This Was Never Capitalism

My father worked in the steel mills of western Pennsylvania. Not in management, but as a foreman. He and the men he worked beside learned something about the economy the hard way. They learned that the system was not designed for them. They could feel it in the way the plant closures were announced, always from somewhere far away, always by people who would never have to live with the consequences. They could feel it in the way the town hollowed out afterward, slowly and then all at once, while the news talked about GDP growth as if that number had anything to do with their lives.

Decades later, when millions of Americans looked at Washington and decided the whole thing was a swamp that needed draining, I understood the impulse. These were not ignorant people being manipulated. They were people who had been watching a rigged game for thirty or forty years and had finally been given a word for what they were seeing.

But here is what I have come to believe, and what I think this country needs to sit with before it can find its way to anything better. The word was wrong. Not the anger. The anger was earned. The diagnosis was wrong. And a wrong diagnosis, pursued with righteous conviction, does not cure the disease. It feeds it.

The question nobody asked honestly, the one that would have changed everything if they had, is this. Is what we have been living under actually capitalism? Or is it something else entirely, something older and more familiar, wearing capitalism’s clothes?

Capitalism in its theoretical form requires a few things to function. Open competition. The ability of new players to challenge established ones. Price signals that reflect genuine supply and demand. Creative destruction, where bad ideas and inefficient companies fail so that better ones can replace them. And most importantly, the assumption that outcomes are determined primarily by what you offer in the marketplace rather than by who you know in the back room.

Hold that framework in your mind and then look at what actually exists.

When a pharmaceutical company spends more on lobbying than on research and then gets Congress to prohibit Medicare from negotiating drug prices, that is not the capitalism we claim to practice. When a bank takes catastrophic risks, fails, and gets rescued with public money while the homeowners it defrauded lose everything, that is not the capitalism we teach in textbooks. Capitalism demands that failure carries consequences. What happened in 2008 was something else. It was a system ensuring that consequences flowed downward while protection flowed upward. When a handful of companies acquire every competitor in a sector until three or four players control an entire market, and the antitrust apparatus meant to prevent this has been deliberately starved and ideologically captured, that is not competition. That is consolidation protected by proximity to power.

Some economists would call this crony capitalism or political capitalism and argue that the merger of capital accumulation with political access is not a corruption of the system but an endogenous feature of it, something markets tend to produce when left to compound long enough. They may be right. But the distinction matters less than the recognition. Whether you believe market capitalism inevitably generates an influence economy or that the influence economy is a parasite that attached itself to an otherwise functional host, the diagnosis leads to the same place. What we are living under is not the system Americans think they are defending when they defend free enterprise. It is something else. And until we name it clearly, we cannot begin to fix it.

What we actually have, and what we have had for decades, is capitalism fused with an influence economy so deeply that the two have become indistinguishable. And understanding how that influence economy works is the key to understanding why draining the swamp was always going to fail, and why what replaced it was always going to look like what came before.

An influence economy runs on relationships, not products. Its currency is access, not innovation. And it operates at every level of American life, not just in Washington.

In DC, a retired four-star general joins a defense contractor’s board. He does not design weapons systems. His value is that he can pick up the phone and reach a current Pentagon official who will take the call. A Senate staffer helps a lobbyist get favorable language into a committee report. Two years later, that staffer needs a job and the lobbyist makes an introduction at a firm. Nobody explicitly traded anything. But both understood the ledger. A technology company hosts “educational briefings” for congressional staff on artificial intelligence policy. Free lunch, credentialed speakers, nice venue. The company is not buying votes. It is becoming the default source of expertise on a topic so that when legislation gets drafted, staffers reach for the frameworks the company already handed them.

But this is not just Washington. The Ivy League runs on the same currency. A kid who goes to Harvard is not just learning economics. That kid is sitting next to the children of senators, hedge fund managers, and media executives. The friendships formed at nineteen become the professional relationships that open doors at thirty-five. For many families, that network is the product they are purchasing. Legacy admissions are not about tradition. They are about maintaining the network’s continuity across generations.

Corporate America operates identically. A small number of people sit on multiple boards, and they hold those seats not because they possess unique expertise in each company’s industry but because they are trusted members of the club. The golf outings, the Davos dinners, the Sun Valley conferences are not recreation. They are where the informal consensus gets built that later shows up as a merger announcement or a coordinated lobbying push or a quiet agreement about executive compensation norms. CEO pay keeps climbing despite shareholder complaints because the boards that set compensation are populated by other executives who have every incentive to keep the benchmarks high.

This is the actual operating system of American economic life. Not supply and demand. Not creative destruction. Not meritocratic competition. Relationships. Access. Position. The slow accumulation of favors and obligations that compound over time into durable structural advantage.

And here is the part that should unsettle everyone, because it means the problem is deeper than anyone in politics wants to admit. This pattern is not a uniquely American corruption. It is not even a modern phenomenon. The raw materials for building influence networks are pre-installed in every human brain, and every complex society in recorded history has assembled some version of them.

Trust is biologically expensive. It takes time, repeated interaction, and shared vulnerability to build. Because it is costly, it becomes scarce, and scarce things become valuable. Once you have built a trust network, you protect it. You limit entry. You favor the people inside it. Not because you are malicious but because your nervous system treats the extension of trust to strangers as a risk, and it is right to do so.

Reciprocity runs deeper than reason. Someone does something for you and you feel an almost physical need to return it. This is the engine of every influence economy that has ever existed, from the Roman patronage system to K Street. It is not rational calculation. It is an emotional reflex that evolved because cooperative groups survived and non-cooperative ones did not.

Status seeking is the accelerant. Humans monitor their position in hierarchies with obsessive precision, and they pursue advantage because for most of evolutionary history, higher status meant survival. The accumulation of influence is just status competition expressed through social architecture rather than physical dominance.

These impulses are universal and enduring. But the institutions they produce are not identical. The Medici patronage system, the British class hierarchy, the Chinese tradition of guanxi, the American revolving door between government and industry, these are all members of the same family, shaped by the same underlying drives, but expressed through vastly different institutional forms depending on the legal frameworks, cultural norms, and economic structures of each society. The drives are inevitable. The specific shape they take is not. And that distinction is everything, because it means institutional design matters. It means the structures a society builds around these impulses determine whether they produce a functional economy or a closed loop of self-dealing.

The societies that have functioned best are not the ones that eliminated these dynamics. That is impossible. They are the ones that built countervailing structures to contain them. Independent courts. Free press. Public education that creates alternative pathways. Antitrust enforcement that prevents economic concentration from becoming political concentration. Campaign finance systems that limit the conversion of wealth into access. These structures do not drain the swamp. They build levees around it. And they require constant, unglamorous maintenance.

The United States had most of these structures at various points in its history. And then, over the last fifty years, it systematically weakened every single one. The press was consolidated. Public education was starved. Antitrust enforcement was ideologically neutered. Campaign finance was deregulated. With each weakening, the influence networks grew stronger, the public grew more frustrated, and the demand for a dramatic solution grew louder.

Enter “drain the swamp.”

The slogan was genius as politics and catastrophic as diagnosis. It validated the legitimate anger of millions of people while channeling that anger toward a solution that could never work.

What the slogan did, with devastating efficiency, was reframe a systemic problem as a personnel problem. It told people that the issue was not the structure of the influence economy but the specific people operating it. The bureaucrats. The career politicians. The deep state. Remove them, install new people, and the problem would be solved. This is the move that guarantees failure, and not just in this instance. Any movement that promises transformation purely through better people, without reforming the institutional incentives, the campaign finance rules, the civil service protections, the transparency requirements that shape how those people behave once in office, is structurally destined to reproduce the same influence dynamics it claims to oppose. The faces change. The architecture does not.

The coalition that believed this was enormous and sincere. It included the steelworker who watched the mill close while Washington debated things that had nothing to do with his life. The small business owner who could not understand why regulations seemed designed for companies with compliance departments she could never afford. The veteran who came home to a bureaucracy that could not process a disability claim. The young person who did everything right, took the degree, accepted the debt, and still could not find a foothold in an economy that rewarded connections over competence.

These people were not wrong about the problem. They were given a theory of the problem that was incomplete in ways that guaranteed the solution would fail. Because the swamp is not a collection of bad actors who can be fired and replaced. The swamp is what emerges when trust is scarce and complexity is high and resources flow toward whoever stands closest to the machinery of decision. You can replace every person in the building. The dynamics reassert themselves within a single election cycle because the conditions that produce them have not been touched.

So what would actually draining the swamp have required?

If you took the grievance seriously, if you genuinely wanted to break the influence economy’s grip on American governance, there was a real agenda available. It would have started with campaign finance reform that severed the direct pipeline between private wealth and political access. It would have included enforceable lobbying restrictions with real teeth, not the current system where a lobbyist can re-register as a “strategic consultant” and continue the same work without disclosure. It would have meant strengthening civil service protections so that the permanent government workforce operated on competence and institutional knowledge rather than political loyalty. It would have required transparency mandates that forced every meeting between industry and regulators into the public record. It would have demanded antitrust enforcement vigorous enough to prevent the kind of market concentration that converts economic dominance into political leverage. And it would have invested in the public institutions, the schools, the courts, the press, the regulatory agencies, that serve as the countervailing structures against network capture.

None of this is exotic or untested. These are the tools that every functioning democracy uses to manage the influence dynamics we have been discussing. They are boring. They are incremental. They do not fit on a hat or fill an arena. But they work, in the specific sense that they keep the levees intact.

Now look at what was actually done.

Campaign finance was not reformed. It was left untouched while the wealthiest individual in human history was given direct operational authority inside the federal government. Lobbying restrictions were not strengthened. The revolving door was not closed. It was ripped off its hinges and replaced with a direct portal between Silicon Valley and the executive branch. Civil service protections were not reinforced. They were systematically dismantled. Hundreds of thousands of career professionals, the people who understood how agencies functioned and who provided institutional continuity across administrations, were fired, placed on indefinite leave, or pressured into resignation. Transparency was not expanded. Communications moved to Signal. Decision-making authority shifted to unelected individuals operating outside normal chains of accountability. Antitrust enforcement was not strengthened. The same concentration of economic power that created the problem was invited to direct the solution. And the public institutions that serve as checks on network capture, the regulatory agencies, the inspectors general, the independent research bodies, the foreign aid apparatus, were not reformed. They were gutted.

Every single item on the structural reform agenda was not merely ignored. It was inverted. The actions taken did not weaken the influence economy. They removed the last remaining barriers to its acceleration. They did not drain the swamp. They paved it, built on it, and handed the deed to a new set of landlords.

There is a word for what happens when you promise one thing and deliver its opposite while using the language of the original promise to prevent anyone from pointing out the switch. It is called a bait and switch. And I use that term not as rhetoric but as a structural description. The bait was reform. The switch was capture. And the people who swallowed the bait are the same people who are now paying the cost of the switch.

And the receipts are now public.

In early 2026, court depositions and discovery documents became public in several federal lawsuits that revealed how the Department of Government Efficiency was actually constructed and how it operated inside the agencies it was sent to transform. The picture that emerges, and I want to be precise here because these are allegations in active litigation, not final legal findings, is one that should be deeply recognizable to anyone who has followed this argument. Every single feature of the old influence economy is present. It is just wearing different clothes.

A young man who graduated from the University of Virginia in 2020 and worked in private equity got into DOGE through a friend whose father happened to be the chief financial officer at one of Elon Musk’s companies. Another recruit was introduced by a venture capital fund manager who served as an “informal recruiter.” That recruit had no government experience. He had never taken a government-related class. His qualification was proximity to the right network.

The recruiting pipeline ran through Musk’s personal orbit and Peter Thiel’s circle. Marc Andreessen, the billionaire venture capitalist, worked as a self-described “unpaid intern” screening candidates. Internal communications ran on Signal, a choice that a federal judge would later note appeared to violate the Federal Records Act. The official head of DOGE, a career government employee named Amy Gleason, apparently never led a single meeting. Real authority flowed through Steve Davis, a Musk loyalist, in a shadow structure that one official described under oath as feeling “more like a club” than a government operation.

A club. The word should stop you cold.

Not an agency with transparent hiring practices. Not an institution with accountability mechanisms and public oversight. A club. Membership determined by who you knew. Authority flowing through personal loyalty rather than legal mandate. Access granted on the basis of proximity to wealth rather than relevant expertise or public mandate.

And the consequences of club governance were not abstract. At the National Endowment for the Humanities, according to court filings, these DOGE associates fed grant descriptions into ChatGPT and asked it to determine which ones related to diversity, equity, and inclusion. The AI flagged 1,057 out of 1,163 grants it reviewed. The results were entered into a spreadsheet that became the basis for canceling more than $100 million in previously awarded funding. Among the grants terminated were a documentary about Jewish women’s slave labor during the Holocaust, a project to digitize photographs of Appalachian residents, efforts to preserve endangered Native American languages, and a $349,000 grant to replace a museum’s aging HVAC system. The NEH’s own acting chair warned in an email that many of the projects on the chopping block had no justification for cancellation. According to the depositions, his objections were overridden. The DOGE associates, neither of whom had consulted scholars or the NEH’s peer review system, made the final calls.

At USAID, the pattern scaled to global consequence. DOGE’s involvement in dismantling the sixty-year-old foreign aid agency contributed to the termination of what the State Department acknowledged was at least 83 percent of its program contracts and the departure of roughly 10,000 staff. A federal judge found that the dismantling likely violated the Constitution. A public health researcher at Boston University estimated that the resulting cuts to foreign aid programs contributed to more than 700,000 excess deaths by January 2026, a figure that continued to climb. A separate analysis found that the supposed savings were illusory, that DOGE’s cuts may have actually increased costs to taxpayers by approximately $135 billion when accounting for the expense of firing, rehiring, and placing workers on paid leave. Government spending, according to the Cato Institute, actually rose under DOGE.

The favor bank. The social positioning. The network as currency. The conversion of private wealth into public authority without democratic consent. Every mechanism of the influence economy we have traced through Washington, through the Ivy League, through corporate boardrooms, and all the way back to the evolutionary roots of coalition-building, was operating at full speed inside the very institution that promised to end it all. And the downstream consequences were not theoretical. They were measured in shuttered research projects, dismantled agencies, and according to one estimate, hundreds of thousands of lives.

This is where the story becomes genuinely tragic, because the people who believed the promise are the ones paying the price.

The steelworker in Beaver County did not vote for a system where twenty-somethings recruited through Silicon Valley dinner parties would decide which government programs survive. The small business owner did not vote for the world’s richest man to embed his personal associates inside federal agencies with access to sensitive data systems. The veteran did not vote for a parallel governance structure accountable to a billionaire’s social circle rather than to the public.

But pointing this out gets you accused of defending the old swamp. The framing has been constructed so that any critique of the new network reads as nostalgia for the previous one. You are either for the revolution or you are part of the problem. This false binary makes honest conversation almost impossible, and that is not an accident. It is the condition under which influence networks have always thrived. They need the silence. They need the tribal loyalty. They need people arguing about which team should run the system rather than examining the system itself.

And the disillusionment that follows, the slow recognition that the new arrangement feels indistinguishable from the old one, does not produce clarity. It produces cynicism. People stop believing reform is possible. They disengage. And cynicism is the one state under which influence networks become truly untouchable, because the public has stopped watching and the insiders no longer need to pretend.

I write this from Cascais, Portugal, where I have lived for a few months. I mention this not to claim some superior vantage point but because distance clarifies things that proximity obscures. Portugal has its own patronage networks, its own insider dynamics, its own legacy of institutional capture. But it also has something the United States has been losing for a long time. It has civic infrastructure that has not been fully hollowed out. Its national health service, while strained, still provides universal coverage funded through general taxation rather than through a labyrinth of private intermediaries. Its public transit system connects cities and regions at a scale that most American communities lost decades ago. Its regulatory environment, while far from perfect, has not been entirely colonized by the industries it oversees. These outcomes are not accidental. They are the product of specific institutional choices, of a society that decided the countervailing structures were worth maintaining even when they were expensive and unglamorous and politically unrewarding.

The United States faces a version of this choice right now, and the stakes have never been higher. Because the next great influence network is already being built, and it is being built around artificial intelligence. A very small number of companies and individuals are constructing the technological infrastructure that will shape economic outcomes for the next generation. The influence networks are already forming around who controls these systems, who gets access, and whose values get encoded into the technology itself. The lobbying, the revolving doors, the strategic positioning, all of the dynamics we have traced through this entire essay are already in motion around AI governance, and they are moving faster than any countervailing structure can currently keep pace with.

The question is not whether the influence economy will colonize this new territory. It will. It already has. The question is whether this time, finally, enough people understand the pattern clearly enough to build the levees before the flood. And the fear, the one I cannot shake and that the evidence does nothing to quiet, is that we will not act at the scale or speed required.

The people who wanted to drain the swamp deserved better than what they got. They deserved an honest accounting of what the swamp actually is. Not a group of corrupt politicians. Not a deep state conspiracy. Not a partisan enemy that can be defeated in a single election. The swamp is what happens to every complex society when the biological impulse to build influence networks is allowed to compound without structural constraint. It is a species, not a scandal. It adapts. It evolves. It colonizes whatever institution you build to contain the last version of it.

You cannot drain it. You can only build the structures that hold it in check, and then you must maintain those structures forever, because the moment you stop, the water rises again.

That is not a slogan anyone will ever put on a hat. But it is the truth. And I think this country has had enough of the alternative.