From Free Competition to Financial Oligarchs: The Evolution of Monopoly in Capitalism
In the jungle of the market, stories often begin with countless vibrant competitors. Imagine, at the start, there are innumerable merchants selling similar goods. To survive and attract customers, they have only two options: relentlessly lowering prices or working hard to optimize their products. This phase, known as "free competition," represents the most dynamic moment in the market. Consumers enjoy a wide array of choices, and the merchants’ sole pursuit is providing the best value for money. The market appears to be relatively fair, raw, and in its infancy.
However, the extreme form of freedom often leads to its opposite. When competition becomes unrelenting, it turns into a brutal "price war." Prices are continuously squeezed, eventually approaching the cost of production. This kind of self-destructive internal conflict is like a prelude to a market breakdown, a chaotic farce before the collapse. Under the pressure of high costs and meager profits, small and medium-sized capitalists quickly run out of resources and are forced to exit. In the end, only those with the deepest pockets and largest scales—the corporate giants—can survive.
This brutal game ends with the birth of "monopoly." A few survivors almost completely dominate the market share, and both production and capital become highly concentrated in their hands—this is known as "concentration of production" and "concentration of capital." These giants continue to merge and acquire, devouring any remaining competitors, and ultimately gain control over the very pulse of the market. They build insurmountable barriers through their overwhelming scale, shutting out any new challengers. Thus, an era dominated by a few giant players—the age of monopoly capitalism—begins.
Once they become the absolute rulers of the market, the logic of the monopolistic capitalists changes completely. They transform from rule followers to rule makers. The pricing of goods is no longer determined by market supply and demand but by the profit targets of the monopolists. Consumers lose their freedom of choice, being forced to accept continually rising prices.
However, this may be the smallest of their lost rights. The more profound consequences soon follow:
Planned Obsolescence: Products are deliberately designed to be fragile, with a simple "pebble" capable of destroying what was once a sturdy "gate." For commercial gain, the lifespan of durable goods is precisely predetermined, a blatant violation of consumer wealth and trust.
Killing Innovation: When breakthrough technologies that could disrupt the market and benefit society arise, monopolists will not hesitate to acquire promising start-ups and lock away their technologies, preserving the current market status quo.
Artificial Scarcity: Even if inventory piles up, monopolists will ensure scarcity to maximize profits, prioritizing their gains over the basic needs of society, preventing prices from falling.
The monopolistic position brings with it unparalleled power to control the market and generate excessive profits. However, enormous profits continuously attract new competitors. If a monopoly giant stops running, it will be replaced by those who come after. Therefore, "expansion" becomes its inescapable fate.
To sustain its boundless ambition for expansion, astronomical sums of money are required. As a result, the monopolists turn their gaze to society's primary reservoir of funds—the banks. The banks, in turn, are eager to provide massive loans to the monopolistic giants, drawn by the astounding interest rates, creating a perfect harmony between both parties.
Behind the enormous exchange of profits lies a web of risks. To manage these risks, banks must deeply intervene in the operations of monopolistic capital, often by acquiring shares or placing executives within these companies. In turn, monopolistic capital infiltrates banks, purchasing their shares, leading to a deep fusion of the two. At this moment, the boundaries between industrial capital and banking capital become blurred, giving rise to a new form—financial capital.
Banks become the lifeblood of monopolistic capital’s expansion, their fates intertwined. When one suffers, they all suffer; when one thrives, they all thrive.
Even so, this privately-driven commercial empire remains vulnerable when faced with periodic economic crises. When the masters of financial capital realize that no matter how much wealth they accumulate, they cannot eliminate the fear of systemic risk, their ultimate goal undergoes a fundamental shift: they move from maximizing profits to ensuring perpetual survival.
The only way to achieve this goal is to tie their survival closely to the nation’s lifeblood, making themselves “too big to fail.” This is no longer a mere business move; it is a strategic upgrade. Financial capitalists extend their reach into fundamental industries like energy, telecommunications, and food, connecting their arteries to the very core of society. Once their collapse would mean the shutdown of the entire social system, attacking them becomes akin to endangering national security. And so, they successfully cloak themselves in the strongest armor of all—national interest.
At this point, they stand at the pinnacle of the pyramid. The evolution of capital reaches its ultimate stage—financial oligarchy.Born from free competition, the strongest player, in order to escape the ultimate fear of destruction, has ultimately betrayed freedom itself. It has secured near-immortal safety, but at what cost?
The financial oligarch, through its monopolistic power and its alliance with the state, extracts excessive profits from society, transforming societal wealth into fuel for private expansion. Their profits are private, yet the risks are shared by the entire society. When a financial storm hits, ordinary citizens are forced to bear the burden of inflation and unemployment. They never shared in the profits during the oligarch's peak, but they are expected to pay for its failure when it teeters on the edge.
This is the path to its deification: starting with the pursuit of profit and ending with the quest for immortality. A path paved by "hijacking" the public good, leading straight to the top.
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