans are not the result of natural market forces or simple misfortune. They are deeply intertwined with the rise of monopolies, the concentration of wealth and power in the hands of a few oligarchs, and pervasive political corruption that has shaped policies to favor the wealthy elite. These overlapping factors have exacerbated inequality, suppressed wages, and eroded public trust in the systems that are supposed to serve the people. Let’s explore the roots of these economic problems.

The Rise of Corporate Monopolies and Market Concentration

The United States has witnessed a remarkable shift toward monopolistic behavior over the past few decades, with a handful of large corporations dominating entire industries. According to a study by the American Economic Review (2021), corporate concentration in the U.S. has increased significantly since the 1980s, leading to the rise of monopolies and oligopolies across key sectors, including tech, healthcare, agriculture, and finance. Austin Frerick did a fantastic job outlining this transition in US Food markets in his 2024 book “Barons: Money, Power, and the Corruption of America’s Food Industry”. As industries consolidate, market competition dwindles, leading to higher prices, lower wages, and fewer choices for consumers. The Federal Reserve reported in 2020 that the share of total income captured by the largest 1% of U.S. firms has nearly doubled since the 1980s. Research published in the Journal of Political Economy (2019) found that market concentration (a measure of how much power a few firms hold within a sector) has increased in industries like airlines, telecommunications, and pharmaceuticals. For example, just three companies now control nearly 80% of the global market for generic drugs. According to a study in the Journal of Health Economics (2020), this lack of competition in the pharmaceutical market has led to 5% annual increases in drug prices, affecting millions who rely on essential medications. The effect of monopolies is felt by the everyday American consumer, who experiences higher prices and limited choices.

The Rise of Oligarchy: Concentration of Wealth and Power

The concentration of wealth and power in the hands of a few has reached unprecedented levels, resulting in what some scholars, and Bernie Sanders, call a “financial oligarchy.” According to the Institute for Policy Studies (2020), the wealthiest 1% of Americans now own more than 40% of the country’s wealth, while the bottom 90% hold just 25%. This incredible divide is the result of a series of policies and economic shifts that have allowed the rich to accumulate more resources while working-class families struggle to make ends meet.

In the Global Inequality Report (2020), Thomas Piketty and colleagues argue that wealth inequality is not simply the result of technological innovation or globalization but is driven by policies that favor the wealthy. For instance, tax cuts for the rich and the corporate elite, deregulation, and the shrinking of the social safety net have all contributed to a widening gap between the rich and the poor. According to a 2019 paper in the American Economic Journal, corporate tax rates in the U.S. have been slashed by more than half since the 1980s, from 50% to just 21% in 2017. These tax cuts disproportionately benefit large corporations and high-net-worth individuals. The average CEO-to-worker pay ratio in the U.S. was 351:1 in 2020, compared to just 20:1 in 1965. In addition, the wealth of the top 1% of U.S. households grew by 75% between 2009 and 2019, while the wealth of the bottom 90% remained stagnant. This concentration of wealth and influence has a direct impact on American politics. The elite use their financial power to shape policy decisions in their favor, often at the expense of the public good. It is a positive feedback loop. Positive for those manipulating the country from the top.

Political Corruption: The Role of Money in Politics

Political corruption and regulatory capture have played a crucial role in reinforcing the oligarchical power structure. As large corporations and wealthy individuals pour money into political campaigns, lobbying efforts, and political donations, they exert outsized influence over policymaking. Citizens United v. FEC (2010), a landmark U.S. Supreme Court decision, allowed unlimited campaign contributions from corporations and unions, further cementing the link between money and political power.

A study from the Journal of Public Economics (2019) found that corporate lobbying now accounts for billions of dollars in influence over U.S. politics, shaping decisions on tax policy, environmental regulations, and healthcare reform. The research highlights how major companies and industries engage in regulatory capture, meaning they influence agencies and policymakers to adopt rules that benefit their interests rather than the public good. For example, the pharmaceutical industry spent over $200 million on lobbying in 2019 alone to influence healthcare policy and block regulations on drug pricing. Research from the Center for Responsive Politics also showed that just 20 billionaires contributed $2 billion, or 40%, of all political donations in the 2018 election cycle, In fact, a recent American Political Science Review report found that wealthy individuals are disproportionately represented in U.S. political campaigns, with the top 1% contributing more than 70% of all political donations.

These financial ties between politicians and corporations make it more difficult for policies to reflect the interests of the public. Instead, they perpetuate a system where tax cuts for the wealthy, deregulation, and corporate bailouts become the norm, even when they contradict the interests of most Americans.

A Call for Change

The economic issues plaguing the United States—stagnant wages, rising inequality, high healthcare costs, and environmental degradation—are not coincidental. They are the result of a deliberate shift toward monopolistic practices, wealth concentration, and political corruption. This convergence of economic and political power has left millions of Americans trapped in a cycle of economic instability and social inequality.

To address these challenges, it will be necessary to:

• Reinforce antitrust regulations to break up monopolies and encourage market competition.
• Implement progressive tax policies to address wealth inequality and ensure that the wealthy contribute their fair share.
• Enforce campaign finance reforms to reduce the influence of money in politics and restore democratic processes.
• Strengthen labor protections and ensure that working Americans have access to a living wage, healthcare, and affordable education.

Only by addressing these underlying structural issues can the U.S. hope to create a more equitable, just, and sustainable economy for all its citizens.